Pepsico loses $1.26 billion default judgment
Two men who claim Pepsi stole their idea to sell bottled water sued company in Wisconsin and won a $1.26 billion judgment last month after the company didn't respond.
Pepsi's Aquafina bottled water.
, PepsiCo calls the accusations "dubious," says it didn't know about the lawsuit until a week after the court granted the award without a trial.
The company has now filed a motion to either have the lawsuit thrown out, or at least give the corporation another chance to fight the allegations.
Pepsi claims that part of the problem is the notices of the case were sent to the wrong location. The lawsuit's papers were sent to North Carolina, where they were incorporated, as opposed to New York, where their corporate headquarters are located.
After the initial mistake, a secretary at the corporate headquarters neglected to tell anyone of the filings.
Spokesman Joe Jacuzzi said PepsiCo wants to fight the claims but acknowledges it failed to respond because of "an internal process issue."
According to Myron Moskovitz, a law professor at Golden Gate University, Pepsi will most likely get a chance to make their case, as judges are often remiss in enforcing default judgments, if there are legitimate reasons for the lack of a response.
"I'd be surprised if they didn't set it aside," he said of the judgment. "But there's going to be some red faces in court."
Charles Joyce, of Juneau, Wis., and James Voigt, of Cleveland, Wis., sued PepsiCo in April, seeking damages of more than $75,000. Their lawyer, David Van Dyke, told The Associated Press the two had worked together and came up with the idea to bottle purified water in individual servings.
Joyce's and Voigt's lawsuit accuses PepsiCo of misusing trade secrets. It also names Wis-Pak Inc. and Carolina Canners Inc., companies that make and distribute PepsiCo products, and Thomas M. Hiles, then the executive vice president of Carolina Canners.
The two claim they had confidentiality agreements with Wis-Pak, and Carolina Canners in regards to creating a new drink called, "U.P." Joyce and Voigt claim the executives of Wis-Pak and Carolina Canners then sold the information to Pepsico, and years later, Pepsi released "Aquafina" bottled water.
"The plaintiffs' claim — that in 1981, they gave someone other than PepsiCo an idea for a 'soft drink' and that somehow, 15 years later, PepsiCo used that alleged information to develop the Aquafina Water products — is completely dubious and without merit," Jacuzzi said.
Van Dyke, said he is crafting a response to PepsiCo's motion. Van Dyke came up with the $1.26 billion mark based on the profits Pepsi has made from Aquafina.
