WEBVTT - The Cola Contest With 600,000 Winners 0:00:00.160 --> 0:00:02.800 Hi, I'm Carol Masser and I'm Jason Kelly. It's time 0:00:02.840 --> 0:00:05.640 to listen to one of this week's feature stories. While 0:00:05.640 --> 0:00:10.920 in May two millions of Filipinos turned on the evening news, 0:00:11.119 --> 0:00:14.000 Pepsi was about to announce the winning numbers for a 0:00:14.120 --> 0:00:18.840 special promotion called Number Fever that was gripping the nation. Jason, 0:00:18.880 --> 0:00:21.440 it certainly was, and a three digit number had been 0:00:21.440 --> 0:00:24.599 printed on the underside of bottle caps. A million pacos. 0:00:24.680 --> 0:00:27.720 That's about sixty eight thousand dollars, you asked in today's dollars. 0:00:28.080 --> 0:00:31.000 It was the largest prize available that published odds of 0:00:31.000 --> 0:00:34.280 winning that amount, where twenty eight point eight million to one. 0:00:34.440 --> 0:00:36.760 Number Fever was such a success that Pepsi began to 0:00:36.840 --> 0:00:40.479 challenge Coca Cola's long time dominance. Monthly sales were jumping 0:00:40.520 --> 0:00:43.840 to fourteen million dollars from ten million dollars, market share 0:00:44.120 --> 0:00:48.040 was growing to from nineteen percent, and then the winning 0:00:48.120 --> 0:00:52.000 number was announced three hundred forty nine. What ensued was 0:00:52.040 --> 0:00:55.480 perhaps the deadliest marketing disaster in history, and it remains 0:00:55.520 --> 0:00:59.000 one of the business world's great cautionary tales. And error 0:00:59.080 --> 0:01:02.200 at a bottling plan led to six hundred thousand winners, 0:01:02.320 --> 0:01:06.520 not to mention lawsuits, riding, and even deaths. The Coola 0:01:06.640 --> 0:01:12.280 contest with six hundred thousand winners decades ago. Pepsi's number 0:01:12.280 --> 0:01:16.040 of fever promotion captivated consumers and promised to end Coke's 0:01:16.080 --> 0:01:19.360 dominance in the Philippines, but an error at a bottling 0:01:19.400 --> 0:01:26.120 plant led to disaster. By Jeff Maisch. Marily So, a 0:01:26.160 --> 0:01:29.400 woman in her early fifties with graying hair, runs a 0:01:29.480 --> 0:01:32.000 Sorry Sorry store out of her one room home in 0:01:32.040 --> 0:01:35.720 a concrete building beside a railway track in Manila. In 0:01:35.760 --> 0:01:39.280 the steamy heat of a summer afternoon, Shirtless children appear 0:01:39.319 --> 0:01:43.160 at her window clutching coins. With a kind smile, she 0:01:43.240 --> 0:01:46.720 serves them warm bottles of water and Royal True, one 0:01:46.720 --> 0:01:50.280 of a few sodas she displays, alongside tiny shampoo, seshets 0:01:50.640 --> 0:01:54.960 and single cigarettes. There's one brand she refuses to sell. 0:01:55.640 --> 0:01:59.600 If someone asks for a Pepsi, her expression sours. For 0:01:59.680 --> 0:02:02.560 more than twenty eight years, she's nurtured bitter resentment against 0:02:02.600 --> 0:02:05.760 the company. I didn't have a job back then, she says, 0:02:06.240 --> 0:02:10.480 starting in on her Pepsi story. It was six pm 0:02:10.560 --> 0:02:15.800 on ma and So was among the seventy of Filipinos 0:02:15.840 --> 0:02:19.920 watching the Channel two evening news. Then twenty three, she 0:02:20.040 --> 0:02:22.160 was living in a wooden shack beside the tracks with 0:02:22.240 --> 0:02:25.760 four children under five. Pepsi was about to announce the 0:02:25.800 --> 0:02:28.320 winning number in a promotion that had gripped the Philippines 0:02:28.400 --> 0:02:32.799 sixty five million people. Her husband, a house painter, had 0:02:32.800 --> 0:02:36.760 spent their last centavos on special number fever bottles of Pepsi, 0:02:37.200 --> 0:02:39.359 hoping one of the three digit numbers printed on the 0:02:39.440 --> 0:02:41.880 underside of the caps would match one of the winning 0:02:41.960 --> 0:02:46.359 numbers locked inside a vault. Across the Philippines seven thousand, 0:02:46.440 --> 0:02:49.880 six hundred and forty one islands. Ads had promised people 0:02:50.280 --> 0:02:54.040 you could be a millionaire. A million pesos worth about 0:02:54.040 --> 0:02:57.800 sixty eight thousand dollars today was the largest prize available, 0:02:58.120 --> 0:03:00.760 six hundred and eleven times the country his average monthly 0:03:00.800 --> 0:03:03.920 salary at the time. The published odds of winning that 