Leonard v. Pepsico

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Leonard v. Pepsico
Court U.S.D.C., Southern District of New York
Citation 88 F. Supp. 2d 116 (1999)
Date decided 1999

Facts

A Pepsi advertisement campaign entitled “Pepsi Stuff” encouraged customers to collect Pepsi Points and redeem them for merchandise featuring the Pepsi logo. A commercial run by the defendant featured a Harrier Fighter Jet flown by a young boy to school, with the words “Harrier Fighter 7,000,000 Pepsi Points” displayed on the screen. This jet was not included in the Pepsi Points Catalogue. The defendant’s catalogue specified that if a consumer lacked enough Pepsi Points to purchase an item then they could purchase additional points for $.10 per point. The plaintiff sent a check for $700,000 (the amount of money required by the commercial to purchase the plane). The defendant notified the plaintiff that the plane in the commercial was not a product available, and that it was purely an advertisement/joke. Plaintiff sued for specific performance.


Procedural History

Plaintiff brought an action for specific performance of a Harrier Jet. Defendant moved for summary judgment, and the defendant’s motion was granted.


Issues

Whether an advertisement can constitute as an offer, specifically an advertisement in which a reasonable person would consider to be done in jest.


Holding

An advertisement does not ordinarily constitute an offer. It is possible to make an offer by an advertisement directed to the general public, but there must ordinarily be some language of commitment or some invitation to take action without further communication. Commercial was clearly done in jest, which to a reasonable person would not extend a contract.


Reasoning

Advertisements are generally understood to be mere requests to consider and examine and negotiate; and no one can regard them as otherwise unless the circumstances are exceptional and the words used are very plain and clear. (This protects businesses from running out of stock.)


Rule

There is a distinction between the offer for the Harrier Jet and the offer of Carbolic Smoke Ball. The commercial urged consumers to accumulate Pepsi Points and to refer to the Catalog to determine how they could redeem their Pepsi Points. This was an invitation to negotiate, not a unilateral offer.