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FTC complaint may influence other POM Wonderful legal actions

By Shane Starling, 07-Oct-2010

Pomegranate leader POM Wonderful and Pepsi-owned Tropicana – locked in a legal battle over juice claims – have been asked to submit comments about the complaint lodged against POM by the Federal Trade Commission last month.

In a pre-hearing, Californian District Court Judge Dale Fischer raised the FTC complaint along with warning letters sent to POM by the Food and Drug Administration (FDA) in February, and called on POM and Tropicana to prepare statements on the matters at a rescheduled pre-trial on November 1, 2010. The case proper will begin the following day.

The FDA warning letters and the FTC complaint hinge on allegations POM has been making unsubstantiated claims that its juices and supplements could benefit atherosclerosis; blood pressure; prostate cancer; erectile function; cardiovascular disease; cholesterol levels and other age-related medical conditions.

In theory these actions are unrelated to POM’s own actions against Tropicana, Coca-Cola’s Minute Maid, Welch’s and other juice makers for making what it alleges are misleading pomegranate juice claims. Or indeed POM’s own action against the FTC over its claims substantiation methodologies.

But the matter was introduced into the pre-trial hearing by counsel for Tropicana who said the FTC complaint could have a "significant bearing" on the case, at which point Judge Fischer called for the parties to submit statements on its significance.

"Obviously, we disagree as to the significance of the complaint," said POM’s attorney.

Tropicana said the action would have been central to its motion if it had preceded it.

In a recent case against Welch’s, the court found Welch’s pomegranate juice claims were misleading due to implications juices were 100 percent pomegranate when they were not, but that no damage was done to POM’s own business. POM has since filed actions seeking a retrial to attain those damages and to gain a permanent injunction to prevent Welch’s ever profiting from the business in question.

A similar case against Minute Maid pomegranate juice found against POM, a decision POM is appealing in the US Court of Appeals for the 9th Circuit and which is also due to be heard in early November.

That case too was discussed in the pre-trial.

POM was not available for further comment at the time of publication.

"Powerful then. Wonderful Now."

All the court activity has not halted POM’s own marketing activities. This week it launched a $10m television campaign drawing on the fruit’s mythological links to Aphrodite, Eve and Persian warriors.

The ads make no specific claims other than POM products are, “backed by modern science”.

Those ads can be seen here.

FTC attorney Betsy Lordan told NutraIngredients-USA.com the agency was aware of the new campaign but gave no indication what actions it may have taken to analyze its content.

She said the agency’s complaint against POM had not been its preferred course of action.

“The FTC did try to reach a settlement with POM, but issued a complaint after it became clear that the efforts to reach a settlement were not going to succeed.”

Lordan affirmed that, “POM’s legal action did not influence the agency’s suit; the two are separate.”

SymphonyIRI data shows POM Wonderful sold just over $35m in juice at supermarkets, drugstores, gas/convenience stores and mass market retailers excluding Wal-Mart in the 12 months to September 5, 2010 – a 6.74 percent drop on the previous 12 months.