MESSAGE FROM ASSOC PROF PAMELA S EVERS ATTORNEY AT LAW This article has been offered by web posting to UNCW students for educational purposes only Articles posted may have been edited for clarity and format by Pamela S Evers Sour Daugh Pizza Hut v Papa John s Brandweek May 21 2001 by Jim Edwards How risky is comparative advertising Consider what happened when two pizza giants went to court over increasingly puffed up claims about each other s products In the spring of 1997 Pizza Hut s then president David Novak stood on the deck of a World War II aircraft carrier and declared war on skimpy low quality pizza The act was filmed as a TV commercial by BBDO New York in which viewers were dared to find a better pizza than Pizza Hut s a pretty unremarkable ad in a category that historically has been littered with over the top ad strategies At the time Novak probably did not imagine that his publicity stunt would become the genesis of a nearly three year legal fight that ultimately ended up in the U S Supreme Court The dispute which came to a conclusion on March 19 ran up lawyers bills in the millions exposed the often unappetizing ways in which Pizza Hut s pizzas are prepared and made the company the butt of newspaper editorial jokes across the nation Even worse it became a distraction at a time when Pizza Hut s business needed serious attention to revive flagging sales and a stagnant storebuilding program For marketers settling an advertising war in the courts poses some serious risks You don t want to lose control of the information you send out to people about your brand said John Allen senior partner at consultancy Lippincott Margulies New York A lawsuit is definitely the last resort The whole issue here in this case is one that s of no interest to consumers added John Grace executive director of consultancy Interbrand New York Great brands are not built on the functional promises of ingredients And pizza consumers don t want to know Indeed the case may be looked at as a cautionary tale it formed a textbook example of how not to go about challenging consumers to compare your rivals products Oddly though it still handed Pizza Hut something of a backdoor victory Here s how it happened Perhaps predictably Novak s war cry was immediately answered by Pizza Hut s hated rival Papa John s pizza The two have corporate headquarters based uncomfortably close to each other in Louisville Ky For two years Papa John s marketing slogan had been Better Ingredients Better Pizza The same month as Novak s ad first ran the smaller chain aired a retaliatory spot in which Pizza Hut founder Frank Carney who sold Pizza Hut in 1977 to PepsiCo and then joined Papa John s as a franchisee in the 1980s appeared at a fictional Pizza Hut conference to declare I found a better pizza meaning Papa John s Sensing blood in the water Papa John s upped the ante considerably in 1998 with a series of ads via Fricks Firestone Atlanta skewering Pizza Hut in an illustration of just why the smaller chain believed that better ingredients do indeed make better pizza One memorable spot showed Papa John s CEO John Schnatter describing how Papa John s dough was made with clear filtered water and yeast that was given several days to work its magic The dough was contrasted with that of the biggest chain that s Pizza Hut incidentally which it said uses whatever comes out of the tap to make frozen dough or dough made the same day The description was accompanied by the image of a back of the house cleanup area where a grungy youth in a tie dyed T shirt was washing an even grungier pile of dishes as a faucet dripped water into the sink Pizza Hut of course did not take the assault lying down The company responded with what its top lawyer svp genearal counsel Bob Millen described as a corrective ad on the dough issue The commercial used a snippet of the Papa John s ad in which John Schnatter was saying We d never use dough the same day The intent of the ad was to alert consumers to the fact that Papa John s make s their dough in regional dough factories kind of like Wonder Bread is made said Millen In August 1998 after getting no sympathy at the National Advertising Division of the Better Business Bureau Pizza Hut accompanied its corrective campaign with a lawsuit in Dallas Federal District Court claiming that much of Papa John s advertising was false and misleading The suit was heard in November 1999 Part of the case revolved around differences in the way the two chains prepare their tomato sauce Pizza Hut s is cooked and then bagged before water is added at the restaurant whereas Papa John s is canned before being reheated Neither method sounded too pleasant As Millen recalled the testimony bordered on the comical At one point a scientist was brought in by Pizza Hut to testify that both sauces in fact taste identical The fresh taste of the sauce as it turned out was not produced by the freshness of the product both sauces sit around for weeks before they even see a pizza but by a naturally occurring amino acid that produces a fresh sensation on the tongue That quite frankly astonished me Millen said They actually had a science around this The jury ruled in favor of Pizza Hut as the ingredient comparisons were deemed misleading The judge admonished both sides for the dubious nature of their advertising but to Pizza Hut s delight ordered an injunction on Papa John s entire Better Ingredients Better Pizza marketing blitz pizza boxes car toppers menus hats ads and all The Appeal Puffery and Other Inflated Charges Papa John s appealed to the 5th Circuit Court of Appeals in January 2000 complaining that the judge had simply gotten the law wrong Truth in advertising is codified partly in a body of laws that define puffery and puffing In laymen s terms puffing is the act of making commercial statements so vague ridiculous outrageous or opinionated that they could not possibly be taken seriously by consumers Better Ingredients Better Pizza fit this definition perfectly Papa John s argued If it did not then BMW would also find itself in court being asked to prove that their cars really were ultimate driving machines and Visa would be forced to prove that its cards really are accepted everywhere you want to be That same month the Court of Appeals handed down a complicated ruling containing matter that would anger both sides The bottom line was that the court sided with Papa John s on the puffery issue and lifted the injunction The judges agreed
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