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Rather than go to court to defend its ginger content, Canada Dry ginger ale will no longer claim to be "Made from Real Ginger" as part of a proposed settlement to a series of US collective actions on misleading advertising.
The company that makes the popular soft drink, Keurig Dr. Pepper, will also offer payments to people who have purchased Canada Dry for personal use in the United States since 2013.
These payments are limited to US $ 5.20 per household without proof of purchase and US $ 40 per household with proof of purchase, in accordance with the proposed agreement, which does not apply to sales in Canada.
The company is now trying to give ample attention to anyone who might qualify for these payments in anticipation of final court approval in April, according to Van Beckwith, a lawyer for Keurig's Dr. Pepper.
A tiny amount of a ginger flavor extract
This follows the decision of a California court last year to allow the case to go to trial, which should begin this week. It would aim to resolve several related lawsuits from various states, from Massachusetts to Missouri.
The New York lawsuit, for example, alleges violations of state commercial law, including "common law fraud, fraud and / or misrepresentation, breach of express and implied warranties, and unjust enrichment."
As a trademark, Canada Dry dates from the inauguration in 1890 of a carbonated water plant in Toronto by John J. McLaughlin. Its "Canada Dry" Pale Ginger Ale was widely sold in Canada in 1904, and soon expanded to New York, where it was a popular blend of home-made liquor during the Prohibition, and globally in the 1930s. New York remains the heart of retail, according to court records.
Today Canada Dry is made with carbonated water, high fructose corn syrup, citric acid, preservatives and natural flavors, which one lawsuit only includes "a tiny amount of a ginger flavor extract." Research done by New York's claimant's lawyer the actual content of Canadian ginger compounds Dry at two parts per million, which is below the limit for human taste, and much lower than any amount that may have health benefits .
Health benefits are a key aspect of the dispute. The flat ginger ale is a common folk remedy for a stomach ache, for example, and lawyers in the New York case argue that Keurig Dr. Pepper has added the claim of "Real Ginger" to labeling "to cultivate a healthy and healthy image ". The goal, according to the process, was to position Canada Dry as a "BFY" option, meaning "Better For You."
Claims relating to packaging "mislead and mislead reasonable customers"
This included a television ad, "Jack's Ginger Farm," about a woman taking a ginger ale from a refrigerator at a picnic and discovering that she was connected through the ground to a handsome ginger farmer.
It seems to have worked. Court records in the New York lawsuit claim that Keurig Dr. Pepper saw a sales increase of nearly 9% only in the first six months of adding the "Made from Real Ginger" claim to the packaging.
The California judge cited internal company documents suggesting that 30 percent of Canada Dry consumers who increased their consumption did so because of the expected health benefits of real ginger.
"In fact, the DPSG soda is not made from real ginger," the lawsuit in the New York District Court said. Packaging claims "mislead and induce reasonable customers to believe that (the Canadian Dry is) made using ginger root – that is, the spice made by cutting or spraying the root of the ginger plant – not tiny amounts of extracts of flavor".
This lawsuit was brought by Julie Fletcher of Bolivar, N.Y., near the border with Pennsylvania. She stated that she often bought her sick children, thinking it was a "healthy alternative to regular soft drinks."
Katie Gilroy, director of corporate communications for Keurig Dr. Pepper, did not respond before the deadline to a request for comment.
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