Dr Pepper Snapple Group apparently has buckled to pressure from Center for Science in Public Interest on grounds that it allegedly engages in deceptive marketing practices. DPS ended litigation from CSPI by agreeing to stop fortifying some of its 7 Up bevs with vitamins and calling out their antioxidant content. "Soda is not a health food, and should not be marketed as a healthy source of antioxidants or other nutrients," said CSPI litigation dir Steve Gardner. "It's to the credit of Dr Pepper Snapple Group that it carefully considered these concerns, and worked collaboratively to resolve the dispute without further litigation." CSPI had brought suit in Nov with law firm Reese Richman LLP on grounds that putting small amount of vit E in bottles sporting pics of cherries, blackberries and other dark fruit gave misleading impression that antioxidants may have derived from fruit. In any case, CSPI pointed out, FDA policy prohibits fortification of CSDs and other junk food with vitamins. Just last week, CSPI reported headway in case vs Coca-Cola over what it contends have been misleading health claims behind Vitaminwater.

CytoSport, whose Muscle Milk protein line has performed well moving thru Pepsi system, has apparently reached to board member and Pepsi system vet Rob King to take ceo reins from cofounder/chmn Mike Pickett. He takes reins of Benicia, Calif-based co immediately, with Pickett moving to prexy position, from which he said he'll maintain active role in co, per release issued today by co. (Curiously, tho, statement from Pickett said, "I could not be more proud of the leadership Mike has exemplified within this company from day one, and look forward to his continued achievements in his ongoing role as President," but that could just be typo.) King started career at E&J Gallo Winery and Procter & Gamble before spending 21 years within Pepsi system in North America, culminating in role as evp/prexy of Pepsi Bottling Group before retiring in 2010 at time bottler was sold to PepsiCo. For past 3 years, King has served as indie consultant for TSG Consumer Partners and portfolio that includes CytoSport, Island Oasis and Neuro Beverages, serving on boards of all 3 cos. CytoSport has been perennial topic of speculation as PepsiCo takeover target tho differences over valuation are among factors that are believed to have kept deal from happening. Muscle Milk holds dominant role in protein space.

Natural-food marketing vets Greg Fleishman and Elizabeth Lombardi, who just left acai marketer Sambazon, have launched incubator called Purely Righteous LLC that has signed fast-expanding HPP juice brand Suja as their first client, even as they work to launch their own snack brand. Following new fashion of virtual corporate structures, Greg joins Suja as cmo and Elizabeth as marketing dir, effective Aug 4. "Together, they bring small, mission-centric company experience via Kashi, Clif and Sambazon combined with large, systematic experience through Clorox, Kellogg and Coca-Cola," said Suja founder Jeff Church in confirming assignment. "We believe their fit and backgrounds will add tremendous value to the Suja business and can't wait for them to start." As reported, Suja is rare HPP player that has installed its own processing capacity in Southern Calif base, and recently established site in Philadelphia area where it may set up 2d line. It's nationally available in Whole Foods, has made it into several hundred other stores and currently has launched outdoor campaign in NY. Reached last night, Greg deferred to Jeff for comment for now, saying just, "Elizabeth and I are very much looking forward to our upcoming adventure with Suja Juice and the new brand we are creating."

Red Bull North America sees plenty of additional space to be grabbed by energy drinks at retail as segment rebounds from slow start to year caused by bad weather and tough comps. Judging by alacrity with which RBNA distribution network got flavored editions out to market - in barely a month - its distribution system is working fine. And sense among employees in co's Santa Monica, Calif, hq is that no big energy deals are on horizon - because Red Bull founder Dietrich Mateschitz seems far from being in selling mood, and because big bevcos see too many challenges to acquisitions of other key players Monster or Rockstar. Those were some of nuggets offered by James Ford, head of biz insights & category development at RBNA, during conference call Fri hosted by Goldman Sachs' Judy Hong. Tho Monster has given Red Bull real run for its money in US, brand still holds 40% $$ share, 28% volume share.

