≡ Menu

Pepsi hit with $1.26 billion default judgment – lawyer’s secretary was distracted, put letter aside, and forgot about it

Ouch:

In court papers, PepsiCo claims it first received a legal document related to the case from the North Carolina agent on Sept. 15 when a copy of a co-defendant’s letter was forwarded to Deputy General Counsel Tom Tamoney in PepsiCo’s law department. Tamoney’s secretary, Kathy Henry, put the letter aside and didn’t tell anyone about it because she was “so busy preparing for a board meeting,” PepsiCo said in its Oct. 13 motion to vacate.

When Henry received a forwarded copy of the plaintiff’s motion for default judgment on Oct. 5, she sent that to Yvonne Mazza, a legal assistant for Aquafina matters. Remembering that she still had the other document, Henry passed it to Mazza too. The next day Mazza sent the documents to David Wexler, a department attorney, and he “immediately” called the agent to get a copy of the complaint.

Lawyers for PepsiCo distributors Wis-Pak Inc. and Carolina Canners Inc. made court appearances in June and July. PepsiCo was at a loss to explain why it hadn’t heard about the case from them. “It’s just another unfortunate thing that didn’t come together,” Jacuzzi said.

In seeking to dismiss the case, PepsiCo argues that the statute of limitations should preclude the lawsuit, brought 15 years after the company started selling Aquafina and more than two decades after the alleged confidential talks.

Lynne Marek, Price to PepsiCo for Not Being in Court: $1.26 Billion, National Law Journal, Oct. 28, 2009.