Rumor Almost Ruins Small Soda Firm : Race relations: A flyer in Harlem said Tropical Fantasy was part of a Ku Klux Klan scheme to ‘make you sterile.’ The firm fought back with the truth--and won back most of its customers.

The rumor made sense to Early May, and she was alarmed. It was that inexpensive soda pop, a flyer posted in her apartment building said, the kind her daughter liked to buy.

For weeks, the story burned through Harlem like wildfire: Low-priced brands of soda called Tropical Fantasy, A-Treat and Top Pop were made by the Ku Klux Klan with an ingredient to sterilize black men.

“My daughter used to buy those sodas and I told her: ‘Don’t buy them no more,’ ” said Early May, 62, who refused to give her last name. “I came from Alabama. That’s why I believe it.”

A block away down Malcolm X Boulevard, 17-year-old Tosh Williams repeated the rumor as he stood outside one of many small groceries dotting the Harlem neighborhood that makes up Tropical Fantasy’s hottest market.

“I heard people talking about it, and I went into a store and saw the sign,” Williams said. “It’s cheap soda that makes you sterile.” If anyone buys it now, he said, “they’re fools.”

This is a story about a rumor--how it nearly soured the success of a little soda company and how the company fought back and won. It’s also about being black in America.

It begins in Brooklyn.

Brooklyn Bottling Co. was limping into bankruptcy in the mid-1980s, barely surviving on sales of seltzer, when Eric Miller inherited the firm his grandfather founded in 1937.

The 33-year-old scion of bottlers revived the family business with shrewd marketing. He brought back the old line of fruit-flavored sodas, added a few more and changed the name from Crown and Glory to Tropical Fantasy. His strategy was to keep the price down, way below big-name competition like Pepsi and Coke.

Tropical Fantasy sold well in corner groceries from Boston to North Carolina, but Miller couldn’t control the counter price. Soda was soda to shopkeepers, who charged up to 85 cents for what Miller intended to be a bargain. He solved the problem by printing the 49-cent price on the bottle cap. While he was at it, he increased the bottle size from 12 ounces to 20. The new packaging made its debut Sept. 30, 1990. It was a smash.

“It just started selling, selling, selling,” Miller said of those heady days.

Sales rose 50% in 1990, to $12 million. Miller projected sales of $15 million this year. Optimism lasted seven good months. But then the rumor struck.

By all accounts, it began in April. At least that’s when the first flyer was seen. It was April 3, to be exact, in Harlem.

Mel Johnson remembers the day. His company, WAM Beverage Distributors, owns half the fleet of 25 trucks that distribute Tropical Fantasy.

The anonymous handbills were crudely printed. The grammar was flawed. They got the KKK’s full name wrong.

“ATTENTION!!! ATTENTION!!! ATTENTION!!!” each handbill read. “Please be advise, Top Pop, and Tropical Fantasy, also Treat .50 sodas are being manufactured by the Klu Klux Klan. Sodas contain stimulants to sterilize the black man, and who knows what else!!!!

“You have been warned,” it concluded. “Please save the children.”

Three days later, the same flyer turned up in Brooklyn.

“Overnight, the thing mushroomed to no end,” Johnson said. “Outside school buildings and churches, we seen kids on the street, giving out these flyers.” The youngsters, when asked, said some guy paid them $5. What guy? They couldn’t say.

The rumor flew and spread and stuck wherever it went. It galloped over the Brooklyn Bridge to East New York, Bedford-Stuyvesant and Coney Island. “One of my drivers went into the Coney Island section,” Johnson said. “A group of kids started throwing bottles at the truck yelling: ‘Get out of here! You sterilize blacks!’ ”

It fanned out into Queens. It leaped westward over the Hudson River into New Jersey where Mary Truesdale, in Englewood, heard her nephew say a couple of his friends weren’t drinking the stuff.

Truesdale came across an article in the newspaper debunking the rumor and gave it to her 7-year-old son, Brian, to take to school, where the teacher discussed it with the class. “The teacher thanked me. The students were interested, especially West Indian kids who have relatives in the city who had heard about it,” Truesdale said.

And still the rumor passed from friend to friend, from child to parent.

Rosemarie Mulero looks after truants at a school in Brooklyn’s Bedford-Stuyvesant section. She’s also the wife of a Brooklyn Bottling truck driver. One day in the school staff lounge, she overheard one black teacher warn another not to drink Tropical Fantasy.

Another day, as Mulero was about to drink from a bottle of the soda, a girl about 14 years old walked into her office. “She said, ‘Mrs. Mulero, don’t drink that soda,’ and I said, ‘Why?’ and she said, ‘You’re going to get sterile.’ She said she saw it on the news.”

About 20 inquiries came in to the Food and Drug Administration, FDA spokesman Herman Janiger said. “We didn’t believe it, but we decided to investigate,” he said.

