A fascinating drama is unfolding in the federal District Court in Philadelphia involving the makers of sweeteners Equal (manufactured by Merisant) and Splenda (manufactured by McNeil Nutritionals).
McNeil had adopted the advertising slogan for Spenda that it is “made from sugar, so it tastes like sugar”, and Merisant sued, alleging it to be false and misleading and seeking $205 million damages. As the case was being considered by the jury in May 2007, the parties entered into a settlement, the terms of which are confidential. (While the parties were entering into the agreement, the jury apparently reached a verdict in favor of Merisant, but since the matter was settled, the verdict was never recorded.)
After the settlement, in an Equal advertisement Merisant claimed, under the headline “Now Taste the Truth”, that McNeil cannot claim that Splenda is more natural than other sweeteners because of the outcome of the litigation “which the parties settled”. The ad goes on to say “now that you have a taste of the truth, please enjoy some Equal on us” (with a $2.00 coupon). Additionally, Merisant in a filing with the Securities and Exchange Commission apparently implied what the terms of the settlement were (i.e., that McNeil was paying Merisant between $22 million and $31 million).
The ad and the SEC filing apparently infuriated McNeil which has gone back to the Court, alleging a breach of the confidentiality agreement and seeking to have the settlement nullified. In a vigorous response, Merisant has alleged that McNeil is only seeking to delay its performance under the settlement agreement (of what is not revealed); further it asks the Court to enforce the terms of the agreement, including making public its “confidential” terms, or in the alternative to enter the jury’s verdict (again, something which has never been made public).
The final chapter of this catfight between corporate giants is yet to be written; we shall let you know the outcome when it is. Incidentally, did you know that a teaspoon of sugar contains only 19 calories? You might ask what the fuss is all about.
– Ken Butera