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Coca-Cola and Pepsi called a brief truce in their long-running “Cola Wars”, to
catch a Coke secretary and two accomplices who allegedly tried to sell a
secret sample to the company’s arch-rival.
The soft-drinks makers have been battling ever since Caleb Bradham, of North
Carolina, came up with Pepsi-Cola, originally called “Brad’s Drink”, to
rival Coca-Cola, concocted by John Pemberton, an Atlanta pharmacist, seven
years earlier, in 1886. When PepsiCo received a mysterious letter in May
offering “very detailed and confidential information” on Coke, the company
quickly tipped off its main competitor.
The FBI mounted a sting operation and made three arrests — including the
secretary of a top Coke executive — on the day a $1.5 million payment was to
be made.
“Competition can sometimes be fierce, but also must be fair and legal,” Dave
DeCecco, a Pepsi spokesman, said. “We’re pleased the authorities and the FBI
have identified the people responsible for this.”
Pemberton, a medicine inventor and morphine addict, created Coca-Cola out of
a secret mixture of stimulant coca-leaf and African kola nuts, which contain
caffeine.
He originally sold it as Pemberton’s French Wine Coca — a knock-off of the
popular Mariani wine favoured by Queen Victoria that was produced by a
Corsican entrepreneur by adding cocaine to low-grade Bordeaux. When Atlanta
declared Prohibition in 1886, however, Pemberton recreated his beverage as a
“temperance drink” and gave it the name suggested by his book-keeper,
Coca-Cola.
Bradham, a medical school drop-out, entered the market in 1893 with a
concoction initially intended to cure stomach pains, or dyspepsia. His
recipe contained pepsin, a digestive enzyme extracted from pigs’ stomachs.
“Brad’s Drink” became Pepsin Cola in 1896 and then Pepsi-Cola in 1898.
The two brands have vied for worldwide supremacy ever since. Coke, being
first, always had the edge, marketing itself with ads such as “Demand the
Genuine”, “Accept No Substitutes” and “The Real Thing”.
Coca-Cola maintains its lead over Pepsi among carbonated drinks. But
PepsiCo’s diversification into non-fizzy drinks, such as Gatorade and its
Starbucks Frappuccino joint venture, has boosted its growth.
The alleged offer to sell Coca-Cola’s trade secrets came in a May 19 letter to
PepsiCo in a Coca-Cola business envelope, datemarked in New York, from a
person calling himself “Dirk”.
An undercover FBI agent contacted the man, who provided 14 pages of
classified Coke documents.
“Dirk” initially asked for $10,000 but agreed to accept $5,000, plus another
$75,000 for providing a secret sample of a new Coke product. The FBI agent
promised to pay him $30,000 upfront and handed over the cash in a biscuit
tin at Atlanta airport last month. The agent then kept him on the hook with
an offer of $1.5 million for “additional trade secrets”.
Investigators identified “Dirk” as Ibrahim Dimson and traced the source of
his information to Joya Williams, who reportedly worked as the
administrative assistant for Coke’s global brand director, prosecutors said.
Security video showed Williams at her desk at Coke headquarters allegedly
stuffing files into her bags and taking what appeared to be a container of a
Coca-Cola product sample.
Williams, 41, Dimson, 30, and Edmund Duhaney, 43, were arrested yesterday —
the day the undercover agent had promised to pay the $1.5 million. All three
were charged with wire fraud and stealing trade secrets.
Coca-Cola thanked PepsiCo for its help. The company said its secret formula
containing the mysterious ingredient known as “7X” - was never at risk.
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