In contrast to its flamboyant, buzz-generating marketing, privately held Red Bull North America generally has kept very low profile on corporate side. So James' appearance was rare chance to get RBNA's direct take on energy segment rather than mainly filtered thru retailers, distributors, analysts and rivals. He joined co last Aug after long runs at Coca-Cola and M&M/Mars. Ford offered frank assessment of category, duly crediting successes by rivals Monster and Rockstar and offering bullish view on energy's prospects in this year's 2d half. Somewhat ironically, his comments served to reinforce Judy's own "buy" rating on Monster shares. "MNST remains the best way to invest behind the growth in energy drinks," she wrote yesterday. "Both MNST and RB have been proven share gainers in the energy space, and strong innovation and easier comps should drive a 2H sales re-acceleration." Here are some of Ford's observations culled from give-and-take on Fri.

'Happy with Our Distribution Model' Tho that's not in his job description, Ford offered general support for current distribution model. Currently network of 220 US distributors is one-third owned by Red Bull (so-called Red Bull distribution cos, or RBDCs), one-third independent but exclusive distributors, and one-third multibrand houses. Tho RBNA is "very aggressive in upleveling distributors," it has "no preference" for one model over other, it's only in-market results that count. Recent launch of flavored Red Bull Editions provided good gauge of network's effectiveness, he said: "We got our product into market faster than any other launch of any other beverage category that we've been able to measure" - about a month to get "distribution almost universally." So it's clear "our guys are able to get it done . . . We're happy with our distribution model and always happy to improve upon it, but it's working effectively."

Still Looking to Grow Shelf Space With energy drinks the biggest category in c-stores now, some have wondered whether segment is close to maxing out its shelf space. Not in Ford's opinion. West Coast chains comprise most highly developed retail channel, yet they're still growing shelf space for energy. RBNA itself is working to get more energy drinks placed cold at cash register. It's undertaking another program to bundle the drinks together in center of store with energy bars, bananas, other categories in destination "energy center" for those seeking a pick-me-up.

Founder Mateschitz Has No Apparent Plans to Sell Out At least among rank and file at RBNA, there is no expectation that founder Dietrich Mateschitz is close to shopping co. He's still very involved in co's operations, has direct say on all new launches and marketing campaigns, and enjoys the platform Red Bull affords him to pursue his interests, James noted. As #1 biz in Austria, RB also confers fair amount of prestige. So Ford has "heard no rumblings that he's looking to sell." That doesn't reflect any inside knowledge, "just what I hear sitting here at Red Bull," he qualified.

Questions Whether Monster, Rockstar Acquisitions Are Imminent Ford cited his long experience at Coca-Cola and Coca-Cola Enterprises to explain why he's skeptical that Coca-Cola would make move on Monster soon, tho he emphasized he wasn't speaking from any current insider knowledge. Reviewing history that saw Monster go on CCE trucks, then migrate to Coke after KO's acquisition of CCE's North American biz, he recalled, "I know the Coca-Cola Company was not happy when Monster was on Coke trucks." Tho to drop Monster would be to abandon a lot of volume and profit, "ideally they would love to get their own brands (NOS, Full Throttle) to grow." As for acquiring MNST, Ford reminded that co's biggest prior acquisition was top-dollar Glaceau deal, "and you can debate whether that was successful or not." (Note that Ford was vp hydration responsible for those brands in wake of KO's acquisition.) KO would be concerned on whether category will continue to grow, and whether regulatory cloud will go away. "We know it will continue to grow," he noted, "but from Coke's perspective it's a risk." No mention from James of Anheuser-Busch, Monster's other key distribution partner, tho many of same deterrents would seem to apply.

As for the other key indie player, Rockstar, it's "in a much worse position than Monster . . . really a regional brand" that's very strong out West. Since it moves largely thru Pepsi system, PEP is logical potential acquirer, but Ford's hunch is "I don't think anyone is going to buy Rockstar right now - it's a declining brand and regional." Elsewhere in PEP portfolio, while Mt Dew's new Kickstart is providing incremental growth, the core Amp energy brand is down 20% and heading toward discontinuation by retailers. Bottom line: Pepsi's in same position as Coke. It hasn't been able to develop successful homegrown energy drinks, and to buy Rockstar would cost truckload of money.

