The words were printed on the inside of the cap on a bottle of Vitamin Water, which Loates bought while dining out in Edmonton, Canada, where she lives. Loates found the phrase particularly offensive because her younger sister, Fiona, has cerebral palsy and autism.
"We immediately thought 'You have got to be kidding me,' " she told Huffington Post Alberta.
The message was part of a promotion by Coca-Cola (KO) in Canada that randomly paired English and French words that together were supposed to make up funny gibberish phrases. But the words were only vetted in French, not English, reports Milwaukee's Journal Sentinel newspaper.
"Retard" in French means late or delayed.
"Not everyone in Canada speaks French -- like my daughter, Blake," Loates wrote to Coca-Cola officials.
"The 'R' word is considered a swear word in our family. We don't use it. We don't tolerate others using it around us. We are over-sensitive, but you would be too if you had Fiona for a daughter! Can you imagine if she had opened this bottle???"
Loates said that he had been drinking Coke since he was 9 and got his first newspaper route, but now calls himself an "ex-Coke drinker."
The soft drink company said it never intended to offend anyone.
"We have learned from this and it was a mistake," David Thomson, vice-president of still beverages for Coca-Cola, told Canada's Metro newspaper. "[We] have cancelled and moved on and have dealt with this as soon as possible," Thomson said, adding that any remaining caps at Coke Plants have been destroyed.