Firm Secures Notable Dismissal for The Coca-Cola Company in False Advertising Case
April, 2023 - New York, New York
On April 21, 2023, Patterson Belknap secured an important dismissal on behalf of its client, The Coca-Cola Company, in a proposed class action involving the packaging labels of its hard seltzer products. The firm represented Coca-Cola in an action brought by a consumer plaintiff, who alleged in an August 2022 complaint that Topo Chico’s Margarita Hard Seltzer falsely claims the beverage contains tequila. The complaint alleged that the use of the word “margarita” and imagery of an agave plant on its label misleads consumers into believing the beverage is made with tequila, despite the product’s clear designation as a “hard seltzer.” The plaintiff also alleged that the Topo Chico brand name misleads consumers into believing the beverage is made with mineral water sourced in Mexico, despite the absence of any statement to that effect on the product label. Plaintiff asked the U.S. District Court for the Southern District of New York to certify two classes, one made up of New York consumers, and a second consisting of multistate consumers from seven other states.
The court granted our motion to dismiss the suit on the grounds that Coca-Cola did not mislead consumers through Topo Chico’s labeling. The court agreed with Coca-Cola's arguments that the plaintiff's interpretation of “hard” to mean “hard liquor” isn’t plausible, as it disregards the phrase “hard seltzer" clearly written on the label. The court found that reasonable consumers “would understand that they were purchasing a hard seltzer made to taste like a margarita and not a ready-to-drink margarita cocktail” made with tequila. The court also found that, to the extent consumers found the label ambiguous on its ingredients, they could look at the ingredient list for more information. Additionally, the court determined the plaintiff’s claim that the brand name “Topo Chico” misleads consumers to believe the drink contains sparkling mineral water sourced in Mexico is not plausible, as the product labeling does not claim that the product is manufactured in Mexico nor that it contains sparkling mineral water.
All of the plaintiff’s claims were dismissed with prejudice, including allegations of fraud, breaches of implied warranty, and unjust enrichment.
To read the U.S. District Court for the Southern District of New York decision, please click here.
To read press coverage from Bloomberg Law, please click here.
To read press coverage from Law360, please click here.
