The First Circuit Court of Appeals has upheld an injunction against the enforcement of a Massachusetts law that regulated wine shipments in a manner that changed “the competitive balance between in-state and out-of-state wineries in a way that benefits Massachusetts wineries and significantly burdens out-of-state wineries.” Family Winemakers of Cal. v. Jenkins, No. 09-1169 (1st Cir., decided January 14, 2010). The statute at issue gave small wineries (those producing 30,000 gallons or less of grape wine annually) the most options for selling to consumers, either by direct shipment or through wholesalers and retailers. According to the court, most Massachusetts wineries are small wineries. Large wineries could sell either through wholesalers or by applying for a special license to ship directly to consumers; they could not do both. Apparently, Massachusetts has no large wineries. A group of California wineries and Massachusetts residents challenged the law, claiming it violated the Commerce Clause by effectively…
Category Archives U.S. Circuit Courts
The Ninth Circuit Court of Appeals has determined that pet food mislabeling claims should not be certified as a class action because the named plaintiff failed to satisfy the predominance requirement of Federal Rule of Civil Procedure 23(b)(3). Kennedy v. Natural Balance Pet Foods, Inc., No. 08-56378 (9th Cir., decided January 6, 2010) (not for publication). The plaintiff alleged that dog and cat food products labeled with “Made in the USA” were mislabeled because they contained ingredients from China and sought to certify a class of individuals from a number of states. While the court upheld the district court’s class certification ruling because the plaintiff failed to show which consumer protection law would apply to the class claims, it reversed the court’s order dismissing the action for lack of subject-matter jurisdiction. According to the court, the case, which had been removed from state to federal court, should have been returned…
According to a news source, a Denver man who alleged that his habit of consuming two bags of microwave popcorn every day caused his bronchiolitis obliterans, a debilitating lung condition purportedly associated with exposure to the butter flavoring diacetyl, has settled his claims against a flavoring manufacturer. Watson v. Dillon Cos., Inc., (D. Colo.) One of three diacetyl lawsuits brought by consumers in 2008, the claims of Wayne Watson were filed on his behalf by an Independence, Missouri, law firm that has obtained a number of settlements for workers with “popcorn lung” purportedly caused by occupational exposures to diacetyl. Details about Watson’s case appear in issue 244 of this Update. No additional information about the settlement has apparently been made available. See Findlaw.com, December 15, 2009.
A fractured Fifth Circuit Court of Appeals has determined that claims alleging violation of the Packers and Stockyards Act of 1921 must be supported by proof of injury, or likelihood of injury, to competition. Wheeler v. Pilgrim’s Pride Corp., No. 07-40651 (5th Cir., decided December 15, 2009). The issue arose from a complaint filed by certain poultry “growers,” alleging under the Act that another grower “was given a contract [with defendant] on preferable terms.” The district court and a Fifth Circuit panel concluded that the Act did not require a showing of adverse effect on competition and allowed the claims to proceed. The appeals court, in a 9-7 decision, reversed, finding the district court erred in denying defendant’s motion for summary judgment. Four judges joined the majority opinion but authored a concurrence to more clearly discuss the statutory interpretation principles at issue in the case. The dissenting judges, relying on…
Francis Ford Coppola Presents, LLC has filed a complaint in a California court against a company that makes corks, screw caps, bottles, and other packaging, alleging that defects in the bottles and screw caps purchased for the winery’s Encyclopedia® collection of wines caused the degradation or destruction of 55,000 cases of wine. Francis Ford Coppola Presents, LLC v. Vinocor USA, Inc., No. 26-50585 (Cal. Super. Ct., Napa Cty., filed November 23, 2009). The winery alleges breach of contract, the implied covenant of good faith and fair dealing and the implied warranty of fitness; fraud in the inducement; negligent misrepresentation; negligence; and “for money had and received.” According to the complaint, the affected wine collection “was crafted and designed to be a collection of wines aimed at educating consumers on understanding how geography, history, food and religion, to name a few, all contribute to the making and enjoyment of wine. In…
