Lawsuit: Cobb firm illegally distributing Mexican Pepsi in U.S.

PepsiCo says a metro Atlanta company is illegally distributing a Mexican version of its soda in Georgia, according to a lawsuit pending in federal court.

PepsiCo, the beverage and snack foods giant based in Purchase, N.Y., alleges in the lawsuit that Clayton Distributing Co. violated trademark laws, committed fraud and engaged in unfair and deceptive trade practices by distributing Mexican Pepsi in the United States.

Clayton Distributing has not been authorized to distribute the Pepsi product, Pepsi said in the lawsuit filed in U.S. District Court in Atlanta.

The Mexican product also is not intended for distribution in the United States, the company said. The labels do not comply with Food and Drug Administration or PepsiCo standards for the United States and the product could deteriorate during shipping.

“The Mexican product is neither authorized nor intended for exportation out of Mexico,” Pepsi said in its filing.

The lawsuit was filed Dec. 17. The court records do not show a response yet by Clayton Distributing. Clayton lists Austell as its principal office and Kennesaw as the address for its registered agent.

Mexican versions of Coca-Cola and Pepsi have found a niche market in the United States both with Hispanic and non-Hispanic customers primarily because they use cane sugar as a sweetener. Most major beverage-makers switched to high-fructose corn syrup in the 1980s for their U.S. sodas, but the Mexican government has adopted policies that have encouraged the use of cane sugar in Mexico.

Pepsi filed a similar lawsuit in August against Grande Produce Ltd., a Hidalgo, Texas, company, for distributing Mexican Pepsi in southern Texas. Pepsi and Grande have reached a settlement but details have not been filed, according to court documents for that case.

— AJC staff researcher Richard Hallman contributed to this article.