The Second Circuit Court of Appeals has upheld an award of $10,000 in sanctions under Federal Rule of Civil Procedure 11 for the filing of a frivolous action related to trademark infringement litigation between companies that make and sell hoisin sauce. Star Mark Mgmt., Inc. v. Koon Chun Hing Kee Soy & Sauce Factory, Ltd., Nos. 10-4931, 11-16 (2d Cir., decided June 13, 2012). Koon Chun prevailed, in part, on its claims of willful trademark infringement against Star Mark, based on Star Mark’s sale of counterfeit versions of Koon Chun’s hoisin sauce. A magistrate judge awarded damages and costs, and the Second Circuit affirmed. In the meantime, the parties were litigating Star Mark’s suit to cancel Koon Chun’s mark “on the theory that Koon Chun’s use of the word ‘hoisin’—which translates to ‘seafood’—was deceptive because the sauce did not contain seafood.” When considering this matter in a motion to amend…
Category Archives 2nd Circuit
A California resident has filed a putative class action against Starbucks Corp. alleging that the company deceived consumers by failing to disclose that some of its products were made with cochineal extract, a common food-coloring ingredient made from crushed insects. Anderson v. Starbucks Corp., No. BC485438 (Cal. Super. Ct., Los Angeles Cty., filed May 25, 2012). Seeking to represent a nationwide class and statewide subclass of consumers, the plaintiff claims that she and the class members, had they known about the company’s use of the ingredient, would not have purchased the products for a number of reasons, including objections to consuming animal products, allergic responses to the ingredient or “sheer disgust.” Alleging violations of the California Unfair Business Practices Act and False Advertising Act, unjust enrichment, fraud by omission/concealment, and violation of California’s Consumers Legal Remedies Act, the plaintiff seeks disgorgement, restitution, compensatory and punitive damages, payment to a cy pres fund,…
A federal court in New York has determined that the Food and Drug Administration (FDA) arbitrarily denied petitions filed by advocacy organizations in 1999 and 2005 requesting the initiation of proceedings to withdraw approval from certain uses of antibiotic drugs in livestock. Nat. Res. Defense Council v. FDA, No. 11-3562, (S.D.N.Y., decided June 1, 2012). The ruling follows the court’s March 2012 grant of summary judgment to the plaintiffs on their first claim for relief. Additional information about that ruling appears in Issue 432 of this Update. The most recent ruling relates to the third claim for relief, that is, whether FDA violated the Administrative Procedure Act when it denied the two petitions “requesting that the FDA withdraw approval of certain uses of certain classes of antibiotics in food-producing animals.” The court first determined that it had subject matter jurisdiction over the claim, disagreeing with FDA’s assertion that its November 2011 decision…
The Second Circuit Court of Appeals has determined that a New York law enacted in 2004, following the invalidation of a prior version, does not violate the Establishment or Free Exercise Clauses of the U.S. Constitution and is not unconstitutionally vague. Commack Self-Service Kosher Meats, Inc. v. Hooker, No. 11-3517 (2d Cir., decided May 10, 2012). The previous law, which defined “kosher” in terms of orthodox Hebrew religious requirements and required adherence to them, was found to (i) advance religion, i.e., the dietary restrictions of Orthodox Judaism, and (ii) inhibit religion “by preventing labeling of food products as kosher that did not meet the Orthodox Jewish religious requirements.” The newer version simply required those marketing their food products as “kosher” to label them as kosher and to “identify the individuals certifying their kosher nature.” The new law did not “define kosher or authorize state inspectors to determine the kosher nature…
The Second Circuit Court of Appeals has determined that Starbucks Corp. did not violate federal labor law by adopting a dress code which limits the number of pro-union buttons its employees can wear on their uniforms. NLRB v. Starbucks Corp., Nos. 10-3511, 10-3783 (2d Cir., decided May 10, 2012). The National Labor Relations Board (NLRB) had ruled that multiple pro-union buttons, at one-inch in diameter, “did not seriously harm Starbucks’s legitimate interest in employee image because ‘the Company not only countenanced but encouraged employees to wear multiple buttons as part of that image.’ These other buttons, the Board found, were not immediately recognizable by customers as company-sponsored, and the pro-union pins at issue were ‘no more conspicuous than the panoply of other buttons employees displayed.’” Reversing this part of NLRB’s determination, the appeals court said that it had gone too far. “Starbucks is clearly entitled to oblige its employees to wear…
