Coca-Cola Bottling Company of Elizabethtown, Inc. Jackson Coca-Cola Bottling Company Dixie Coca-Cola Bottling Company, Incorporated New Bern Coca-Cola Bottling Works, Inc. Plymouth Coca-Cola Bottling Company, Incorporated Owensboro Coca-Cola Bottling Company, Inc. Sacramento Coca-Cola Bottling Co., Inc. Coca-Cola Bottling Company of Shelbyville, Inc. Beaver Coca-Cola Bottling Co. Quaker State Coca-Cola Bottling Company the Cleveland Coca-Cola Bottling Company, Inc. Keystone Coca-Cola Bottling Company Central Coca-Cola Bottling Company, Inc. Reading Coca-Cola Bottling Works Coca-Cola Bottling Company of Shreveport, Inc. (Formerly Star Bottling Works, Ltd.) the Coca-Cola Bottling Company of Fort Smith, a Partnership Texarkana Coca-Cola Bottling Company Coca-Cola Bottling Company Las Cruces Coca-Cola Bottling Company West Plains Coca-Cola Bottling Company the Coca-Cola Bottling Company of Tucson, Inc. Hattiesburg Coca-Cola Bottling Company Magnolia Coca-Cola Bottling Company, Inc. Coca-Cola Bottling Company of Tulsa, Inc. Ouachita Coca-Cola Bottling Company, Inc. Natchez Coca-Cola Bottling Co., Inc. Wichita Coca-Cola Bottling Co. Coca-Cola Bottling Co. (North Dakota) Marshall Coca-Cola Bottling Co. Liquidating Trust Permian Coca-Cola Bottling Co. Scioto Coca-Cola Bottling Co. Richmond Coca-Cola Bottling Co. Coca-Cola Bottling Co. Of Kennett (A Partnership) Coca-Cola Bottling Co. Of Jamestown Streator Coca-Cola Bottling Co. Texas Coca-Cola Bottling Co. Jefferson City Coca-Cola Bottling Co. Coca-Cola Bottling Co., Inc., Alexandria, Mn Deming Coca-Cola Bottling Co. Trenton Coca-Cola Bottling Co. MacOn Coca-Cola Bottling Co. Mary Louise Goodrich Mary Louise Kay Robinson, Individually and as Trustee of the Kendall Family Inter Vivos Trust Ann Kay Hobson Haack, Individually and as Trustee of the Kendall Family Inter Vivos Trust John K. Hobson Margaret Dodge Hobson, Individually and as Trustee of the Kendall Family Inter Vivos Trust (Subst. For Natchez Coca-Cola Bottling Co., Inc.) Oliver C. Hutaff, Jr., as Trustee Under Shareholders' Lawsuit Trust Agreement (Subst. For Wilmington Coca-Cola Bottling Works, Inc. And Kelford Coca-Cola Bottling Works, Inc.) v. The Coca-Cola Company, a Delaware Corporation, Coca-Cola Bottling Co. Of Mt. Pleasant Coca-Cola Bottling Co. Of Muskegeon Coca-Cola Bottling Co. Of Dickinson Laredo Coca-Cola Bottling Company, Inc., Intervenors in D.C., Coca-Cola Bottling Company of Magnolia Sacramento Coca-Cola Bottling Company Coca-Cola Bottling Company of Elizabethtown, Inc. (Also Successor by Merger to Coca-Cola Bottling Co. Of Owensboro) Coca-Cola Bottling Company of Shelbyville Trenton Coca-Cola Bottling Company Plymouth Coca-Cola Bottling Company Coca-Cola Bottling Company of Dickinson Coca-Cola Bottling Co. Of Jamestown Coca-Cola Bottling Company of Williston Cleveland Coca-Cola Bottling Company Coca-Cola Bottling Company of Lehigh Valley (Formerly Known as Bethlehem) Laredo Coca-Cola Bottling Company Central Coca-Cola Bottling Company Love Bottling Company Coca-Cola Bottling Company of Lacrosse Arkansas-Georgia Company (Also