• Bottler Termination Suit: Pepsi Claims Bottler Sought 'Outrageous Bounty.'
• Antitrust Suit: Pepsi Says Coke 'Bullying Its Customers.' Coke Says Pepsi's Case 'Defective.'

Bottler termination. PepsiCo amends complaint in suit to terminate bottler Pepsi Central Investment (Pepsi CIC). Original filing did not mention bottler's alleged threat to "intervene against Pepsi" in its antitrust suit against Coke (BD 6/12/98, 5/8/98). Backdrop. During 1997-98, Pepsi worked to acquire rights from bottlers to sell fountain syrup directly via open commissaries; but not all bottlers agreed. On June 2, Pepsi sued Pepsi CIC seeking termination of bottler's franchise and alleged bottler failed to cooperate with Pepsi re fountain syrup delivery via commissaries. New complaint. On June 15, PepsiCo files amended complaint and claims Pepsi CIC tried "to coerce PepsiCo into paying an outrageous bounty" for bottler's agreement "not to interfere" in commissary delivery. Pepsi claims bottler told PepsiCo CEO Roger Enrico that unless "PepsiCo capitulated" within 24 hours, bottler would "seek to intervene" on Coke's side in Pepsi's antitrust suit vs Coke.

'Right to terminate.' PepsiCo alleges bottler's interference "with commissary deliveries" and threat "to align with Coke" constitute material breach of "Bottling Appointments" and jeopardize "strength of PepsiCo trademark." Pepsi claims "defendants' breaches" give PepsiCo "right to terminate" bottler's franchises. Bottler. Pepsi Central Investment executive: "As we indicated before, we shall defend this vigorously." Asked when response due, executive says "filing with the court required by July 2."

Pepsi and Coke cross swords in antitrust suit. After PepsiCo brings antitrust suit vs Coke on May 7, Coke files motion to dismiss on May 28 (BD 5/29/98). In June 19 reply, Pepsi declares: "There are restaurants and theater operators across America that want Pepsi, their foodservice distributors want to deliver Pepsi, and Coca-Cola is preventing them from getting Pepsi. That is monopoly power in action, and no amount of theorizing about market definition can hide the fact that Coca-Cola is bullying its customers and breaking the law." Coke's response. On June 29, Coke files counter-reply. Claims: 1) "No amount of rhetoric can make up for a defective market definition or for a failure to allege anti-competitive, exclusionary conduct." 2) "PepsiCo's remedy is to persuade a sufficient number of retail outlets ... to serve its products rather than Coca-Cola's ... PepsiCo has not done so yet." 3) "PepsiCo takes numerous potshots at our recitation of facts ... PepsiCo's case is defective as a matter of law (and) should be dismissed."

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