0:03:03.960 --> 0:03:07.000 amount were twenty eight point eight million to one, but 0:03:07.040 --> 0:03:11.520 Pepsi had already minted eighteen millionaires. They appeared in its ads. 0:03:11.720 --> 0:03:16.000 Realist A one. A bus driver named Nema Balmas became 0:03:16.040 --> 0:03:19.160 known as Mrs Pepsi after joking that drinking cola put 0:03:19.200 --> 0:03:22.799 her husband in the mood. Number of Fever was the 0:03:22.840 --> 0:03:26.480 brainchild of an executive named Pedro Virgara, a Chilean who 0:03:26.480 --> 0:03:29.480 worked for the promotions department in New York. After a 0:03:29.560 --> 0:03:34.440 successful US rollout, Pepsi Coli International Chief Executive Officer Christopher 0:03:34.440 --> 0:03:37.320 Sinclair made it part of his strategy to fight Coca 0:03:37.320 --> 0:03:41.520 Cola abroad. Since becoming the global arms youngest CEO at 0:03:41.560 --> 0:03:45.840 thirty eight, Sinclair had developed a reputation as a battlefield commander, 0:03:46.560 --> 0:03:50.200 visiting seventies seven countries in six months. He was dismayed 0:03:50.200 --> 0:03:53.320 to find the world's grocery aisles awash with Coca cola 0:03:53.360 --> 0:03:57.880 red as Fortune put it. Pepsi hired a Mexican company, 0:03:58.320 --> 0:04:03.440 d G Consultaures to bring Number Fever to Argentina, Chile, Guatemala, Mexico, 0:04:03.520 --> 0:04:07.840 and the Philippines, where it truly caught fire. Monthly sales 0:04:07.880 --> 0:04:11.680 there quickly jumped from ten million dollars to fourteen million dollars, 0:04:11.680 --> 0:04:14.160 and its market share from nineteen point four percent to 0:04:14.200 --> 0:04:18.920 twenty four point nine. Bottling plants roared twenty hours a day, 0:04:19.360 --> 0:04:24.000 doubling their usual production. An aggressive ad campaign dominated the media, 0:04:24.200 --> 0:04:27.640 with twenty nine radio stations and four newspapers circulating the 0:04:27.640 --> 0:04:31.760 winning numbers. The promotion, initially scheduled to end on May eighth, 0:04:32.279 --> 0:04:36.480 was extended five weeks. By then, number fever was verging 0:04:36.520 --> 0:04:40.679 on number hysteria. Cops jailed a maid accused of stealing 0:04:40.680 --> 0:04:43.880 her employer's winning crown. As the bottle caps were known. 0:04:44.520 --> 0:04:47.640 Two Pepsi sales people were murdered following a dispute over 0:04:47.680 --> 0:04:52.679 another crown. The night of May, so murmured a prayer 0:04:52.760 --> 0:04:55.440 as the blue of the television shown her children's eyes. 0:04:55.839 --> 0:04:59.360 When Pepsi announced the winning number, her husband is Sagani, 0:04:59.800 --> 0:05:02.680 r fold through their crowns and found the one three 0:05:02.839 --> 0:05:07.600 forty nine, a million paceos. Her prayer had been answered. 0:05:07.839 --> 0:05:10.280 The couple danced and laughed until the TV started to 0:05:10.360 --> 0:05:12.960 rattle in a passing freight train drowned out their shrieks 0:05:12.960 --> 0:05:17.600 of joy. Five miles across town, Ernesto did Guzman Dalima, 0:05:17.920 --> 0:05:21.560 a tricycle taxi driver, was dashing downstairs to tell his nephew, 0:05:21.600 --> 0:05:24.479 Simon Marcello that his three forty nine crown had just 0:05:24.560 --> 0:05:29.200 won him fifty thousand paceos. Marcello was already celebrating he 0:05:29.279 --> 0:05:32.200 had a three forty nine worth a hundred thousand paceos, 0:05:32.320 --> 0:05:34.320 enough to quit his job as a cocktail waiter in 0:05:34.320 --> 0:05:38.000 the city's red light district. Similar scenes were playing out 0:05:38.040 --> 0:05:41.680 across the country. A bus driver had three one million 0:05:41.680 --> 0:05:45.159 paso three forty nine. A mother of twelve whose children 0:05:45.200 --> 0:05:47.760 went through ten bottles of Pepsi a day had won 0:05:47.839 --> 0:05:51.920 thirty five million paceos. Winners raced to the iron gates 0:05:51.920 --> 0:05:55.359 of Pepsi's bottling factory in Quezon City, just northeast of 0:05:55.360 --> 0:05:59.160 Manila to claim their prizes. As the crowd grew, a 0:05:59.240 --> 0:06:03.080 secretary die out. The marketing director Rosemarie Vera. There seems 0:06:03.120 --> 0:06:06.720 to be many three crowns in circulation among people I know, 0:06:06.960 --> 0:06:09.920 the secretary said, According to an account in the Philippine 0:06:10.000 --> 0:06:14.160 Daily Inquirer, at ten