A federal multidistrict litigation (MDL) court in California has certified a nationwide class of consumers who purchased a POM Wonderful pomegranate juice product between October 2005 and September 2010 and allege that the company’s health-related benefit claims are false and misleading. In re POM Wonderful LLC Mktg. & Sales Practices Litig., MDL No. 2199 (C.D. Cal., decided September 28, 2012). The suit was filed under California’s False Advertising Law, Unfair Competition Law and Consumers Legal Remedies Act. While POM argued that a nationwide class could not be certified because California law cannot be applied to consumers in other states, the company failed to specifically identify conflicts between the laws of California and other states. According to the court, the company simply cited a Ninth Circuit decision “[p]erhaps relying upon the mistaken assumption that California law cannot be applied to a nationwide class as a matter of law,” and included an exhibit…
Category Archives U.S. Circuit Courts
A California resident has filed a putative class action against General Mills, Inc., alleging that its “100% Natural” labeling and advertising for products such as Nature Valley® Dark Chocolate Peanut Butter Crunchy Granola Bars are misleading because the products contain ingredients grown from genetically modified organisms (GMOs). Rojas v. General Mills, Inc., No. 12-5099 (N.D. Cal., filed October 1, 2012). Contending that the soy, yellow corn flour, soy flour, and soy lecithin in the granola bars are GMO ingredients, the plaintiff does not request that the defendant provide a GMO disclosure; rather, he “only requests Defendant to remove the ‘100% NATURAL’ labeling from its Product.” While the plaintiff’s alleged harm is purely economic, i.e., he did not get the benefit of his bargain, he alleges that GMOs “pose a potential threat to consumers because medical research and scientific studies have yet to determine the long-term health effects of genetically engineered foods.”…
A federal court in California has denied Nabisco, Inc.’s request that it reconsider a previous ruling granting a motion to remand a consumer fraud class action to state court for failing to satisfy the amount in controversy for diversity jurisdiction under the Class Action Fairness Act. Garcia v. Nabisco, Inc., No. 12-04272 (C.D. Cal., decided September 26, 2012). Because the product targeted by the plaintiff, “Wheat Thins 100% Whole Grain” crackers, is no longer on the market, the court rejected an estimate of expenses that would be incurred, if the plaintiffs succeed, to reformulate product packaging for other newly formulated products, “which are not the subject matter of this action.”
A federal court in Georgia has denied a request to certify a nationwide class of Steak 'n Shake hourly employees in a dispute over alleged violations of the Fair Labor Standards Act, finding that class members are not similarly situated to the named plaintiffs or to each other. Beecher v. Steak 'n Shake Operations, Inc., No. 11-04102 (N.D. Ga., decided September 27, 2012). The putative class would have involved some 65,000 employees working in more than 400 corporate restaurants in five different U.S. regions. They alleged that restaurant managers were authorized to and did in fact change time records in bad faith and thus did not compensate them for all of their work or paid them less than minimum wage. According to the court, the evidence showed that restaurant managers had a number of legitimate reasons for altering time records. For example, if the clock in/clock out times did not correctly…
A federal court in the District of Columbia has dismissed the declaratory judgment action that POM Wonderful filed against the Federal Trade Commission (FTC) shortly before the Commission brought an enforcement action against the pomegranate product producer. POM Wonderful LLC v. FTC, No. 10-1539 (D.D.C., decided September 30, 2012). More information about the complaint and FTC’s motion to dismiss appears in Issues 364 and 373 of this Update. According to the court, “[t]he balance of relevant factors counsels against exercising jurisdiction over this action.” Among other matters, the court found that (i) the declaratory judgment action would not fully resolve the parties’ claims because they would “still have to litigate whether POM’s health claims about its products were false, misleading, and unsubstantiated in violation of the FTC Act”; (ii) “other overlapping proceedings are pending” and POM can raise arguments in those proceedings that it has raised in the declaratory judgment…
