A federal court in Wisconsin has reportedly denied the motion to dismiss filed by Dean Foods Co. in antitrust litigation brought by the U.S. Department of Justice (DOJ) and the attorneys general of three states, challenging the company’s acquisition of a milk producer in 2009. U.S. v. Dean Foods Co., No. 10-59 (E.D. Wis., filed January 2010). More details about the case can be found in issue 335 of this Update. While the court’s ruling rejects Dean Foods’ claim that the complaint lacked sufficient details, the court expressed some concerns about the government’s pleading, criticizing “structural issues” and “a lack of specificity in content.” A Dean Foods spokesperson was quoted as saying,” We believe our acquisition of Foremost Farms is promoting competition in the region and has already produced benefits for consumers and farmers. We continue to believe that the government’s complaint against us is unfounded.” Noting the court’s “recognition…
Category Archives Litigation
Supervalu, Inc. has filed an antitrust action against a number of chocolate manufacturers, alleging that they conspired to fix chocolate candy prices and overcharged the plaintiff for these products from 2002 through 2008. Supervalu, Inc. v. The Hershey Co., No. 10-1354 (E.D. Pa., filed March 29, 2010). The complaint outlines the chocolate companies’ sales during the relevant time period and details the increases in prices charged for specific products despite a decrease or lack of change in the price for cocoa beans during the same period. The plaintiff also claims that the prices of sugar, milk and labor remained relatively stable throughout the period. Included in the complaint are allegations contained in affidavits filed in connection with an investigation into the companies’ conduct by the Canadian Competition Bureau. Seeking treble damages, declaratory and injunctive relief and attorney’s fees and costs, the plaintiff alleges a single count of conspiracy to fix prices under…
A federal court in Maryland has determined that it is not a convenient forum for the pursuit of claims by Chinese citizens seeking millions in compensation for the injuries allegedly caused by their children’s consumption of powdered milk formula and similar products tainted with melamine. Tang v. Synutra Int’l, Inc., No. 09-0088 (D. Md., decided March 29, 2010). The scandal led to a global recall of powdered milk products and resulted in the execution of several milk company officials found responsible for adding melamine to the products, purportedly to increase their protein content. The melamine allegedly caused the deaths of six infants and caused kidney stones and related injury to thousands of others. The government established a compensation program for affected families, but some sought increased damages in Chinese courts. The defendants filed a motion to dismiss on the ground of forum non conveniens, and the court discussed at length…
A California resident has filed a putative class action in federal court against Kellogg Co., alleging that the company misled consumers by claiming its snack products were healthy and nutritious and met “stringent food safety requirements,” when in fact they contained Salmonella-contaminated peanut paste supplied by the Peanut Corporation of America. Benavides v. Kellogg Co., No. 10-02294 (C.D. Cal., filed March 29, 2010). The Peanut Corp. Salmonella outbreak led to a massive recall of food products, including Kellogg’s Austin® and Keebler® branded sandwich crackers and cookies. The complaint alleges that Kellogg hired unqualified private inspectors to audit its suppliers’ manufacturing plants while claiming that its suppliers met Codex Alimentarius Commission standards. The plaintiff seeks to certify a nationwide class of consumers with alleged monetary injury. He alleges (i) unlawful business acts and practices in violation of California’s Sherman Food, Drug and Cosmetics Law and Consumer Legal Remedies Act; (ii) deceptive marketing and…
A meat manufacturer that recalled more than 1 million pounds of meat products linked to a Salmonella outbreak that purportedly sickened more than 250 consumers in 44 states has reportedly sued the companies that supplied the red and black pepper allegedly identified as the source of the contamination. Daniele Int’l, Inc. v. Wholesome Spice & Seasonings, Inc., No. 10-155 (D.R.I., filed March 30, 2010). Seeking compensatory, punitive and exemplary damages, the plaintiff apparently alleges that it recalled more than 1.2 million pounds of meat, including salami, prosciutto and pancetta, refunded more than $1.5 million to customers, incurred transportation and shipping costs, and lost customers and future profits. The company reportedly purchased more than 50,000 pounds of pepper from one defendant and more than 40,000 pounds of pepper from the other in 2009. According to a news source, public health officials traced the Salmonella strain to the black and crushed red pepper…
