A Massachusetts consumer has filed a putative class action against ACH Food Companies, Inc., manufacturer of Weber® BBQ Sauces, alleging the company misleadingly markets its products as "All Natural" despite containing caramel coloring. Demmler v. ACH Food Cos., Inc., No. 15-13556 (D. Mass., filed October 13, 2015). The complaint asserts that under Massachusetts and federal regulations, the term "natural" cannot be used on products containing artificial ingredients such as added flavoring or coloring, so ACH's use of caramel coloring precludes it from labeling and marketing its products as natural. The plaintiff alleges he paid a premium for the sauce because he believed it to be natural, and he seeks to represent a class of consumers alleging unjust enrichment and a violation of state law. Issue 582
Category Archives 1st Circuit
Gosling Brothers Ltd. has filed a complaint against Pernod Ricard USA, maker of Malibu Island Spiced Rum®, alleging that a recipe on the Malibu website violates Gosling’s “Dark ‘N Stormy” trademarks. Gosling Bros. Ltd. v. Pernod Ricard USA, No. 15-13360 (D. Mass., filed September 15, 2015). Gosling holds five trademarks for “Dark ‘N Stormy” in the categories of wine and spirits, bar services and clothing to protect a cocktail recipe and a premixed cocktail drink composed of Gosling’s Black Seal Rum and ginger beer. The Malibu website, the complaint alleges, offers a recipe for a “Dark N’ Stormy” drink composed of Malibu Island Spiced Rum®, ginger beer, bitters and a lime wedge along with a video instructing how to make the cocktail. The complaint further alleges that a similar recipe for a “Black Stormy” cocktail uses similar ingredients but replaces the Malibu Island Spiced Rum® with Malibu Black Rum®. Gosling…
A federal court in Puerto Rico has certified a question to the territory’s supreme court to determine whether a company can be held liable for injuries stemming from the consumption of a species of shrimp that can contain a naturally occurring toxin. Cabán v. JR Seafood Inc., No. 14-1507 (D.P.R., order entered September 11, 2015). The plaintiff became quadriplegic after eating shrimp tainted with saxitoxin at a restaurant supplied by JR Seafood. He sued JR Seafood for strict liability, arguing that the product was defective. The district court abstained from ruling, holding, “After careful review of the parties’ allegations and applicable law, the court finds that this case relies solely on an unsettled issue of Puerto Rico law, as to which this court cannot reasonably predict how the Puerto Rico Supreme Court would rule.” It then certified two questions: “Under the principles of product liability, is a supplier/seller strictly liable…
A consumer has filed a lawsuit against Fifth Generation, Inc. alleging that its Tito’s Handmade Vodka® is not “handmade” as claimed on the label because it is produced through a mechanized process. Wilson v. Fifth Generation, Inc., No. 15-561 (M.D. Ala., filed August 5, 2015). The complaint joins a number of other lawsuits alleging similar facts and claims against Tito’s Handmade Vodka®. Fifth Generation has filed a motion to dismiss a similar lawsuit in Massachusetts federal court, arguing that the claims have “no basis in law or common sense” and no reasonable person could believe that a product sold nationally “was made exclusively in human hands in some backwoods, ad hoc operation, without any mechanical equipment.” Emanuello v. Fifth Generation, Inc., No. 15-11513 (D. Mass., motion filed August 5, 2015). In May and July 2015, courts dismissed lawsuits targeting “handmade” claims made on Maker’s Mark® labels, finding that the “handmade” claim “obviously cannot…
A consumer has filed a putative class action against Kraft Foods Group Inc. alleging that the company’s fat-free cheese is mislabeled as “natural” because it contains artificial or synthetic ingredients, including “artificial color.” Quiñones-Gonzalez v. Kraft Foods Grp., Inc., No. 15-1892 (D.P.R., filed July 27, 2015). The plaintiff asserts that she relied on the “natural” label to mean that the product, “at a minimum, has no artificial ingredients or characteristics. The public is further led to believe the Product will be healthier, safer and/or produced to a higher standard.” She seeks class certification, an injunction, restitution and damages for allegations of deceptive and unfair marketing and unjust enrichment. A class was certified in June 2015 in a similar lawsuit pending in California federal court; details about the ruling appear in Issue 570 of this Update. Issue 573
