Netflix’s new documentary, ‘Pepsi, Where’s My Jet’, is the story of when John Leonard sued Pepsi for false advertising, but it turned around and backfired for him. It also shaped advertising laws forever.
In 1995, Leonard was a 20-year-old student near Seattle in the United States, where he was coaching little league football and dreaming of having a successful business. But, as a courageous and adventurous young man, a commercial from Pepsi changed the course of his life. Leonard was set to win a military-grade Harrier jet for an insane amount of Pepsi Points.
As the 90s were all about the cola wars, and in a bid to steer Gen Xers to choose Pepsi over Coca-Cola, the brand introduced Pepsi Points, which could be redeemed for Pepsi merch. Pepsi Points suddenly appeared everywhere, getting customers to drink the beverage religiously.
What could Pepsi Points buy?
In order to understand the difficulty of buying merchandise with points, basic maths needs to be applied. The amount of points a customer would receive includes:
A fountain drink = one point
Two-litre bottle = two points
12 pack = five points
After months of saving for points (similar to Qantas Frequent Flyer members) customers would be able to buy the following:
Baseball caps = 60 points
T-shirts = 80 points
Mountain bikes = thousands
And the prize that took Leonard to court, a military grade Harrier jet = a whopping 7,000,000 points
The commercial did not include any fine print, disclaimer or legal notice telling viewers it was a joke.
“I started thinking, geez, how could you actually make this work,” Leonard said in the Netflix series.
“But I can’t make it happen. And I have had to find a crazy partner in the deal. And luckily, I happen to know somebody that fit the bill.”
But Leonard was on a mission to get the jet, and rang up his friend Todd Hoffman and pitched his idea, of which he was immediately interested to be a part.
How was it possible?
Leonard was set to pay for numerous warehouses, trucks and drivers to purchase the millions of Pepsi bottles needed to get the seven million points. But the estimated cost would have exceeded over $3.4 million – this set Leonard and Hoffman back to planning.
This led Leonard to find a loophole in the fine print, that Pepsi Points could be purchased for ten cents a piece. This fueled their plans and a $700,008.50 cheque – ready to win the top prize.
But weeks after sending the cheque to the Pepsi headquarters, Pepsi responded saying the inclusion of the Harrier jet in the commercial was nothing more than a joke. But neither Leonard nor Hoffman wanted to take no as an answer. They recruited a lawyer, Larry Schantz to send a letter demanding Pepsi to stick with their arrangement.
The response by Pepsi
The brand counter-responded to the letter by filing a lawsuit against Leonard and Hoffman, asking the court for a declaratory judgement stating that it had no obligation to provide them with a Harrier jet.
However, Schantz filed a countersuit arguing that Pepsi was obligated to produce the jet, as there was no fine print or disclaimers in their commercial.
Shortly after this, Pepsi decided to change the ad twice. The first time they changed the number of points to win the jet from 7,000,000 to 700,000,000 and the second time they followed the number with a “Just Kidding”.
Soon after, Pepsi offered Leonard and Hoffman a settlement of $750,000, but Leonard refused as he was still on a mission to claim the jet.
“Now, sure, [I would have settled], but I still get a kick out of the fact that I had the chutzpah at that time to actually come to that conclusion. Probably wasn’t the smartest decision I’ve ever made in my life,” says Leonard.
Another lawyer, Michael Avenatti, joined the case but ultimately, the judge ruled in favour of Pepsi, saying no reasonable person would think a Harrier jet was attainable by claiming Pepsi reward points.
The duo could not receive their military jet, but they made history as they changed the ways of advertising, with disclaimers now an integral part of many commercials.