Managers and the Legal Environment 7th Edition by David Madsen, Constance Bagley

Exercise 3

In a 1991 attempt to persuade soft drink bottlers to switch from 7UP to Sprite, Coca-Cola Company, the distributor of Sprite, developed a promotional campaign entitled "The Future Belongs to Sprite." In its presentation, Coca-Cola used charts and graphs to compare the two drinks' relative sales and market share during the previous decade. The campaign was especially targeted at seventy-four "crossfranchise" bottlers, which distribute 7UP along with Coca- Cola products other than Sprite. After Coca-Cola made the presentation to eleven of these cross-franchise bottlers, five decided to switch from 7UP to Sprite. In response,
Seven-Up Company filed suit against Coca-Cola, alleging that the presentation violated the Lanham Act's prohibition on misrepresentations "in commercial advertising or promotion." Coca-Cola argued that its presentation was not sufficiently disseminated to the public to constitute advertising under the statute. Was Coca-Cola's presentation "advertising" and therefore subject to the Lanham Act? [Seven-Up Co. v. Coca-Cola Co., 86 F.3d 1379 (5th Cir. 1996).]