Coca-Cola Bottling Co. v. Coca-Cola Co.
| Decision Date | 28 June 1991 |
| Docket Number | 87-398-JJF.,Civ. A. No. 81-48 |
| Citation | 769 F. Supp. 599 |
| Parties | COCA-COLA BOTTLING COMPANY OF ELIZABETHTOWN, INC., et al., Plaintiffs, v. The COCA-COLA COMPANY, a Delaware Corporation, Defendant. |
| Court | U.S. District Court — District of Delaware |
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Edmund N. Carpenter, II, Charles F. Richards and Jesse A. Finkelstein of Richards, Layton & Finger, Wilmington, Del. (Emmet J. Bondurant, Jane F. Vehko and Jeffrey D. Horst of Bondurant, Mixson & Elmore, Atlanta, Ga., of counsel), for plaintiffs.
Richard D. Allen of Morris, Nichols, Arsht & Tunnell, Wilmington, Del. (Frank C. Jones, Chilton Davis Varner and Dwight J. Davis of King & Spalding, Atlanta, Ga., of counsel), for defendant.
This is one of three related actions involving the contracts which govern the relationship between The Coca-Cola Company (the "Company") and certain of its bottlers (the "bottlers"). This action, which for convenience will be referred to as the "Elizabethtown" case, arises out of contractual disputes between the Company and the bottlers involving the supply of syrup for the product bottled Coca-Cola. Two related actions, Coca-Cola Bottling Co. of Shreveport, Inc. v. The Coca-Cola Co., C.A. No. 83-95, and Alexandria Coca-Cola Bottling Co., Ltd. v. The Coca-Cola Co., C.A. No. 83-120 (), 769 F.Supp. 671, arise from disputes involving introduction by the Company of its new diet product, diet Coke, in 1983.1
Litigation of these cases was conducted for eight years before Hon. Murray M. Schwartz, who became unable to see the litigation to its completion when he became ill in the Winter of 1989, after the end of trial on these matters. The cases were reassigned to me in the Spring of 1989. The parties elected to retry the cases rather than to allow decision on the then-existing record, and the Elizabethtown case was retried before me from September 1989-March 1990. This Opinion constitutes the Court's Findings of Fact and Conclusions of Law pursuant to Fed.R.Civ.P. 52(a) in the Elizabethtown case.
The Elizabethtown litigation began in 1981 and stems from the Company's decision to substitute high-fructose corn syrup ("HFCS" or "HFCS-55") for granulated sugar in the syrup for the Coca-Cola beverage drink sold by the Company to the plaintiff bottlers. The dispute centers primarily around the appropriate price of that syrup and evaluation of the Company's conduct in supplying the syrup and negotiating several issues with the bottlers. The Elizabethtown litigation also involves alleged historical overcharges by the Company to the bottlers in the sucrose component of the syrup.
Plaintiffs are profitable businesses which are presently or were formerly engaged in the bottling of Coca-Cola under contracts which conform to Consent Decrees issued by this Court in 1921. This action involves 30 plaintiffs and 30 bottling contracts. During the course of the litigation, twelve plaintiffs either amended their bottling contracts or sold their rights to bottle Coca-Cola to bottlers who operate under amended bottling contracts. These twelve plaintiffs seek only past damages and make no claims under Count II, which seeks declaratory and injunctive relief. For convenience these twelve will be referred to as the "past damages plaintiffs." The remaining plaintiffs will be known as full plaintiffs. The full plaintiffs, their principal places of business, and the dates for the beginning of their alleged damage periods are as follows:
STATE OF INCORPORATION
OR PRINCIPAL PLACE OF
PLAINTIFF BUSINESS BEGINNING OF DAMAGE PERIOD
Coca-Cola Bottling Magnolia, AK February 2, 1976
Co. of Magnolia
Sacramento Coca-Cola Sacramento, CA February 2, 1977
Bottling Co
Coca-Cola Bottling Elizabethtown, KY January 1, 1969
Co. of Elizabethtown
Coca-Cola Bottling Shelbyville, KY January 1, 1969
Co. of Shelbyville
Trenton Coca-Cola Trenton, MO February 4, 1976
Bottling Co
Kelford Coca-Cola Kelford, NC February 4, 1971
Bottling Co
Plymouth Coca-Cola Plymouth, NC February 4, 1971
Bottling Co
Wilmington Coca-Cola Wilmington, NC February 4, 1971
Bottling Works
Coca-Cola Bottling Dickinson, ND February 4, 1975
Co. of Dickinson
Coca-Cola Bottling Jamestown, ND February 4, 1975
Co. of Jamestown
Coca-Cola Bottling Williston, ND February 4, 1975
Co. of Williston
Cleveland Coca-Cola Cleveland, OH January 1, 1969
Bottling Co
Coca-Cola Bottling Bethlehem, PA January 1, 1969
Co. of LeHigh Valley
Laredo Coca-Cola Laredo, TX February 4, 1977
Bottling Co.
