Yesterday a jury trial began in Durant, Bryan County, Oklahoma, with prosecutors claiming substantial damages from Monster.
Ongoing litigation/regulatory matters cost the firm $5m alone in Q1 2014, and despite Monster’s persistent ability to outperform the wider energy sector in the States, are raising investor concerns.
The Wheat trial is expected to last about a week, and is the first of three ongoing so-called ‘product liability and wrongful death’ claims hanging over the energy drinks giant to reach the trial stage.*
Coupled with wider attention in the US on safety issues surrounding energy drinks, this means the case will attract much media and industry interest.
Angela Wheat claims her 16 year-old son Jason Hamric drank a can of Monster Energy in November 2011, and later had a heart attack while working at Fairview Baptist Church.
Hamric survived, but Wheat’s lawsuit filed on January 23 2013 lawsuit against Monster and its distributor states that he still suffers from medical problems as a result of the incident she says resulted from his consuming Monster Energy, including slurred speech and memory problems.
Yesterday prosecutors working for Burrage Law Firm in Durant claimed in their opening remarks that Monster failed to properly label products; Wheat’s suit claims the drink was a “defective product” given “undisclosed high levels of caffeine” and other ingredients she says were dangerous.
Monster denies these claims, and told the court yesterday that the teen had a history of medical problems, while there was no proof he’d actually drunk Monster Energy before he collapsed.
News of the suit sent Monster’s share price down 4.53% to $64.74/share yesterday, and in a media statement released last night in response to media enquiries, the company said there was “no credible evidence” that Hamric even drank Monster Energy on that day in 2011.
A pastor at the church said he saw the teen with a ‘silver can’ on the day of the incident, Monster admits, but the brand says it had no product on sale that was even close to that description in 2011.
“We are truly sorry about Jason’s injury, but we are confident that once all the evidence is heard, it will be shown that Monster had no responsibility in this case,” the company said.
The company reiterated a claim it has made numerous times before. Namely, that 12bn Monster Energy drinks have been sold over the last 12 years, which “has shown that our products are safe”.
“Contrary to allegations, they are not ‘highly caffeinated’ and they are not marketed to children,” the company adds.
*The other cases are Wendy Crossland et al. v. Monster Beverage Corporation (concerning the death of Anais Fournier) and Paula Morris v. Monster Beverage Company (over the death of Alex Morris).