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Billionaires Behaving Badly: Lynda and Stewart Resnick


Are the owners of Fiji water and Pom juice practicing clever marketing? Or is there something more nefarious going on?

When you think of the islands of Fiji, what springs to mind is images of a honeymoon tropical paradise, crystal blue lagoons, white sand beaches and palm trees -- not human rights violations perpetrated against innocent civilians by an illegal totalitarian military regime. And when you think of a leftist philanthropist Beverly Hills husband and wife couple who rub shoulders with the liberal elite, the last thing you expect them to be is sponsors of an illegal totalitarian military regime that perpetrates human rights violations against innocent civilians.

But that's precisely the allegation levied against Fiji Water owners Lynda and Stewart Resnick whose bottled water company, in 2009, comprised roughly 20 percent of exports and three percent of GDP, $3,900 per capita of a country seized by an oppressive military junta. Fiji's population, according to Amnesty International, "is living in fear as a result of draconian measures implemented by the regime" where the Resnicks enjoy nearly exclusive access to the third world country's aquifer, tax-free status and untold millions in profits.

And if the military dictatorship isn't in the back pocket of the Resnicks, it sure acts like it is. When a Mother Jones reporter was in the country writing an expose on Fiji Water, she was snatched up by police from an internet cafe and detained. During her interrogation, an officer taunted and threatened her: "I'd hate to see a young lady like you go into a jail full of men" and "You know what happened to women during the 2000 coup, don't you?" He accused her of working for a competing bottled water company. "It would be good to come here and try to take away Fiji Water's business, wouldn't it?"

There may be Fiji Water everywhere but there's not a free drop to drink in the country, the Mother Jones journalist reported. With a water supply so unsanitary it causes typhoid outbreaks, the people are forced to buy Fiji Water or risk a host of medical problems. And even though the little square bottles don't need to be shipped halfway across the planet, the company charges its impoverished locals almost as much as US consumers, 90 cents a pint, for the privilege of using its own natural resource.

In an attempt to offset negative publicity surrounding its role in the country's colonial injustices, Fiji Water has established a village trust and makes charitable contributions to benefit various aspects of island life from education to public works. And although the company keeps actual dollar amounts close to the vest, "court proceedings indicate that it has agreed to donate .15 percent of its Fijian operation's net revenues; a company official testified that the total was about $100,000 in 2007." The following year, Fiji Water spent $10 million on marketing alone.

That budget was put to strategic use to counter criticism from environmentalists who rail against the wasteful practices inherent in the bottle water industry. The company's green-washing campaign, literally called "Fiji Green," boasted the use of biofuels and diesel generators at the Fiji plant and promised to become a carbon-negative brand. The website claims, "We are the first and only major bottled water company to make this commitment, under which we will continue to offset 120% of our emissions."

These kinds of eco-conscious efforts by water bottlers never fail to draw the ire of conservationists like the Rainforest Action Network's Michael Brune who said, "Bottled water is a business that is fundamentally, inherently and inalterably unconscionable. No side deals to protect forests or combat global warming can offset that reality." And what Fiji Water neglects to disclose is that the plastic used in its bottles is imported from China.

Despite their costly PR efforts, the Resnicks still manage find themselves in hot water -- most recently from their foray into the business of peddling pomegranate juice. As the founders of POM Wonderful, the couple has been slapped with a complaint from the Federal Trade Commission for false and deceptive advertising. Federal regulators aren't buying the company's extravagant health claims of the "Rubies in the Orchard," as dubbed by Lynda in her marketing book, including preventing heart disease, prostate cancer and erectile dysfunction. Unless Pom Wonderful comes up with valid scientific evidence to substantiate its claims to the Food and Drug Administration, the company will be forced to remove them from all advertising materials.

A statement issued by POM Wonderful in response to the complaint accused the government of "wasting taxpayer resources to persecute the pomegranate."

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