Soda samples were checked for the presence of saltpeter, potassium nitrate, an anaphrodisiac. Investigators visited Brooklyn Bottling. They checked the warehouse, the raw materials area, the production line. Nothing unusual was found.

At Brooklyn Bottling, meanwhile, the situation deteriorated.

Grocers couldn’t move the soda. Some shoved unsold bottles to the back of their coolers; others stopped ordering it.

Top Pop, made by Premium Beverage Packers Inc. of Wyomissing, Pa., and A-Treat, made in Allentown, Pa., lost business too. But they depended less on the New York market.

Eric Miller had the most to lose, and he was the angriest. A man proud that his company of 125 workers is staffed largely by minorities, who likes the idea of offering poorer consumers a good deal on soda, he saw the rumor as an absurd attack and set about to stop it.

Miller hired Robin Verges, a public relations consultant and an expert in African-American concerns. Her efforts paid off immediately when New York Mayor David N. Dinkins, a black man, agreed to drink Tropical Fantasy on television.

The news media jumped on the story. The Ku Klux Klan came out with a disclaimer: “The KKK is not in the bottling business,” Wizard James Farrands of Sanford, N.C., told a weekly magazine. Editorials in the city’s major and minority newspapers raised stern voices against believing hurtful nonsense. Brooklyn Bottling employees met with the PTA and church leaders.

And Brooklyn Bottling, as well as the maker of Top Pop, distributed its own flyers.

“Someone put up a stone wall. We didn’t have dynamite, but we have a pick and we’re breaking it down, stone by stone,” Miller said. “We just went around re-educating and shaming people. Step by step, people are realizing it’s a hoax.”

Miller also bought a billboard truck to drive around affected areas touting Tropical Fantasy. As summer approached, he gave away free samples. Then he waited for the hot weather. What thirsty kid can resist a bargain?

A month later, stores were refilling their stocks. Near the sodas, customers found photocopies of editorials and a letter from Dinkins promising the sodas were safe.

The wait worked.

“I’d say we got most of our consumers back,” Miller could say by mid-June. “But we had three months of horror.”

Like the other bottlers hit by the rumor, he believes a jealous competitor planted the story.

“Right now, the economy is so bad, the big boys are as nervous as the little boys,” Miller said. The rumor was “racism for economics,” he said. “What’s more frightening to blacks than the Klan and sterility? If they said I used cheap ingredients, would it concern them?”

Major bottlers deny involvement. A spokesman for Pepsicola West, which serves the region, said no way was his company involved in any rumor.

Bob Lanz at Coca-Cola Bottling of New York said his company checked it out down to the distributors and found no rumormongers. “You don’t take any glee,” Lanz added, “because it could happen to you.”

Miller hired a detective agency to investigate, and the Kings County district attorney’s office also looked into it. But the agency quit after reaching only dead ends, and the DA’s office came up with nothing.

Rumor experts weren’t surprised.

“I have never heard of a commercial rumor being started by a competitor,” said Fred Koenig, a social psychologist at Tulane University who is an expert in marketplace rumors.

A competitor could take advantage of a rumor already started, he said, but that’s risky. “You don’t know if, by the end of the day, that rumor’s going to turn on you,” Koenig said. “It’s like chemical warfare. The wind changes.”

Adding to Koenig’s skepticism was the fact that the rumor has been spread before, the last time about a fried-chicken franchise said to use a chemical that sterilizes black men.

So where do rumors come from? Why do people spread them? Why are they so powerful? And why would many blacks believe this one in particular?

“Imagine a rumor being like a bullet, and imagine people being like guns,” said Ralph Rosnow, a psychologist at Temple University who has written about rumors and gossip. “We load the gun when we’re feeling anxious and nervous about something. When people are very anxious about something, they don’t worry whether or not it’s true.”

Spreading rumors, Rosnow said, allows people to share their anxieties.

“Having come from a slavery background, where we were so brutalized for so long, the sense of fear we have as a people is very real,” said Lorraine Hale, a psychologist who is president of Hale House Foundation, a philanthropy for drug addicts’ babies, women with AIDS and formerly drug-addicted mothers and their children.

“There’s a mass paranoia that the objective here is to kill us out, as easily and quickly as possible. We don’t articulate it,” Hale said, “but we act upon it.” This leads to watchfulness and caution and suspicion, enough to question the contents in a soft drink.

Like other blacks interviewed, Robert Johnson, a chemistry professor at Medgar Evers College in Brooklyn, said the story about tainted soda invoked memories of the Tuskegee Study. Between 1932 and 1972 in Alabama, 600 black men suffering from syphilis went untreated during a U.S. public health study of the effects of the disease.

The soda rumor “makes a person of color leery,” Johnson said. “We wouldn’t put it past some people.”

And still, Miller remains determined to find a culprit.

“To the day I die,” he said, “I’m not going to stop until I find out who the hell did it to us.”