Category Dynamics: Traversed Poor Weather, Tough Comps but Fundamentals Strong Grocery /c-store sales slowed from robust summer 2012, growing at 6% clip - for better than energy shot category, mainly 5-Hour, which has reversed 8% growth to go down 13% in Q2. In those channels, energy was biggest net sales contributor, offering $82 mil, followed by bottled water (+$50 mil) and RTD coffee (+$29 mil). Biggest decliners were shots (-$25 mil) and soft drinks (-$56 mil).

On energy side, James credited Monster's core green can and its Absolutely Zero and Rehab extensions for driving lotta co's growth while older extensions like Assault and Khaos were down. He credited Ultra as being big growth driver - "probably the most successful energy launch of the past couple of years" - but said some of volume seemed to be sourced from other parts of Monster biz. Both Absolutely Zero and Rehab have softened lately, while original Ultra White and its recent Blue extension are growing briskly. Some contribution from new Muscle Monster protein line but it still has low retail penetration.

Ford offered several reasons for confidence about sector. First, household penetration is still low, at 18%, vs 75% for CSDs, 39% for sports drinks, 46% for tea, 64% for bottled water. Encouragingly, penetration grows from 18% for younger Gen X cohort to 32% for Gen Y, encouraging RBNA to believe it will grow as these consumers mature. And fast-growing Hispanic demo indexes 148 on energy drinks.

Also, occasions are building, with 31% of consumers telling pollsters they need a pick-me-up 5X per week, another 39% saying 3-5X per week. And Ford feels marketers are addressing some of barriers to further penetration: taste (addressed by new Red Bull Editions and Monster Rehab) and high sugar/calorie count (addressed by Red Bull Total Zero).

Overall, Ford is sanguine about what year holds for energy sector. No question weather has hurt sales, as did timing of Monster's cycling of key innovations like Rehab. But Monster's Ultra Blue and Pink Lemonade Rehab are "doing very well" and RBNA "see some growth coming back to Monster." RBNA is also glad to see MNST backing off some very aggressive promo discounts. As for Red Bull itself, Ford argues that flavored Editions "have done very well in the marketplace for us" and put "a lot of wind in our sales." He cited Dunnhumby loyalty card data that Editions seem to be enticing current RB consumers to drink more and are sourcing some volume from rival brands, but "I don't think we're sourcing a massive number from CSDs." (BBI has observed that, whatever sellthrough of Editions, they've provided pretext for RB to demand more shelf space vs highly sku'd Monster and Rockstar rivals.)

Safety Furor: Only Folks Spooked Seem to Be Those Not in Category Anyway Asked about regulatory environment, Ford denied any significant impact so far. He said furor mainly seems to be reinforcing among consumers who're already skeptical of category that they don't want to be there. Overall, # of consumers entering and leaving category seems to have stayed same. Issue may loom larger for shots category, given older, white-collar consumer base presumably more interested in health issues. Both RB and Monster are part of American Beverage Assn and while the 2 cos haven't coordinated efforts, both have been involved in debate, with dir of regulatory & scientific affairs Becki Holmes leading RB effort. (She's former regulatory affairs exec at Starbucks.)

59th Summer Fancy Food Show broke records in exhibit space and attendance even as it sent record amount of leftover food to City Harvest charity, sponsor Specialty Food Assn reported. Show marked its return to NY after 2 years in exile in Washington, DC, while Javits Center was under renovation, and its 24,100 visitors topped attendance record set by last NY-sited show, in 2010. "New York is the birthplace of the Fancy Food Show and its home," said SFA prexy Ann Daw. "Our return to the city coincided with unprecedented interest in specialty food and the passionate entrepreneurs who create it." Show filled 354K sq ft of exhibit space with 180K foods/bevs from 1,500+ US exhibitors and 1,000 from overseas.

Sipp continues to carefully build out brand, hitting West Coast and tweaking formulas and package. Co always used certified-organic ingredients but needed copacker that was likewise certified, said Greg Parentice, whose wife, Philadelphia-based mixologist Beth Wilson-Parentice, created brand. That prompted move from Mass to Ore, where production and warehousing base has enabled expansion to West Coast from brand's base of Northeast and Mid-Atlantic States. Brand moves now thru Haddon House for all of East Coast south to Fla. But co is hoping to sign up DSD shop in NY soon and is looking to add sales reps.

