MID-ATLANTIC COCA-COLA BOTTLING CO. v. CHEN, WALSH & TECLER

• Decision Date: 11 October 1983
• Docket Number: Civ. No. Y-81-3301.
• Citation: 571 F. Supp. 1253
• Parties: MID-ATLANTIC COCA-COLA BOTTLING COMPANY, INC. v. CHEN, WALSH & TECLER, et al.
• Court: U.S. District Court — District of Maryland

571 F. Supp. 1253

MID-ATLANTIC COCA-COLA BOTTLING COMPANY, INC. v. CHEN, WALSH & TECLER, et al.

Civ. No. Y-81-3301.

United States District Court, D. Maryland.

October 11, 1983.

Benjamin Rosenberg, Baltimore, Md., and Alison D. Kohler, Baltimore, Md., counsel for plaintiff.

Alfred H. Carter, Rockville, Md., and John F. McCabe, Jr., Rockville, Md., counsel for defendants.

MEMORANDUM OPINION AND ORDER

JOSEPH H. YOUNG, District Judge.

Plaintiff, Mid-Atlantic Coca-Cola Company ("Mid-Atlantic"), is a franchised bottler and distributor of products of The Coca-Cola Company. Between June and October, 1981, Mid-Atlantic sponsored a "Summer of Fun" promotion in connection with the advertising and distribution of Coca-Cola products. "Summer of Fun" was an "under the crown" promotion in which each bottle cap carried either a cap liner with one of six words, "Have a Coke and a Smile," or an instant winner cap liner. A participant could win by collecting all six words or by obtaining instant winner cap liners.

In accordance with the promotion, prizes were awarded in Maryland to Maryland citizens. Defendants, a Maryland law firm, purchased 624 bottles of soft drink from Mid-Atlantic during the promotion. On October 1, 1981, defendants wrote to Mid-Atlantic claiming that the promotion constituted an illegal lottery and that they were therefore entitled to a civil penalty of $50.00 per bottle or a total of $31,200.00 pursuant to Md.Ann.Code art. 27, § 356 et seq. Although plaintiff responded that the "Summer of Fun" program was not illegal under Maryland law because free caps were available and in fact distributed under the promotion, defendants continued to demand payment. Pursuant to 28 U.S.C. §§ 2201 and 2202, Mid-Atlantic filed a diversity action in this Court seeking a declaration that the "Summer of Fun" promotion was not an illegal lottery under Maryland law. Defendants counterclaimed for declaratory judgment and damages, seeking $50.00 for each purchase of soda as a civil penalty under Section 359. Plaintiff then moved for summary judgment.

This Court, finding that questions of Maryland law might be determinative of the action, certified the following questions of law to the Court of Appeals of Maryland pursuant to Md. Cts. & Jud.Proc. Code Ann. § 12-601 et seq.:

1. Whether an advertising promotion which awards prizes on the basis of chance to persons who purchase the company's products and which also provides methods for entering the promotion without

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