In November 2015, the FDA announced that it was opening regulatory proceedings to define the term “natural” for food and beverage labeling. Ever since then, courts have stayed cases raising “natural” claims under the primary jurisdiction doctrine, appropriately deferring to the FDA’s deliberative process. Recently, however, plaintiffs’ counsel have filed new “natural” suits, or sought to reopen previously stayed “natural” cases, apparently impatient over the duration of the FDA’s rulemaking. The notion, implicit in these new filings, that class action lawsuits should take precedence over FDA rulemaking is wrong-headed: Courts have long held that class actions are not an appropriate tool to set national policy, the FDA has expertise in food labeling that courts lack, and recent statements by the FDA Commissioner suggests the FDA is poised to act on “natural.”
Each month we will be sharing the PC Food Litigation Index, a summary of latest class action filings in the food and beverage industry. This data is compiled by Perkins Coie based on a review of dockets from courts nationwide.
Annual Filing Trends
In the wake of the 2016 dismissal of human rights cases filed against food companies in California, a new class action case was filed on February 26, 2018 in Massachusetts federal court (Tomasella v. Hershey Co.) alleging human rights violations associated with cocoa farming and processing. At its core, the complaint is premised on a theory of unjust enrichment in violation of the Massachusetts Consumer Protection Law—namely, that the defendants, by failing to disclose trafficking and child labor in their supply chains (and in fact asserting in their disclosures that they had “zero tolerance” for such activities), caused consumers to purchase their products when they never would have done so had they known about the purported trafficked and child labor taint in the products’ supply chains.
Earlier this week, attorneys in the Perkins Coie Food Litigation team joined top in-house counsel, defense attorneys and regulatory experts at the GMA Legal Conference which took place in New Orleans, LA. The conference covered a wide array of important and timely legal issues, with an emphasis on protecting your brands from litigation risks and complying with government regulations. Highlights from the conference included:
- Statistics showing a steady increase in the number of lawsuits being filed in recent years, particularly in hotbed jurisdictions for food litigation including California, New York, Illinois, Missouri and Florida;
- Discussion of key recent decisions and important pending cases, including renewed judicial interest in the “reasonable consumer” standard as a basis for early dismissal in false labeling and “natural” cases;
- Increased Prop 65 activity in California involving a growing list of chemicals and targeted products; and
- A session entitled “What in the World was He Thinking? A Look Inside the Mind of a Plaintiffs’ Attorney, and How to Respond” featured our own David Biderman, where he stressed the importance of a collaborative effort by the industry to fight and ultimately minimize the number of frivolous lawsuits.
Perkins Coie was a proud sponsor of this annual event with many members of its Food Litigation Team attending the conference including David Biderman, Charles Sipos, Julie Hussey and Steven Hwang.
In yet another Rule 12 decision tied to the “reasonable consumer” standard, Judge William Alsup of the Northern District of California dismissed a putative class action against Coca-Cola challenging the name “Diet Coke” as misleading. Plaintiff in the lawsuit, Shana Becerra, alleged that the product name “Diet Coke,” which has been in regular use since 1982, might mislead consumers into believing that merely drinking Diet Coke will necessarily lead to weight loss. The complaint cited scientific studies which the plaintiff claimed to show that consuming diet sodas actually leads to weight gain.
Newman v. Dierbergs Markets, Inc., No. 1822-CC00194 (Mo. Cir. Ct. – St. Louis): Putative class action asserting violations of Missouri’s Merchandising Practices Act, and raising a claim for unjust enrichment. Plaintiff alleges that the label on Defendant’s Extra Crunchy “All Natural” Extra Kettle Cooked Potato Chips is false and misleading, representing the chips as “all natural” despite the fact that they contain xanthan gum, a synthetic ingredient. Continue Reading
Parties Settle Kombucha False Advertising Action
Retta, et al. v. Millennium Products, Inc., No. 2:15-cv-01801 (C.D. Cal.): The Ninth Circuit entered an order granting Objector-Appellant’s motion for voluntary dismissal of this putative class action for violations of California’s CLRA, UCL, and FAL, as well as New York’s Deceptive and Unfair Trade Practices Act. Plaintiffs alleged that Defendant’s kombucha beverages are falsely and misleadingly labeled, representing the products as containing antioxidants when in fact the beverages “do not have even a single nutrient that the FDA recognizes and approves of for labeling statements using the term ‘antioxidant.’” Continue Reading
Quiroz v. The Apple & Eve, LLC, No. 2:18-cv-00401 (E.D.N.Y.): Putative class action alleging violation of New York’s Deceptive and Unfair Trade Practices Act and False Advertising provision of the GBL, as well as California’s CLRA, UCL and FAL, and raising a claim for common law fraud. Plaintiff alleges that Defendant falsely and misleadingly labels its juice products, representing them as having “No Sugar Added” and claiming “[no] preservatives have been added,” leading consumers to believe that “they are receiving a healthier, lower-calorie juice, when they are not.” Continue Reading
Kelly v. Cameron’s Coffee and Distribution Company, No. 1816-CV00470 (Mo. Cir. Ct. – Jackson Cnty.): Putative class action asserting violations of the Missouri Merchandising Practices Act. Plaintiff alleges that Defendant sells coffee pods labeled as “100% compostable and environmentally friendly,” when in fact the coffee pods are only compostable in commercial composting facilities that are not generally available in Missouri. Continue Reading
Court Grants Motion to Dismiss Class Action Involving Organic Baby Formula
Organic Consumers Association v. The Hain Celestial Group, Inc., No. 1:16-cv-00925 (D.D.C.): The Court entered an order granting Defendant’s motion to dismiss this putative class action for violation of the District of Columbia Consumer Protection Procedures Act. Plaintiff alleged that Defendant’s “Earth’s Best” brand infant and toddler formula is falsely and misleadingly labeled “organic,” when it in fact contains several ingredients that are not permitted in organic food products, among them, ascorbyl palmitate, zinc sulfate, sodium selenite, and taurine. Continue Reading