978-1337614436 Cases POM Wonderful

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CASE 04

POM Wonderful: Crazy Healthy!

CASE NOTES FOR INSTRUCTORS

This case introduces students to the company POM Wonderful. Most likely these students are

already familiar with the company’s renowned hour-glass shaped bottles of pomegranate juice.

POM Wonderful has a good reputation because of the pomegranate products it sells. Pomegranates

are high in antioxidants and are thought to be helpful in combating some diseases. This case is

unique because despite POM Wonderful’s reputation as a company that sells healthy products, the

Federal Trade Commission ruled that its advertising was deceptive. This demonstrates that even

companies that sell products beneficial to society must still be careful about how they advertise

their products.

POM Wonderful has secured a large portion of the pomegranate beverage market. Like most firms,

it takes great strides to protect its market share. For instance, POM Wonderful filed a lawsuit against

Coca-Cola after it introduced its Minute Maid pomegranate-blueberry juice blend because the

beverage consisted mostly of apple and grape juices, not pomegranates. However, POM Wonderful

would face its own legal scrutiny in 2010 when the Food and Drug Administration sent POM

Wonderful a letter claiming that its products were being marketed similarly to pharmaceuticals in

terms of their touted health benefits. For instance, company ads claim that pomegranates can help

prevent certain diseases or maladies, such as erectile dysfunction and prostate cancer, as well as

have a positive impact on LDL cholesterol. As such, POM Wonderful was required to prove with

scientific rigor that its juice products were beneficial in the curing, mitigation, treatment, and/or

prevention of diseases. Because POM Wonderful’s claims were not substantiated, its ads were

deceptive.

The Federal Trade Commission (FTC) found POM Wonderful guilty of violating the Federal Trade

Commission Act. It ruled that POM Wonderful had made unsubstantiated efficacy and establishment

claims. It forbade POM Wonderful from making any more health claims unless they were

substantiated by two randomized and controlled human clinical trials.

POM Wonderful appealed the ruling, but the U.S. Court of Appeals upheld most of the FTC’s ruling. It

did say, however, that two human trials were excessive and that one clinical trial would be enough to

provide valuable health information.

What is so interesting is that unlike new and untested pharmaceuticals, pomegranates almost

certainly have health benefits of some sort. They do not have nearly the same risks as untested

pharmaceuticals. Therefore, it could be argued that POM Wonderful’s beverages are being held to

unrealistic standards. The U.S. Court of Appeals seemed to agree as it ruled that POM Wonderful

only had to perform one clinical trial. This case could be used as a debate exercise for whether food

should be held to the same standards as pharmaceuticals regarding the promotion of health

benefits.

distributed with a certain product or service or otherwise on a password-protected website for classroom use.

QUESTIONS AND 0DISCUSSION

1. Is there any difference in potential deception between Coca-Cola’s advertisers and POM Wonderful’s

advertising?

The biggest difference is that the Coca-Cola example involves the actual content of its product,

while the POM Wonderful example deals with the health claims of its products. It is sometimes

hard to determine whether an advertisement is misleading or if it is just a form of puffery.

However, most students will likely agree that a product’s marketing should not misrepresent its

However, students may argue justifiably that both companies made claims that they knew might

not be accurate. Therefore, both of them should be held accountable. Other students might argue

that pomegranates are a healthy product and most likely do have some health benefits, so trying

2. Why does the FTC want food and supplement makers’ claims about the health impact of their

products to be substantiated with clinical trials?

The FTC wants to crack down on food and dietary supplement manufacturers that make

misleading claims upon which consumers depend. The FTC desires to adopt the more stringent

3. Do you feel that POM Wonderful—a product with known health attributes—should be subjected to

the same scrutiny as drug companies if it wants to make health claims about its product?

Students’ answers will vary. Some will likely point out that unlike untested pharmaceuticals,

pomegranate juice is not likely to cause harm and most likely does have certain health benefits.

Therefore, these products should not be held to the same standards as pharmaceuticals. It is

important to note that people depend upon pharmaceuticals for health reasons; if the

ADDITIONAL RESOURCES

POM Wonderful’s misleading marketing:

https://www.forbes.com/sites/davidvinjamuri/2012/05/23/judge-finds-pom-wonderful-a

dvertising-deceptive-but-thats-just-the-tip-of-the-iceberg/#62671ce01619

distributed with a certain product or service or otherwise on a password-protected website for classroom use.

POM Wonderful ruling:

http://www.latimes.com/business/la-fi-pom-wonderful-20160503-snap-story.html

POM Wonderful health benefits:

https://www.pomwonderful.com/pomegranate-wellness/wonderfully-nutritious/

distributed with a certain product or service or otherwise on a password-protected website for classroom use.