Seeking to represent a nationwide class of consumers, a New York resident has filed a lawsuit in a New Jersey federal court, alleging that Smart Balance, Inc. falsely labels its fat-free milks enhanced with omega-3 as “Fat Free” when they actually contain 1 gram of fat per serving. Stewart v. Smart Balance, Inc., No. 11-06174 (D.N.J., filed October 19, 2011). Acknowledging that the nutrition facts label indicates that the products contain 1 gram of fat, the plaintiff nonetheless contends that the front-of-package representations are “intentionally confusing and misleading.” She alleges that she paid more for the company’s products than she would have otherwise paid for alternative milk options because she relied on the “Fat Free” labels, which she contends violate federal labeling rules. Alleging violation of the New Jersey Consumer Fraud Act, unjust enrichment, breach of warranty, and injunctive relief, the plaintiff seeks class certification; compensatory, treble and punitive damages; disgorgement;…
Category Archives 3rd Circuit
A federal court in New Jersey has refused the request to intervene filed by plaintiffs to a California consumer-fraud lawsuit against the company that makes the hazelnut spread Nutella®. Glover v. Ferrero USA, Inc., No. 11-1086 (D.N.J., decided October 20, 2011) (unpublished). The New Jersey action, like its California counterpart, was filed as a putative nationwide class action; the laws under which the cases were filed and the class periods differ. According to the New Jersey court, the intervenors had no interest in litigating the New Jersey case; rather, their stated intent was to dismiss the case or transfer it to California. The court also noted that while the California Nutella® litigation was filed first, “the actions are not truly duplicative.” The Judicial Panel on Multidistrict Litigation has refused to consolidate the California and New Jersey actions for pretrial proceedings.
A federal multidistrict litigation (MDL) court has granted several motions to dismiss in consolidated actions alleging a conspiracy by egg producers and trade associations to restrict the domestic supply of eggs. In re: Processed Egg Prods. Antitrust Litig., MDL No. 2002 (E.D. Pa., decided September 26, 2011). Among other allegations, the plaintiffs contend that the defendants agreed over a period of years to reduce the size of egg-laying flocks and require larger cages to reduce overall hen densities as part of an alleged collective plan to keep egg prices high. In their motions to dismiss, the defendants argued that while the second amended complaint alleged sufficient facts to support the antitrust conspiracy claim as to some of the defendants, “the pleading is deficient with respect to each of the movants by failing to allege facts that they specifically were parties to the conspiracy.” Examining each motion in turn, the court dismissed…
While settlement terms are apparently confidential, a high-end bottled water company has reportedly settled its claims against a company that supplied bottles which reacted to the water by causing foaming and a poor taste. Penta Water Co. v. Zuckerman-Honickman, Inc., No. 09-2633 (E.D. Pa., dismissed with prejudice September 21, 2011). The water company evidently switched to the defendant’s bottles in conjunction with the launch of a campaign intended to broaden its customer base beyond athletes, celebrities and health food consumers. The alleged bottle defect forced the plaintiff to halt the campaign, close its manufacturing plant and undertake “crisis management.” The packaging company and the water bottler have both reportedly undergone bankruptcy proceedings. See Law360, September 22, 2011.
