Coca Cola 2003 Annual Report Download - page 18

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period in the Georgia Case through April 15, 2004, and have submitted to the Court a consent order setting
forth the agreed discovery schedule.
The Company believes it has substantial legal and factual defenses to Aqua-Chem’s claims.
The Competition Directorate of the European Commission made unannounced visits to the offices of the
Company and certain of our bottlers in Austria, Belgium, Denmark, Germany and Great Britain several years
ago. This investigation, which is directed at various commercial and market practices, is continuing and the
Company and bottlers are endeavoring to have a dialogue with the Commission in order to address their
concerns. The Commission may, following its usual practice, issue one or more statements of objection, after
which the Company and the bottlers would have formal rights to reply and to judicial appeal in the event of an
adverse decision by the Commission. The Commission has authority to impose fines in connection with an
adverse decision, however, the Company is not able to predict whether fines would be imposed or the amount of
such fines.
The Spanish competition service made unannounced visits to our own offices and those of certain bottlers
in Spain in 2000. In December 2003, the Spanish competition service suspended its investigation until
the European Commission notifies the service of how the European Commission will proceed in its
aforementioned investigation.
The French competition directorate has also initiated an inquiry into commercial practices related to the
soft drinks sector in France. This inquiry has been conducted through visits to the offices of the Company;
however, no conclusions have been communicated to the Company by the directorate.
By letter dated June 10, 2003, the Company was informed that the United States Securities and Exchange
Commission (the ‘‘SEC’’) had commenced an informal, non-public inquiry into whether the Company or certain
persons associated with the Company violated federal securities laws in connection with the allegations in two
lawsuits filed by Matthew Whitley, a former employee, in May 2003. In his lawsuits, Mr. Whitley alleged, among
other things, that he was terminated in retaliation for reporting to senior management certain accounting and
other improprieties. Mr. Whitley’s lawsuits alleged, among other things, the improper manipulation of a
marketing test for Frozen Coke products conducted by one of the Company’s customers, improper accounting
treatment in connection with the purchase of certain fountain dispensing equipment and marketing allowances,
and false or misleading statements or omissions in connection with the reporting of sales volume. Both Whitley
lawsuits were settled. The Company is cooperating with the SEC inquiry, and has provided substantial
documents and other information to the SEC in connection with the inquiry. On January 14, 2004, the Company
received an order from the SEC, making its inquiry a formal investigation.
On July 11, 2003, the Company announced that the United States Attorney’s Office for the Northern
District of Georgia had also commenced a criminal investigation of the allegations raised by Mr. Whitley. In
connection with that investigation, the Company has received Grand Jury subpoenas as well as a number of
additional informal requests for documents and materials relating to the issues under investigation. The
Company is cooperating with the investigation and has provided substantial documents and information to the
United States Attorney’s Office.
The investigations being conducted by the United States Attorney’s Office and the SEC are ongoing. To the
Company’s knowledge, no criminal prosecutions or civil enforcement actions have been filed. While the
Company cannot predict whether any such actions will be filed in the future, the Company will continue to
cooperate fully with the governmental investigations.
The Company is involved in various other legal proceedings. Management of the Company believes that any
liability to the Company which may arise as a result of these proceedings, including the proceedings specifically
discussed above, will not have a material adverse effect on the financial condition of the Company and its
subsidiaries taken as a whole.
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