Naked Wines LLC has filed an action against Nakedwines.com, Inc. and Groupon, Inc. alleging that they have infringed its “family of erotically-themed marks” including NAKED WINERY®, NAKED WINERY VIXEN®, NAKED WINERY NAUGHTY®, and NAKED WINERY DIVA®. Naked Wines LLC v. Nakedwines. com, Inc., No. 12-01717 (D. Or., filed September 21, 2012). According to the complaint, Oregon-based Naked Wines has used the marks since 2005 and has “developed and maintains customers throughout the United States.” The marks have purportedly “become an asset of substantial value as a symbol of Plaintiff and its products.” Nakedwines.com, located in Napa, California, is allegedly “the U.S. arm of a UK-based, online company that sells and distributes wine from multiple producers.” According to the plaintiff, defendant Nakedwines.com, which is working with various producers to sell 400,000 cases of wine in the United States in 2013 and planning to open a winery in California under the name “Naked…
Chipotle Mexican Grill, Inc. has filed another infringement action against a retailer allegedly selling a chicken sandwich combo using the CHIPOTLE® trademark. Chipotle Mexican Grill, Inc. v. Jack in the Box, Inc., No. 12-02511 (D. Colo., filed September 21, 2012). Information about the trademark infringement lawsuit Chipotle filed in April against Kroger Co. appears in Issue 435 of this Update. In the new action against Jack in the Box, Chipotle alleges that when asked to cease using the CHIPOTLE® marks to promote its chicken sandwich, the defendant responded that its use of the word did not infringe the marks and that it did not currently plan to use the mark, which was used in connection with a limited time offer, in the future. Still, according to the complaint, the defendant “suggested that it would use the CHIPOTLE Marks in the future.” Claiming that its marks have “acquired substantial goodwill and are…
A federal court in New York has dismissed with prejudice claims that Mario Batali’s Del Posto restaurant allegedly retained portions of workers’ tips in violation of federal and state labor laws after approving an agreement requiring the defendants to pay $1.15 million into a settlement fund and provide workers with training and paid vacation time and sick leave. Amastal v. Pasta Resources, Inc., No. 10-07748 (S.D.N.Y., order entered September 24, 2012). Additional information about the lawsuit can be found in Issue 368 of this Update. The 31 plaintiffs in this lawsuit had opted out of a similar class action involving captains, servers, waiters, bussers, runners, backwaiters, bartenders, and barbacks at Del Posto and seven other restaurants; the class action apparently concluded with a $5.25 million settlement deal preliminarily approved in May. Details about the class action appear in Issues 361 and 430 of this Update. The deal also apparently releases claims…
A federal court in New York has denied a motion to dismiss a consumer fraud action against the company that makes Four Loko®, a beverage allegedly containing high alcoholic and caffeine content and sold without disclosing “possible negative health effects.” Yourth v. Phusion Projects, LLC, No. 11-1261 (N.D.N.Y., decided September 27, 2012). The defendant contended that the court lacked subject matter jurisdiction on the ground of mootness “because defendant has offered ‘to fully refund any amounts that Plaintiff paid for Four Loko as well as any fees and costs he incurred.’” Noting that the circuit courts have split over whether a defendant can moot a putative class action by offering to satisfy the plaintiff’s demand before a motion for class certification is filed, the court concluded that “unless plaintiff has unduly delayed in moving for certification, defendant’s offer of full relief does not moot the action.” According to the court,…
A California resident has filed a putative nationwide class action with a California subclass against a company that makes low-calorie frozen desserts that allegedly have as much as 68 percent more calories than touted on the product label. Freeman v. Arctic Zero, Inc., No. 12-2279 (S.D. Cal., filed September 18, 2012). Similar putative class claims filed by another California resident in August are summarized in Issue 451 of this Update. According to plaintiff Brenda Freeman, “[c]onsumers do not receive the benefit of their bargain because the actual calorie content of the Frozen Desserts is up to 68 percent higher than Arctic Zero prominently represents on the front of the product packaging, on the nutritional label, and in Arctic Zero’s other marketing materials.” She cites testing on the company’s Chocolate Peanut Butter and Vanilla Maple products showing them to be higher in calories than the 150 calories per pint on package…