PM, someone from the company telephoned 0:06:14.160 --> 0:06:16.880 the Philippine Department of Trade and Industry and said a 0:06:16.920 --> 0:06:21.000 mistake had been made. Within a year, a violent consumer 0:06:21.080 --> 0:06:24.599 uprising would be underway, with riots and grenade attacks, leaving 0:06:24.680 --> 0:06:28.799 dozens injured and five dead. It was perhaps the deadliest 0:06:28.839 --> 0:06:32.200 marketing disaster in history and remains one of the business 0:06:32.240 --> 0:06:36.000 world's great cautionary tales. I don't think that from the 0:06:36.040 --> 0:06:38.560 onset people would look at this and say people could 0:06:38.560 --> 0:06:42.880 actually die, says Lee Auster, a University of Idaho professor 0:06:42.920 --> 0:06:45.479 and the co author of a risk management textbook that 0:06:45.560 --> 0:06:48.919 included number fever as a case study. But even then, 0:06:49.000 --> 0:06:52.359 like the nuclear power industry or aviation, people have to 0:06:52.360 --> 0:06:54.960 be on top of things and realize that catastrophic events 0:06:55.000 --> 0:06:57.839 that can happen at the end. In response to a 0:06:57.880 --> 0:07:00.920 request for comment on the events described in this story, 0:07:01.240 --> 0:07:04.920 Pepsi said it would be unable to verify them. These 0:07:04.920 --> 0:07:07.680 events took place almost thirty years ago, and none of 0:07:07.680 --> 0:07:11.400 the executives familiar with this programer at PepsiCo anymore, and 0:07:11.400 --> 0:07:13.640 given that the Philippines is just emerging from one of 0:07:13.680 --> 0:07:17.120 the world's longest COVID lockdowns, we have been unable to 0:07:17.200 --> 0:07:20.960 access stored records on this matter, the company wrote, but 0:07:21.200 --> 0:07:24.600 it said we deeply regret any pain and suffering our 0:07:24.720 --> 0:07:30.520 mistake caused the people of the Philippines. America dominates many 0:07:30.560 --> 0:07:34.280 aspects of Filipino life, from the kaleidoscope of beverages and 0:07:34.400 --> 0:07:37.840 most sorry Sorry stores to a fondness for swing dancing 0:07:37.880 --> 0:07:41.120 and apple pie. The US took control of the islands 0:07:41.120 --> 0:07:45.760 from Spain in eight after defeating the country's revolutionary government 0:07:45.800 --> 0:07:49.240 in a vicious three year war. It established military bases 0:07:49.280 --> 0:07:53.160 and colonial rule, and its influence remained long after independence. 0:07:53.200 --> 0:07:59.440 In the US, interfered in presidential elections, tacitly supported Ferdinand 0:07:59.480 --> 0:08:03.280 Marcos during his brutal two decades of rule, and generally 0:08:03.400 --> 0:08:06.000 used the country as proxy turf for the Cold War, 0:08:07.120 --> 0:08:10.600 sometimes in bizarre ways. At one point, the CIA helped 0:08:10.640 --> 0:08:14.640 suppress a communist peasant rebellion by faking vampire attacks to 0:08:14.720 --> 0:08:20.480 scare superstitious guerrillas into leaving their positions. Two American companies 0:08:20.560 --> 0:08:23.640 also used the Philippines for a different kind of proxy war. 0:08:24.240 --> 0:08:27.320 PepsiCo and Coca Cola duked it out there in ways 0:08:27.360 --> 0:08:30.320 that would never have been allowed in the US, employing 0:08:30.440 --> 0:08:33.680 espionage and other dirty tricks. At one point, during the 0:08:33.720 --> 0:08:36.960 Marco Sarah, Pepsi executives were caught cooking the books to 0:08:36.960 --> 0:08:40.360 show higher sales than Coke, forcing a ninety million dollar 0:08:40.520 --> 0:08:44.119 right off. Coke kept the upper hand mainly by undercutting 0:08:44.160 --> 0:08:48.160 Pepsi's prices. By it had expanded its share of the 0:08:48.160 --> 0:08:52.000 cola market to so high that it no longer bothered 0:08:52.040 --> 0:08:56.440 to advertise number of fever hit Coke like a sucker punch. 