NEW YORK Pom Wonderful is not so wonderful to Purely Juice. The small beverage must pay $1.5 million in damages to Pom Wonderful after a U.S. Federal Court in Los Angeles ruled its marketing was misleading.
Purely Juice is one of many new products that hopped on the pomegranate bandwagon after the little known fruit became a hot ingredient for everything from candles to soaps to juices.
It claimed that one of its products was "100 percent pure pomegranate juice" and contained "no added sugar or sweeteners." Seven different labs, however, found that the product contained trace amounts of pomegranate juice and a healthy dose of high-fructose corn syrup.
"Healthy competition is one thing, but they lied," said Lynda Resnick, owner of Pom Wonderful. "In 2002, when we first started marketing pomegranate juice for the first time, only 4 percent of [the U.S. population] had tasted it. Now there are 950 products that claim to contain pomegranates. There aren't enough pomegranate groves on the planet to supply the products in the marketplace."
Resnick said her company would continue to challenge competitors' claims and further litigation is a possibility.
Purely Juice CEO Paul Hachigian said the product in question was a result of "a supply chain issue. We were buying 100 percent concentrate. That was part of the spec and the formula. There was never any intent to falsely advertise. It was one production period. We had no idea it occurred. We stopped shipping the product and started shipping an all new product."
Pom Wonderful, which tallied $165 million in sales last year, took offense to Purely Juice using its research about the health benefits of pomegranate in its marketing. It also didn't care for the fact that it was undercutting them in price. "The retailers wanted them because they were cheaper," said Resnick.
After the lab results came back "we politely asked [them] to stop advertising the product as 100 percent pomegranate and of course they wouldn't so we sued them and won," said Resnick, whose company Roll International also owns Fiji Water and Teleflora.
Purely Juice's supplier Perma Pom was not named in the suit. Hachigian said he is "discussing our legal options at this point" in regards to suing the supplier.
For the Newport Beach, Calif.-based company the court's decision could be a death knell between the hefty payout and the damage the brand has received. Hachigian said his company is evaluating its options moving forward.