Has the Cap Been Blown Off the Coca Cola Secret?

Dan Whalen is a JD candidate at Osgoode Hall Law School.

An American radio program claimed to have discovered “one of the most jealously guarded trade secrets in the world”: the formula for Coca Cola. The eponymous company, which has gone to extraordinary lengths to guard the secret recipe since its creation in 1888, emphatically refuted the claim.

On its website, the radio program This American Life posted a photograph from a 1979 magazine article that purportedly shows the beverage’s original recipe. Many of the ingredients listed are unsurprising; they include caffeine, sugar, and “fluid extract of coca.” More intriguing are the elements and proportions listed under the cryptically titled “Merchandise 7X.” Indeed, therein lies the rub. This secret ingredient is thought to give the beverage its distinct flavour among the market’s caffeinated carbonations. Quick to dismiss the claim, Coca Cola Co. has denied that the recipe is the “Real Thing.”

However, the company does have some inherent reason to worry. The need for secrecy against would-be imitators precludes public avenues of protection, like patents or trademarks, which would require full disclosure. Rather, the recipe is kept as a heavily guarded trade secret. In 46 American states, trade secrets are protected under the model Uniform Trade Secrets Act; in the remaining states, these secrets are protected by similar common law remedies. By either system, however, trade secrets are among the most vulnerable forms of intellectual property protection; for example, such protection can be lost in an instant if the secret is discovered by a third party.

Accordingly, Coca Cola Co. has gone to great lengths to keep its formula secret. For instance, the company keeps its recipe in the vault of a SunTrust Bank branch in Atlanta, Georgia. Coca Cola Co. even gave the bank 48.3 million shares in a gesture of good faith and the two companies each has executives sitting on the other’s board of directors.

Coca Cola Co.’s recipe may be safe for a while longer. The company archivist has said that the discovery may be a precursor to, but is not the true ingredient list of the beverage that millions know and love. This may be true, but surely the executives’ hearts skipped a beat when news of the claim broke – as would that of any person part of a billion-dollar enterprise based on a secret.

  1. Coca-Cola does have one thing going for it: brand. One of the people interviewed in the show, Coca-Cola’s official historian, made the claim that even if someone managed to duplicate their recipe, they would not be able to make Coke. This was followed by a quote from one of the random on-the-street people they interviewed: “[Coke] tastes like my childhood.”

    I know it works on me. I’ve tried many a generic cola drink to save money and yet I still break down and buy a case of Coke on occasion. Even though it doesn’t really taste much different, it is different. As long as Coke never acknowledge’s that a competitor’s product is Coke, they’ll be safe.

  2. Although some are starting to view trade secret protection as a viable alternative to patent protection, trade secrets are much more vulnerable — and, once the cat is out of the bag, there is often little recourse for redressing that loss of secrecy. The recent, purported disclosure of the Coca-Cola recipe is just one story illustrating the tenuousness of trade secret IP rights. On the other hand, some may say that almost 140 years of trade secret protection (in Coke’s example) is a pretty good run.

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