Friday, April 17, 2009

Corporate Filings - Scam Alert!

It's annual report filing season for Illinois corporations and LLC's. Many company annual reports are due during the first months of the year.

The Illinois Secretary of State has the following warning on its website about a company that is scamming businesses out of $150:

WARNING! A fraudulent company called "Illinois Corporate Compliance" is contacting Illinois businesses with a deceitful solicitation to collect a $150 fee to file corporate meeting minutes. This solicitation is an illegal scam - do not respond to it.
It's a good idea to make sure your corporation has prepared it annual meeting minutes, but the only place the minutes need to be filed are in your minute book!

Another company runs a similar scam by contacting trademark and patent holders with a deceitful solicitation regarding monitoring services. The notice looks very official and infers that the monitoring services are somehow affiliated with
the US Patent and Trademark Office. Here's what the USPTO says:
You may receive unsolicited communications from companies requesting fees for trademark related services, such as monitoring and document filing. Although solicitations from these companies frequently display customer-specific information, including USPTO serial number or registration number and owner name, companies who offer these services are not affiliated or associated with the USPTO or any other federal agency. The USPTO does not provide trademark monitoring or any similar services.
Be wary of any correspondence that looks like its from a government agency, but asks for a payment to a private company. When in doubt, do a quick search on the Internet for more information.


Tuesday, April 14, 2009

The New Pepsi Challenge: Gatorade v. Powerade

PepsiCo, Inc. sued Coca-Cola Co. over Coke's ad campaign touting the superiority of Powerade over Gatorade. Pepsi is claiming that Coke's ads are deceptive. Coke states that its sports drink is superior and Gatorade is "incomplete" because Powerade ION4 contains calcium and magnesium. According to Pepsi, that the amount of the minerals in Powerade ION4 is less than 0.5 percent of their recommended daily allowance and that most tap water contains more minerals.

It reminds me of when the FTC challenged an advertisement by Nestle that claimed Carnation Instant Breakfast has as much mineral nourishment as two slices of bacon. The problem? Bacon has no minerals.

The FTC encourages advertisers to run comparative ads - they're viewed as beneficial to consumers so long as they don't mislead. Coke's statement that Gatorade is incomplete without an insignificant amount of calcium and magnesium isn't a comparative ad - it is a claim and ad claims must be substantiated. Coke will have a tough time substantiating a claim that Gatorade is incomplete without an insignificant amount of minerals.

It looks like Coke might just lose the Pepsi challenge again.