Known as Nashville) Coca-Cola Bottling Company of Streator Natchez Coca-Cola Bottling Company Coca-Cola Bottling Company of Jefferson City Coca-Cola Bottling Company of MacOn Coca-Cola Bottling Company of Deming Coca-Cola Bottling Company of Tulsa Coca-Cola Bottling Company of Brownsville (Rgv) Coca-Cola Bottling Company of San Angelo Las Cruces Coca-Cola Bottling Company Coca-Cola Bottling Company of Tucson Coca-Cola Bottling Company (Alexandria) Coca-Cola Bottling Company of Marshall Oliver C. Hutaff, Jr., as Trustee Under Shareholders' Lawsuit Trust Agreement (Subst. For Wilmington Coca-Cola Bottling Works, Inc. And Kelford Coca-Cola Bottling Works, Inc.), Coca-Cola Bottling Company of Elizabethtown, Inc. Jackson Coca-Cola Bottling Company Dixie Coca-Cola Bottling Company, Incorporated New Bern Coca-Cola Bottling Works, Inc. Plymouth Coca-Cola Bottling Company, Incorporated Owensboro Coca-Cola Bottling Company, Inc. Sacramento Coca-Cola Bottling Co., Inc. Coca-Cola Bottling Company of Shelbyville, Inc. Beaver Coca-Cola Bottling Co. Quaker State Coca-Cola Bottling Company the Cleveland Coca-Cola Bottling Company, Inc. Keystone Coca-Cola Bottling Company Central Coca-Cola Bottling Company, Inc. Reading Coca-Cola Bottling Works Coca-Cola Bottling Company of Shreveport, Inc. (Formerly Star Bottling Works, Ltd.) the Coca-Cola Bottling Company of Fort Smith, a Partnership Texarkana Coca-Cola Bottling Company Coca-Cola Bottling Company Las Cruces Coca-Cola Bottling Company West Plains Coca-Cola Bottling Company the Coca-Cola Bottling Company of Tucson, Inc. Hattiesburg Coca-Cola Bottling Company Magnolia Coca-Cola Bottling Company, Inc. Coca-Cola Bottling Company of Tulsa, Inc. Ouachita Coca-Cola Bottling Company, Inc. Natchez Coca-Cola Bottling Co., Inc. Wichita Coca-Cola Bottling Co. Coca-Cola Bottling Co. (North Dakota) Marshall Coca-Cola Bottling Co. Liquidating Trust Permian Coca-Cola Bottling Co. Scioto Coca-Cola Bottling Co. Richmond Coca-Cola Bottling Co. Coca-Cola Bottling Co. Of Kennett (A Partnership) Coca-Cola Bottling Co. Of Jamestown Streator Coca-Cola Bottling Co. Texas Coca-Cola Bottling Co. Jefferson City Coca-Cola Bottling Co. Coca-Cola Bottling Co., Inc., Alexandria, Mn Deming Coca-Cola Bottling Co. Trenton Coca-Cola Bottling Co. MacOn Coca-Cola Bottling Co. Mary Louise Goodrich Mary Louise Kay Robinson, Individually and as Trustee of the Kendall Family Inter Vivos Trust Ann Kay Hobson Haack, Individually and as Trustee of the Kendall Family Inter Vivos Trust John K. Hobson Margaret Dodge Hobson, Individually and as Trustee of the Kendall Family Inter Vivos Trust (Subst. For Natchez Coca-Cola Bottling Co., Inc.) Oliver C. Hutaff, Jr., as Trustee Under Shareholders' Lawsuit Trust Agreement (Subst. For Wilmington Coca-Cola Bottling Works, Inc. And Kelford Coca-Cola Bottling Works, Inc.) v. The Coca-Cola Company, a Delaware Corporation, Coca-Cola Bottling Co. Of Mt. Pleasant Coca-Cola Bottling Co. Of Muskegeon Coca-Cola Bottling Co. Of Dickinson Laredo Coca-Cola Bottling Company, Inc., Intervenors in D.C., the Coca-Cola Company

