California residents have filed a putative nationwide class action against Late July Snacks LLC, alleging that the company’s snack products are misbranded because they include “organic evaporated cane juice” on their ingredient lists in violation of the state’s Sherman law, which incorporates the federal Food, Drug, and Cosmetic Act. Swearingen v. Late July Snacks LLC, No. 13-4324 (N.D. Cal., filed September 18, 2013). The plaintiffs contend that regardless whether the products actually contain sugar or dried sugar cane syrup as sweeteners, the Food and Drug Administration (FDA) requires that these terms, and not “evaporated cane juice,” be used on product labels. They cite a 2000 FDA guidance letter and warnings that FDA subsequently provided to companies using the prohibited term on food labels. They assert that the state’s unfair competition law does not require that they relied on the labels in making their purchasing decisions, just that they would not otherwise have purchased an unlawful product, “absent the Defendant’s failure to disclose…
Category Archives U.S. Circuit Courts
While continuing to deny that its labeling and marketing for Truvia® sweetener products misled consumers, Cargill has apparently agreed to settle a putative nationwide class action alleging consumer fraud and breach of warranty. Martin v. Cargill, Inc., No. 13-2563 (D. Minn., preliminary agreement filed September 19, 2013). The plaintiffs claimed that the products are not “natural” because they contain “highly processed” ingredients or those derived from genetically modified organisms. Under the agreement, the company would create a $5 million fund for cash refunds and vouchers on selected Truvia® products. The company has also agreed to modify product labels that will refer consumers to its website where it will explain in some detail how the erythritol in Truvia® is produced. Cargill has agreed not to oppose attorney’s fees and expenses of $1.59 million. Any residual funds remaining in the settlement fund would be distributed to the National Consumer Law Center and…
Brothers Eric and Ryan Jensen who own the Colorado cantaloupe farm linked to a deadly 2011 Listeria outbreak have reportedly been arrested on six misdemeanor charges of introducing adulterated food into interstate commerce and aiding and abetting. According to court records, they purportedly changed their cantaloupe cleaning process in May 2011 and never used the chlorine spray incorporated into the system. The Department of Justice (DOJ) alleges that they “were aware that their cantaloupes could be contaminated with harmful bacteria if not sufficiently washed.” The Centers for Disease Control and Prevention determined that people in 28 states consumed the contaminated cantaloupe, 33 died, 147 were hospitalized, and a pregnant women miscarried. The brothers reportedly pleaded not guilty and face a December 2, 2013, trial. If convicted, each could serve one year in prison and be fined up to $250,000 for each charge. See DOJ News Release, September 26, 2013; Fox…
A federal court in California has denied the motion to dismiss defendants’ counterclaims filed by plaintiff sugar producers in a dispute between them and companies that make high-fructose corn syrup (HFCS) and promoted it in a national campaign claiming that “HFCS is corn sugar,” “HFCS is natural,” and “sugar is sugar.” W. Sugar Coop. v. Archer-Daniels Midland Co., No. 11-3473 (C.D. Cal., order entered September 16, 2013). The court ruled that (i) because the counterclaims do not allege fraud, they satisfy the pleading requirements of Federal Rule of Civil Procedure 8; (ii) whether the plaintiffs’ statements, at issue in the counterclaims, are immune from liability under the Noerr-Pennington doctrine requires further factual development and is thus premature; (iii) the counterclaims’ allegations do not demonstrate that the plaintiffs are immune from liability under the Communications Decency Act of 1996 in that they “neither demonstrate that Plaintiffs ‘passively displayed’ the statements [authored by…
A federal court in California has granted in part and denied in part the motion to dismiss filed by Dole Food Co. in a putative nationwide class action alleging that the company misbrands a number of its fruit products by making certain “all natural,” “fresh,” nutrient content, antioxidant, sugar-free, and health claims, as well as failing to disclose that the products contain artificial additives, chemical preservatives and other artificial ingredients. Brazil v. Dole Food Co., No. 12-1831 (N.D. Cal., order entered September 23, 2013). According to the court, the plaintiff has standing at this stage of the proceedings to bring claims as to products he did not purchase, ruling that he may proceed with “substantially similar claims based on both products he purchased and substantially similar products he did not purchase” on behalf of unnamed class members. The court dismissed with prejudice claims based on the company’s website statements because the…
