Lawsuit To Protect Secret Pepsi-Cola Documents

Richard John Ritchie is credited with developing the original, commercially successful formula for Pepsi-Cola in 1931. Loft Inc. was a candy company that that hired Ritchie in 1931. The president acquired in his own name the Pepsi-Cola company that was bankrupt at the time. He wanted to replace the costly Coca-cola syrup with a more affordable one. That is when Ritchie stepped in to formulate the Pepsi-Cola syrup. The Loft candy shop took a nosedive, but ten years later, Loft renamed itself the Pepsi-Cola company. During that same year, Ritchie wrote down the Pepsi-Cola formula, and it was locked in a bank vault.

Ten years after that, Ritchie signed an agreement to become an outside consultant – this agreement annulled a previous agreement that prohibited him from claiming the formula because it cancelled all superseding agreements between Pepsi and Mr. Ritchie. The noncompete clause of the agreement expired in 1959 and Ritchie joined a competitor C&C and developed a formula for them. Ritchie honored the provision of the contract against “voluntary disclosures until he died in 1985. In 2008, one of Ritchie’s sons, who has since passed of Parkinsons, received three boxes that contained secret documents, including the formula.

Pepsi claims that the formula is a trade secret and has threatened to sue Ritchie’s heirs if they reveal the documents. Ritchie’s heirs are seeking an injunction to stop Pepsi from preventing them from revealing the documents and a declaratory judgment stating that their family owns the documents.

See Heirs of Pepsi Inventor to Sue to Release Formula, Courthouse News Service, May 18, 2012.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.