Business Law Pepsis Harrier Jet Discussion

Week Five Discussion: Pepsi’s Harrier Jet
Watch the following advertisement:
Pepsi Harrier Jet Commercial 1 (Links to an external site.)
Please discuss the following case study and determine whether there should be a valid contract
between Leonard and Pepsi Co.
Pepsi Co ran an ad and promotional campaign in 1996 called the “Drink Pepsi Get Stuff” campaign. The
enormously successful campaign allowed customers to claim prizes in exchange for points on PepsiCo
beverage containers, and points could be combined with cash payments to obtain prizes. The campaign
was so successful that the second round of ads and promotions was not run because the prizes were
nearly exhausted.
In one television ad, Pepsi Co pictured a Harrier jet as a satirical spoof on the prizes available under the
campaign. The jet was offered in the ad for 7 million beverage points. Harrier jets are made only for the
Marine Corps and are not sold in the open market. They cost $33.8 million each and can be produced at
a rate of only one dozen at a time.
John Leonard, a 21-year-old business student, called Pepsi Co and was told he would need to drink 16.8
million cans of Pepsi in order to obtain the required points. He was also told that he had the option of
buying Pepsi Co points for 10 cents each. Leonard developed a pool of investors (Pepsi drinkers) and
delivered 15 PepsiCo points and a check for $700,008.50 for the remaining 6,999,985 points plus
shipping and handling.
PepsiCo refused to provide Leonard with a Harrier jet because it said the ad was not an offer but a joke.
Leonard filed sue but PepsiCo had already filed a pre-emptive suit asking that Leonard’s suit be
dismissed and declared frivolous and that PepsiCo should be reimbursed for its legal expenses.
(1) Define the elements of a contract?
(2) What are the elements of an offer and an acceptance?
(3) Did PepsiCo make an offer?
(4) Did Leonard accept?
(5) Was there a contract? Why or why not. Discuss.
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