A federal judge in California has notified the parties to a consumer-fraud action against the company that makes Mission® tortilla chips of her inclination to stay the litigation for six months and refer to the Food and Drug Administration (FDA) the question “whether products containing GMO [genetically modified organisms] or bioengineered ingredients may properly be labeled ‘Natural’ or ‘All Natural.’” Cox v. Gruma Corp., No. 12-6502 (N.D. Cal., notice filed June 7, 2013). The plaintiffs have opposed the tentative stay order, arguing that a prompt regulatory determination is unlikely given FDA’s past inaction on the matter. They reportedly cited a recent Florida decision denying a soup company’s motion to dismiss similar litigation on preemption grounds because FDA does not regulate “Natural” or “All Natural” food labeling claims. The court, however, cited a Ninth Circuit ruling deferring to FDA’s regulatory authority so that the agency’s “considered judgments” would not be undermined…
Category Archives U.S. Circuit Courts
A federal court in California has denied the class certification motion filed by a woman who sought to represent anyone in the state who had purchased products in entire beverage lines produced by the defendant, because she had purchased just five specific products and thus her labeling and misbranding claims were not typical of those of the putative class. Major v. Ocean Spray Cranberries, Inc., No. 12-3067 (N.D. Cal., decided June 10, 2013). The amended complaint alleged that the company’s juice and drink products were unlawfully labeled “No Sugar Added” or had improper nutrient claims or false representations that the products were “free from artificial colors, flavors or preservatives.” While the plaintiff had purchased five beverages, including a Diet Sparkling Pomegranate Blueberry drink, she sought to certify a class of purchasers of entire product lines, such as 100% juice and Sparkling. According to the court, the plaintiff “has not met her…
A unanimous U.S. Supreme Court has determined that the Ninth Circuit erred by failing to consider the unconstitutional takings defense raised by raisin growers who were subject to penalties and assessments for failure to pay assessments and set aside reserve-tonnage raisins under a Depression-era program intended to stabilize prices for agricultural commodities by limiting their quantity in the domestic competitive market. Horne v. USDA, No. 12-123 (U.S., decided June 10, 2013). Pursuant to the Tucker Act, claims “for just compensation under the Takings Clause must be brought to the Court of Federal Claims in the first instance, unless Congress has withdrawn the Tucker Act grant of jurisdiction in the relevant statute.” The Court found that the Agricultural Marketing Agreement Act (AMAA) of 1937 displaces Tucker Act jurisdiction and, because the raisin growers had no alternative remedy, “their takings claim was not ‘premature’ when presented to the Ninth Circuit.” The Court…
A federal court in California has reportedly determined that a named plaintiff in a putative consumer-fraud class action may pursue claims pertaining to the defendant’s green tea products but not its black teas. Khasin v. R.C. Bigelow, Inc., No. 12-2204 (N.D. Cal., order entered May 31, 2013). The plaintiff apparently alleges that the defendant made misleading statements in press releases and on its website about the presence of antioxidants in its tea products, including both green and black teas. Because he did not purchase the black teas, the court ruled that he lacked standing to represent consumers who did purchase them. The court also reportedly dismissed the plaintiff’s unjust enrichment claim but refused to dismiss most of his other allegations finding them sufficiently pleaded. See Bloomberg BNA Product Safety & Liability Reporter, June 4, 2013.