These consolidated appeals are from orders the United States District Court for the District of Delaware entered in one of three related actions1 concerning the contracts between The Coca-Cola Company (the Company) and some of its bottlers who have persisted in refusing the Company's proposed amendments to its agreements to supply the bottlers' requirements of CocaCola bottling syrup.2 In the appeal at our Docket No. 91-3496, eighteen bottlers of the soft drink known as Coca-Cola appealed an order of the United States District Court for the District of Delaware dismissing their amended Count Two claim for declaratory and injunctive relief.3 The relief sought would have required the Company to supply them with Coca-Cola syrup (herein the syrup) sweetened with high-fructose corn syrup (HFCS) under contracts that license them to market bottled Coca-Cola in a particular territory. Their licenses had their roots in the terms of an 1899 national franchise the Company had granted the predecessor of the bottlers' licensors. That franchise was, however, amended from time to time and ultimately modified by agreements incorporated into two 1921 Consent Decrees (herein Consent Decrees) which settled a 1920 dispute between the Company and the bottlers' licensors.

In its cross-appeal at Docket No. 91-3498, the Company challenges the order of the district court awarding a total of $20,742,398.20 in compensatory damages and prejudgment interest for breach of contracts to the eighteen bottlers who continue to seek injunctive relief in No. 91-3496 and twelve other bottlers who formerly bottled and distributed Coca-Cola (herein the "former bottlers"). These thirty bottlers claimed in Count One of their complaint that the Company had breached its contractual obligations to them when it unilaterally substituted syrup sweetened with the cheaper HFCS for syrup sweetened with the more expensive cane or beet sugar they claim that the Consent Decrees require. The Consent Decrees followed a 1920 law suit the bottlers' licensors brought against the Company, after World War I fluctuations in the supply and price of cane sugar, then the exclusive sweetener used for the syrup, ignited a heated dispute between the parties. The bottlers' individual contracts are similar in all material respects and their terms derive their meaning from the 1899 contract, as ultimately modified by the Consent Decrees.

The primary issue in the appeal of the bottlers at No. 91-3496 and the Company's cross-appeal at No. 91-3498, as well as the companion appeal at No. 91-3497 of another somewhat overlapping set of bottlers who claim entitlement to diet Coke syrup, is what type of syrup the Company is contractually obligated to provide its bottlers under the bottling contracts derived from the 1899 franchise, as amended and ultimately modified by the Consent Decrees. The district court held that two key terms in the Consent Decrees, "sugar" and "syrup," were ambiguous and, after evidential hearings, interpreted sugar in the light of the parties' practices over the years. The district court's findings concerning the meaning the parties intended to give the term "sugar" are the subject of Coke III and its findings concerning the parties' intent in using the term "syrup" are made in Coke VII.

In amended Count Three of their complaint, the bottlers sought additional damages because, they claimed, the Company overpriced the naturally sweetened syrup it was selling to them by determining the market price for sugar contrary to the pricing formula the Consent Decrees set for syrup. In Count Four, the bottlers claimed a share of monies the Company received in settlement of an antitrust action it had brought against the major refiners of sugar.4

We hold that the district court did not err in determining that the Consent Decrees and the resulting contracts with the bottlers covered only syrup sweetened with 5.32 pounds per gallon of cane or beet sugar. We will therefore affirm the district court's order dismissing the bottlers' demands for syrup sweetened with HFCS. We also agree with the district court that the Company breached its contracts with the bottlers when it began unilaterally supplying them with syrup sweetened with HFCS. Nevertheless, because the HFCS-sweetened syrup was comparable in all material respects to the syrup made with 5.32 pounds per gallon of cane or beet extracted sugar, we also hold that the bottlers have not shown that they suffered any loss of economic expectancy as a result of this breach. Therefore, the district court's award of compensatory damages to the bottlers on Count One of their complaint, including its award of pre-judgment interest, will be vacated and the case remanded with instructions to substitute therefor an award of $1.00 in nominal damages to each of the bottlers who are cross-appellees at our Docket No. 91-3498. In all other respects we will affirm the orders of the district court.

The history of Coca-Cola is essential background to our analysis of this case.5 The story begins in 1886 when an Atlanta pharmacist, Dr. John Smyth Pemberton, developed the formula for Coca-Cola. Soon afterward, Asa G. Candler, also a pharmacist and the owner of a wholesale drug company, purchased an interest in the formula and the trademark and formed the Company to manufacture and market Coca-Cola syrup to drugstores for use in a fountain beverage.

In 1899, two Chattanooga lawyers, B.F. Thomas and J.B. Whitehead, bought the rights to receive Coca-Cola syrup at a fixed price for vending in "bottles or other receptacles" throughout the United States with the exception of Connecticut, Maine, Massachusetts, Mississippi, New Hampshire, Rhode Island, Texas and Vermont. Thomas and Whitehead also received the exclusive right to use the trademark "Coca-Cola" on bottles in the territories covered by the contract. The bottling rights the Company conveyed to Thomas and Whitehead were exclusive, not only of all other potential bottlers, but also of the Company itself, which reserved only the exclusive right to distribute its syrup for use at soda fountains in non-bottled soft drinks and to manufacture bottling syrup for sale to Thomas and Whitehead. As part of the deal, Thomas and Whitehead agreed to buy their requirements for Coca-Cola bottling syrup from the Company. Under these exclusive bottling contracts (the 1899 Contracts), Whitehead and Thomas agreed to "establish in the city of Atlanta, as soon as the necessary machinery and buildings can be obtained, a bottling plant for the purpose of bottling a mixture of Coca-Cola syrup preparation with carbonic acid and water." Coca-Cola Bottling Co. v. Coca-Cola Co., 269 F. 796, 800 (D.Del.1920) (Coke 1920) (quoting 1899 contract).