0:08:56.920 --> 0:09:01.920 Rodolpho Salazar, president of Pepsicola Product Philippines, boasted that half 0:09:01.920 --> 0:09:05.920 the country's population was participating, making it the most successful 0:09:06.000 --> 0:09:10.240 marketing promotion in the world. As Pepsi's sales jumped, Coke 0:09:10.280 --> 0:09:14.800 executives scrambled unsuccessfully to devise their own promotional game, even 0:09:14.920 --> 0:09:19.280 recalls Barbara Gonzalez, Coke's former corporate communications director in the Philippines, 0:09:19.679 --> 0:09:22.360 buying a whole truck of bottles to find out what 0:09:22.520 --> 0:09:25.080 is the ratio of what we call the seating the 0:09:25.080 --> 0:09:29.880 winning crown to the non winning. Coke's Filipino president Jesus 0:09:30.000 --> 0:09:33.400 King King Seldran, a World War Two hero who sometimes 0:09:33.400 --> 0:09:37.080 showed up at bottling factories in a tank, publicly admitted 0:09:37.120 --> 0:09:40.840 he was concerned. There was reason to be skeptical, though 0:09:40.880 --> 0:09:44.000 that the promotion would end as a clear win for Pepsi. 0:09:44.320 --> 0:09:47.720 During the rollout in Chile earlier that year, a garbled 0:09:47.760 --> 0:09:51.200 facts had led a wrong number to be announced, triggering riots, 0:09:51.679 --> 0:09:55.200 and swindlers in the Philippines were creating fake winning crowns, 0:09:55.760 --> 0:09:58.920 leading people to claim they'd been wrongly denied prizes. Even 0:09:58.960 --> 0:10:03.400 before the three fort nine. Error emerged when disaster struck on. 0:10:04.520 --> 0:10:08.600 Pepsi initially tried to change the winning number. Newspapers reported 0:10:08.600 --> 0:10:11.160 the next morning that the real number was one thirty four, 0:10:11.640 --> 0:10:15.120 only adding to the confusion, the company locked the factory 0:10:15.160 --> 0:10:18.440 gates in Quezon City, and by mid morning policemen and 0:10:18.480 --> 0:10:21.400 soldiers were wrestling with three forty nine holders who were 0:10:21.480 --> 0:10:25.280 lobbing rocks at the building. Executives inside, we're trying to 0:10:25.280 --> 0:10:29.520 phone headquarters in New York, but Sinclair was unreachable, schmoozing 0:10:29.559 --> 0:10:32.560 on a yacht at an annual gathering of bottlers, according 0:10:32.600 --> 0:10:36.520 to a report in Asia Week magazine. Sinclair declined to 0:10:36.600 --> 0:10:41.080 comment for this story. Protests carried on through the next night. 0:10:41.600 --> 0:10:44.480 At three am, Pepsi decided it would pay three forty 0:10:44.520 --> 0:10:47.679 nine holders who came forward over the following two weeks, 0:10:47.720 --> 0:10:52.520 a goodwill gesture of five paces. Executives calculated that if 0:10:52.559 --> 0:10:55.160 half the six thousand crowns that had been minted with 0:10:55.160 --> 0:10:57.920 the number three forty nine were cashed in, the damage 0:10:57.920 --> 0:11:02.920 would be contained at six million dollars. Among those assembled 0:11:02.920 --> 0:11:06.960 outside the factory was Vicente del Fierro Jr. An advertising 0:11:07.000 --> 0:11:10.920 consultant and a preacher for a charismatic Catholic sect. Del 0:11:10.960 --> 0:11:14.720 Fierro had called the promotion a social disease that nurtures 0:11:14.760 --> 0:11:17.560 the gambling instinct in our children in an open letter 0:11:17.600 --> 0:11:21.679 to a newspaper, but despite his opposition, his daughter Simbelle 0:11:21.760 --> 0:11:24.720 held a winning crown. He later wrote that he saw 0:11:24.800 --> 0:11:27.960 security guards tossing glass soda bottles at the crowd, and 0:11:28.000 --> 0:11:30.600 that a policeman charged at him with a riot shield. 0:11:31.160 --> 0:11:33.840 He took cover at a nearby Duncan donuts, jammed with 0:11:33.880 --> 0:11:39.319 agitated winners. Outside, Pepsi trucks rumbled past, flanked by guards 0:11:39.320 --> 0:11:43.160 carrying automatic weapons. A manager tried to escape the factory, 0:11:43.480 --> 0:11:47.160 but protesters threw stones at him. A bomb threat would follow. 0:11:47.200 --> 0:11:50.760 Hours later, Del Fierro stood on a table at the 0:11:50.800 --> 0:11:54.880 donut shop and demanded quiet. Then he asked for volunteers 0:11:54.920 --> 0:11:57.880 to draw up a list of winners names. As reporters 0:11:57.920 --> 0:12:01.679 gathered around, he announced a crusade, aid it's about Third 0:12:01.679 --> 0:12:08.040 world countries being exploited by multinationals. He said many three 0:12:08.160 --> 0:12:11.760 forty nine holders took up Pepsi's offer of five pesos 0:12:11.800 --> 0:12:14.880 for their crowns. In the first two days, the company 0:12:14.880 --> 0:12:17.280 paid out more than twelve and a half million pesos. 0:12:18.040 --> 0:12:20.600 The final bill ended up close to ten million dollars. 