PHILADELPHIA - The company behind Splenda knew consumers were confused about whether the sweetener contained sugar, but made ambiguous statements to avoid being tagged an artificial sweetener, an attorney for rival Equal said Thursday.
An expensive food fight within the $1.5 billion market for sugar substitutes goes to a jury Friday after a monthlong trial over Splenda's marketing slogan, "Made from sugar so it tastes like sugar."
Merisant Co., which makes Equal, accuses Splenda's marketers of misleading consumers and eroding Equal's sales.
McNeil rejected a plan to add the phrase "does not contain sugar" to the front of Splenda's yellow box, words that might have cleared up the confusion, Merisant lawyer Gregg LoCascio said.
"It was good for business," LoCascio said in his closing argument Thursday.
Instead, McNeil tried to position the sweetener as a natural product - a spin that defrauded consumers and cost Equal millions in lost sales and profits, he said.
McNeil Nutritionals, which markets Splenda, calls the lawsuit sour grapes.
The company says consumers prefer the taste of Splenda, leading to its huge market gains since its 2000 debut.
"That is a marketing advantage that Splenda has been able to exploit over the years," Splenda lawyer Steven Zalesin told jurors.
The active ingredient in Splenda is sucralose, which starts as pure cane sugar before it is chemically altered to create a compound that contains no calories, according to McNeil. The final product contains no sugar.
Still, McNeil can accurately claim that Splenda is "made from" sugar, Zalesin said.
The company's own consultants reported that the slogan confused many potential customers, some of whom thought that Splenda was sugar without the calories, LoCascio said. Nearly half the consumers in one marketing study thought it contained at least some sugar.
And McNeil chose to sell it in yellow packaging to match the color used by Domino sugar, LoCascio said.
Splenda is used in more than 4,000 food and drink products, from Diet Coke to Juicy Fruit gum. Separately, it had 60 percent of the consumer artificial sweetener market last year, according to the research firm Information Resources Inc.
Equal, which comes in blue packets and is made with aspartame, and Sweet'N Low, in pink packets and made with saccharin, each held about 14 percent of the consumer market.
"There is a public interest in avoiding and preventing misleading advertising," argued LoCascio, who said McNeil violated a federal law that bars such claims.
McNeil says it simply has a better product with better marketing. It told jurors it has spent $234 million promoting Splenda, more than twice the $108 million spent on Equal in the same period.
Chicago-based Merisant charges that McNeil made at least $183 million in unfair profits since 2003 and that Merisant lost at least $25 million in sales because of Splenda's "sugar" claim.
McNeil, a unit of Johnson & Johnson based in suburban Philadelphia, markets Splenda for its manufacturer, London-based Tate & Lyle PLC. It is also defending its Splenda advertising claims in a separate lawsuit in California filed by a group of U.S. sugar manufacturers.