Introduction
Red Bull is an energy product which is sold by Red Bull GmbH. Red Bull GmbH is an Australian company which was formed in 1987 and has the highest market share as compared to any other energy drink across the world. However, to maintain this status, the company had to advertise its product so as to create market awareness about what their product can and cannot do. Conversely, after launching an advert under the slogan,' Red Bulls Gives You Wings' Red Bulls were sued by the consumers for deception. In the past two decades, the company has been using the slogan claiming that the caffeinated drink could improve the concentration and reaction speed. However, these were viewed by a large number of consumers to be misleading since they had tried it out but in vain. They thus decided to file a lawsuit for the damages they have incurred in the long run.
The Filing of the Lawsuit and Case Arguments
It was Beganin Caraetherer who brought the complaint against the Australian drink company. He did postulate that he was a regular customer of red bull's products for the past decade. However, he had not developed any wings or had an improvement in the physical or intellectual abilities. However, the lawsuit was filed by a number of red bull drinkers, where one of them said that he had to consume the drink since 2002 but have not improved in his athletic performance. The suit said such deceptive products and practices are done by Red Bull in its advertisement shows that it is not just puffery but rather illusory and fraudulent hence an action should be taken against them. During the case, Red Bull argues that the drink can improve concentration and reaction speed among those who consume it. They did insist that their labeling and marketing have always been accurate and truthful, hence did repudiate any form of wrongdoing as well as liability. Nonetheless, the plaintiff in the case did postulate that the claims of the Red Bull company were false, misleading since they do not have any scientific backings. The suit did not allege that the plaintiff was disappointed that they did not have wings after a long duration of brand consumption. However, it says that the Red Bull company normally put a lot of emphasis on the words like wings and boosts to give an impression that when the consumers take the drink, they will have some sort of physical enhancement, a claim which is not true but influences the decisions made by the consumers. These make most people to incur a lot of costs hence damages.
The statement of the case
The hearing of the case was to be done in March 2015 by the US District Court of the Southern District of New York. The Red Bull company will be required to pay $6.5 million into a settlement fund within a weeks' time. Besides, the settlement states that the company will compensate the disappointed customers $ 10 or a voucher worth $ 15 for the Red Bull products. These, however, will prove to be very costly since the class action suit covers millions of people who have bought and consumed Red Bull's products in the past 10 years. In addition, the courts give an opportunity to the public to make a claim by filling the claim form or calling (877) 495-1568 or by posting their completed form to Class Action Settlement Administrator at Energy Drink Settlement.
The anticipated Verdict
Even though the Red Bull company never agreed that they commit any wrongdoing, they decided to pay for the damages to avoid distraction of litigation. The company agreed to pay up to $ 13 million which comprised of $ 10 every US consumers who have had that drink since 2002. However, these have been predicted by consumerists to bring down Red Bull by $ 7.4 million in a few days' time.
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The Case Verdict and Consequence
In accordance with the court document which was filed in the New York Federal Court, it was passed that the Europe based energy Drink Company, Red Bull should pay a compensation of $13 million to settle the class action suit launched by the upset customers who argue that the company used a false advertisement to promote its product to the consumers. Besides, the company did agree to change its advertising tactics and they will aim at making the changes in their tagline. However, the change which they made was to add two ii's in the word wings to make it just a word which has no English meaning. These made them to start a new campaign with the 3 ii's in their product brand slogan. It can thus be evident that Red Bull Company had incurred a lot of costs as a result of being negligent despite being aware of the advertising principles and guidelines. It can thus be said to be a breach of law of torts (Negligence).
Conclusion and Recommendation
From the verdict, it can be evident that adherence to the advertising principles is very important in all aspect of the trade. All companies should be objective and reconsider their brand slogan as well as a tagline as they design their adverts before actual display for the consumers to use. They should ensure that the information incorporated is not misleading but is the truth since most people will make a decision based on the information they provide. However, most of the advertisements are misleading hence causing the consumers to make wrong judgments. These thus create a lot of losses to the public. Therefore, the government should enact laws that prevent companies from using such deceptive words in their promotions and brand campaigns. They should ensure that the companies have adhered to the principles of advertisements such as visual consistency, campaign duration, and use of repeated taglines, consistent positioning, and simplicity. Besides, the consumers should also be aware of what they buy since at times the consumer can suffer losses when the Caveat emptor principles are put into considerations.
References
Ever thought why Red bull has 3 i'es in their tagline? Its $13 Million US story. - Bmmguru. (2017, October 30). Retrieved from http://www.bmmguru.in/ever-thought-red-bull-3-ies-tagline-13-million-us-story/
Heilpern, W. (2016, March 31). 18 false advertising scandals that cost some brands millions. Retrieved from http://www.businessinsider.com/false-advertising-scandals-2016-3?IR=T#red-bull-said-it-could-give-you-wings-3
