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The Right Moves, Baby


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THE RIGHT MOVES, BABY

Craig E. Weatherup remembers the moment well. It was the evening of June 14, and "I was in my backyard trying to help my wife clean up some hedge trimmings," says the chief executive of Pepsi-Cola North America. "I got a call from the commissioner of the FDA. I'd never met David Kessler or talked to him, but it was clear we knew the same thing: that for this to be happening defied logic."

So began an intriguing, crucial partnership between government and industry. The weekend before, newspapers in Seattle and New Orleans had carried reports of people who claimed they had found syringes in Pepsi cans. By June 23, more than 50 people would come forward with similar stories. No matter that logic was lacking: The reports had taken on a panicky tone. In the end, though, real panic never set in--partly because the consumer reports were mostly fraudulent. But it's due also to the effective linkup between Pepsi-Cola and the Food & Drug Administration.

By the time Weatherup and Kessler spoke, one important decision already had been made. That morning, Kessler had chosen not to stage a recall of Pepsi, despite growing pressure for such a move. "My considerations were solely from a public-health standpoint," he says. His logic: Consumers would be safe as long as they got the message to pour soda into a glass before drinking.

HELL WEEK. But that action didn't do much to ease public concern. By the following morning, June 15, says Weatherup, "the networks were calling to see if we wanted to say anything." They did. Weatherup had his staff prepare video footage demonstrating the canning process at Pepsi, showing how it is virtually impossible to insert a syringe into the cans. "We sent that footage up by satellite by 3 o'clock on Tuesday," says Weatherup. By that time, there were so many satellite trucks and helicopters filled with television crews landing at IBM's helicopter pad, just up the road from Pepsi-Cola headquarters, that it "looked like a moon landing."

Then, another question: Was Weatherup the right person to present Pepsi's case to the masses? A straightforward, no-nonsense type, Weatherup is not as avuncular as his boss, PepsiCo Inc. Chairman D. Wayne Calloway. But Pepsi executives decided Weatherup was more comfortable with the intricacies of canning operations. And in six personal appearances on morning and evening news shows, The MacNeil/Lehrer Newshour, and Larry King Live, the executive's earnestness played well. He quietly explained how a syringe couldn't possibly find its way into a can.

Then, on the night of June 15, Weatherup and Kessler appeared on Nightline together. By that time, Kessler knew his agency had at least one arrest in the works: A Pennsylvania man, it turned out, had made up a story about Pepsi tampering. Ted Koppel peppered both men with questions about product safety and the penalties for making false claims of product tampering (5 years in prison and a $250,000 fine) and helped dispel the notion that Pepsi cans were contaminated.

The united front was a compelling image for consumers, who otherwise might not have believed a consumer products company executive. Says Tom Pirko, a consultant for the beverage industry who does some work for Pepsi: "There wasno question that [Kessler] was the dominant influence in terms of the public believing [Pepsi] and cauterizing the whole thing."

By Thursday, June 17, the Federal Bureau of Investigation had arrested four people for making false claims about tampering with a product. After long discussions on June 16 and June 17, Kessler and top-ranking FDA officials unanimously decided that they had no evidence of nationwide tampering. "Once that decision was made," says Kessler, "we decided to go public with the statement."

At Pepsi-Cola, there still was plenty of hand-wringing. Weatherup worked a string of 20-hour-plus days, speaking to Calloway several times a day and calling him every night at home. Pepsi employees faxed updates to anxious bottlers twice daily. And two dozen employees hit the phones, taking calls from worried consumers and bottlers, as well as various celebrities and supermarket chain CEOs calling to offer support.

HI, MOM. Dr. Joyce Brothers called in. So did supermodel and Pepsi spokeswoman Cindy Crawford. "Cindy called from backstage at David Letterman to see what she could do to be helpful," says Weatherup. Home Box Office comedian Paul Rodriguez, another pitchman, offered to help out at no charge. "My mother called, of course," says Weatherup.

Some bottlers tried to calm local jitters themselves. "Hell, we opened our plant up to everybody," says James C. Lee Jr., chairman of Buffalo Rock Co. in Birmingham, Ala. "The TV stations came over, and we showed 'em we got 28 people doing quality control 'round the clock."

All the attention brought a lot of free publicity--normally, not a bad thing for a cola company at the start of a long, hot summer. There was a dark side to the exposure, of course: Pepsi executives had to reassure consumers that this wasn't another Tylenol or Perrier scare. But since there had been no injuries, deaths, or poisonings, Weatherup says a recall would have been "dishonest"--and very expensive.

Now, the crisis has quieted. The FBI has made 20 arrests, and Kessler's FDA is basking in its success at pursuing an objective investigation under intense public scrutiny. Pepsi continues to re-assure the public. Starting on June 21, the company ran full-page ads in 12 national papers, and bottlers ran ads in 300 to 400 local dailies telling readers that the stories about Pepsi were a hoax. "This was a very isolated, freaky kind of thing," says Pirko. "But Pepsi gained by it." Now Weatherup can ease up. "Don't tell anyone," he says."But I'm planning to take a day off."Laura Zinn in New York, with Mary Beth Regan in Washington D.C.


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