USA: PepsiCo faces $209 million lawsuit from Peruvian bottler

By Sarah Diston | 13 October 2000

Soft drink giant PepsiCo has been accused, in a lawsuit issued by Peruvian bottler Compania Emobtelladora Del Pacifico SA, of wrongfully terminating a 47-year exclusive bottling contract and causing the company financial problems.Embotelladora filed the suit in Manhattan on Wednesday. It claims that PepsiCo terminated its bottling agreement in March 1999 so that it could pursue agreements with Rivera and Frontera, two other Peruvian bottling companies. Both these companies were granted certain tax exemptions allowing them to sell products at lower prices. The suit says that Pepsi "intended to take advantage of these exemptions and drive its competitors, particularly Coca-Cola, from the market."Embotelladora also claims that after a successful relationship with Pepsi for a number of years the cola giant failed to promote its soft drink in Peru, and that any marketing campaigns by Pepsi were poorly conceived and unsuccessful. This left Compania Embotelladora facing financial problems.Further claims by Embotelladora accuse Pepsi of blocking the sale of the company to Rivera as well as refusing to allow Compania Embotelladora to bottle its own brand of soft drinks.The lawsuit seeks more than $209m in damages.Charles Nicolas, spokesman for Pepsi told just-drinks.com: "We have not seen the complaint so there is not much we can say about it."

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Soft drink giant PepsiCo has been accused, in a lawsuit issued by Peruvian bottler Compania Emobtelladora Del Pacifico SA, of wrongfully terminating a 47-year exclusive bottling contract and causing the company financial problems.Embotelladora filed the suit in Manhattan on Wednesday. It claims that PepsiCo terminated its bottling agreement in March 1999 so that it could pursue agreements with Rivera and Frontera, two other Peruvian bottling companies. Both these companies were granted certain tax exemptions allowing them to sell products at lower prices. The suit says that Pepsi "intended to take advantage of these exemptions and drive its competitors, particularly Coca-Cola, from the market."Embotelladora also claims that after a successful relationship with Pepsi for a number of years the cola giant failed to promote its soft drink in Peru, and that any marketing campaigns by Pepsi were poorly conceived and unsuccessful. This left Compania Embotelladora facing financial problems.Further claims by Embotelladora accuse Pepsi of blocking the sale of the company to Rivera as well as refusing to allow Compania Embotelladora to bottle its own brand of soft drinks.The lawsuit seeks more than $209m in damages.Charles Nicolas, spokesman for Pepsi told just-drinks.com: "We have not seen the complaint so there is not much we can say about it."

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