Bang Energy, PepsiCo ‘meteoric partnership’ flames out in litigation

Just eight months ago, the CEO of Bang Energy, Jack Owoc, boasted[1] an alliance with PepsiCo would fuel a “meteoric partnership, one for the beverage history books.”

The agreement granted PepsiCo the rights to exclusively distribute Bang Energy beverages in the U.S.

The partnership has burst into flames. In October, the manufacturer of Bang Energy—Vital Pharmaceuticals Inc., doing business as VPX Sports—notified PepsiCo that it was terminating the distribution agreement.

Relations between VPX and PepsiCo have further deteriorated. On Nov. 25, VPX sought a preliminary injunction in Federal District Court in Florida against PepsiCo.

“Unfortunately, we were blindsided and bamboozled,” Owoc stated in a press release[2] announcing the lawsuit.

PepsiCo hadn’t responded to the complaint as of Dec. 2, but it’s plausible the beverage behemoth will argue the dispute between the entities shouldn’t be settled in the judiciary. PepsiCo recently filed for arbitration with the American Arbitration Association, VPX disclosed in its complaint accompanying the motion.

The complaint alleged breach of the distribution agreement, as well as tortious interference with business relationships. Although several paragraphs of VPX’s complaint are focused on the distribution agreement, including one related to PepsiCo’s obligations, many portions have been redacted in the public court filing due to confidentiality.

VPX is seeking a preliminary injunction that would bar PepsiCo from stating in communications with VPX’s customers or independent wholesale distributors that PepsiCo is the exclusive distributor of the licensed products. VPX also wants the Federal District Court to enjoin PepsiCo from discouraging or deterring VPX’s customers or independent wholesale distributors from buying the licensed products from VPX or its independent distributors.

“Pepsi’s actions have caused incalculable and irreparable harm, and unless enjoined, will continue to cause such harm to VPX, the Bang Brand and the VPX distribution network and other operations worth billions of dollars,” VPX, based in Weston, Fla., proclaimed in its motion for a preliminary injunction.

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