Thomas and Whitehead formed the "Coca-Cola Bottling Company," a Tennessee corporation, in December 1899. Shortly after its formation, they decided to assign some of their rights under the 1899 contract to outside bottlers. Thomas and Whitehead soon disagreed about the terms of the contracts between their company and the bottlers who would actually bottle Coca-Cola. They decided to divide the Coca-Cola bottling business and go their separate ways. Thomas retained the original Tennessee bottling company (the "Thomas Company") and an exclusive territory for the business of bottling Coca-Cola in approximately fifteen states. The exclusive right to bottle Coca-Cola in the remaining states that were the subject of the grant from the Company went to Whitehead. Whitehead and a new partner, J.T. Lupton, also named their bottling company "The Coca-Cola Bottling Company." To avoid confusion, we will call it the "Whitehead-Lupton Company." The 1899 Contract with the Company for the supply of bottling syrup was amended to reflect this separation.

As consumer demand for bottled Coca-Cola escalated, the two new bottling companies found themselves unable to meet it. In order to fulfill their obligations under the contract, they again subdivided their territories and entered into licensing contracts with bottlers who bottled, promoted, and sold Coca-Cola out of their own bottling plants in various exclusive territories assigned to them. The Thomas Company and the Whitehead-Lupton Company, the "parent bottlers," became largely licensors of the exclusive right that the Company had given them to market bottled Coca-Cola. Their licensees, the actual bottlers, performed the tasks of manufacture, shipment, and bottling.6 The parent bottlers' primary functions became the recruiting of actual bottlers to meet the rising demand for bottled Coca-Cola and continued expansion of the market for that product.

In 1919, a banking syndicate purchased the Company. The syndicate converted it into a Delaware corporation which assumed the old Georgia company's previous obligations to the parent bottlers. It did not directly contract with the parent's licensees, the actual bottlers of Coca-Cola. One year later, in 1920, smoldering tensions between the Company and the bottlers over the content and pricing of the syrup erupted into litigation, prosecuted primarily by the parent bottlers.

The 1920 litigation, like the World War that engendered it, led only to a prolonged armistice. In order to understand the impact of the 1920 litigation on the current dispute, it is helpful to set out several changes that were made in the formula for Coca-Cola bottling syrup between 1899 and 1920. Prior to 1906, the syrup was sweetened with a combination of sugar and saccharin. In 1906, Congress passed the Pure Food and Drug Act, following which the Company began using granulated sugar, in lieu of saccharin which was banned by the Act. Refined granulated sugar, a form of sucrose, became the most expensive ingredient used in the manufacture of the syrup. Accordingly, the parent bottlers and their licensees agreed to an increase in the price of syrup to reflect the higher cost attendant on the use of cane sugar as the sole sweetener for Coca-Cola bottling syrup. A second change was the introduction of different formulae for fountain syrup and bottlers' syrup. This change resulted in the Company's use of more sugar in bottlers' syrup than in fountain syrup.

World War I severely affected the sugar market and, with it, the Company's cost of producing syrup. Among other things, the war brought rigid price controls and rationing. The Company and its bottlers were permitted to buy only fifty percent of their sugar requirements. The removal of price controls at the end of the war, combined with a continuing shortage of sugar, produced a three-fold rise in the price of sugar, from nine cents a pound in September 1919 to over twenty-seven cents a pound in June 1920. Sugar rationing during the war had, in the meantime, spurred experimentation with sweeteners other than the sucrose obtained by refining cane or beet sugar. A division of the United States Department of Agriculture tested corn syrup and corn sugar for suitability as substitutes for conventional granulated sugar and concluded that the substitutes "[could] be used to replace one-fourth to one-half of the amount of sugar ordinarily used [in soft drinks], thereby effecting a saving of approximately 50,000 tons of sugar a year." Coke VI, 696 F.Supp. at 63 (quotation omitted). At approximately the same time, the Company began substituting corn syrup for sugar in order to attempt to meet demand, but the bottlers found that the use of the corn syrups then available adversely affected the quality of their product.

In 1919, because of the wartime rise in sugar prices, the parent bottlers agreed to permit the Company to pass on sugar price increases in excess of nine cents per pound. The Company was not satisfied. In 1920, it sought new contracts with the parent bottlers that would allow it to raise syrup prices on the basis of all its costs in manufacturing Coca-Cola bottling syrup. The bottlers were unwilling to agree to such a cost plus contract unless the Company gave them the right to obtain information on its manufacturing costs. The Company was unwilling. Instead, it stood on "the integrity and good faith of The Coca-Cola Company." Coke VII, 769 F.Supp. at 609. The parent bottlers then rejected the Company's proposal for flexible pricing. Stung by this rejection, the Company informed the parent bottlers that its contracts with them were terminable at will. The parent bottlers replied with a demand that the Company acknowledge that their contracts were perpetually binding. The Company responded with a notice that the parent bottlers' contracts would be terminated as of May 1, 1920.

