The agreement resolves allegations that the Chicago-based company
marketed and sold flavored malt beverages, including Four Loko, in
violation of consumer protection and trade practice statutes by
promoting the drink to underage youth, promoting dangerous and
excessive consumption of Four Loko, and failing to disclose to
consumers the effects and consequences of drinking alcoholic
beverages combined with caffeine.
"Phusion used marketing and sales tactics that glorified alcohol
use and promoted binge drinking," Madigan said. "This agreement is a
significant step forward in our ongoing efforts to reduce access to
dangerous caffeinated alcoholic beverages, especially to underage
Under the agreement, which 19 other attorneys general and the
city of San Francisco joined, Phusion will not manufacture
caffeinated alcoholic beverages and will also reform how it markets
and promotes its non-caffeinated flavored malt beverages, including
Four Loko. Additionally, Phusion must not:
drinking, drinking while driving, consuming an alcoholic
beverage by means of a rapid ingestion technique or device, or
consumers, wholesalers, distributors or marketers the mixing of
its flavored malt beverages with products containing caffeine.
Sell, offer for
sale, distribute or promote alcoholic products to underage
individuals, or actors under the age of 25, to promote alcohol
Hire models or
actors who are under the age of 25 or who appear to be under the
age of 21 for its promotional materials.
malt beverages on school or college property, except at retail
establishments licensed to sell alcoholic products.
initials, logos or mascots of any school, college, university,
student organization, sorority or fraternity in Phusion's
promotional materials for its alcohol products.
Distribute, sell, provide or promote
merchandise bearing the brand name or logo of flavored malt
beverages to underage individuals.
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Phusion will also police its websites and social media accounts
for posts that depict or describe consumption of its caffeinated
alcohol beverages, mixing of its flavored malt beverages with
products containing caffeine, or alcohol abuse. It will also inform
its distributors and retailers that its flavored malt beverages
contain alcohol and will advise retailers to display its flavored
malt beverages separate and apart from nonalcoholic products.
The agreement announced last week is the attorney general's
latest effort to protect young people from harmful products. In
2008, Madigan, the attorneys general of 12 other states and the San
Francisco city attorney initiated investigations of the two leading
manufacturers of alcoholic energy drinks at that time, MillerCoors
Brewing and Anheuser-Busch Inc, which resulted in halting their
production of these types of beverages.
In 2007, Madigan urged the Alcohol and Tobacco Tax and Trade
Bureau to increase its efforts to prevent dangerous, misleading
claims by alcoholic energy drink manufacturers. Similarly, Madigan
joined other attorneys general that same year in urging
Anheuser-Busch to change its advertising of another alcoholic energy
drink, Spykes, and the company pulled the drink from store shelves.
The "Assurance of Voluntary Compliance and Voluntary
Discontinuance" agreement was entered with Madigan, the states and
the city of San Francisco with Phusion Projects LLC and its officers
Jaisen Freeman, Christopher Hunter and Jeffrey Wright. Joining
Madigan in the agreement with Phusion were attorneys general from
the following states: Arizona, Connecticut, Idaho, Indiana, Iowa,
Kansas, Kentucky, Maine, Maryland, Massachusetts, Mississippi, New
Mexico, New York, North Carolina, Ohio, Oregon, Pennsylvania,
Tennessee and Washington.
[Text from file received from the office of
Illinois Attorney General Lisa