Dr Pepper, bottler drop dueling disputes; DPS buys distribution, "Dublin" disappearing from label
Published in CSP Daily News
DUBLIN, Texas -- Dr Pepper Snapple Group Inc. and Dr Pepper Bottling Co. of Dublin, Texas, have resolved all litigation over the Dr Pepper trademark and distribution rights, the companies said last week. Under the terms of their agreement, DPS has--for an undisclosed sum--purchased all of the Dublin bottler's sales and distribution operations and related assets, as well as the rights to distribute Dr Pepper and other DPS brands in the six-county territory previously served by Dublin.
DPS will now distribute Dr Pepper sweetened with cane sugar throughout Dublin's former territory, and continue to sell it in other areas of Texas, including Dallas/Fort Worth, Houston and Waco. It is the same product Dublin sold, DPS said. It will still be bottled and canned in distinct, nostalgic packaging; however, it will not reference Dublin on the label.
With the central issues of trademark infringement and territorial selling rights resolved, DPS is dropping the federal lawsuit it filed in June, and Dublin is dropping its state countersuit.
In its suit, DPS said Dublin Dr Pepper was selling Dr Pepper beyond the six-county territory designated in its license agreement. The suit also sought to end what it said was the bottler's "unauthorized use" of the term "Dublin Dr Pepper" on product packaging and on other merchandise. DPS asked a federal court to terminate its licensing agreement with Dublin Dr Pepper and to prevent sales of the beverage on Dublin Dr Pepper's website and via its toll-free number.
The bottler's countersuit cited DPS documents that showed inconsistent positions taken by DPS on the issue, including its support of the Dublin brand for decades and promoting online and phone sales of Dublin Dr Pepper.
The company began selling Dr Pepper in Texas in 1891, said the Wall Street Journal. With about $7 million in annual revenue, it sells less than 1% of Dr Pepper's overall volume.
Dublin Dr Pepper's cachet had grown in recent years as it touted that it had always used cane sugar to sweeten its soft drinks, unlike most U.S. bottlers who switched to high-fructose corn syrup in the 1970s. It also increasingly sold its version of Dr Pepper through its website, alongside other "Dublin Dr Pepper" paraphernalia including coffee mugs and clocks.
Jeff Kloster, vice president of the Dublin bottler, told the newspaper that his family-controlled company laid off 14 of its 37 workers Wednesday following the settlement. "It's a sad day, but we needed some certainty,'' he added.
The former Dr Pepper bottler now is doing business as Dublin Bottling Works Inc. It will continue to produce other soft drinks at its bottling facility and operate its museum and Old Doc's Soda Shop, offering tours and selling soft drinks, food and officially licensed Dr Pepper merchandise.
"We want to thank our many customers for their support of our family-owned business during the past 120 years, and we want them to know that Dr Pepper is still a big part of Dublin," said Jeff Kloster, vice president of Dublin Bottling Works. "We hope customers will continue to visit our town, the W.P. Kloster Museum and Old Doc's Soda Shop, where they can still enjoy Dr Pepper sweetened with cane sugar."
Rodger L. Collins, president of packaged beverages for DPS, said the company is committed to a seamless transition for Dublin's local customers and consumers.
"Our main focus has always been on protecting the strength and integrity of the Dr Pepper trademark," said Collins. "We're pleased to reach an agreement that accomplishes that while also preserving the history and the special relationship Dr Pepper has with the Dublin community."
DPS will continue to support the popular "Dr Pepper, Texas," celebration as well as the related "10-2-4k" run held each June in Dublin.
Dublin Bottling Works is one of the oldest producers and distributors of bottled soda in the United States, with a legacy dating back more than 120 years. Located in Dublin, Texas, the privately owned company provides a variety of distinctive sodas made with pure cane sugar, including Triple XXX Root Beer, NuGrape, SunCrest and a variety of other custom flavors. Dublin Bottling Works also operates Old Doc's Soda Shop and the W.P. Kloster Museum, home to one of the world's largest collections of Dr Pepper memorabilia.
Dr Pepper Snapple Group Inc., Plano, Texas, is a leading producer of flavored beverages in North America and the Caribbean. In addition to its flagship Dr Pepper and Snapple brands, its portfolio includes Sunkist soda, 7UP, A&W, Canada Dry, Crush, Mott's, Squirt, Hawaiian Punch, Peñafiel, Clamato, Schweppes, Venom Energy, Rose's and Mr & Mrs T mixers.