Anheuser-Busch must pull some ads about MillerCoors: Judge

by Ike Obudulu Posted on May 27th, 2019

A Wisconsin judge has ordered Anheuser-Busch to stop suggesting in advertising that MillerCoors’ light beers contain corn syrup, wading into a fight between two beer giants that are losing market share to small independent brewers.

U.S. District Judge William Conley for the Western District of Wisconsin on Friday granted a preliminary injunction sought by MillerCoors that temporarily stops Anheuser-Busch from using the words “corn syrup” in ads without giving more context.

MillerCoors sued its rival in March, saying St. Louis-based Anheuser-Busch has spent as much as $30 million on a “false and misleading” campaign, including $13 million in its first commercials during this year’s Super Bowl.

However, the ruling did not affect all of Anheuser-Busch’s advertising targeting MillerCoors, allowing the commercials that premiered at the Super Bowl to keep airing.

Anheuser-Busch’s ad drew a rebuke from the National Corn Growers Association, which thanked MillerCoors for its support. In its lawsuit, MillerCoors said it’s “not ashamed of its use of corn syrup as a fermentation aid.”

Corn syrup is used by several brewers during fermentation. During that process, corn syrup is broken down and consumed by yeast so that none of it remains in the final product. Bud Light is brewed with rice instead of corn syrup, but Anheuser-Busch uses corn syrup in some of its other beverages, including Stella Artois Cidre and Busch Light beer.

MillerCoors applauded the ruling and said Anheuser-Busch should be trying to grow the beer market, not “destroy it through deceptive advertising.”

“We are pleased with today’s ruling that will force Anheuser-Busch to change or remove advertisements that were clearly designed to mislead the American public,” said MillerCoors CEO Gavin Hattersley.

Anheuser Busch, however, called the ruling a “victory for consumers” because it allows the brand’s “Special Delivery” Super Bowl ad to continue airing.

That ad showed a medieval caravan pushing a huge barrel of corn syrup to castles for MillerCoors to make Miller Lite and Coors Light. The commercial states that Bud Light isn’t brewed with corn syrup. Anheuser Busch said the ad would air as early as this weekend.

“As the number one selling beer in the U.S., Bud Light remains committed to leading the alcohol industry by providing more transparency for consumers including letting them know about the ingredients that are used to brew their beer,” said Cesar Vargas, Anheuser-Busch vice president of legal and corporate affairs.

Judge Conley ordered Anheuser Busch to temporarily stop using advertisements that mention corn syrup without references to “brewed with,” ”made with” or “uses,” or that describe corn syrup as an ingredient in the finished products.

The ruling affects two Bud Light commercials and billboards that describe Bud Light as containing “100 percent less corn syrup” than Miller Lite and Coors Light.

Anheuser Busch said those ads are no longer up and the company had no plans to continue using them.

Judge Conley also denied an Anheuser Busch motion to dismiss the case, saying it was likely to succeed in proving misleading statements and some harm to the reputation of MillerCoors.

Chicago-based MillerCoors and Anheuser-Busch have the biggest U.S. market share at 24.8 percent and 41.6 percent, respectively, but they’ve been losing business in recent years to smaller independent brewers, imports, and wine and spirits, according to the Brewers Association.

MillerCoors maintains Anheuser-Busch is preying on health conscious consumers who have negative connotations of corn syrup, sometimes confusing it with the high-fructose corn syrup in sodas.

The feud threatens to disrupt an alliance between the two companies to work on a campaign to promote the beer industry amid declining sales.

EARLIER: MillerCoors Sues Anheuser-Busch For Corn Syrup Super Bowl Ad

MillerCoors LLC has filed a lawsuit against Anheuser-Busch Companies LLC, part of Anheuser-Busch InBev (AHBIF.PK,BUD), alleging that Anheuser-Busch’s ad campaigns associating MillerCoors’ products, Miller Lite and Coor Light, with corn syrup is “false and misleading.”

During the Super Bowl, ABInBev ran an advertising campaign that mocked Miller Lite and Coors Light use corn syrup in brewing, while its own Bud Light does not.

The lawsuit was filed by MillerCoors in the United States District Court for the Western District of Wisconsin on Thursday. Anheuser-Busch owns the Bud Light beer.

MillerCoors said in its lawsuit that AB has publicly explained it launched the false and misleading advertising campaign in order to deceive beer consumers into believing that there is corn syrup and high-fructose corn syrup in Miller Lite and Coors Light and to increase sales of Bud Light under the guise of “transparency.”

Even after the Super Bowl, ABInBev ran the advertisements, describing Bud Light as having 100 percent less corn syrup than either Coors Light or Miller Lite. The company also said its own Bud Light beer is brewed with only water, rice, barley, and hops, according to MillerCoors’ lawsuit.

MillerCoors further argues in its complaint that ABInBev’s ad campaign was designed to take advantage of existing consumer confusion between corn syrup and high-fructose corn syrup or HFCS, the controversial sweetener commonly used in soft drinks.

The company added that Miller Lite and Coors Light never use HFCS and that there is no corn syrup in its beers that consumers drink.

MillerCoors also pointed out in its lawsuit that AB also uses corn syrup as a fermentation aid in several of its products across various price points, ranging from above-premium brands to economy brands. In addition, AB adds HFCS to several of its other brands such as Rita’s Berry-A-Rita and Best Damn Peach Tea, the company alleges.

MillerCoors noted that ABInBev invested over $13 million in media time to convey the message to nearly 100 million consumers during Super Bowl alone, to perpetuate the consumer confusion.

MillerCoors said it is seeking “an immediate halt to ABInBev’s false and misleading advertising claims and willful trademark dilution.” It is also seeking damages and costs, and an order requiring ABInBev to run “corrective advertising.”

However, Anheuser-Busch said it stands by the Bud Light ad campaign and called the MillerCoors lawsuit baseless.

“The recent Bud Light campaign is truthful and intended to point out a key difference from Miller Lite and Coors Light,” said Gemma Hart, vice president of communications at Anheuser-Busch. “Those beers are brewed with corn syrup; Bud Light is not.”

The lawsuit is only the latest salvo between the rivals since the Super Bowl. MillerCoors has promised free Coors Light in certain bars every time Bud Light launches another attack. It also has pulled back from a planned cross-brewer marketing push designed to win drinkers back from spirits and wine.

Earlier this week, Miller Lite released ads purporting to pick up where Bud Light ad shoots leave off, depicting actors who choose Miller Lite in real life.

Bud Light immediately released a counterattack that it had previously recorded in anticipation, pivoting back to its corn syrup message.

Although the corn-syrup battle is a higher-profile spat than most, brands sue each other over advertising from time to time. Sprint Corp. sued AT&T Inc. last month over a campaign it said falsely tells customers they are getting 5G service on their smartphones. AT&T said it would fight the suit.

But marketers often take their disputes to the National Advertising Division of the Better Business Bureau, as AT&T did over 5G ads from Verizon Communications . The National Advertising Division found Thursday in AT&T’s favor, recommending that Verizon discontinue or change the ads to avoid implying that it offers a 5G mobile wireless network.

That decision isn’t binding, and Verizon said it would appeal.

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