Since returning to Chevy, Richard Childress Racing’s Kyle Busch has made two major decisions regarding his business venture. He has sold his championship-winning Truck series team. Kyle Busch Motorsports to Spire Motorsports and has ceased the operations of his energy drink production company Rowdy Energy.
Despite the energy drink market being one of the most competitive fields in the beverage sector, Busch and his partners made good revenue In the first two seasons on the back of their extensive marketing strategy. But the headwinds became too much for them to carry towards the end of 2023. Hence, the decision was made to close their operations.
The company was facing two class action lawsuits in California for false advertising, and it was reported that the decision to shut down so early would’ve been made because of these cases; now Busch has come forth publicly addressing these claims. He has insisted the decision to shut down has nothing to do with the legal cases, as the call about the firm’s future was made at the start of 2023.
No, actually we were talking about shutting it down in April, May something like that and then all the lawsuits came in December before it closed because we were just trying to get rid of the rest of the product that we had on stock. So, is what it is, we’ll deal with it. Legalities are legalities.Busch told Fox Sports (H&T: On3.com).
Why was Rowdy Energy sued?
Two lawsuits were filed in California against false advertisements associated with the Power Burn Energy drink. It was advertised as preservative-free. However, it was later found that they used Citric and ascorbic acids as preservatives.
Another lawsuit was filed after they were found violating the Safe Drinking Water and Toxic Enforcement Act of 1986. Rowdy Energy drinks were found to have extensive lead and mercury, which is a severe violation of the law.
Kyle Busch and his partners can’t escape prosecution even if they sold the company as, according to the laws of North Carolina, where they are registered, the firm can be held liable for the next five years after any legal dispute after closing down. The lawsuit must have played a key role in ending the company.
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