Central Coca-Cola Richmond, VA February 4, 1971
Bottling Co.
Love Bottling Co. Muskogee, OK July 24, 1982
Coca-Cola Bottling LaCrosse, WI July 24, 1981
Co. of LaCrosse
Arkansas-Georgia Nashville, AK July 24, 1982
Consolidated Pretrial Order 2-3 (Dkt. 848).
The past damages plaintiffs, their principal places of businesses, and their alleged damages periods are as follows:
STATE OF INCORPORATION OR
PLAINTIFF PRINCIPAL PLACE OF BUSINESS DAMAGES PERIOD
Coca-Cola Bottling Streator, IL Feb. 2, 1971-April
Co. of Streator 30, 1987
Natchez Coca-Cola Natchez, MS Feb. 4, 1975-Dec.
Bottling Co. 31, 1986
Coca-Cola Bottling Jefferson City, MO Feb. 4, 1976-April
Co. of Jefferson City 30, 1987
Coca-Cola Bottling Macon, MO Feb. 4, 1976-April
Co. of Macon 30, 1987
Coca-Cola Bottling Deming, NM Feb. 4, 1975-April
Co. of Deming 30, 1987
Coca-Cola Bottling Tulsa, OK Feb. 4, 1976-Dec.
Co. of Tulsa 31, 1984
Coca-Cola Bottling Brownsville, TX Feb. 4, 1977-May
Co. of Brownsville 31, 1984
Coca-Cola Bottling San Angelo, TX Feb. 4, 1977-Dec.
Co. of San Angelo 30, 1985
Las Cruces Coca-Cola Las Cruces, NM Feb. 4, 1975-Dec.
Bottling Co. 30, 1985
Coca-Cola Bottling Tucson, AZ Feb. 4, 1975-Dec.
Co. of Tucson 30, 1985
Coca-Cola Bottling St. Cloud, MN Feb. 4, 1975-July
Co. (Alexandria) 31, 1984
Coca-Cola Bottling Marshall, TX Feb. 4, 1975-Oct.
Co. of Marshall 1, 1987
Consolidated Pretrial Order at 3-4 (Dkt. 848).
The Company is a corporation organized and existing under the laws of the State of Delaware, and having its principal office and place of business in the State of Georgia. Each of the plaintiffs is a corporation that is incorporated in and has its principal place of business in a state other than Delaware or Georgia. Therefore, there is complete diversity of citizenship. The amount in controversy exceeds the sum of $10,000, exclusive of interest and costs, and therefore, the Court has subject matter jurisdiction pursuant to 28 U.S.C.A. ? 1332(a)(1).
The factual background of this case has been recited repeatedly in Judge Schwartz' published opinions and should be familiar to all who have participated; however, for the sake of completeness in this Opinion, it will be repeated generally.
As indicated, the following narrative is intended to provide background only. Specific occurrences which have bearing on the issues pending before the Court will be discussed in greater detail in the Court's findings of fact under each Count. This narrative is drawn from numerous sources, including evidence presented in the record and Judge Schwartz' prior opinions.
In 1886, Dr. John Smyth Pemberton, an Atlanta pharmacist, developed the formula for a syrup that could be mixed with carbonated water to produce a beverage. He named the beverage "Coca-Cola." The name "Coca-Cola" derives from two of the ingredients, coca leaves and cola (or kola) nuts, extracts of which were used to manufacture Merchandise No. 5, one of seven compounds or "merchandises" used by Dr. Pemberton in the original formula for Coca-Cola. United States v. Coca-Cola Co. of Atlanta, 241 U.S. 265, 271 & 272, 36 S.Ct. 573, 574 & 575, 60 L.Ed. 995 (1916).
Dr. Pemberton registered the name "Coca-Cola" written in Spencerian script as a trademark "for soda water and other beverages" on June 6, 1887. The original trademark registration dated June 6, 1887, described Coca-Cola as follows:
In 1888, Asa G. Candler, a pharmacist and owner of a wholesale drug company in Atlanta, acquired a partial interest in the Coca-Cola trademark and formula. He acquired complete ownership in 1891. In 1892, Asa Candler formed the...
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