Acting on behalf of environmental interest groups, a University of Maryland School of Law student clinic has filed a lawsuit against a chicken farmer and the company that owns and processes the farm’s chickens, alleging that the farm’s poultry waste is being discharged into and polluting navigable waters of the United States in violation of the Clean Water Act. Assateague Coastkeeper v. Alan & Kristin Hudson Farm, No. 10-487 (D. Md., filed March 1, 2010). The plaintiffs purportedly tested downstream waters and found high levels of fecal coliform and E. coli bacteria, as well as nitrogen, phosphorus and ammonia. They allege that the water carried from the farm eventually empties into the Chesapeake Bay. In response to the lawsuit, the Maryland Legislature reportedly approved a measure that requires the clinic to disclose its clients and budgets from the preceding two years. An early version of the bill would have penalized the university…
A federal court in California has dismissed a lawsuit that the Center for Science in the Public Interest (CSPI) filed against a company which claimed its multivitamin supplements supported prostate health or reduced the risk of prostate cancer. CSPI v. Bayer Corp., No. 09-05379 (N.D. Cal., decided March 25, 2010). The court determined that CSPI could not bring claims under California’s Unfair Competition Law (UCL) or its Consumer Legal Remedies Act (CLRA) in a representational capacity on behalf of consumers. The court also found that the organization lacked standing to sue on its own behalf. According to CSPI’s complaint, the company’s conduct interfered with its mission to “provide useful, objective, and safe information to the public.” The court found that these allegations of injury were insufficient to demonstrate cognizable injury for the organization to sue on its own behalf under the UCL, which requires an action to be brought by a…
The Ninth Circuit Court of Appeals has lifted a preliminary injunction that prevented California from enforcing a law adopted after The Humane Society’s video of the mistreatment of downer cattle at a slaughterhouse became public and led to a massive beef recall in 2008. Nat’l Meat Ass’n v. Brown, 09-15483 (9th Cir., decided March 31, 2010). The National Meat Association challenged California’s law, which prohibits slaughterhouses from receiving, processing or selling nonambulatory animals, as preempted by the Federal Meat Inspection Act (FMIA), and the district court agreed. The state law also prohibits moving a nonambulatory animal without a sling or other sled-like or wheeled conveyance. According to the Ninth Circuit, the federal law, which contains an express preemption provision, prescribes what is to be done with nonambulatory animals to be slaughtered and sold for human consumption; it does not limit states “in their ability to regulate what types of meat may…
The European Union (EU) and Argentina have apparently reached an agreement in a dispute before the World Trade Organization (WTO) involving genetically engineered products and the application of biotechnology to agriculture. The agreement, which provides for the establishment of a regular dialogue on these issues, follows a similar agreement the EU struck with Canada, which, along with Argentina and the United States, challenged the EU’s legislation on biotech products. The WTO dispute settlement body previously found that the EU violated international agreements by applying a general de facto moratorium on the approval of genetically modified organisms (GMOs) from 1999 to 2003 and imposing undue delays on the approval of 23 product specific applications. The WTO also found that six member states failed to base their national safeguard measures on appropriate risk assessment. According to EU Trade Commissioner Karel De Gucht, “This is the second settlement regarding the WTO case on…
Old Republic Insurance Co. has filed a lawsuit in a New York state court, seeking a declaration that it is entitled to reimbursement for the costs it has incurred defending a company that distributed diacetyl and has been sued with other companies for personal injuries allegedly sustained from exposure to the butter-flavored chemical. Old Republic Ins. Co. v. The Travelers Indemnity Co., No. 10103533 (N.Y. Sup. Ct., filed March 18, 2010). According to the complaint, some 21 active lawsuits are currently pending against Old Republic’s insured, Citrus & Allied Essence, Ltd. The carrier claims that it has successfully defended the company for three years at a cost of more than $1 million in cases where other carriers, including one that is now insolvent, share coverage and defense responsibilities.
