Celsius Holdings, Inc., the maker of the popular Celsius energy drink, has faced multiple lawsuits accusing the company of false advertising, misleading marketing practices, financial misrepresentations, and regulatory violations. These legal actions have involved claims about product ingredients, health effects, investor losses, and influencer marketing disclosures. This article provides a comprehensive overview of the Celsius energy drink lawsuits, covering background, allegations, legal claims, updates, consumer guidance, and business consequences.
Background of the Celsius Energy Drink Lawsuit
Celsius came under scrutiny beginning in late 2022 and early 2023 when a class action lawsuit was filed alleging the company falsely advertised its products as containing “no preservatives,” while they actually contained citric acid, a preservative. Plaintiffs claimed that Celsius’ misleading label caused consumers to pay premium prices for products that were not as advertised. The company later settled this false advertising lawsuit for $7.8 million in early 2023.
In 2024 and 2025, new lawsuits arose accusing Celsius of misleading investors by overstating sales tied to PepsiCo’s distribution partnership, inflating stock prices and concealing inventory overstock issues. Moreover, Celsius faced a class action alleging its fitness drinks were misbranded and sold without proper FDA approval due to unauthorized health claims. Additionally, influencer marketing practices have been challenged for lack of proper disclosure regarding sponsorships.
Parties Involved and Case Context
Plaintiffs include consumers, investors, and regulatory bodies alleging false advertising, securities fraud, and unfair business practices. Defendants prominently include Celsius Holdings, Inc. and specific executives involved in public statements and marketing campaigns. The lawsuits engage the intersections of consumer protection, securities law, and regulatory compliance.
Details of the Celsius Energy Drink Lawsuit Allegations or Claims
- False Advertising: Celsius was alleged to mislead consumers by advertising “no preservatives” despite the presence of citric acid.
- Securities Fraud: Investors claimed Celsius misrepresented sales performance and prospects, inflating stock value artificially.
- Misbranding and FDA Violations: Plaintiffs allege Celsius sold products making unapproved health claims without FDA clearance.
- Undisclosed Influencer Sponsorships: Lawsuits accused Celsius and social media influencers of failing to disclose paid endorsements, violating FTC rules.
Legal Claims and Relevant Laws Involved in the Lawsuit
- Federal Trade Commission Act (FTC Act): Addressing deceptive advertising and endorsement disclosure violations.
- Securities Exchange Act of 1934: Governing truthful and complete disclosure by publicly traded companies.
- Federal Food, Drug, and Cosmetic Act (FDCA): Regulating product approval and labeling requirements.
- State Consumer Protection and False Advertising Laws: Supporting claims of misleading marketing and unfair practices.
Current Status and Recent Developments in the Lawsuit
The false advertising class action lawsuit was settled for $7.8 million in early 2023, with no admission of wrongdoing by Celsius. The securities class action remains active, with investors seeking damages tied to inflated stock prices. A California federal court approved a proposed class action alleging FDA misbranding claims, and enforcement and litigation surrounding influencer advertising disclosures continue to develop.
Most recently, Celsius issued product recalls due to product mix-ups, although no injuries have been reported yet. Ongoing monitoring of the lawsuits, settlements, and regulatory actions is essential for consumers and investors alike.
Consumer Advice and Business Consequences Related to the Lawsuit
Consumers should carefully scrutinize energy drink marketing claims and ingredient labels before purchasing and report any adverse effects experienced. Investors should remain informed on securities litigation developments affecting stock valuation and potential recovery. Businesses in the beverage and health supplement sectors must ensure strict compliance with advertising laws, endorsement guidelines, FDA regulations, and transparent communication to avoid costly legal actions.
Practical Recommendations
- Review product labels and marketing claims critically to identify potential misleading statements.
- Monitor settlement announcements to file claims for compensation where eligible.
- Investors should consult legal counsel regarding participation in securities class actions.
- Companies should strengthen advertising compliance, obtain necessary approvals, and disclose sponsorship transparently.
Conclusion: Significance and Future Outlook of the Celsius Energy Drink Lawsuit
The Celsius energy drink lawsuits highlight the critical importance of truthful marketing, regulatory conformity, and investor transparency in the competitive health and wellness market. Settlements and ongoing litigation serve as warnings for companies about the risks of misrepresenting product attributes and financial health. For consumers and investors, these legal actions emphasize the need for vigilance and informed decision-making.
As the beverage market expands and regulatory scrutiny intensifies, Celsius and other companies face mounting pressure to uphold stringent standards to maintain consumer trust and avoid future legal entanglements.