The two principal parent bottlers, the Thomas Company and the Whitehead-Lupton Company, filed suit against the Company in Georgia. The suit was shortly withdrawn and refiled in the United States District Court for the District of Delaware on June 1, 1920. The parent bottlers sought to enjoin the Company from terminating their contracts. Six actual bottlers from the Whitehead-Lupton territory intervened in their support. What occurred during the pendency of that litigation is described in Coke III, 654 F.Supp. at 1394-95:

On June 10, 1920, the parties to the Delaware litigation agreed to entry of an order requiring the Company to supply the parent bottlers' and actual bottlers' requirements of Coca-Cola Bottlers Syrup during the pendency of the litigation. Under the terms of the Order, the price of the syrup paid by the actual bottlers to the parent bottlers was fixed at $1.72 per gallon for 5 months (until November 1, 1920), by which time it was anticipated a final decision on the applications for interlocutory injunctions would have been rendered. The Order further provided that if the final decision had not issued by November 1, 1920, the syrup price would be increased or decreased from the $1.72 level based upon increases or decreases in the Company's actual costs of manufacture of the syrup.

During the negotiations leading to the June 10 Order, it appears the Company failed to disclose fully that it had entered into substantial long-term sugar contracts at prices near the top of the market. The bottlers were given to understand, from representations made in an affidavit filed on June 7, 1920 by Charles H. Candler, then Chairman of the Board of The Coca-Cola Company, that the Company had favorable long-term sugar contracts "very much lower than the present market price." Charles Rainwater, in a letter to Candler dated January 14, 1921, recollected Candler's statements to the bottlers:

[Y]ou represented that The Coca-Cola Company had but one written contract, which expired in about three weeks, and one verbal contract, under which the market price each Monday morning was controlling.

Although the price of sugar dropped steadily from its peak in June, 1920, the price of syrup to the parent and actual bottlers under the June 10, 1920 Order remained fixed. Thus, while competing soft-drink prices fell, the retail price of Coca-Cola remained high. Actual bottlers suffered a loss in sales volume. The Chairman of The Coca-Cola Company reported that the Company's total sales volume of syrup (which included both bottle and fountain syrup) declined 53% in September, 1920 and 50% in October, 1920, because of the high price of syrup.

The bottlers expected relief on November 1, based on their understanding of the Company's sugar contracts. Instead, with the market price of sugar continuing to fall, the Company announced a price increase for its syrup in November, 1920, in order to recoup the cost of its inventories of high-priced sugar. The Company also announced price increases in December, 1920, and January, 1921. The bottlers by agreeing in the June 10 Order to a price for syrup based upon the Company's total manufacturing cost quickly discovered they had unwittingly exposed themselves to and insulated the Company from the hazards of the marketplace. The Company required the bottlers to pay for the Company's poor judgment in overpurchasing high-priced sugar, while it continued to receive fixed profits per gallon of syrup. Both The Coca-Cola Company and especially the actual bottlers found themselves in a precarious economic position while maintaining an increasingly antagonistic negotiating posture.

The Company represented its costs of manufacture under the June 10 Order had increased because of long-term sugar contracts at high prices. The parent bottlers, in disbelief, demanded verification of the Company's figures. The bottlers' audit revealed discrepancies, and the Company and the parent bottlers were unable to reconcile their figures or even agree on items of overhead to be included in the cost calculation. When the Company in January 1921 announced an estimated February cost of manufacture of $1.85, the bottlers took new action. In February, a parent bottler and actual bottlers filed supplemental complaints accusing the Company of fraud in the negotiation of and operation under the Order and sought appointment of a special master to determine the syrup cost under the terms of the Order.

Id. (citations omitted).

In Coke 1920, the district court granted the parent bottlers' motions for preliminary injunctions, declaring that their contracts with the Company were perpetual and that the Company had sold them property rights in the bottling of Coca-Cola. See Coke 1920, 269 F. at 816. The Company appealed the decision to this Court. On July 6, 1921, while the appeal was pending, the Company executed separate settlement agreements with both the Whitehead-Lupton Company and the Thomas Company. The district court formally incorporated those agreements into Consent Decrees on October 4, 1921.7

The Consent Decrees amended and clarified the contracts between the Company and the parent bottlers. Paragraph One of the settlement agreement so incorporated declared "that the primary obligation of all parties hereto, as well as all other individuals and Bottling Companies who employ the name Coca-Cola ... is to promote the sale of Coca-Cola." Joint Appendix (App.) at 4415.

