US: Pepsi rubbishes US$100m duty evasion claim
PepsiCo has dismissed a claim from a former employee that it has evaded import duties totalling over US$100m.
The company was hit by a lawsuit from Scott Winslow last month. The suit, which was originally filed in November 2005, was released for suit on 21 December last year, it was confirmed yesterday (8 January).
Winslow, a former distribution analyst in concentrate operations, has alleged that PepsiCo "never used reasonable care in identifying the proper classification for the importation of its soda concentrate from Ireland".
Between January 2004 and March 2005, the suit claims, Pepsi imported soda concentrate from Ireland using an incorrect harmonised tariff schedule (HTS) classification. In doing so, Winslow alleges, PepsiCo avoided duties of just under $102m.
The suit said: "On further information and belief, "PepsiCo and defendants knew they were intentionally using the wrong HTS classification, but continued to do so because it was highly profitable and the Customs Service would not investigate their use of the HTS classification 3302.10.1000."
When contacted by just-drinks today, a spokesperson for PepsiCo said: "This is a totally frivolous lawsuit from a former employee. US customs has reviewed our concentrate shipment classifications from Ireland on multiple occasions and has raised no objections. We believe we've classified these shipments properly since the very beginning."
A scheduling conference with the court has been set for 23 January.
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