Leonard v. PepsiCo, Inc.

Facts

PepsiCo ran a promotion called Pepsi Stuff that encouraged consumers to collect Pepsi Points from specially marked packages of Pepsi and Diet Pepsi and redeem the points for merchandise featuring the Pepsi logo. A Pepsi Stuff catalog was distributed to consumers in the Pacific Northwest test market, including Washington State. Leonard, a resident of Seattle, saw a Pepsi Stuff television commercial in which a teenager arrives at school in a Harrier Jet, and the words "HARRIER FIGHTER 7,000,000 PEPSI POINTS" appear on screen. The catalog's order form listed fifty-three items redeemable for points, ranging from 15 points for a jacket tattoo to 3300 for a mountain bike; no Harrier Jet appeared in the catalog or on its order form. The catalog said additional points could be purchased for ten cents each, provided at least fifteen original points accompanied each order. Finding he could not buy, let alone drink, enough Pepsi to collect the points fast enough, Leonard raised about $700,000 through acquaintances. On or about March 27, 1996, he submitted an order form, fifteen original Pepsi Points, and a check for $700,008.50, writing in "1 Harrier Jet." PepsiCo's fulfillment house rejected the submission, explaining the jet was fanciful and included to create a humorous and entertaining ad.

Issues

1. Did the Pepsi Stuff television commercial constitute an offer of a Harrier Jet that Leonard could accept by submitting an order form?
2. Would an objective, reasonable person have understood the commercial to be a serious offer?
3. Was there a writing sufficient to satisfy the statute of frauds for a sale of goods?

Holding

The court gave three separate reasons. The commercial was merely an advertisement, not a unilateral offer: it reserved the details to the catalog, had no words of limitation, and sought a reciprocal promise, not the performance a reward offer seeks. Separately, no objective person could reasonably have concluded that it actually offered a Harrier Jet. And no writing satisfied the statute of frauds. Summary judgment for PepsiCo on the contract and fraud claims.