General Mills Sues Chobani for False Yogurt Ad: Reports
General Mills, Inc. GIS has reportedly sued rival yogurt maker, Chobani, for advertising that the former’s Yoplait brand of yogurt contains “BugSpray”.
A TV advertisement released by Chobani earlier this month reportedly says that Yoplait Greek 100 contains potassium sorbate, which is used to kill bugs. It further says that Chobani’s 100-calorie Greek yogurt is the only brand which contains zero preservatives. General Mills’ lawsuit claims false advertising and requests Chobani to cease the ad campaign and compensate for damages.
General Mills witnessed weak sales in its Yogurt segment in the first half of fiscal 2016. The benefit from lower dairy prices was offset by intense competition. However, its Greek 100 calorie yogurt has done well. The company claims that a false ad campaign like this can “permanently harm its reputation”.
Reportedly, Dannon, another yogurt giant, sued Chobani for the same ad campaign which claimed that Dannon's Light & Fit yogurt contains an artificial sweetener processed with "added chlorine."
General Mills acquired 51% controlling interest in Yoplait S.A.S. and a 50% interest in a related entity which holds the worldwide Yoplait brands in fiscal 2012. With the acquisition, the company entered the fast growing food category of yogurt.
In December last year, the Zacks Rank #4 (Sell) company announced the acquisition of Parana-based Brazilian yogurt maker, Carolina, known for its yogurt brands – Carolina, VeryGurt and Gluck.
Stocks to Consider
Some better-ranked food stocks are Campbell Soup Company CPB, The Chefs' Warehouse, Inc. CHEF and Omega Protein Corporation OME. While Campbell Soup sports a Zacks Rank #1 (Strong Buy), The Chefs' Warehouse and Omega Protein have a Zacks Rank #2 (Buy).
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GENL MILLS (GIS): Free Stock Analysis Report
CAMPBELL SOUP (CPB): Free Stock Analysis Report
OMEGA PROTEIN (OME): Free Stock Analysis Report
CHEFS WAREHOUSE (CHEF): Free Stock Analysis Report
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