A consumer has filed a putative class action against Ghirardelli alleging that the company deceptively advertised its white chocolate products as containing chocolate, white chocolate or cocoa butter. Vega-Encarnacion v. Ghirardelli Chocolate Co., No. 15-1821 (D.P.R., filed June 16, 2015). Three of the products at issue in the complaint were the subjects of an October 2014 class action settlement open only to consumers who purchased the product “in the United States,” so the Puerto Rican consumer seeks to represent those similarly situated in U.S. territories. Additional details about the settlement appear in Issue 540 of this Update. The complaint cites the U.S. Food and Drug Administration’s (FDA’s) definitions of “chocolate” and “white chocolate,” which include required levels of cacao-derived products such as cocoa butter. Ghirardelli’s white-chocolate products—baking chips, confectionery coating wafers and ground white chocolate flavor—do not contain any white chocolate as defined by FDA, but merely white-chocolate flavoring, the…
A plaintiff has alleged in Massachusetts federal court that Whole Foods Market mislabels its 365 Everyday Value Plain Greek Yogurt as containing 2 grams of sugar per serving despite Consumer Reports tests showing that a serving of the product contains an average of more than 11 grams of sugar. Knox v. Whole Foods Market, No. 14-13185 (U.S. Dist. Ct., D. Mass., filed Aug. 1, 2014). According to the complaint, the plaintiff learned about the alleged labeling discrepancy from Consumer Reports magazine, which tested six samples of 365 Everyday Value Plain Greek Yogurt and apparently found the average sugar content to be nearly six times the amount listed on the label. Whole Foods reportedly responded to the magazine’s findings by asserting that it relied on testing results from reputable third-party labs. The plaintiff alleges breach of warranty, unjust enrichment and negligence, and he seeks class certification, compensatory and punitive damages, attorney’s…
The First Circuit Court of Appeals has upheld the dismissal of an attempted appeal from an administrative ruling under the Perishable Agricultural Commodities Act (PACA), agreeing with the district court that the company which allegedly failed to pay all of the required purchase price on four truckloads of produce failed to file an appropriate appeal bond within the prescribed period. The Alphas Co. v. Kopke, No. 12-1581 (1st Cir., decided February 13, 2013). So ruling, the court affirmed the order of an administrative law judge, acting on behalf of the Secretary of Agriculture, awarding the produce supplier $50,025 plus interest. The bond that Alphas filed had “three material defects: it was not filed within the prescribed thirty-day appeal period; it was in an amount less than the amount stipulated; and it did not contain appropriate indemnification covenants.” Looking to the statute, legislative history and other courts for guidance, the First…
The First Circuit Court of Appeals has upheld a jury verdict tracing the source of E. coli-contaminated beef to Greater Omaha Packing Co. thus sustaining a third-party indemnification claim against it. Long v. Fairbank Reconstruction Corp. v. Greater Omaha Packing Co., No. 12-1412 (1st Cir., decided November 21, 2012). Two Maine residents sickened in the outbreak settled for $500,000 with Fairbank Reconstruction, which had purchased the meat from Greater Omaha and further processed it for sale in retail-sized packages by grocery stores. Fairbank sought indemnification from Greater Omaha, and the trial focused for the most part “on the ‘traceback’ analyses that led Fairbank’s experts to conclude that the contaminated meat could only have come from the [Greater Omaha] combos and not from another supplier’s product.” The court found that “ample evidence” supported the jury’s conclusion that Greater Omaha was the source of the E. coli contamination that sickened the two…
The First Circuit Court of Appeals has determined, as a matter of first impression, that Starbucks Corp. violated a Massachusetts law prohibiting restaurant tips to be shared with employees who have managerial responsibilities, because the “upscale coffee house” chain allowed tips collected in tip jars by the cash registers of its Massachusetts shops to be shared by shift supervisors and baristas. Matamoros v. Starbucks Corp., Nos. 12-1189, -1277 (1st Cir., decided November 9, 2012). Massachusetts apparently amended a tip-sharing law in 2004. Under the earlier version, the courts applied a “primary duty” test to decide whether an employee could participate in a tips pool—if the primary duty was to serve customers, he could participate; if the primary duty was to manage, she was ineligible. After amendment, the legislature clearly defined a “wait staff employee” as someone, among other matters, “who has no managerial responsibility.” The court agreed with the plaintiffs…