On reconsideration, a federal court in California has dismissed a lawsuit against Chobani, Inc., in a putative class action alleging that its yogurt products are mislabeled because they include “evaporated cane juice” (ECJ) as an ingredient and state that they have no added sugar and contain only “natural ingredients.” Kane v. Chobani, Inc., No. 12-2425 (N.D. Cal., San Jose Div., order entered September 19, 2013). Details about the order the court reconsidered appear in Issue 491 of this Update. The court dismissed the Unfair Competition Law (UCL), False Advertising Law (FAL) and Consumers Legal Remedies Act (CLRA) claims without prejudice and gave the plaintiffs 21 days to file a third amended complaint. Claims for unjust enrichment and violation of the Song-Beverly and Magnuson-Moss Warranty Act were dismissed with prejudice. Essentially, the court found that the plaintiffs lacked standing to pursue their UCL, FAL and CLRA claims because they failed to…
The Eighth Circuit Court of Appeals has found constitutional Missouri’s four-tier alcohol distribution system which includes a residency requirement for wholesalers, which comprise the third tier. S. Wine & Spirits of Am., Inc. v. Div. of Alcohol & Tobacco Control, No. 12-2502 (8th Cir., decided September 25, 2013). According to the court, the decision required it to examine the “current state of the relationship between the dormant Commerce Clause and the Twenty-First Amendment.” The former forbids discrimination against out-ofstate residents, while the latter gives states “certain prerogatives particular to the regulation of alcohol.” Missouri law requires those seeking a wholesaler license to be incorporated under the state’s laws, with all officers and directors “qualified legal voters and taxpaying citizens of the county . . . in which they reside” and “bona fide residents” of Missouri for at least three years. Resident shareholders must own at least 60 percent of all the…
A divided Fourth Circuit Court of Appeals panel has determined that a Virginia Alcohol Beverage Control Board prohibition on alcohol advertisements in college newspapers, as applied, violates the First Amendment rights of two campus newspapers because the majority of the papers’ readers are age 21 or older, and thus the rule is “not appropriately tailored to Virginia’s stated aim.” Educ. Media Co. at Va. Tech, Inc. v. Insley, No. 12-2183 (4th Cir., decided September 25, 2013). So ruling, the court reversed a district court decision upholding the rule’s validity. The board argued that the purpose of the regulation “is to combat underage and abusive college drinking.” The court majority found that, under either a strict scrutiny or intermediate scrutiny analysis, the regulation was overbroad as applied to college newspapers that were read by college students of legal age. The regulation failed, said the court, “because it prohibits large numbers of…
The Equal Employment Opportunity Commission (EEOC) has filed a complaint against Performance Food Group, Inc., alleging that it had a “standard operating procedure of denying employment to female applicants for operative positions in its [warehouse] facilities on the basis of their gender”; EEOC also alleges that the defendant failed to promote a woman at its Maryland facility on the basis of her gender. EEOC v. Performance Food Group, Inc., No. 13-1712 (D. Md., filed June 13, 2013). The defendant apparently distributes food-related products to more than 130,000 independent and national chain restaurants, theaters, schools, hotels, health care facilities, and other institutions across the United States. According to the complaint, the defendant unlawfully discriminated against hiring women at multiple facilities since at least January 1, 2004, for warehouse positions that required the operation of machinery and factory-related processing equipment or were supervisory occupations. A corporate senior vice president allegedly stated on…
A federal court in California has granted a motion for final settlement approval in a nationwide class action alleging that Kellogg Co. falsely advertised its Frosted Mini-Wheats cereal products as a food that could help improve children’s attentiveness by 20 percent. Dennis v. Kellogg Co., No. 09-1786 (S.D. Cal., order entered September 10, 2013). Details about prior rulings in the case appear in Issue 483 of this Update. The court had previously given reluctant approval to the preliminary settlement, concerned that the class relief appeared to have diminished after remand from the Ninth Circuit, with attorney’s fees appearing to remain constant—the original settlement had a cash value of about $10.5 million with $2 million for attorney’s fees and claims administration; the revised settlement has a cash value of $4 million with $1.5-2 million reserved for attorney’s fees and claims administration. According to the court, the plaintiffs demonstrated that “the seemingly unchanged total…
