Category Archives U.S. Circuit Courts

A California federal court has rejected a trademark infringement claim on the grounds that the company alleging preceding use of the trademark manufactures cannabis-infused edibles, which are illegal under federal law. Kiva Health Brands LLC v. Kiva Brands Inc., No. 19-3459 (N.D. Cal., entered September 6, 2019). The parties to the litigation—Kiva Brands Inc. (KBI) and Kiva Health Brands (KHB)—dispute the rights of the "Kiva" trademark, and KBI argues that its ownership stems from its predecessor company selling cannabis-infused edibles in California since 2010. "While KBI is only asserting California common law rights to the KIVA mark [], it is doing so as a defense to a federal trademark claim," the court found. "That defense relies on KBI's prior use of the mark. [] KBI's prior use was illegal under federal law []. KBI therefore did not make lawful prior use of the mark. [] To hold that KBI's prior…

A California federal court has reportedly refused to lower the fine of $100 million that StarKist must pay following a guilty plea on charges of price fixing. The company apparently argued that the penalty could bankrupt it because it continues to face potential civil damages, but the court found that StarKist had legal recourse to ask for an extended payment schedule should financial troubles arise. Under the court's schedule, StarKist will pay $5 million within 30 days of the ruling, $11 million in 2020 and $21 million each year from 2021 to 2024.

The U.S. Court of Appeals for the Ninth Circuit has reversed a district court's decision not to apply an abstention that would defer a case on the legality of transporting hemp to state court proceedings. Big Sky Scientific v. Bennetts, No. 19-0040 (9th Cir., entered September 4, 2019). Hemp producers were reportedly hoping to receive guidance from the federal courts on the interpretation of the 2018 Farm Bill and its change in legal status for hemp, which producers began sending across state lines before states established regulatory frameworks for the crop.

Chipotle Mexican Grill Inc. has agreed to pay $6.5 million to settle allegations that it misleadingly marketed its food as free of genetically modified organisms (GMOs). Schneider v. Chipotle Mexican Grill Inc., No. 16-2200 (N.D. Cal., motion for preliminary approval filed September 11, 2019). Under the agreement, class members can receive 10 meals with proof of purchase, with a limit of 15 meals per household, or $2 per meal up to five meals without proof of purchase.

A consumer has filed a putative class action alleging that Trader Joe's Co. sells raw poultry products that contain more retained water than indicated on the package. Webb v. Trader Joe's Co., No. 19-1587 (S.D. Cal., removed August 23, 2019). The complaint alleges that the retained water in some packaged poultry was found to be as much as 16% but labeled as a maximum of 5%. "Poultry products are sold by weight," the plaintiff argues. "Excess Retained Water in the product unlawfully increases the price the consumer pays and decreases the value of the product, cheating the consumer." The plaintiff asserts eight causes of action, including theft by false pretenses and unjust enrichment, and seeks class certification, restitution and damages.

Citing a Consumer Reports piece investigating the arsenic content of several bottled-water brands, three plaintiffs have filed a lawsuit alleging that Whole Foods Market Inc. sells water that "has some of the highest arsenic levels of any bottled water presently being marketed in the United States, with some bottles exceeding the maximum arsenic contamination levels allowed by federal and state law." Berke v. Whole Foods Mkt. Inc., No. 19-7471 (C.D. Cal., filed August 28, 2019). The plaintiffs argue that Whole Foods charged a "hefty premium," "especially as compared to tap water," for a product it marketed as "some of the purest and most pristine water available in the U.S." while it knew "that the product has been universally contaminated with arsenic, with some bottles containing the industry's highest levels of arsenic for many years." The plaintiffs seek class certification damages, restitution and attorney's fees for alleged violations of California and…

A California federal court has dismissed a lawsuit alleging that Clif Bars misled consumers into believing their bars contained white chocolate, but it granted the plaintiffs leave to amend their allegations. Joslin v. Clif Bar & Co., No. 18-4941 (N.D. Cal., entered August 26, 2019). The court first found that the plaintiffs failed to show that they had standing to pursue injunctive relief because they did "not allege a cognizable threat of future harm," then turned to the issue of white chocolate on the label. "Accepting Plaintiffs’ allegations as true, and drawing all reasonable inferences in favor of Plaintiffs, the Court concludes Plaintiffs’ allegations are not sufficient to show members of the public are likely to be deceived," the court ruled. However, it was "not convinced at this stage that amendment would be futile," so it granted leave to amend.

The Center for Food Safety and Center for Environmental Health have filed a lawsuit seeking to compel the U.S. Food and Drug Administration (FDA) to promulgate rules for a program to improve foodborne-illness detection as required under the Food Safety Modernization Act (FSMA). Ctr. for Food Safety v. Azar, No. 19-5168 (N.D. Cal., filed August 19, 2019). The organizations allege that FDA failed to create a laboratory accreditation program "whereby an increased number of accredited laboratories following model standards developed by the agency would be in place 'to rapidly detect and respond to foodborne illness outbreaks and other food-related hazards.'" "FDA’s failure to implement FSMA’s laboratory accreditation provisions by their statutory deadlines is an abdication of the agency’s fundamental responsibilities," the complaint asserts. "Moreover, the agency’s unlawful withholding and unreasonable delay is putting millions of lives at continued risk from contracting foodborne illnesses, contrary to Congress’s commands. This lawsuit therefore…

A plaintiff has filed a putative class action alleging Tillamook County Creamery Association misleadingly markets its products as sourced from cows in Tillamook County. Bohr v. Tillamook Cty. Creamery Ass'n, No. 19-36208 (Ore. Cir. Ct., Multnomah Cty., filed August 19, 2019). The complaint alleges that consumers "increasingly seek out and are willing to pay more for products that they perceive as being locally and ethically sourced—better for the environment, more humane." Tillamook allegedly sought to capitalize on this consumer preference by advertising its products as "made with four ingredients, patience, and old-fashioned farmer values in Tillamook, Oregon," despite producing its cheese and ice cream with ingredients obtained from "the largest and most industrialized dairy factory farm in the country," a "complex of cement-floored production facilities and barren dirt feedlots, where cows are continuously confined, milked by robotic carousels, and afflicted with painful udder infections." The complaint cites a "recent consumer…

A California federal court has dismissed a putative class action complaint alleging that Danone U.S. Inc.'s So Delicious Coconut Milk is misleadingly marketed as healthful. Andrade-Heymsfield v. Danone U.S. Inc., No. 19-0589 (S.D. Cal., entered August 14, 2019). Danone argued that the challenged statements were not health or nutrient content claims, and the court assessed each statement. "The 'Maximum Calcium Absorption' statement . . . is a permissible structure/function claim as permitted under the [U.S. Food and Drug Administration's (FDA's)] own guidance to its regulations. FDA guidance even lists 'calcium helps build strong bones' as a permitted structure/function claim, not a health claim," the court found. Similarly, "Nutrition in Every Sip" is a "permissible structure/function claim" and "is not made in connection with an explicit or implicit claim or statement about a nutrient as required by the regulation for implied nutrient content claims such as the cited example, 'healthy, contains…

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