Red Bull to Pay over $13 Million for False Advertising Settlement
Another U.S. class action lawsuit that accuses a beverage company of false and misleading advertising claims and the following multimillion dollar settlement!
Red Bull GmbH agreed to pay over $13 million to settle the class action in New York federal court accusing the Austria-based beverage company and its U.S. subsidiaries of falsely advertising its energy drinks as providing more benefit to a consumer than a cup of coffee, according to Law360.
While a few news media such as USA Today and Business Insider somewhat mislead or confuse the readers as if the lawsuit is over Red Bull’s “gives you wings” advertising promise or slogan, I found that the complaint was more about Red Bull’s false claims regarding the scientific studies to back up the efficacy of the energy drink.
The following is the excerpt from the 20 page Court Claim document:
17. Although Defendants point to purported scientific studies and research to back up their claims that the unique blend of ingredients is responsible for the claimed superior benefits of drinking Red Bull, the well-regarded scientific journal Nutrition Reviews published an evaluation of various studies of energy drink ingredients and their efficacy and found that:
With the exception of some weak evidence for glucose and guarana extract, there is an overwhelming lack of evidence to substantiate claims that components of [energy drinks], other than caffeine, contribute to the enhancement of physical or cognitive performance. Tom M. McLellan, et al., “Do Energy Drinks Contain Active Components Other Than Caffeine?”, Nutrition Reviews, Vol. 70, pp. 730-44 (2012)(emphasis supplied).
You can fine the full content of Careathers Class Action Complaint under the court document of the settlement website.
In fact, the Proposed Settlement is for two consumer class action lawsuits: Benjamin Careathers v. Red Bull North America, Inc., Case No. 1:13-CV-00369 (KPF); Wolf, et al. v. Red Bull GmbH, et al., Case No. 1:13-CV-08008 (KPF).
The settlement provides cash payments or free Red Bull products to anyone who made retail purchases of Red Bull products in the United States between January 1, 2002 and October 3, 2014 (the “Class Period”). To be specific, the option of a $10 cash reimbursement or Free Red Bull products (either Red Bull ® Energy Drink or Red Bull ® Sugarfree) with a retail value of approximately $15.00. All you need to do is register your claim by March 2nd, 2015 either online or by mail (visit the Red Bull energy drink settlement website for more details). No proof of purchase required.
The Court will hold a hearing on May 1, 2015 at 10 a.m. to decide whether to finally approve the settlement. If the Court approves the settlement, after that there may be appeals. Payments will be distributed within 150 days after the Court grants final approval of the settlement, pending any appeals. Cash reimbursement in the form of a check will be made directly to you by first class mail after entitlement to payment to all Claimants is determined. Red Bull products fulfilling the Product Option will be shipped directly to Claimants selecting the Product Option after entitlement to payment to all Claimants is determined, via a shipping method to be determined by Red Bull at its discretion.
More about Red Bull
In the 1980s Red Bull branded energy drinks were founded on a tonic originally created in Thailand known as “Krating Daeng” (which translates to Red Bull). Re-formulated for western tastes, Red Bull was introduced in Europe in a carbonated “functional beverage” format beginning in 1987 and was introduced in the United States in 1997.
It is currently sold throughout the United States in three varieties: Red Bull Energy Drink, Red Bull Sugar Free and Red Bull Total Zero.
Red Bull Energy Drink contains caffeine, taurine, glucuronolatone, B vitamins, sucrose, and glucose. Red Bull Sugar Free and Red Bull Total Zero remove sugars, and all carbohydrates, respectively, from the original formulation.
Reference:
http://www.energydrinksettlement.com/index
http://www.energydrinksettlement.com/docs/Careathers_Complaint_01.16.13.pdf
http://www.law360.com/articles/563228/red-bull-puts-up-13m-to-settle-false-advertising-suit
http://www.bevnet.com/news/2014/red-bull-to-pay-13-million-for-false-advertising-settlement
http://www.usatoday.com/story/money/business/2014/10/09/red-bull-refund/16959529/
http://www.businessinsider.com/red-bull-settles-false-advertising-lawsuit-for-13-million-2014-10