It's using taller, more elegant bottle, tho still 12-oz, with design work from Sandstrom, Portland, Ore, shop which has done work for St-Germain liqueurs and Tazo Tea. They've tweaked Mojo Berry to bring more blackberry up front and evolved Honey Pear to Summer Pear, bringing up more pear. Founders have evened out calorie count to 100 for all flavors, including other key flavor, Ginger Blossom.

Republic of Tea looked to cover all bases by intro'ing functional line even as it extended indulgence line mimicking flavor cake. Super Herb Tea is offered in 36-unit canisters that contain blends based on exotic herbs baobab, jiaogulan and moringa. Baobab, sourced from South Africa, offers such features as centering, asthma prevention, inflammation/fatigue, blended with touch of mint. Jiaogulan, so-called Chinese immortality herb, boasts benefits associated with longevity and anti-stress and is blended with monkfruit. Moringa, Ethiopian "miracle tree" for its nutritional bennies, is blended with mango and rooibos (red tea). Canisters go for $12.99. RoT also has joined forces with Action Against Hunger, dedicating $1 per $10.99 tin of Hibiscus tea to supporting water programs. Meanwhile, in indulgence realm, seeing success with Cuppa Chocolate line, it's now offering Cuppa Cake Tea in Lemon Chiffon, Caramel Vanilla and Blueberry Bundt. Move echoes efforts by spirits cos to mimic flavor of desserts in their recent offerings. And RoT has begun offering quart-size brewpacks for iced tea in flavors like Ginger Peach, Watermelon Mint, caffeine-free Hibiscus Sangria and Arnold Palmer-like Limon Black Tea. Tin of 8 bags is priced at $6.99-7.99.

Ito En offered sneak preview of Culinary Matcha that aims to broaden role of nutrient-rich, stoneground powdered green tea that is mainstay of traditional Japanese tea ceremony. "Whisk. Drink. Cook" is mantra for ingredient that takes place in fledgling Matcha Love branded created by big Japanese tea marketer, which sees role for ingredient on both sweet and savory side. Matcha has also been finding expanding role within health and beauty sector. At show, dry run for formal launch at Ingredion ingredient show this week, co showed prototype of 0.7-oz canister targeting both consumers and foodservice pros, for use blended into smoothies as well as in chocolates and other sweets, savories and vinaigrette. It will be offered this fall in full-bodied Koicha, lighter-bodied Usucha and classic forms. Matcha Love brand is intended in part to overcome intimidation some consumers might feel around item so rich in association with tea ceremony, noted Ito En (N America) svp Rona Tison.

After hitting viral jackpot with Pepsi Max ad in which nerdy-disguised Nascar driver Jeff Gordon takes care salesman on hair-raising test drive, PepsiCo is trying again, this time with spot in which actor Josh Duhamel does surprise stint as checkout clerk in LA grocery. Unlike convincing but staged Gordon caper, this one seems legit, with hidden cameras portraying Duhamel popping out of floor displays and hurling shoppers' purchases on floor while advising female customers, "I'm checking you out." "Are you Josh Duhamel?" asks one woman. "I get that a lot," actor evades. "Oh," she says. Video can be viewed at http://www.youtube.com/watch?v=BMGMi2Webd0. Meanwhile, Jeff Gordon spot is approaching 38 mil views on Youtube.

Green Mountain Coffee Roasters shares surged 6.3% yesterday to close at $73.19 as investors reacted positively to news that co may create a competing machine to challenge SodaStream, reported Bloomberg. Trademark was filed on Jul 3 by GMCR's Keurig div, per US Patent Office Web site. "We are not going to comment on this specific trademark," said rep Suzanne DuLong. GMCR is covering all bases as it competes with more cos for K-Cup share, and earlier this month announced a fast 64-oz coffee pot system as well. Article points out stock gain was co's best since May 9 and GMCR shares are up 77% YTD. Recall that some mfrs, like recently profiled Bevyz (BBI, May 23), are offering machines that do both hot bevs and cold via single system.