The Judicial Panel on Multidistrict Litigation (JPML) has denied a motion seeking to consolidate and transfer to a multidistrict litigation court three cases filed in federal courts against companies allegedly responsible for a 2009 E. coli outbreak involving contaminated ground beef. In re: Ne. Contaminated Beef Prods. Liab. Litig., MDL No. 2346 (J.P.M.L., D. Conn., decided April 17, 2012). According to the court, the cases do not “contain significant overlapping questions of fact sufficient to warrant centralization of the few involved actions,” and “the likelihood that additional actions will be filed concerning this E. coli outbreak—which occurred nearly two and a half years ago and affected under 30 individuals—seems low. With only three actions pending in two adjacent districts involved in this litigation, movant has failed to convince us that centralization is needed.” The court indicated that it would be “practicable and preferable” for the parties, courts and counsel to informally…
A federal court in New York has reportedly consolidated three putative class actions against Frito-Lay North America Inc. involving claims that the company falsely advertised its chips as “all natural” despite using genetically modified corn and oil in the products. In re: Frito-Lay N. Am. Inc. “All-Natural” Litig., No. 12-00408 (E.D.N.Y., order entered March 20, 2012). Two of the suits were filed in December 2011 in California, and the plaintiffs agreed to transfer the claims to New York where a similar action had been filed in January 2012. The parties reportedly stipulated to the consolidation “to streamline the litigation and conserve judicial resources.” See Law 360, March 21, 2012.
A federal magistrate judge in New York has ordered the Food and Drug Administration (FDA) to begin proceedings to withdraw approval for the subtherapeutic use of certain antibiotics in animal feed, agreeing with the Natural Resources Defense Council (NRDC) and a coalition of advocacy organizations that the agency had a statutory duty to hold withdrawal proceedings after issuing notices in 1977 of its intent to withdraw approval because the use of such drugs had not been shown to be safe. NRDC v. FDA, No. 11-3562 (S.D.N.Y., decided March 22, 2012). According to the court, “if the Secretary finds that an animal drug has not been shown to be safe, he is statutorily required to withdraw approval of that drug, provided that the drug sponsor has notice and an opportunity for a hearing.” Further details about the lawsuit appear in Issue 396 of this Update. Questions about whether the agency has…
Restaurateurs Mario Batali and Joseph Bastianich have apparently agreed to settle for $5.25 million wage-related claims in a class action filed by waitstaff at their New York City restaurants including Babbo, Bar Jamon, Casa Mono, Del Posto, Esca, Lupa, Otto, and Tarry Lodge. Capsolas v. Pasta Resources Inc., No. 10-5595 (S.D.N.Y., motion for preliminary approval of settlement filed March 5, 2012). Additional information about the suit appears in Issue 361 of this Update. If approved, the settlement would cover attorney’s fees (one-third of the total) and costs, class members’ awards, service payments to the named plaintiffs, and the claim administrator’s fees. The class, consisting of captains, servers, waiters, bussers, runners, back waiters, bartenders, and/or barbacks, will receive a proportional share of the settlement fund “based on the number of hours they worked, the Restaurant at which they worked, the percentage of total tips received during their employment, and whether they opted…
A federal court in New York has dismissed, for lack of jurisdiction, the claims filed by numerous organic farming interests seeking a declaration that they are not infringing Monsanto’s genetically modified (GM) seed patents, the patents are invalid and unenforceable and the company would not be entitled to remedies against them. Organic Seed Growers & Trade Ass’n v. Monsanto Co., No. 11-2163 (S.D.N.Y., decided February 24, 2012). According to the court, because Monsanto has an express policy not to bring infringement actions against a farmer whose fields have trace amounts of its seed or traits “as a result of inadvertent means,” such as seed drift, cross-pollination or commingling with tainted equipment, the plaintiffs are unable to establish a substantial controversy or an injury traceable to the defendant. While Monsanto has brought 144 infringement actions against farmers over a 13-year period, the court found this insignificant given the 2 million farms currently…
