G.R. No. 134559 - Torres vs. Court of Appeals

In 1984, PepsiCo, Inc. launched the successful “Number Fever” promotional campaign in several Latin American countries.
Pepsi Cola Products (Philippines), Inc. (PCPPI), franchise holder of PepsiCo in the Philippines, sought to replicate the campaign locally.
On January 15, 1992, PCPPI requested permission from the Department of Trade and Industry (DTI) to conduct a nationwide “Number Fever” promotion, wherein buyers of Pepsi Cola products could win cash prizes determined by numbers printed on specially marked crowns or resealable caps.
Approval was granted by the DTI on January 23, 1992.

D.G. Consultores, a Mexican consultancy firm handling PepsiCo’s promotions elsewhere, randomly preselected the winning numbers and their matching security codes using a computer system.
The list of both winning and non-winning numbers was sent to PCPPI.
To prevent tampering, the DTI supervised the production of the winning crowns and coordinated the seeding of the winning numbers into the trade.
A safety measure was implemented: the predetermined winning numbers and corresponding security codes were deposited in a safety deposit box at United Coconut Planters Bank (UCPB) with two keys, one held by the DTI and the other by PCPPI.

PCPPI advertised the campaign via television, radio, and printed materials, explaining that the winning three-digit numbers, to be found underneath crowns or caps, would be announced daily (except on weekends).
Consumers with winning crowns would redeem their cash prizes at designated stations after verification that the crowns were authentic and untampered.

Due to the promotion’s success, PCPPI extended the campaign by five weeks and submitted a second list of predetermined winning numbers, which was also secured in a safety deposit box under similar arrangements.
On the afternoon of May 25, 1992, the number 349 was announced as the winning number for the following day.
A significant number of consumers, including the respondents, had crowns bearing the number 349; however, many of these crowns contained security codes that did not match those in the official list (notably, the respondents’ crowns bore the code L-2560-FQ, which was not authorized).
In response, PCPPI recalled the winning number 349 for that day and replaced it with another number (134 for June 12, 1992).
To mitigate growing public dissatisfaction, PCPPI offered a goodwill gesture of P500.00 per crown to holders of the non-winning 349 crowns if they presented their crowns on or before June 12, 1992.
Approximately 486,170 crown holders accepted the offer, costing PCPPI an aggregate of P240 million.
However, several crown holders, including the respondents, refused the offer and organized under the Ugnayan 349 Association Inc. to pursue their claims through litigation.

On November 9, 1992, a complaint for collection of sum of money and damages was filed before the Regional Trial Court (RTC) of Quezon City.
The RTC, while declaring that the plaintiffs were “not entitled to their crowns,” ordered PCPPI and others to pay each plaintiff moral damages of P10,000.00.
Unhappy with this decision, three respondents (Armando Enriquez, Victorino Alcano, and Jane Geronimo) and PCPPI appealed.
Their appeals were consolidated and docketed as CA-G.R. CV No. 54604 before the Court of Appeals (CA).
The CA modified the trial court’s judgment by increasing the moral damages to P30,000.00 per respondent and additionally awarded a collective attorney’s fee of P30,000.00, along with costs.

Similar complaints arising from the “Pepsi 349” incident had been filed in various parts of the country.
Final and executory rulings in cases such as Mendoza v. PCPPI and PCI, and Rodrigo v. PCPPI and PCI had held that crowns bearing incorrect security codes were not winning crowns.
The Supreme Court, in previous cases and a later decision in De Mesa v. Pepsi Cola Products, Phils., Inc., emphasized the application of the principle of stare decisis, mandating adherence to settled judicial decisions.
The present petition was filed by PCPPI, challenging the CA’s award of moral damages and attorney’s fees, despite the clear similarities with these earlier rulings.

Whether crowns bearing the number 349 with security codes not matching those in the official, predetermined list (i.e., L-2560-FQ) should be deemed winning crowns deserving of the prize money printed thereon.

Whether ordering PCPPI to pay moral damages (initially P10,000.00 per affected crown holder, later modified to P30,000.00) along with attorney’s fees is legally supportable under the circumstances of the “Pepsi 349” incident.

Whether the final and executory rulings in previous cases such as Mendoza and Rodrigo, which held that mismatched crowns are not winning, should bind the current case under the doctrine of stare decisis.
Whether re-litigation of settled issues, regarding the disputed promotional scheme, is permissible in light of these precedents.