0:12:20.640 --> 0:12:23.760 According to Asia Week, It didn't take long for Pepsi 0:12:23.800 --> 0:12:26.520 to trace the source of the error. Three forty nine 0:12:26.559 --> 0:12:29.679 designated a non winner in the original promotion had been 0:12:29.720 --> 0:12:33.120 mistakenly chosen as a winner for the contest extension. The 0:12:33.200 --> 0:12:36.320 company reported that crowns from the extension had been printed 0:12:36.320 --> 0:12:39.360 with a different seven digit security code, and that none 0:12:39.400 --> 0:12:43.920 of these would be honored. The explanation didn't appease the protesters, 0:12:44.320 --> 0:12:47.520 as del Fierro rallied support for his campaign, which he 0:12:47.600 --> 0:12:50.960 called Coalition three forty nine. He got an early boost 0:12:51.000 --> 0:12:55.920 from an unlikely source, Celdron Coke's local CEO, who instructed 0:12:55.920 --> 0:12:59.800 an employee to offer del Fierro ten thousand pesos start 0:12:59.840 --> 0:13:02.920 up money. According to the now former staffer, who spoke 0:13:02.960 --> 0:13:06.240 on condition of anonymity, can I have a megaphone? The 0:13:06.240 --> 0:13:10.920 employee recalls del Fierro asking when the contribution arrived. Sel 0:13:10.960 --> 0:13:15.680 Dron passed away in Coke didn't respond to emailed requests 0:13:15.679 --> 0:13:20.920 for comment. Coalition three forty nine organized rallies outside Pepsi plants, 0:13:21.240 --> 0:13:24.559 where del Fierro would yell into his new p A system. 0:13:24.600 --> 0:13:27.400 He also started preparing a lawsuit he hoped would win 0:13:27.559 --> 0:13:31.960 class action status, promising crown holders a huge settlement. He 0:13:32.040 --> 0:13:35.000 accepted five pesos for legal fees from those who could 0:13:35.000 --> 0:13:37.760 afford it, and worked pro bono for those who couldn't. 0:13:38.240 --> 0:13:41.840 De Guzman Dalina, the Manila taxi driver, arrived with his 0:13:41.920 --> 0:13:44.760 nephew at del Fierro's house one night, not long after 0:13:44.800 --> 0:13:47.800 the draw, to find three forty nine holders lined up 0:13:47.840 --> 0:13:52.479 around the block. Inside. Del Fierro's wife, Nori, a glamorous 0:13:52.520 --> 0:13:56.800 cookbook author, was making food for the crowd. Del Fierro 0:13:56.920 --> 0:13:59.200 said he'd take the fight all the way to New York, 0:13:59.440 --> 0:14:02.960 a city he knew mainly from Frank Sinatra songs. We 0:14:03.000 --> 0:14:05.920 are committed to pursue this crusade until the very end, 0:14:06.080 --> 0:14:09.319 he wrote in a letter to the Manila Chronicle. God 0:14:09.480 --> 0:14:12.760 is definitely bigger than the fiftieth largest corporation in the world. 0:14:13.520 --> 0:14:18.000 When the story hit international papers, Kenneth Ross, PepsiCo International's 0:14:18.040 --> 0:14:23.080 primary spokesman, portrayed the activists as opportunists. Quick buck artists 0:14:23.080 --> 0:14:26.720 have lured thousands of unwinning Filipinos with very empty promises 0:14:26.720 --> 0:14:29.320 of a huge settlement for the payment of an upfront fee. 0:14:29.440 --> 0:14:33.920 He told the associated press. Groups with names such as 0:14:34.040 --> 0:14:37.400 United three forty nine and Solid three forty nine actually 0:14:37.440 --> 0:14:40.120 were charging fees, with some asking as much as a 0:14:40.120 --> 0:14:44.800 thousand pesos for membership. Maralissa and her husband signed up 0:14:44.800 --> 0:14:48.320 with the preacher brother Bambi Santos, who said God had 0:14:48.360 --> 0:14:51.320 called him to fight Pepsi. They agreed to pay him 0:14:51.360 --> 0:14:54.600 thirty of any future settlements and joined his rallies and 0:14:54.640 --> 0:14:58.720 protests in the provinces. Farmers were reported to be selling 0:14:58.720 --> 0:15:01.800 their cattle to afford the ernie to Manila, and the 0:15:01.880 --> 0:15:07.800 chaos continued. Protesters in Quezon City burned tires, Speculators offered 0:15:07.840 --> 0:15:10.520 wads of cash for three forty nine in hopes of 0:15:10.520 --> 0:15:14.240 a bigger payoff later. Even police weren't immune to the frenzy. 0:15:14.640 --> 0:15:18.160 One National Bureau of Investigation officer arrived at the Kaezon 0:15:18.200 --> 0:15:21.320 City plant with an empty attache case to carry home 0:15:21.400 --> 0:15:25.280 his million pasos. Pepsi either pays, he told a reporter, 0:15:25.640 --> 0:15:29.360 or they closed down. As days turned into weeks and 0:15:29.400 --> 0:15:33.440 then months, some ten thousand claimants filed suits demanding money. 