Paragraph Two memorialized the parties' agreement that the original contracts between them "shall remain of full force and effect" and "be perpetual," except as "modified" herein, and provided that the parent bottlers must obtain the consent of the Company to an assignment made under the contract. Id.

Paragraph Five fixed the price of syrup to be offered by the Company to the parent bottlers at $1.17 1/2 per gallon, and established a formula to accommodate changes in the price of sugar. The parties designed the pricing formula so that upward changes in it would be triggered when the market price of sugar rose more than seven cents per pound over the price prevailing at the time the settlement was made. For every one cent increase in the price of sugar above the seven cents per pound increase, the bottlers agreed to pay six additional cents per gallon of syrup.8 The pricing formula was "to include all possible increases in the cost of producing such syrup" by the Company, other than those resulting from arbitration.9 Id. at 4417.

Paragraph Six obliged the parent bottlers to sell syrup to the actual bottlers at a maximum current price of $1.30 per gallon, "[i]n order to promote the sale of Coca-Cola and enable the actual bottlers to compete with other beverages." Id. It also provides that the initial $1.30 per gallon price of syrup to the actual bottlers would increase by six cents per gallon for every one cent per pound increase in the market price of sugar over and above an initial seven cents per pound increase. Id. This provision is similar to Paragraph Five of the Consent Decree which requires a similar increase in the price of syrup to the parent bottlers.

Paragraph Seven provides a method for calculating the market price of sugar. The parties agreed that sugar's market price would be determined quarterly, the first seven days of each quarter, "by averaging the market price of standard granulated sugar ... as quoted at [the ten largest domestic refineries]." Id. at 4417-18.

Paragraph Ten contains the Company's promise that "the syrup sold and furnished by it to the party of the first part [the parent bottlers] is to be high grade standard Bottlers Coca-Cola Syrup." Id. at 4420. Paragraph Ten also provides that the syrup furnished to the bottlers "shall contain not less than five and thirty two one hundredths (5.32) pounds of sugar to each gallon of syrup." Id.

The 1899 agreement between Thomas and Whitehead and the Company, as amended by the 1921 Consent Decrees, does not give any precise definition of the Coca-Cola syrup that is to be supplied, and neither the bottlers who are parties to this case concerning natural sweeteners, nor those who are parties to the diet Coke case, contend on appeal that the term syrup as used in the Company's agreement with the parent bottlers adds anything to the 1921 agreement's description of the syrup in terms of its sugar content. The bottlers in the instant case do argue, however, that the required "standard" Coca-Cola bottling syrup mentioned in Paragraph Ten of the Agreement, commonly used by all or substantially all Coca-Cola bottlers, is the HFCS-sweetened syrup because that is the syrup the Company now provides to approximately ninety-seven percent of its bottlers.10

By 1975 the Company had acquired the parent bottlers and assumed their obligations to their licensees, the actual bottlers. In 1978, the Company proposed to amend its bottlers' contracts to substitute a new pricing formula for its syrup (the "1978 Amendment"). The new formula continued to use a "sugar element" as the "base element" but added a factor based on the Consumer Price Index, instead of the "market price" of sugar. As discussed supra, the impetus for the "market price" term in the Consent Decrees came from the bottlers' disastrous experience with the Company's sugar purchases following World War I and during the first several months of the 1920 litigation. Tying the syrup price to the market price of sugar served the dual purpose of transferring the economic risks associated with long term sugar purchases from the bottlers to the Company and of providing an objectively verifiable price for the cost of sugar. Coke III, 654 F.Supp. at 1408.

Even in the period immediately following the entry of the Consent Decrees, the parties disagreed over whether the syrup should be priced at the "quoted" or "list" price, or at the actual selling price. This disagreement went unresolved. The Company's practice at that time, however, as reflected in a 1956 memorandum from C.W. Hodgson, Company Vice-President to the head of the Company's Purchasing Department (hereinafter "Hodgson Memorandum"), was to use the actual selling price rather than the higher list price. Id. at 1416. The Company determined actual selling prices through inquiries of the refiners. In 1969, the Company discontinued this practice and began using the refiners' official list prices to calculate the market price.