The Campbell Soup Co. will change its low-sodium tomato soup labels under a settlement with a class of consumers who sued the company in a New Jersey federal court in 2010, alleging that these products cost more while actually containing about the same level of sodium as the company’s regular tomato soup. Smajlaj v. Campbell Soup Co., No. 10-01332 (D.N.J., preliminary approval granted August 9, 2011). The company will also provide a cash fund of $1.05 million for consumers throughout the United States who purchased the products over a two-year period ending in August 2011. Maximum recovery, depending on which soup was purchased and whether receipts are available, is $10 or $.50 for each can that a class member can show she purchased. The agreement would permit class counsel fees of $350,000; the court has scheduled a final settlement approval hearing for November 29. According to court documents, Campbell will…
A federal court in New Jersey has determined that Pennsylvania and California residents may pursue claims against New Jersey-based Nestlé Healthcare Nutrition, Inc. in consolidated putative class actions alleging that the company’s BOOST Kid Essentials® beverage did not provide its advertised health benefits for children. Scheuerman v. Nestlé Healthcare Nutrition, Inc., No. 10-3684; Johnson v. Nestlé Healthcare Nutrition, Inc., No. 10-5628 (D.N.J., decided August 1, 2011) (unpublished). So ruling, the court granted in part and denied in part Nestlé’s motion to dismiss. While the court ruled that the California plaintiff may not bring a cause of action under the New Jersey Consumer Fraud Act (NJCFA), because the defendant’s presence in the jurisdiction alone is insufficient under conflict-of-law rules to apply the state’s law, the court did give the California plaintiff the opportunity to amend her complaint to allege consumer fraud under California law. Because the Pennsylvania plaintiff alleged that he…
A New Jersey appellate court has partially reinstated a lawsuit against an Indian restaurant that mistakenly served meat samosas to a group of Hindu vegetarians, who are now seeking compensation for emotional distress and to recover the cost of traveling to India for a purification rite. Gupta v. Asha Enterprises, L.L.C., A-3059-09T2 (N.J. Sup. Ct., decided July 18, 2011). According to the court opinion, plaintiffs notified Moghul Express & Catering Co. of their “strict vegetarian” status and were twice “assured of the vegetarian nature of the food,” which actually contained meat. The complaint alleges that this oversight caused the diners spiritual injury and involved them “in the sinful cycle of inflicting pain, injury and death on God’s [creations], and it affects the karma and the dharma, or purity of the soul.” Although the New Jersey Superior Court initially dismissed the claims of negligence, negligent infliction of emotional distress, consumer fraud, products…
The parents of a 29-year-old who died after he fell into a vat of chocolate have filed a wrongful death action in a Pennsylvania state court against the company that owned the plant where he worked and a number of other defendants involved in manufacturing the allegedly faulty equipment that purportedly led to the accident. Smith v. Lyons & Sons, Inc., No. __ (Pa. Ct. Com. Pleas, Philadelphia Cty., filed July 1, 2011). The decedent allegedly slipped on a cardboard-covered platform made slippery with chocolate and other materials and fell into the vat through unguarded holes. The vat was “processing, mixing and melting chocolate at extremely high temperatures at the time.” Co-workers were allegedly unable to stop the vat from operating because the switch was not located on the platform. Alleging negligence, strict liability and breach of express and implied warranties, the plaintiffs seek damages in excess of $50,000. The…
A divided Delaware Supreme Court has determined that ConAgra’s insurance 0contract is ambiguous and therefore might provide broader coverage, with a lower “retained limit” or deductible, for claims arising out of an alleged Salmonella outbreak involving the company’s peanut butter. ConAgra Foods, Inc. v. Lexington Ins. Co., No. 227, 2010 (Del., decided April 28, 2011). The court reversed a lower court ruling that granted, in part, the insurer’s motion for summary judgment and remanded for consideration of extrinsic evidence about what the parties intended when they agreed to a “lot or batch” endorsement; if that intent cannot be ascertained, the lower court was instructed to interpret the contract in ConAgra’s favor. The court also determined that because ConAgra exceeded the retained limit, the insurer’s duty to defend was triggered on the date the food maker’s liabilities exceeded that limit. The policy at issue included two definitions for “occurrence,” one of which was in…
The company that makes gourmet cookies sold as “One Smart Cookie™” has filed a trademark infringement and unfair competition lawsuit against a company that makes organic cookies sold as the “Original Smart Cookie.” Jimmy’s Chocolate Chip Cookies, LLC v. Nature’s Select Food Group, LLC, No. 11-01 (D.N.J., filed April 15, 2011). According to the plaintiff, the defendant sought to register its mark, which the plaintiff opposed, and registration was refused. Still, the defendant allegedly continues to use the name “Original Smart Cookie.” The plaintiff alleges infringement of federal trademark registration, false designation of origin and unfair competition under state and federal statutes, and common-law unfair competition. Jimmy’s Chocolate Chip Cookies seeks injunctive relief, an accounting of profits, compensatory and punitive damages, and attorney’s fees and costs.
