While the Dairy Farmers of America (DFA) and affiliated Dairy Marketing Services have agreed to pay $50 million to settle class claims that they conspired to monopolize the market for raw milk in the Northeast, a federal court in Vermont has denied preliminary approval of the proposed settlement without prejudice. Allen v. DFA, Inc., No. 09-0230 (U.S. Dist. Ct., D. Vt., order entered July 9, 2014). Details about the litigation appear in Issue 323 of this Update. The court pointed to a number of flaws in the draft class notice, including that it released the defendants and a number of related entities and extended beyond the legal claims in the lawsuit without making this clear to class members. The basis for its ruling, however, was that some class members apparently plan to object to the settlement, but no information about their objections was provided in the expedited motion for preliminary approval…
Category Archives 2nd Circuit
The Beech-Nut Nutrition Co. has filed a complaint against an organic baby-food maker seeking a declaration that Beech-Nut has not infringed any of Plum PBC’s trademarks and that the trademarks Plum has asserted to the word “JUST” and certain phrases are invalid. Beech-Nut Nutrition Co. v. Plum PBC, No. 14-0791 (N.D.N.Y., filed June 30, 2014). According to the complaint, Plum sent Beech-Nut a cease-and-desist letter in June 2014 shortly after Beech-Nut launched a new line of whole fruit and vegetable foods for babies including the word “just” on product labels and advertised them under a promotional campaign “This is not baby food” and “This is real food for babies.” The letter allegedly demanded that Beech-Nut stop infringing Plum’s “JUST” trademark and using the promotional phrases. Beech-Nut contends that (i) the word “just” is simply descriptive and generic; (ii) Plum does not use the trademark symbol beside the word on its product…
A California federal court has dismissed with prejudice a putative class action alleging that Hain Celestial Group Inc. mislabels its vegetable juice products as “organic” and “raw” one day before a proposed class action was filed against the company in New York federal court alleging similar claims about its baby foods and home care products. Alamilla, et al. v. Hain Celestial Group, Inc., No. 13–5595 (N.D. Cal., order entered July 2, 2014); Segedie v. The Hain Celestial Group, Inc., No. 14–5029 (S.D.N.Y., filed July 3, 2014). The California court dismissed the case based on two articles cited and incorporated into the complaint concluding that “pressurization has ‘little or no effects’ on nutritional and sensory quality aspects of foods,” which contradicted the plaintiffs’ argument that the treatment deprives the juice of nutritional value and that the company’s representations that it does not cook the juice are thus misleading. As a result of…
A pair of plaintiffs has filed putative class actions against Chobani LLC and Fage Dairy Processing SA in New York federal court claiming that the yogurt producers deceptively marketed yogurt as healthy despite its high sugar content. Stoltz v. Chobani LLC, No. 1:14-cv-3827 (E.D.N.Y., filed June 19, 2014); Stoltz v. Fage Dairy Processing SA, No. 1:14-cv-3826 (E.D.N.Y., filed June 19, 2014). The nearly identical suits allege that Chobani and Fage used a label intended “to create consumer confusion by causing purchasers to impute any meaning to the 0 percent that consumers wish, such as that the products lack sugar, carbohydrates, calories or any other content which a consumer may believe is unhealthy,” according to the complaint against Fage. The complaints include pictures of the defendants’ products and pictures of competitors’ products to illustrate the industry standard of including what nutrition levels the “0 percent” refers to, such as fat or…
After Kangadis Food Inc. filed for bankruptcy claiming that putative class litigation challenging its alleged misleading olive oil representations has cost the company, which does business as The Gourmet Factory, more than $1.4 million in attorney’s fees and could cost an additional $750,000 if the claims go to trial, the named plaintiffs filed class claims against its owners in a New York federal court. Ebin v.Kangadis Family Mgmt. LLC, No. 14-1324 (S.D.N.Y., filed June 11, 2014). The heavily redacted complaint alleges that these individuals were directly involved in trying to pass off pomace oil, processed from olive oil residue, as “100% Pure Olive Oil” under the Capatriti brand. Details about the litigation appear in Issue 515 of this Update. One of the individuals named as a defendant in the new lawsuit—identified as Aristidis Kangadis—apparently evaded deposition when the company’s counsel argued to the court that he “is a 73 year…