In January 1980, the Company started using a new, cheaper sweetener, HFCS, in place of the sucrose contained in refined, granulated cane or beet sugar. HFCS is made "by hydrolysis of corn starch by chemical enzymes." Coke VI, 696 F.Supp. at 67 (quotation omitted). At first, HFCS constituted fifty percent of the sweetener used in the syrup, but eventually the Company eliminated sucrose entirely.

The 1978 amendment "also contained a provision that in the event the Company modified the formula of Coca-Cola Bottlers Syrup to replace sugar with 'another sweetening ingredient,' the resulting savings would be passed through to amending bottlers." Coke III, 654 F.Supp. at 1395. From 1978 until 1987, when the Company withdrew it, most of the bottlers accepted the proposed 1978 amendment and had their contracts modified accordingly. Out of an original group of 102 bottlers, only forty-two remained in this case by the time the class issues were tried in 1983 and, as stated, only thirty participate in this appeal. See supra n. 3. Eighteen of these thirty participating bottlers continue to buy syrup for bottled Coca-Cola under the original contracts as modified by the Consent Decrees or contracts that closely resemble those original agreements. They seek both damages and injunctive and declaratory relief. The other twelve have sold or abandoned their contracts and seek only damages for breach.

For a time, the Company sold HFCS-sweetened syrup to both those bottlers who had accepted the 1978 amendment it proposed and the bottlers who insisted on operating under the 1921 agreements. The bottlers who agreed to amend their contracts received a "pass-through" of the savings to the Company from the use of HFCS, which is cheaper than the sucrose that is obtained from cane or beet sugar. The bottlers who refused to amend their contracts did not receive that particular price advantage. Despite the pass-through provision, the bottlers with amended contracts pay a higher price for syrup, due at least in part to the amended contracts' inclusion of promotional costs in the syrup's price base, a cost not included in the 1921 agreement's pricing formula. See Coca-Cola Bottling Co. of Shreveport v. Coca-Cola Co., 563 F.Supp. 1122, 1126 n. 14 (D.Del.1983).

The bottlers filed the present actions in 1981 following the Company's 1980 decision to substitute HFCS for granulated sugar in the syrup for bottled Coca-Cola. The parties' differences concern the nature of Coca-Cola's bottling syrup and the appropriate price for HFCS, as well as alleged pre-existing and continuing overcharges for syrup.11

As stated, the thirty bottlers who remain in this case are now, or once were, engaged in bottling Coca-Cola under contracts which conform to the Consent Decrees issued in 1921. In amended Count One of their complaint, all thirty seek damages claiming the Company breached their contracts by unilaterally supplying them with HFCS sweetened syrup instead of sugar-sweetened syrup. During the course of the litigation, twelve of these bottlers either amended their bottling contracts as Coca-Cola requested or sold their rights to bottle Coca-Cola to bottlers who operate under amended bottling contracts. These twelve bottlers now seek only past damages under amended Count One and have no remaining claims under Count Two in which the remaining eighteen bottlers seek declaratory and injunctive relief requiring the Company to supply them with fructose-based syrup.

In Count One of their complaint, the bottlers had originally sought to enjoin the Company from providing it with HFCS-sweetened syrup and only alternately sought a "pass through" of the savings the Company realized by using HFCS in place of sugar. In 1986, faced with claims by some of the bottlers that this violated their contracts, the Company announced that it would henceforth supply the bottlers who refused the 1978 amendment with syrup sweetened with the cane or beet sugar which they claimed they had a right to.

Presented with the Company's new policy of providing sucrose-sweetened syrup, the bottlers reversed position and asked to amend their complaint to add a claim that they were entitled to HFCS syrup. See Coke V, 668 F.Supp. at 922 (allowing leave to allege "an additional breach of the Consent Decrees and Bottler's Contracts based on the Company's decision in March, 1987 to supply sucrose syrup to unamended bottlers"). In their original complaint, the bottlers had also included as Count Two a claim for restitution based on the benefit the Company realized from use of the cheaper HFCS syrup. The bottlers abandoned any claim to restitution as untenable and were allowed to substitute, as amended Count Two, their claim of contractual entitlement to HFCS-sweetened syrup. Because the bottlers no longer wanted sugar-sweetened syrup, they also amended Count One of their original complaint by eliminating its prayer for equitable relief and limiting themselves on that claim to damages for breach of contract in the form of a pass-through of the savings the Company realized by using the cheaper HFCS syrup. Id.