A federal court in Arkansas has ruled that it has jurisdiction, pursuant to the U.S. Supreme Court’s seminal standing decision under the Class Action Fairness Act (CAFA), Standard Fire Insurance Co. v. Knowles, 133 S. Ct. 1345 (2013), to adjudicate the putative class claims filed by a woman who alleges that Frito-Lay deceives consumers by labeling its Tostitos® and SunChips® products as “All Natural” because they contain genetically modified corn and hexane-extracted soybean oil. Deaton v. Frito-Lay N. Am., Inc., No. 12-1029 (W.D. Ark., order entered June 5, 2013). At issue was whether the defendants had submitted sufficient evidence to show that the amount in controversy exceeded CAFA’s $5 million jurisdictional minimum. The plaintiff had stipulated that she would not seek more than $5 million to keep the lawsuit in state court, but conceded that her stipulation could not prevent removal under the Knowles decision. The court ruled that the…
A federal court in Minnesota has dismissed a putative class action alleging that General Mills misleads consumers by labeling its Nature Valley products as “Natural” or “100% Natural” when they actually contain highly processed ingredients such as high-fructose corn syrup, high-maltose dextrin syrup and maltodextrin. Chin v. General Mills, Inc., No. 12-2150 (D. Minn., decided June 3, 2013). Additional details about the original complaint appear in Issue 453 of this Update. The court dismissed all counts relating to Nature Valley products that the plaintiffs did not purchase, according to their first amended complaint, ruling that they lacked standing to bring such claims. The court dismissed a breach of written warranty claim brought under the Magnuson-Moss Warranty Act because labeling a product as “100% Natural” is not a written warranty under the law; rather, it is a “product description.” Implied warranty claims under the Act and state law were also dismissed…
Class representatives in litigation against Papa John’s International have filed an unopposed motion for preliminary approval of a class action settlement in a case involving claims that the company’s franchisees sent unlawful commercial text messages through OnTime4U to some 220,000 individuals without their express consent. Agne v. Papa John’s Int’l, Inc., No. 10-1139 (W.D. Wash., filed May 17, 2013). Details about the court’s grant of class certification appear in Issue 463 of this Update. Under the proposed agreement, class members who are provided notice will automatically receive a merchandise certificate for a free Papa John’s pizza—a $13 retail value with a collective value of $2.86 million. Class members who submit claims and whose phone numbers are verified will also receive $50 each at an aggregate value of $11 million. Attorney’s fees and costs will add $2.45 million to the settlement fund, and $25,000 in incentives for the named plaintiffs will…
A YUM! Brands shareholder has brought a derivative action on behalf of the company against its officers and directors in a federal court in Kentucky, alleging they inflated the company’s growth predictions and failed to promptly inform shareholders that the company purchased chicken with allegedly excessive levels of antibiotics and toxic chemicals for sale in KFC establishments in China; according to the complaint, once the information became public, business in China and the company’s share price plummeted, while the defendants “profited handsomely” from “dumping more than $64.6 million of personally held common stock during the Relevant Period.” Zona v. Novak, No. 13 506 (W.D. Ky., filed May 21, 2013). Alleging breach of fiduciary duty, insider selling and misappropriation of information, and unjust enrichment, the plaintiff seeks damages, injunctive relief, disgorgement, attorney’s fees, costs, and expenses. She claims that management knew as early as 2009 that the chicken purchased in China was tainted…
A federal court in Georgia has overruled the government’s objections to Stewart Parnell’s representation by attorney Kenneth Hodges in the defense of criminal charges arising from a Salmonella outbreak allegedly traced to Parnell’s former company, Peanut Corp. of America. United States v. Parnell, 13-12 (M.D. Ga., order entered May 30, 2013). Because the government’s motion was sealed, further details about the objections are unknown. According to the court, Parnell “knowingly and voluntarily waived his right to object to Hodges’ potential or actual conflict.” Additional information about the criminal charges appears in Issue 472 of this Update.
A federal court in California has granted in part and denied in part the motion to dismiss filed by Twinings North America, Inc. to the second amended putative class complaint filed by a woman who alleged that she paid a premium for the company’s green, black, white, and red teas relying on their purportedly misleading label—“a natural source of antioxidants.” Lanovaz v. Twinings N. Am., Inc., No. 12-2646 (N.D. Cal., order entered May 23, 2013). The company sought to dismiss claims relating to products the plaintiff did not purchase, labeling the plaintiff did not see or advertising upon which the plaintiff did not rely. According to the court, as long as the “not purchased products” are nearly identical, a plaintiff may bring claims on behalf of others related to those products. Here, “Because the claims for 51 of the varieties of tea are based upon the exact same label describing…