0:15:34.040 --> 0:15:38.520 Molotov cocktails crashed into Pepsi factories and dozens of delivery trucks, 0:15:38.840 --> 0:15:42.360 their drivers dousing the flames with seven Up. The Pepsi 0:15:42.360 --> 0:15:45.520 Coola hot Shots basketball team changed its name to the 0:15:45.520 --> 0:15:50.240 Seven Up on. Kola's executives began traveling with bodyguards, and 0:15:50.280 --> 0:15:53.440 the company moved American employees out of the country, save 0:15:53.520 --> 0:15:57.080 for one who had worked in Beirut. We were eating 0:15:57.160 --> 0:16:00.720 death threats for breakfast Vera, the marketing direct later told 0:16:00.720 --> 0:16:03.960 a reporter At a riot in Manila, a sixty four 0:16:04.000 --> 0:16:07.720 year old protester named Passiencia Salem, whose husband had died 0:16:07.760 --> 0:16:11.360 of heart failure during March, told a journalist, even if 0:16:11.400 --> 0:16:14.640 I die here, my ghost will come to fight Pepsi. 0:16:17.120 --> 0:16:20.800 Why had the contest sparked such anger. It was the money, 0:16:20.880 --> 0:16:24.240 of course, but it wasn't only that. The scandal tapped 0:16:24.280 --> 0:16:27.720 into rising anti colonial sentiment in the Philippines, which was 0:16:27.760 --> 0:16:33.400 then flaring over the American military presence. Following fraud failed negotiations, 0:16:33.520 --> 0:16:36.480 the US was withdrawing from the last of its six bases. 0:16:37.040 --> 0:16:40.080 The closures were a victory for nationalists, but they came 0:16:40.120 --> 0:16:42.160 at the cost of hundreds of millions of dollars in 0:16:42.240 --> 0:16:46.520 yearly aid and tens of thousands of jobs. Number fever 0:16:46.680 --> 0:16:49.520 also became linked in the public imagination with the country's 0:16:49.600 --> 0:16:53.320 chaotic national elections, which had taken place a few weeks earlier. 0:16:53.360 --> 0:16:57.040 But we're still unresolved thanks to counting delays and procedural 0:16:57.120 --> 0:17:01.520 and legal challenges. The presidential test in particular, had had 0:17:01.640 --> 0:17:06.359 colonial overtones, pitting Fidel Ramos, a cigar chomping, right leaning 0:17:06.359 --> 0:17:11.320 West point graduate with Pentagon connections, against Miriam defense Or Santiago, 0:17:11.720 --> 0:17:14.200 a US educated lawyer who had worked overseas for the 0:17:14.280 --> 0:17:18.639 United Nations, and Edward Kawango, chairman of San miguel a 0:17:18.640 --> 0:17:23.240 Coca Cola partner. Other candidates included mL de Marco's widow 0:17:23.320 --> 0:17:26.840 of Ferdinand. One must wonder how many voters were drawn 0:17:26.880 --> 0:17:29.919 from the voting booth to PEPSI protests, a columnist wrote. 0:17:30.560 --> 0:17:34.879 In the end, Ramos narrowly defeated Santiago, a result marred 0:17:34.880 --> 0:17:40.000 by evidence of fraud. In January, PEPSI had to pay 0:17:40.040 --> 0:17:43.000 a fine of one fifty thousand pesos to the Department 0:17:43.040 --> 0:17:46.480 of Trade and Industry for deviating from the promotional campaign 0:17:46.560 --> 0:17:49.719 the government had approved. We have done everything that we 0:17:49.760 --> 0:17:53.440 think is reasonable to amically conclude this issue. Ross told 0:17:53.440 --> 0:17:56.240 the Los Angeles Times at this point, we do not 0:17:56.359 --> 0:18:00.280 intend to lay out additional money. Del Fierro mean while 0:18:00.600 --> 0:18:04.359 had hired five employees to process new lawsuit claimants, he 0:18:04.440 --> 0:18:07.399 eventually signed up about eight hundred in all, and was 0:18:07.440 --> 0:18:09.920 looking for US lawyers to bring the fight to New York. 0:18:10.520 --> 0:18:13.680 His daughter, sim Belle had taken over his advertising business. 0:18:14.600 --> 0:18:18.800 One morning in February, a schoolteacher named Anisetta Rosario made 0:18:18.800 --> 0:18:21.040 her way to a Sari Sari store in Manila to 0:18:21.119 --> 0:18:24.920 buy rice. As she reached the market, a Pepsi delivery 0:18:24.920 --> 0:18:28.400 truck arrived. Someone through a homemade bomb that bounced off 0:18:28.400 --> 0:18:31.960 the truck and detonated. The blast killed Rosario and a 0:18:31.960 --> 0:18:35.840 five year old girls standing nearby. Five others were injured. 