The bottlers apparent about face had a compelling business rationale. Over ninety-seven percent of all bottlers had accepted the 1978 amendment the Company proposed and now use an HFCS-sweetened syrup. Id. at 909; see also Coke VII, 769 F.Supp. at 646. Before the introduction of HFCS syrup, many of the bottlers had formed cooperatives in order to reduce the cost of bottling. After the Company's 1987 decision to supply the bottlers who had refused the 1978 amendment with sugar-sweetened syrup, it "notified the [cooperatives] ... that the Company's Beverage Quality Assurance Department would develop and forward procedures for segregating HFCS-sweetened syrup from sucrose-sweetened syrup." Coke VII, 769 F.Supp. at 644.12 The bottlers who continued to resist the Company's proposal to supply HFCS syrup and received the sugar-sweetened syrup now incurred additional costs when they sought to have their syrup bottled by these cooperatives. Faced with the rising costs attendant to the Company's new quality control procedures, the bottlers asked and were granted leave to amend their complaint to include the present version of Count Two, claiming entitlement to HFCS-sweetened syrup.

As so amended, the bottlers' complaint continues to have four counts. Count One now seeks damages for breach of contract said to result from the Company's unilateral decision to supply the cheaper HFCS syrup to the bottlers who had refused amendment without a "pass through" of the savings that the Company realized when it substituted HFCS-sweetened syrup for sucrose-sweetened syrup in its sales to the bottlers. The bottlers argue that the Consent Decrees and their individual contracts with the Company entitle them to sugar-based syrup and that the damages suffered can be measured by the difference between the cost of sucrose-sweetened syrup and the cost of the cheaper HFCS syrup (the savings realized by the Company in light of the breach).

Only the eighteen bottlers who persist in their refusal to sign amended contracts are involved in Count Two. In it, they seek an injunction and declaratory relief that would require the Company to provide them with HFCS-sweetened syrup. They argue that under the Consent Decrees the Company promised to provide them with "standard syrup" and that the Company's subsequent course of conduct in introducing and expanding the use of HFCS-sweetened syrup has redefined the "standard syrup" as HFCS syrup. Therefore, they contend that the Company must provide the same HFCS syrup that all the bottlers with amended contracts now receive, at cost plus a mark-up equivalent to mark-up above sucrose prices specified in the Consent Decrees and the individual contracts informed by those Consent Decrees.13

In Count Three, the bottlers claim that the Company erroneously calculated the market price on which the Consent Decrees required the Company to base its charges for the sugar-based syrup. The bottlers claim that market price means the lowest actual prices made known by sugar refiners to purchasers. The Company claims that market price means the generally higher "official list prices" issued by the sugar refiners.

Finally, in Count Four, the bottlers seek recovery of a portion of a $4,300,000.00 award the Company received under a settlement agreement it made with the major sugar refiners against whom it had claimed antitrust violations. The bottlers claim that they are injured parties entitled to share in that recovery with the Company.

In Coke I, the district court denied the bottlers' motion for class certification, holding that the commonality and typicality requirements of Federal Rule of Civil Procedure 23(a) were not satisfied because as many as thirty-two different states' laws could be involved and different courses of dealing peculiar to individual bottlers would have to be considered. Coke I, 95 F.R.D. at 175-79.

The district court also held that the plaintiffs lacked standing to enforce the Consent Decrees because the bottlers were not parties to the Consent Decrees entered into between the parent bottlers and the Company. Id. at 175 (quoting Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723, 750, 95 S.Ct. 1917, 1932, 44 L.Ed.2d 539 (1975) (nonparties to consent decrees may not directly enforce those judgments "even though they were intended to be benefitted by [them]")).

The district court's second opinion, Coke II, arose out of an order granting reargument on some of the issues considered in Coke I. Following reargument, the district court reversed itself on the denial of class certification and vacated its holding denying the bottlers standing to enforce the Consent Decrees. With respect to class certification, the court concluded that because:

the meaning of certain provisions of the Consent Decrees regarding the pricing and composition of Bottler's Syrup ... will affect all or a significant number of the putative class members, the plaintiff has satisfied the commonality requirement of Rule 23(a)(2).

Coke II, 98 F.R.D. at 265 (footnote omitted). It also reassessed the typicality question and decided that some, but not all, of the issues involved with the proposed representative's claims would be typical of those of the putative class members. Id. at 266-67. The district court then certified two issues as appropriate for class consideration: the meaning of the term "sugar" and the meaning of the term "market price" in the Consent Decrees. Id. at 268.

In Coke II, the court also withdrew its Coke I standing holding after concluding "the Court need not have decided these issues in that they were not necessary for a determination of the class certification motion then before the Court." Id. at 264. Coke II left the standing issues to "be addressed when and if a decision is necessary for the proper adjudication of this case." Id.

Coke III is of central importance to this appeal. In that opinion, after trial of the two certified class issues, the district court set forth its findings of fact and conclusions of