INTEGRATED: integrated issues; Will a US law student teach PepsiCo a lesson?

By NICK GILLIES,, Friday, 30 August 1996 12:00AM

A spoof Pepsi promo may prove costly for the drinks giant, Nick Gillies reports

A spoof Pepsi promo may prove costly for the drinks giant, Nick Gillies


When PepsiCo in the US dreamed up the idea of offering a pounds 16

million Harrier Jump-jet in a spoof promotion, it never imagined anyone

would take up the offer.

However, the wheeze backfired when a business student, John Leonard, did

just that. Now the joke could cost PepsiCo up to dollars 25 million and

lead to changes in the law on advertising, not only in the US but in

this country as well.

The ad, which was devised by the New York office of BBDO, depicts goods

that can be won by accumulating tokens, or ‘stuff’ points, on Pepsi Cola

bottles. It shows a 13-year-old boy getting ready for school by putting

on a leather jacket and sunglasses as the number of points required to

win them (1,250 and 125, respectively) flashes underneath. The closing

shot depicts him landing a Harrier in his schoolyard with the figure

‘7,000,000’ flashing underneath - the number of points supposedly

needed to claim the jet.

The promotion says points can also be bought for ten cents each.

Consequently, Leonard got together a group of investors, who produced

the minimum three tokens and a cheque for dollars 700,000 to claim the


When PepsiCo refused to pay up, Leonard, instructed a Florida law firm

to issue proceedings in Miami.

Leonard has since set out his side of the case on the Internet

(, where he claims he dreamed up the idea

from what he learned in a class in contract law. Lawyers in this

country, however, are cautiously dismissive of his chances of success.

The basic point of law governing advertising in both the US and UK was

set out more than 100 years ago in England following the case of Carlill

versus the Carbolic Smokeball Company.

The company took out a newspaper ad that stated that anyone who caught

influenza within a month of using its smokeball product would get pounds

100 compensation. When the eponymous Mrs Carlill sued, the company

turned to the existing law of contract, which stated that a person

making an offer must know who they were making it to.

The judges, who loathed what they saw as vulgar advertising, compared

the ad with a reward for a lost dog; the advertiser wants their dog back

and doesn’t care who accepts the reward.

However, Stephen Groom, head of intellectual property at the UK

advertising law specialists, Lewis Silkin, says the judges were driven

by more than just distaste for the new medium. ‘They said they were

influenced by the ad, which said that money to cover any claims had been

deposited at the bank. They thought that showed it was meant to be taken

seriously,’ he says.

Leonard’s claim is not as clear-cut as he might have thought because the

ad was one in a series produced by BBDO, all of which were in the same

style and ended with an obvious joke.

Leonard’s claim could hinge on a PepsiCo press release that called the

jet the ‘ultimate Pepsi stuff award’, but he may have problems here,

too. PepsiCo’s US spokes-man, Brad Shaw, claims: ‘The language, and

everything about the release, made it clear it was a joke. There is a

long-established right to use humour in advertising.’

Vanessa Hall-Smith, a solicitor at the UK media law firm, the Simkins

Partnership, thinks the case would not get to court in this country.

‘The courts take a fairly robust view of what is real. There was a

credible offer in Carbolic Smokeball, but a Harrier is a ludicrous

offer,’ she explains.

Even so, agencies would probably do well to take greater care when

preparing promotional ads. Robin Price, who qualified as a lawyer but is

now a partner at Howell Henry Chaldecott Lury, says: ‘People always

sound me out during the development phase if they think there is

anything potentially dangerous, and I refer it to lawyers and tax


But Leonard’s claim has done nothing to deter PepsiCo’s efforts in this

country. A spokesman says that, although the company has not run loyalty

reward schemes in the UK, he does not rule them out. ‘They are a good

idea,’ he adds.

Although comparisons are being made with the Hoover ‘free flights’

debacle, where Hoover offered plane tickets worth much more than the

value of the goods purchased, a huge multinational such as PepsiCo is

unlikely to be hit too badly even if it loses.

This article was first published on


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