Seven-Up has accused Coca-Cola of scheming to make its sales go flat.
Seven-Up Co. filed a lawsuit seeking $500 million in punitive damages from Coca-Cola Co. for misleading bottling companies that sell both sodas.The company, a unit of Dallas-based Dr Pepper/Seven-Up Cos., said its giant rival is campaigning to persuade bottlers to sell only Coca-Cola products, including Sprite, the lemon-lime drink that directly competes with its 7Up.
The suit accuses Coca-Cola of interference with Seven-Up's contracts, unfair competition and publication of false statements about Seven-Up.
"Their actions are aimed at a significant portion of our distribution system," said John Nabors, a Dallas attorney representing the company. About 8 percent of Seven-Up bottlers are also licensed to Coca-Cola, he said.
Randy Donaldson, spokesman for Atlanta-based Coca-Cola, said the company had not seen the suit late Thursday and could not respond to its allegations.
The suit says Coca-Cola presented a bottling company in Nacogdoches, Texas, with false statements and materials to persuade the company to terminate its 20-year relationship with Seven-Up.
The Nacogdoches bottler quit its contract with Seven-Up in early January, the first time in Seven-Up history a bottler had done so, according to the suit.
The suit said Coca-Cola's "The Future Belongs to Sprite" campaign is forcing bottlers to choose between Coke products and Seven-Up. Faced with that choice, bottlers for economic reasons would naturally choose the larger company, the suit contends.
Coca-Cola's lemon-lime drink Sprite captured 3.9 percent of the total soft-drink market in 1991 and Seven-Up's 7Up had 2.6 percent, according to Beverage Digest. All Coca-Cola products captured 41 percent of the soft drink market last year, the trade journal said in January.