Cadbury and Pepsico Square-Up Over Seven Up

02 October 2001

Anti-competitive sales practices are alleged by UK food and soft drinks group Cadbury Schweppes, whose US subsidiary Dr Pepper/Seven Up on Monday issued a lawsuit against Goliath Pepsico.

The latter’s actions, asserts Cadbury, unlawfully interfere with existing businesses relationships enjoyed by Dr Pepper/Seven-Up, and at the same time violate US anti-trust laws.

Central to the dispute is Tricon, America’s largest fast food company which numbers Taco Bell and Pizza Hut among its brands. Tricon, avers Cadbury, has been penalised by Pepsico for stocking Seven-Up.

Cadbury contends that Tricon receives discounts on Pepsi’s drink fountain concentrates only if it stocks all Pepsico’s products. “We believe that they [Pepsico] are misusing their market power to drive Seven Up out of the market,” complains the British company. Fountain sales represent ten per cent of Seven Up’s US revenues.

So lethargic is the due process of law in competition matters that it could be several years before a final ruling is given. Pepsico has yet to respond to the filing of the suit.

News source: Financial Times