Sandiganbayan dismisses coconut levy case on Pepsi companies for good

The Philippine Commission on Good Government says pursuing the case is ‘unwarranted,’ taking into consideration the pieces of evidence, the witnesses available, and the circumstances of the case

MANILA, Philippines – Anti-graft court Sandiganbayan has permanently dismissed Civil Case No. 0033-G — the coconut levy case which alleged that the Pepsi companies belong to the Philippine government.

The case stems from Civil Case No. 0033 filed by the Philippine Commission on Good Government (PCGG) on July 31, 1987, seeking to recover the Marcoses’ ill-gotten wealth. It was divided into eight cases to manage the number of defendants.

The Office of the Solicitor General (OSG) on February 13, 2025 presented a copy of the Bagong Pilipinas Commission Resolution No. 2024-0710-002, where commissioners of the PCGG agreed to “desist from further proceedings in the present case.” The PCGG said pursuing the case is “unwarranted,” taking into consideration the pieces of evidence, the witnesses available, and the circumstances of the case.

“The Court recognizes the discretion of the plaintiff to move for the dismissal of its complaint under Section 2, Rule 16 of the Rules of Court based on its evaluation as regards the feasibility of pursuing the case,” said the Sandiganbayan Second Division in its 12-page resolution dated June 26, 2025.

“Hence, the dismissal of the Third Amended Complaint, as prayed by the plaintiff, is hereby granted. Accordingly, the present case is deemed disposed of in its entirety.”

The PCGG alleged that the Pepsi companies should be under the Philippine government as it was bought using coconut levy funds — P462 million loans from the United Coconut Planters Bank (UCPB), a P125-million Letter of Credit from UCPB, and P350 million from the Coconut Industry Foundation (CIF).

Among those who were named in the original case were Eduardo “Danding” Cojuangco Jr., Ernest Escaler, the heirs of the late industrialist Ernesto Escaler, former president Ferdinand Marcos Sr., and former first lady Imelda Marcos. Corporate defendants named were ECI Challenges Inc. (ECI), Pepsi Cola Bottling Group (PCBG) of the Philippines, and Pepsi Cola Distributors, Inc. (PCD).

OSG and PCGG lawyers said Escaler could not have gotten the loans if it weren’t for his connection with and “special favors” from Cojuanco, then chairman of UCPB and the administrator of the coconut levy funds. Escaler admitted that he is the maternal nephew of Cojuangco’s wife, based on a pleading dated June 18, 1999.

The Supreme Court in April 28, 2021 granted the petition for prohibition of Cojuangco on the ground of the government failing to pursue the case after decades, violating his right to constitutional due process.

The Sandiganbayan also dismissed cases in December 12, 2024 against the Marcos couple and their heirs.

The anti-graft court noted that the government, in a 1989 Compromise Agreement, “agreed to settle the controversy and put an amicable end” to the lawsuit.

It added that the PCGG in August 21, 2003 already submitted a compliance noting that the loan with the United Coconut Planters Bank (UCPB) was settled by the Pensacola Marketing and Distributors, Inc. (the Lapanday Group) in 1989. – Rappler.com