The Costs of False Advertising – Sugar v Corn

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One issue with false advertising, is that should a consumer or competitor dislike what you are advertising, and have a case for false advertising, the ensuing litigation or settlements can be far more costly than the ad campaign.

A recent legal scuff between sugar and corn syrup industries shows this. In 2011, a coalition of sugar refiners took legal action against the Corn Refiners Association for running an ad campaign that pro-ported high fructose corn syrup to be a healthier product than the sugar industry felt was accurate. The ad campaign used terms like, “corn sugar” and “natural” to describe high fructose corn syrup.

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However, the Sugar Association had published a newsletter in which it stated that corn syrup caused obesity and cancer. This gave ammo for the Corn Refiners Association to counter-sue.

The ‘sugar coalition’ had asked for damages of over $1 billion. The corn refiners countered that the sugar industry had actually seen unusual growth and profitability during the time period of the ad campaign, and that the Sugar newsletter had caused $530 million in damages.

This case was shadowed by the fact that corn syrup has seem a drop in demand due to health concerns related to diseases like diabetes, adult and child obesity.

Only now, almost four years later, has an (undisclosed) settlement in this matter been reached. They released a joint statement announcing the settlement. To give some historical context, in the early 2000s, corn syrup and other sweeteners were being consumed more than sugar. However, since 2014, that has changed, with sugar in a slight lead.

It is recommended that companies speak with their business attorney before making advertising claims that stand on questionable ground.

Business Litigation Lawyers in Orange County California