Outrage followed the ad's release earlier this week, as Jenner was shown ending a protest by sharing a Pepsi with a police officer. Many threatened to boycott the soft drink company, accusing the brand of mocking the Black Lives Matter movement.
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"Pepsi was trying to project a global a message of unity, peace and understanding," the company said in a statement posted on its website on Wednesday. "Clearly, we missed the mark, and we apologize. We did not intend to make light of any serious issue. We are pulling the content and halting any further roll out. We also apologize for putting Kendall Jenner in this position."
A source told ET that Jenner has been "devastated" by the backlash related to the campaign, but that "this is not a career breaker for her."
"This is the first controversial campaign she has been involved with," the source said. "Even though she had nothing to do with the production and the message of the campaign, she will be blamed for this since she is the face."
"Kendall relied on Pepsi to do their due diligence and trusted that it would tasteful," the source continued, adding that Jenner's contract will not allow her to comment on the controversy without Pepsi's approval.