0:18:37.040 --> 0:18:41.040 Rosario's eldest daughter, Cindy, still recalls the shock of seeing 0:18:41.040 --> 0:18:44.359 her mother's lower half covered. At the funeral, they told 0:18:44.400 --> 0:18:48.880 me her legs were shattered, she says. Rosario's widower, Raoul, 0:18:49.200 --> 0:18:52.359 didn't speak for days after his wife's death. A slight 0:18:52.440 --> 0:18:55.280 man who never remarried, he tells me in a whisper 0:18:55.280 --> 0:18:57.760 that Pepsi invited him to an office where a group 0:18:57.800 --> 0:19:01.080 of men in polo shirts with corporate logos offered him 0:19:01.080 --> 0:19:05.320 fifty thousand pesos about thirty four hundred dollars today, not 0:19:05.520 --> 0:19:09.320 to sue. My wife wouldn't have died, he says. He 0:19:09.400 --> 0:19:12.959 shouted in reply, it's because of the three forty nine incident, 0:19:13.040 --> 0:19:16.679 because you cheated the people. He stormed out, but not 0:19:16.800 --> 0:19:19.800 long afterward, on the advice of friends, he changed his 0:19:19.880 --> 0:19:23.760 mind and took the money. In early April, Sinclair, the 0:19:23.760 --> 0:19:27.639 Pepsi International CEO, flew to Manila for an emergency meeting 0:19:27.640 --> 0:19:31.160 with President Ramos. A Ramos aide told the Los Angeles 0:19:31.240 --> 0:19:34.480 Times that Sinclair pleaded for help, warning that the incident 0:19:34.560 --> 0:19:39.200 could scare away much needed foreign investment. Ramos disagreed. It's 0:19:39.200 --> 0:19:42.760 a special kind of case, Ramos told the Times. The 0:19:42.800 --> 0:19:45.560 following month, a grenade tossed into a Pepsi plant in 0:19:45.640 --> 0:19:50.320 Devou City killed three employees. The company urged the NBI 0:19:50.480 --> 0:19:54.040 to open an investigation into the attacks. A witness to 0:19:54.119 --> 0:19:57.720 several riots, no Mere Palacios, came forward with a list 0:19:57.800 --> 0:20:01.440 of six leaders of anti Pepsi coalition who he claimed 0:20:01.480 --> 0:20:05.160 were masterminding the violence. To force the company to pay. 0:20:05.440 --> 0:20:08.399 In late July, del Fierro and his wife boarded a 0:20:08.400 --> 0:20:11.000 flight to New York, armed with the findings of a 0:20:11.040 --> 0:20:15.720 Philippine Senate report whose legitimacy Pepsi contested. It called the 0:20:15.720 --> 0:20:20.640 company guilty of gross negligence and misleading or deceptive advertising. 0:20:21.280 --> 0:20:25.120 As del fierro strode through Manhattan. He later wrote, sinatras 0:20:25.200 --> 0:20:28.000 New York, New York played in his head a kind 0:20:28.040 --> 0:20:32.080 of personal battle him. He hired two American consumer lawyers 0:20:32.119 --> 0:20:35.320 to sue Pepsi for four million dollars in actual damages 0:20:35.680 --> 0:20:39.880 and one million dollars in moral and exemplary damages. This 0:20:39.920 --> 0:20:42.720 problem will become a serious threat to the very existence 0:20:42.760 --> 0:20:47.000 of PepsiCo, he told reporters. Massive negative public reaction will 0:20:47.000 --> 0:20:50.000 create a very deep wound which may be very difficult 0:20:50.040 --> 0:20:54.880 to heal. Pepsi was in the midst of an annus 0:20:54.960 --> 0:20:58.520 horribilist in the US. Dozens of people were claiming they'd 0:20:58.560 --> 0:21:02.760 found syringes inside it's cans, a tempering crisis the FBI 0:21:02.840 --> 0:21:07.399 would later expose as a hoax. Crystal Pepsi, a colorless 0:21:07.480 --> 0:21:10.879 version of the soda, was selling miserably, soon to become 0:21:10.920 --> 0:21:14.359 one of history's great product failures, and a world tour 0:21:14.480 --> 0:21:17.040 by long time spokesman Michael Jackson was about to be 0:21:17.119 --> 0:21:21.919 derailed by accusations of child molestation, with Jackson canceling dates 0:21:21.960 --> 0:21:25.600 and saying that he'd become addicted to painkillers first prescribed 0:21:25.640 --> 0:21:29.520 after his hair caught fire during a Pepsi commercial shoot. 0:21:30.440 --> 0:21:32.919 Del Fierro showed up at a Pepsi building in upstate 0:21:32.960 --> 0:21:36.240 New York, where Ross met with him. He warned the 0:21:36.280 --> 0:21:38.560 spokesman that he'd stay in New York until they reached 0:21:38.560 --> 0:21:41.719 a settlement. Ross said the violence had to end first. 0:21:42.240 --> 0:21:45.360 We don't have any control over the violence. Del Fierro replied. 