A German appeals court has dismissed a lawsuit brought by consumer group Stiftung Warentest accusing candy manufacturer Ritter Sport of labeling its Whole Hazelnut bar as natural despite containing piperonal, which the group contends can only be obtained using unnatural chemicals. The ruling prevents Stiftung Warentest from claiming Ritter is misleading customers but does not yet allow claims for damages. A representative of Stiftung Warentest expressed disappointment with the decision, saying that they still did not know how Ritter produced the piperonal, but a Ritter representative said that the company, along with its piperonal supplier Symrise, had filed patents on how the substance could be obtained naturally. See Confectionery News, September 15, 2014. Issue 539
Category Archives Issue 539
A California federal court has granted Duke University’s motion to dismiss in a lawsuit filed by John Wayne Enterprises seeking a declaratory judgment that its registration and use of Duke trademarks are not likely to cause consumer confusion and do not violate or dilute the school’s trademarks. John Wayne Enterprises, LLC v. Duke Univ., No. 14-1020 (C.D. Cal., order entered September 30, 2014). The case was dismissed on procedural grounds after the court found that it did not have jurisdiction over the North Carolina-based university. Additional information about the lawsuit appears in Issue 530 of this Update. Issue 539
A Michigan federal court has denied The International Group Inc.’s (IGI’s) motion for summary judgment in a case alleging that the waxmaker and FPC Flexible Packaging Corp. provided Kellogg with non-merchantable cereal bags. Kellogg Co. v. FPC Flexible Packaging Corp., No. 11-272 (W.D. Mich., order entered September 30, 2014). IGI supplied wax to FPC, which used it to construct cereal bags sold to Kellogg. The bags were then used as liners in boxes of Corn Pops, Froot Loops, Apple Jacks, and Honey Smacks, and after consumers complained of nausea and diarrhea, Kellogg destroyed its inventory of the cereals and issued vouchers to consumers who had already purchased boxes. After ruling that Canadian law applied, the court assessed the contract between FPC and IGI, determining when it began, what terms were implicit and what warranties existed as a result. “Questions of fact exist as to whether the wax was merchantable,” the…
A New York federal court has approved a $910,000 settlement in a class action contending that Pret A Manger failed to pay employees for the time it took them to put on uniforms or time spent waiting for the changing room. Trinidad v. Pret A Manger (USA) Ltd., No. 12-6094 (S.D.N.Y., order entered September 19, 2014). Under the settlement agreement, Pret will pay $910,000 to the class to be distributed on a sliding scale, with $5 to class members employed for less than a week, and about $4.50 per week to class members who worked there longer. Class counsel sought 33 percent of the settlement fund for attorney’s fees, but the court found fault with some of counsel’s billing practices. It noted that approximately 70 percent of the billed hours were worked by a partner at the rate of $550 per hour, but “a close review of the tasks that [the…
The Third Circuit Court of Appeals has found that a lower court did not abuse its discretion in approving a $3 million settlement offer in a nationwide class action alleging that Ferrero USA falsely advertised Nutella hazelnut spread as nutritious for children. In re Nutella Mktg. & Sales Practices Litig., No. 12-3456 (3rd Cir., order entered September 29, 2014). Several class members had objected to the size of the attorney’s fees award and the deduction of the award from the settlement fund. More details about the settlement appear in Issue 444 and Issue 530 of this Update. Issue 539
According to a news source, a Smith & Wollensky waiter has filed a putative class action lawsuit in a Nevada state court alleging that he was forced to share tips with assistant and general managers and even had to pay them hundreds of dollars for preferential customers, tables, shifts, or time off. Waiter Mario Viggiani has reportedly estimated that on an average night, he paid managers $65, but on busy nights he paid them “upwards of $200.” The complaint cites a Nevada law that makes it unlawful for employers “to require an employee to rebate, refund or return any part of the wage, salary or compensation earned and paid,” as well as a law making it unlawful “for any person to take all or part of any tips or gratuities bestowed upon the employees of that person.” The upscale steakhouse chain apparently has eight other facilities in the United States,…
A California federal court has certified a statewide liability class in a lawsuit accusing Jamba Juice of labeling its home smoothie kits as “all natural” despite containing five synthetic ingredients—ascorbic acid, xanthan gum, steviol glycosides, modified corn starch, and gelatin—but it refused to certify the class for damages. Lilly v. Jamba Juice Co., No. 13-2998 (N.D. Cal., order entered September 18, 2014). The court dismissed Jamba Juice’s argument that the class was unascertainable because no purchase records existed for the kits, finding that such an approach would “have significant negative ramifications for the ability to obtain redress for consumer injuries.” The court agreed, however, with Jamba Juice’s proposition that the plaintiffs could not provide a plausible class-wide damages model, because they did not show “any evidence, expert reports, or even detailed explanation about how those damages models can be fairly determined or at least estimated.” See Bloomberg BNA, September 19, 2014.…
A New York bankruptcy court and federal court have issued orders certifying classes in litigation against Kangadis Food, Inc. d/b/a The Gourmet Factory and related entities, alleging that the company falsely labeled its products as “100% Pure Olive Oil” when they actually contain the industrially processed substance “olive-pomace oil,” “olive-residue oil” or “Pomace.” In re Kangadis Food Inc., No. 14-72649 (U.S. Bankr. Ct., E.D.N.Y., order entered September 19, 2014); Ebin v. Kangadis Family Mgmt. LLC, No. 14-1324 (S.D.N.Y., order entered September 18, 2014). Additional information about the federal court proceeding appears in Issue 507 of this Update. While the federal court dismissed the direct claims against the company’s owners, it found that the claims could proceed against them “under the veil piercing and alter ego theories.” The court further rejected the defendants’ “ascertainability” challenge to class certification, noting that “whether or not an individual purchased during the class period a tin…
The U.S. Court of Federal Claims has ruled that the U.S. Food and Drug Administration (FDA) is not required to compensate tomato growers for a regulatory taking after incorrectly warning the public in 2008 that a Salmonella outbreak was linked to tomatoes. Dimare Fresh Inc. v. U.S., No. 13-519 (Fed. Cl., order entered September 18, 2014). The growers argued that FDA had “appropriated a benefit” through the seizure of tomatoes, but “[a] regulatory takings claim is not plausible and cannot proceed when the government action at issue has no legal effect on the plaintiff’s property interest,” the court said. “Advisory pronouncements, even those with significant financial impact on the marketplace, are not enough to effect a taking of property under the Fifth Amendment.” The growers were attributing independent consumer behavior to FDA, the court found, and the argument that consumer advisories alone constituted takings had no support in case law.
A federal court in Maryland has allowed the personal representative of the estate of a man who died in 2011 during a nationwide Listeria outbreak linked to a Colorado cantaloupe farm to sue the company responsible for auditing the cantaloupe producer’s processing facilities, finding that it owed him a duty of care. Wells Lloyd v. Frontera Produce, Ltd., No. 13-2232 (D. Md., order entered September 24, 2014). An Oklahoma court refused to allow claims against the auditor in December 2013, finding that the plaintiff, who was sickened during the Listeria outbreak, could not show that the auditor owed him a duty under Oklahoma law. Details about that ruling appear in Issue 509 of this Update. In contrast, the Maryland court found that the food safety auditor owed a duty to the decedent, because its allegedly negligent audit of the facility—finding that it complied with applicable standards of care for food processing—met…
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