Key Takeaway: As consumer demand for “sustainable” products grows, so does the risk of litigation challenging sustainability claims on advertising and packaging. As one recent case shows, failure to plead actual reliance can be grounds for dismissal of claims that sound in fraud, including claims under California’s False Advertising Law (“FAL”), Unfair Competition Law (“UCL”), and Consumers Legal Remedies Act (“CLRA”).

On October 7, 2021, the Northern District of California dismissed a suit alleging that a restaurant chain’s tuna sandwiches are not “100% sustainably caught skipjack and yellow fin tuna” as advertised. The Court found that the Plaintiffs alleged the “who” (the Defendant) and the “what” (the sandwiches) but not the other elements required to meet a heightened pleading standard for claims that sounded in fraud. “Plaintiffs still need to describe the specific statements they saw and relied upon, when they saw the statements, and where the statements appeared.” The Court found it fatal that Plaintiffs did not allege that “they actually read or heard any such advertising or packaging.”

Plaintiffs could not overcome this specificity requirement by alleging that the defendant’s advertising campaign was long-running and widespread. Ultimately, the Court dismissed with leave to amend Plaintiffs’ FAL, UCL, CLRA, and common law fraud claims. The Court also dismissed Plaintiffs’ unjust enrichment claim as duplicative.

The case is Amin et al v. Subway Restaurants, Inc. et al., No. 4:21-cv-00498 (N.D. Cal. – October 7, 2021), and the Court’s opinion is available here.

As readers of this blog know, food law is a hot topic in today’s legal practice. For those looking to deepen their understanding of the growing field of food law, Tommy Tobin, an attorney in the firm’s Food Litigation practice, has edited the treatise Food Law: A Practical Guide. Written by practicing lawyers, including leading Perkins Coie attorneys, for practicing lawyers, the book aims to provide an introduction to how different areas of law and legal practice intersect with food, with information that is both practical and actionable.

As noted in the book, “food litigation has quickly become a distinct practice area in commercial litigation, with the plaintiffs’ bar increasingly targeting the industry, law firms establishing practice teams focusing on these matters, and even law schools offering courses on the subject,” and “this growing field sees no signs of slowing down in the years ahead.”

Chapters include “Food Litigation: An Emerging Field,” “Reasoning with the Reasonable Consumer Standard in Food Litigation,” and “Food Law and the Pandemic: Securing the Food System.” The book was published by the American Bar Association.

To learn more about the book, please visit the American Bar Association’s website, or contact Tommy Tobin.

Consumers and brands are well aware of the benefits of environmentally friendly products. A recent report found that nearly 89% of brands implementing sustainability initiatives see an improvement in brand reputation. However, brands should take care to comply with applicable state and federal guidance and legal requirements, as regulators, competitors, and class action attorneys continue to scrutinize eco-friendly marketing. For example, the FTC’s “Green Guides” warn marketers against making broad and unqualified environmental claims, such as “eco-friendly” or “green,” which may convey multiple meanings to consumers. While marketers should take care with all environmental claims, we draw on recent litigation and enforcement trends to bring you the following best practices for making certain common claims: “recyclable,” “biodegradable,” and “sustainable” sourcing.

Read more in this Perkins Coie Update: Sustainability Advertising: Key Takeaways

From investors and shareholders to customers and employees, key stakeholders are increasingly demanding both corporate action and broad-based public disclosure of environmental, social, and governance (ESG) issues. As corporations take action and report on their ESG challenges and achievements, they will be well served to take steps to mitigate the risks of both regulatory enforcement and private litigation.  To mitigate the risks associated with ESG claims, companies might consider how their policies and procedures address the adequacy of disclosures to shareholders on ESG topics, substantiation of ESG claims with appropriate documentation, and the bounds of aspirational and similar ESG statements.

Read more in this Perkins Coie Update: ESG Claims in an Era of Heightened Regulatory and Litigation Risks.

According to the Financial Times*, consumer packaged goods (CPG) had been among the most resilient industries during the pandemic. Even as CPG brands are facing increasing food and input prices among other market disruptions, many companies are maintaining and even increasing their marketing budgets. But at the same time, companies are scrutinizing ad spend to produce effective results to drive sales.

As Perkins Coie attorneys wrote in Law360* (reg. req.) last year, “the food and beverage industry is providing much-needed goods to the market, despite challenging conditions. While doing so, it faces ongoing and unwelcome litigation. Now more than ever, the industry’s attention should be focused on what really matters to consumers: producing a stable supply of safe and healthy food.”

*Subscription-based publication

Most Americans are familiar with the term “THC” at this point. What they might not yet appreciate is that common nomenclature is actually referring to Delta-9-tetrahydrocannabinol or “Delta-9” THC. That’s the scientific terminology for the molecule in marijuana that’s well-known for its psychoactive properties—i.e., what causes a “high.” Delta-9 is a cannabinoid and there are hundreds of different cannabinoids within any given cannabis plant.

Read the full article on our sister blog Cannabis Legal Highlights.

Despite a tumultuous year, one thing stayed the same: plaintiffs’ class action attorneys continued to file plenty of lawsuits against manufacturers of consumer packaged goods (CPGs). Attorneys in Perkins Coie’s Food Litigation practice have defended false labeling cases across a broad range of products and industries. As our practice area has expanded, we have continued to pay close attention to the litigation environment for emerging trends, important developments in case law, and related regulatory guidance across CPG product categories.

On April 1, Perkins Coie’s Kristine Kruger and Carrie Akinaka will be presenting “Current Trends in Cosmetics Litigation” hosted by the American Bar Association. Find out more & register here.

Perkins Coie is pleased to announce that its fifth annual Food Litigation Year in Review, in coordination with the expansion of the firm’s practice, has been broadened and renamed the Food & Consumer Packaged Goods Litigation Year in Review. In coordination with this rebranding, we have also launched an infographic report that highlights key litigation outcomes, filing data, and industry trends. Despite a tumultuous year, one thing stayed the same: plaintiffs’ class action attorneys continued to file plenty of lawsuits against manufacturers of consumer packaged goods (CPGs). Continue Reading Food & Consumer Packaged Goods Litigation Year in Review 2020

Last week the Ninth Circuit concluded that a campaign for class certification brought by dog food purchasers was all bark and no bite.

In a memorandum disposition issued on December 9, 2020, the Ninth Circuit affirmed the district court’s denial of class certification on predominance grounds, because of the varying nature of the labeling representations at issue, and because plaintiffs failed to present a viable damages model. Reitman v. Champion Petfoods USA, Inc., et al., No. 19-56467, 2020 WL 7238439 (9th Cir. Dec. 9, 2020). The panel also reaffirmed the principle that full refunds are not a recoverable form of damages for consumer goods that plaintiffs purchase and use—and thus receive some value from. Continue Reading Recent Ruling: Ninth Circuit Rules that Dog Food Purchasers’ Class Certification Campaign Has No Bite

On December 10, 2020, the U.S. District Court for the Northern District of California held its Class Action Symposium. The symposium is as timely as ever. Food, beverage, and consumer product class actions are rocketing, with projected filings up 24 percent over 2019. The Northern District of California sees a substantial subset of these filings, earning it the nickname “the Food Court.” Continue Reading Industry Insights: Key Takeaways from Northern District of California’s Class Action Symposium