Four food, beverage and business trade organizations have filed a constitutionally based challenge to Vermont’s recently enacted law that would require food and beverage manufacturers to disclose on product labels that their products are “produced with genetic engineering” (GE), or “may be” or are “partially” so produced and to prohibit the use of terms such as “natural” in the labeling, signage and advertising of GE products. Grocery Mfrs. Ass’n v. Sorrell, No. 14-0117 (D. Vt., filed June 12, 2014). According to the complaint, it will be difficult or impossible to comply with the law’s July 1, 2016, effective date, because members must “revise hundreds of thousands of product packages,” “establish Vermont-only distribution channels” or “revise the labels for all of their products, no matter where they might be sold in the United States.” The plaintiffs claim that the law’s proscriptions “are beyond Vermont’s power to enact” by “compelling manufacturers to…
Ice cream truck franchiser Mister Softee Inc. has filed a motion for a preliminary injunction in a lawsuit alleging trademark infringement and violation of a non-compete covenant against former franchisee Dimitrios Tsirkos, who converted his 16 Mister Softee trucks to Master Softee trucks and began selling his own ice cream out of them at the beginning of the 2014 ice cream truck season. Mister Softee of Queens Inc. v. Tsirkos, No. 14-1975 (S.D.N.Y., motion filed April 25, 2014). Mister Softee ended Tsirkos’ franchise contract after he refused to pay $74,000 in franchise royalties for his trucks, but Tsirkos allegedly adjusted the logo on his trucks, started his own soft-serve depot and began selling ice cream in New York City anyway. Tsirkos has filed a motion opposing the injunction, and a hearing is set for May 15, 2014. See Law360, May 2, 2014. See New York Daily News, May 1, 2014. …
Four former employees of T.G.I. Friday’s, Inc. have filed a putative class action against the restaurant and its parent company, Carlson Restaurants, Inc., to recover unpaid wages, including overtime compensation and unlawful deductions. Flood v. Carlson Restaurants Inc., No. 14-2740 (S.D.N.Y., filed April 17, 2014). The former employees claim that T.G.I. Friday’s managers required them to work in violation of the Fair Labor Standards Act and New York Labor Law. In the complaint, the employees allege that managers required tip-earning workers to do “side work” like rolling silverware, cleaning the restaurant and other tasks that did not merit them tips while the restaurant paid them at the reduced minimum wage reserved for tipped workers. They further allege that managers prevented the employees from receiving their earned overtime pay by lowering the amount of time the employees were on the clock each week to below 40 hours and that the restaurant…
A federal court in New York has dismissed an amended complaint filed against high-fructose corn syrup (HFCS) manufacturers, alleging that the HFCS in foods and beverages, such as McDonald’s hamburger buns and Pepsi, was a substantial factor in causing a 14-year-old girl to develop Type 2 diabetes. S.F. v. Archer-Daniels-Midland Co., No. 13-634, decided April 21, 2014). The plaintiff alleged market-share liability under the tort doctrines of strict liability, negligence and failure to warn. The court agreed with the defendants that Type 2 diabetes is a multifactorial disease, stating “[n]o expert opinion is required to arrive at this conclusion.” And even accepting the allegations as true, the court said, “[T]here is little in it to suggest that Plaintiff could prove that her consumption of some foods containing HFCS over the course of her life was a substantial factor in causing Type 2 diabetes. . . . [A]side from idly listing various…
A federal court in New York has refused to dismiss claims alleging that Bumble Bee Foods is strictly liable for and was negligent in failing to warn about the mercury in its products in a lawsuit alleging personal injury from excessive consumption of the company’s tuna products, which contain methylmercury. Porrazzo v. Bumble Bee Foods, LLC, No. 10-4367 (S.D.N.Y., order entered February 27, 2014). An earlier ruling in the case is summarized in Issue 413 of this Update. The plaintiff, who apparently consumed one to two cans of tuna daily for more than two years and was diagnosed with dangerously high levels of mercury in his body, also brought claims for breach of implied warranty of merchantability and violations of certain state statutory provisions involving agricultural and business law. The court found that the issues argued in Bumble Bee’s motion for summary judgment involved genuine issues of material fact that…
