Red Bull False Advertising $13 million lawsuit - Essay Example

Red Bull False Advertising $13 Million Lawsuit I would like to begin by concurring with the fact that ‘Red Bull to Pay $13 Million for False Advertising Settlement’ is an article that accurately states the law. It is written by Max Rothman and published by BevNet.com, an organization that has been involved in conducting research and disseminating invaluable information about beverages in the country. In fact, it is a reputable authority which has been providing up dated information to leading publications like Wired Magazine, Wall Street Journal, the New York Times, Detroit Free Press and CNBC. The article provides an exhaustive report regarding the case. Apart from using the right law jargons, the article appears to be a product of an extensive research. In his report, Rothman begins by saying more about the filing of the case by the class of plaintiffs. Then, he proceeds to say much about the allegations and goes ahead to provide evidence on how it qualifies to be a misleading advert. After explaining all these, the writer sheds more light on how the plaintiff and the defendants negotiated an out of court settlement without necessarily fighting the case in the court of law up to the very bitter end. It does not merely state facts, but punctuates them with the exact figures, dates and names of the involved parties (Fletcher 79). It was indeed, a credible and authoritative piece that can be invaluable to anyone interested in knowing much about the case. Although the company did not admit liability, I would like to fault its management for acting inappropriately. In my opinion, the decision of the company to use ‘Red Bull gives you wings’ as its marketing slogan was misleading. It is an unlawful action that violates Lanham Act, 15 U.S.C.A. § 1125(a) which considers such a statement as violation of the law. According to the act, the slogan qualifies as a misleading advert because of its ambiguity and incompleteness that made it possible for the target clients to misunderstand and mistake it for something else. This is because the slogan did not provide all the facts about the product. Instead of disclosing all the facts that the targeted consumers should know, the slogan remained partial and incomplete. By merely stating that the consumption of the company’s brands, one gets wings, is quite complicated and can be misleading (Bangert, et al. 19). It is a very serious offense that can really affect the company should any client file a suit case for misleading advert as it happened. The slogan helped the company to appeal to and win the confidence of many clients. Besides, it capitalized on it by hiking the prices of its product since they were perceived to superior to those of its competitors. Therefore, to avoid such suit cases, the company should refrain from publishing misleading adverts (Bangert, et al. 19). In fact all ads should comply with the Lanham Act, be simple, clear, complete and easy to comprehend. This is the only way through which it can escape any unnecessary liability arising from such law suits. In this regard, if I were to advise the company based on its decision to settle the law suit out of court, I would commend it for doing so. As a student of Business Law, I believe that the settlement of a case out of court is much better than undergoing through the litigation process. As compared to litigation, out of court settlement is cheaper. Since it involves the termination of the case at an earlier stage, it is cost-friendly. Once it is concluded, the defendant would not need to pay the defendant attorney any more. At the same time, there would be no more expenses to cater for travel, expert witnesses and court costs. Better still, such an arrangement would enable the defendant to incur lower costs of contingency that would not be expected to exceed 33% (Fletcher 131). Better still; out of court settlement would be an appropriate choice for the company since it would reduce the amount of damages. Being that it could only pay $13 million means that the parties could agree. However, this would not be the case if the matter was tried and decided upon at the court. May be, the damages would have been doubled or tripled. The other benefit of settling a law suit out of court is that it enables the defendant to avoid the admission of liability even if it was to lose the case and do so upon a court order. I think this can be good news to a business organization that has been accused of cases like negligence or deliberate violation of the law just like the Red Bull. By not openly admitting liability, the company would have saved its reputation that would otherwise be damaged should it have agreed to do so. By failing to admit liability, the company would not be viewed to have intentionally engaged in wrong, unlawful and unethical practice. It is for this reason that I would advise the management of Red Bull not to proceed with the case, but settle it out with the plaintiffs. In conclusion, ‘Red Bull to Pay $13 Million for False Advertising Settlement’ is undoubtedly an insightful article that gives invaluable information on the settlement of the ‘Red Bull gives you wings’ case. While the decision of the company to reach an out of court settlement with the plaintiffs, the company should be so careful when designing its adverts. Even if they are intended to market its products, an intentional violation of the Lanham Act can surprisingly end up to be a costly affair that might even get the company out of business. Works Cited Bangert, Sharon J., et al. "Unfair and Deceptive Advertising of Consumer Credit." The Maryland Bar Journal 35, 2002: 8–13. Fletcher, George. Basic Concepts of Criminal Law. New York: Oxford University Press, 2011. Print. Read More