Police raided the offices of No. 2 beer maker Hite Jinro Co. and one of its provincial agencies yesterday in connection with suspicions that company employees have been spreading malicious rumors against its larger rival Oriental Brewery (OB), maker of the popular Cass Beer.
According to a police spokesperson, investigators seized computer hard drives and other documents from Hite Jinro’s headquarters in southern Seoul as well as from the local sales agency based in Daejeon.
The raid came after OB, South Korea’s largest beer maker, called for a police investigation into allegations that beginning in June Hite Jinro spread rumors against Cass, OB’s best-selling beer brand, on social media sites and mobile messenger services such as KakaoTalk
Some of the rumors (in Korean) read:
- “Women who are ovulating definitely should avoid this.”
- “Better not drink any beer made between June and July”
- “Looks like they didn’t rinse off all the antiseptic when they were cleaning the vats.”
Police reportedly suspect that Hite Jinro employees were directly involved in starting the rumors online and through text messaging.
An OB employee was quoted in the Korean media as saying: “We requested an investigation because we really thought that this could cause some serious damage to our brand image if left unchecked. We did not name any specific company. If it turned out to be the work of individuals, we asked the police to find out whether someone had put them up to it.”
After rumors continued to spread, the Ministry of Food and Drug Safety investigated whether there was any truth behind them. Turns out there were–at least concerning the reportedly foul odor coming from the beer, but not specifically about any potential harm.
Last week the ministry announced that the disinfectant smell in question was actually a product of the oxidation of the fat in the malt and the dissolved oxygen in the beer, a process that occurs naturally during the distribution process.
OB issued an official apology to drinkers about the odd smell, but still took issue with the additional rumors about the dangers to women:
“When customers express their dissatisfaction, we apologize and take measures to deal with the issue. Our request for a police investigation was a response to malicious rumors that were spread about how women who are ovulating should not drink the beer.”
Hite-Jinro dismissed the apology, saying that OB was intentionally deceiving customers and not looking at the basis for the larger concerns of beer safety.
A representative for Hite Jinro acknowledged that some employees might be involved in the spreading of rumors.
“These were not groundless rumors; they were confirmed during the investigation by the Ministry of Food and Drug Safety. Customers kept making claims, too. Since we have sales staff around the country, it’s possible that some of them took advantage of these claims on an individual level, but this was not a company policy,” said a representative for Hite-Jinro.
A Continuation of Hite Jinro’s Marketing Plan?
This could turn out to be just another chapter in the story of Hite-Jinro defaming competitors as an orchestrated method of marketing.
On August 7th a court charged Hite Jinro executives with funding a program on cable TV claiming that the water used in the production of soju competitor Lotte Chilsung’s Cheoeum Cheoreom brand, was harmful, while offering no verification of the allegation. The court found that the company intentionally spread the rumor through a video posted online as well as through the use of fliers –which they ordered sales staff across the country to distribute.
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