A unanimous U.S. Supreme Court on Thursday revived juice-maker POM Wonderful’s false advertising challenge against Coca-Cola, ruling that federal regulations on the books do not preclude one company from suing another over misleading claims.
POM, which makes a pomegranate-blueberry juice blend, accused Coca-Cola of marketing a competing product as predominantly containing pomegranate and blueberries, when it is actually made mostly from less expensive apple and grape juices.
Coca-Cola countered that such lawsuits are precluded by regulations set forth in the Federal Food, Drug, and Cosmetic Act (FDCA) that prohibit misbranding of food and drinks.
Lower courts sided with Coca-Cola in a pair of decisions, but those rulings were reversed Thursday by the Supreme Court.
“Nothing in the text, history, or structure of the FDCA or the Lanham Act shows the congressional purpose or design to forbid these suits,” Justice Anthony Kennedy wrote in the majority opinion.
“Quite to the contrary, the FDCA and the Lanham Act complement each other in the federal regulation of misleading food and beverage labels,” Kennedy wrote. “Competitors, in their own interest, may bring Lanham Act claims like POM’s that challenge food and beverage labels that are regulated by the FDCA.”
All of the other justices, except for Stephen Breyer, joined in the opinion.