Parent Company of LaCroix Plummets After Lawsuit

Shares of National Beverage, the parent company of LaCroix, have fallen to a multiyear low after Wall Street learned about a lawsuit against the company.

The lawsuit claims that National Beverage President Joseph Caporella fired an employee who objected to false statements about the chemicals in LaCroix cans.

National Beverage commented, “false statements were made in litigation brought by a former employee seeking to extract a monetary recovery from the company. We intend to vigorously defend our company and our brands against false claims brought by this disgruntled former employee.”

Shares hit their lowest price since 2016 on Tuesday following news of the lawsuit.

Former employee Albert Dejewski filed the lawsuit in New Jersey and alleges that he had been fired after he objected to the plan to falsely say that LaCroix cans did not contain a chemical called Bisphenol A, also known as BPA.
National Beverage stated to CNBC, “All LaCroix beverages are now produced in cans without BPA liners. We began converting to BPA-free liners two years ago, and continued as suppliers were able to supply cans. As of April 2019, all cans produced for LaCroix products were produced without BPA liners.”

Earlier this year, National Beverage said an independent, accredited lab found that LaCroix did not contain traces of artificial or synthetic additives.

Caporella had responded with, “We are truly sorry for these results stated above. Negligence nor mismanagement nor woeful acts of God were not the reasons – much of this was the result of injustice! Managing a brand is not so different from caring for someone who becomes handicapped. Brands do not see or hear, so they are at the mercy of their owners or care providers who must preserve the dignity and special character that the brand exemplifies. It is important that LaCroix’s true character is not devalued intentionally − in any way. National Beverage Corp. is and will remain the preeminent innovator that adds zest and authenticity to the ‘sparkling water’ phenomenon in North America.”

“Additionally, gross margins were impacted by volume declines. Comparisons were further skewed by the adoption of the new tax act in the third quarter of the prior year, which included credits and rate reduction adjustments aggregating $11.3 million. Nothing herein mentioned has detracted from the ultimate value and future of our dynamic company.”

“There is no greater passion than the kind that creates the wonderful refreshment and contentment described as unique! No doubt, the sound and personality of the word LaCroix, coupled with the awesome experience of its essence and taste . . . is unique. One can be induced to purchase by cheapening price or giving away a product, but falling in love with a feeling of joy is the result of contentment. Just ask any LaCroix consumer . . . Would you trade away that LaLa feeling? ‘No way, they shout – We just love our LaCroix!’ I am positive they respond this way each and every time,” he concluded.

Disclaimer: We have no position in National Beverage Corp. (NASDAQ: FIZZ) and have not been compensated for this article.