The company behind Splenda knew consumers were confused about whether the sweetener contained sugar, but made ambiguous statements to keep it from being tagged as an artificial sweetener, an attorney for rival Equal said Thursday.
An expensive food fight within the $1.5 billion market for sugar substitutes goes to a jury Friday after a monthlong trial over Splenda’s marketing slogan, “Made from sugar so it tastes like sugar.” Merisant Co., which makes Equal, accuses Splenda’s marketers of misleading consumers and eroding Equal’s sales with false advertising.
Merisant lawyer Gregg LoCascio said in his closing argument Thursday that Splenda’s makers chose not to use the phrase “does not contain sugar” on packaging, because “it was good for business.” He says Equal unfairly lost millions in sales and profits.
McNeil Nutritionals, which markets Splenda, calls the lawsuit sour grapes.
The company says consumers prefer the taste of Splenda, leading to its huge market gains since its 2000 debut.
“That is a marketing advantage that Splenda has been able to exploit over the years,” Splenda lawyer Steven Zalesin told jurors.
Splenda uses sugar in the manufacturing process, though it is burned off and is not part of the final product.
McNeil’s own consultants said many consumers were confused by the claim and thought that Splenda was sugar without the calories, LoCascio said. Nearly half the consumers in one marketing study thought it contained at least some sugar, he said.
However, a marketing consultant told McNeil to avoid adding the phrase “but it’s not sugar” to the tag line because consumers would then wonder what it did contain, he said. In doing so, McNeil violated federal laws prohibiting false or misleading advertising claims, LoCascio said.
Splenda, introduced in 2000, is used in more than 4,000 food and drink products, from Diet Coke to Juicy Fruit gum. Separately, it had 60 percent of the consumer artificial sweetener market last year, according to the research firm Information Resources Inc.
Equal and Sweet’N Low each held about 14 percent of the consumer market, and appear to be on a downward slide.
Chicago-based Merisant charges that McNeil made at least $183 million in unfair profits since 2003 and that Merisant lost at least $25 million in sales because of Splenda’s “sugar” claim.
McNeil says it simply has a better product with better marketing. It told jurors it has spent $234 million promoting Splenda, more than twice the $108 million spent on Equal in the same period.
McNeil, a unit of Johnson & Johnson based in suburban Philadelphia, markets Splenda for its manufacturer, London-based Tate & Lyle PLC. It is also defending its Splenda advertising claims in a separate lawsuit in California filed by a group of U.S. sugar manufacturers.