0:21:46.080 --> 0:21:50.320 He returned to Manila empty handed. Later that year, the 0:21:50.440 --> 0:21:53.520 NBI alleged that a trio of thugs dubbed the Three 0:21:53.640 --> 0:21:57.600 Kings was behind the anti Pepsi bombings. Initially, one of 0:21:57.640 --> 0:22:01.240 the men, a garment factory worker named RhoD Elio Formento, 0:22:01.400 --> 0:22:04.320 said he'd volunteered for a three forty nine group and 0:22:04.400 --> 0:22:07.240 been recruited by the other two during a clandestine lunch. 0:22:07.800 --> 0:22:11.600 According to documents obtained by Bloomberg Business Week from the NBI, 0:22:11.800 --> 0:22:14.959 he told investigators that a PEPSI security officer was present 0:22:15.000 --> 0:22:17.239 at the meeting and that the company had paid the 0:22:17.240 --> 0:22:20.159 three Kings to cause violence at rallies in an effort 0:22:20.160 --> 0:22:24.600 to frame protest organizers. Fomento also said they'd been hired 0:22:24.640 --> 0:22:27.800 to cause a rift among the various movements leaders. If 0:22:27.840 --> 0:22:30.719 we were successful in our mission, PEPSI would give us 0:22:30.760 --> 0:22:35.640 a huge amount, he claimed, but Fermento's conscience nagged at him. 0:22:35.720 --> 0:22:39.280 Many got hurt and died. He told investigators, I was 0:22:39.320 --> 0:22:42.239 so guilty and I could not take it anymore, so 0:22:42.280 --> 0:22:46.200 I decided to reveal the truth. Fermento couldn't be located 0:22:46.240 --> 0:22:50.320 for comment. A lawyer for PEPSI dismissed the police report, 0:22:50.520 --> 0:22:53.360 but the head of the NBA's Anti Organized Crime division 0:22:53.440 --> 0:22:57.240 told the media, we've been had. The People's Journal soon 0:22:57.320 --> 0:23:02.720 ran a story headlined PEPSI goons ombed own trucks. In February, 0:23:04.040 --> 0:23:07.600 the company lost a three court case. A twenty one 0:23:07.680 --> 0:23:10.960 year old medical student named Joel roquet one a lower 0:23:11.000 --> 0:23:14.760 court verdict in Bulah Khan, north of Manila, ordering PEPSI 0:23:14.840 --> 0:23:18.520 to pay him more than one million pasos. The company appealed, 0:23:18.560 --> 0:23:24.000 but it's unclear whether it succeeded. That spring, Delphierro suffered 0:23:24.040 --> 0:23:28.040 a serious stroke. He recovered well enough that in the fall, 0:23:28.160 --> 0:23:31.000 when the Philippine Supreme Court issued a rest warrants for 0:23:31.080 --> 0:23:35.280 nine local Pepsi executives, he posed for a celebratory photograph 0:23:35.720 --> 0:23:40.240 holding a newspaper with the headline arrest of nine Pepsi executives. Okayed. 0:23:41.119 --> 0:23:44.880 There's no record that the warrants were executed. The company 0:23:44.960 --> 0:23:48.440 sued him for libel, saying he'd been circulating pamphlets calling 0:23:48.520 --> 0:23:52.080 number fever a scam and had falsely claimed Pepsi had 0:23:52.160 --> 0:23:57.199 him illegally detained. Soon afterward, another stroke almost killed him. 0:23:57.320 --> 0:24:01.160 From his hospital bed, he labored over paperwork, dragging himself 0:24:01.160 --> 0:24:06.000 into court when necessary. Pepsi, they killing me softly. Sim 0:24:06.000 --> 0:24:09.399 Bell recalls him telling her he made her promise to 0:24:09.480 --> 0:24:13.480 keep fighting the company even after he was gone. That November, 0:24:13.680 --> 0:24:16.920 hundreds of torch wielding three forty nine winners demonstrated near 0:24:16.960 --> 0:24:20.359 Manila's Malakanjang Palace during a state visit by U. S 0:24:20.400 --> 0:24:24.119 President Bill Clinton, yelling for his help and igniting a 0:24:24.160 --> 0:24:28.320 Pepsi bottle effigy stuffed with fireworks. Their hopes of American 0:24:28.359 --> 0:24:31.719 intervention were further dashed the following summer when a new 0:24:31.760 --> 0:24:35.199 York court dismissed del Fiero's lawsuit, saying it should be 0:24:35.240 --> 0:24:38.760 heard in the Philippines. Sinclair was made c e O 0:24:38.920 --> 0:24:42.680 and chairman of Pepsi's combined international and North American operations 0:24:42.680 --> 0:24:46.119 in March nineteen ninety six, but he resigned four months 0:24:46.160 --> 0:24:52.800 later citing personal reasons. Sinclair departed voluntarily but ungracefully, Fortune wrote, 0:24:53.359 --> 0:24:56.320 leaving the overseas beverage mess for someone else to mop up. 0:24:57.000 --> 0:25:00.160 PEPSI had by then fallen back to also ranst at 0:25:00.200 --> 0:25:03.119 Us Abroad, out sold by Coke three to one. In 0:25:03.160 --> 0:25:07.240