Welch Foods Inc. has filed suit against its insurers claiming that they have a duty to defend and indemnify the beverage maker in litigation alleging that the company deceptively marketed its “100% Juice White Grape Pomegranate Flavored 3 Juice Blend”®. Welch Foods Inc. v. Zurich Am. Ins. Co., No. 09-12087 (D. Mass., filed December 8, 2009). According to Welch, the insurers were timely notified about two lawsuits, one by a competitor, POM Wonderful LLC v. Welch Foods Inc., and one by a consumer on behalf of a class, Burcham v. Welch Foods Inc., and denied they had a duty to defend or indemnify the beverage maker. Additional information about those lawsuits appears in issues 290, 313 and 316 of this Update. Alleging that its defense costs have exceeded $75,000 to date in both cases, Welch seeks a declaration that the insurers have a duty to defend and indemnify it under…
A federal court in Connecticut has ordered the payment of $1.9 million in equitable restitution to consumers who purchased Chinese Diet Tea and Bio-Slim Patch in 2003-2004. FTC v. Bronson Partners, LLC, No. 04-1866 (D. Conn., decided December 4, 2009). The court determined in 2008 that the Federal Trade Commission’s (FTC’s) claims of false advertising against the defendants had merit and issued this ruling to explain the basis for its damages award and why it was not allowing any offsets to the defendants from the gross amounts they received for all of the products sold. Essentially, the court found that the defendants’ poor recordkeeping and legal precedent did not allow offsets for credit card refunds, bounced checks, operating expenses, or revenue generated by reorders, which defendants claimed represented satisfied customers. According to the court, reorders could also have represented customers who “had not yet achieved the results promised in the…
In an unpublished opinion, the Fifth Circuit Court of Appeals has upheld the dismissal of a biscuit maker’s claim that the Food and Drug Administration’s (FDA’s) negligent testing of its product for Listeria monocytogenes resulted in a false positive report that caused it to lose its contract with a company that supplied 7-Eleven convenience stores with biscuit sandwiches. Lone Star Bakery, Inc. v. U.S., No. 09-50374 (5th Cir., decided November 17, 2009). The litigation arose under the Federal Tort Claims Act following a 2002 Listeria contamination incident for which the biscuit maker was initially blamed, but later cleared of any responsibility. The company sought $2.9 million in damages from the FDA. According to the court, which affirmed a grant of the FDA’s summary judgment motion, while the company submitted evidence showing “several instances where the FDA inspectors failed to follow agency collection and testing protocol,” its evidence was “devoid of…
According to a news source, a federal jury has awarded conventional rice farmers about $2 million in compensatory damages for the economic losses they allegedly experienced when European markets closed to U.S. rice imports that were found to be contaminated with genetically modified (GM) rice. In re: Genetically Modified Rice Litig., MDL No. 1811 (E.D. Mo., verdict reached December 4, 2009). The verdict was reached in the first bellwether cases to be tried. The next bellwether trial is apparently scheduled to begin in January and involves farmers from Arkansas and Mississippi. Defendant Bayer AG apparently indicated that it was pleased the jury did not award punitive damages and was preparing for the upcoming trials, which “will be different from these initial cases.” See Product Liability Law 360, December 4, 2009. In a related development, the MDL court has entered an order disposing of pre-trial motions related to the second bellwether trial. Among…
ConAgra Foods, Inc. has asked a multidistrict litigation (MDL) court to sever and transfer the claims of 68 plaintiffs from 14 different states in an action (Bowman v. ConAgra Foods, Inc.) recently filed against the company arising out of the purported Salmonella contamination of its peanut butter. In re: ConAgra Peanut Butter Prods. Liab. Litig., MDL No. 1845 (N.D. Ga., motion filed November 24, 2009). The motion is similar to one filed earlier in November. Additional details about that motion appear in issue 327 of this Update. While ConAgra does not object to the court retaining jurisdiction over the Bowman claims for purposes of pre-trial proceedings, it asks that the plaintiffs’ claims be severed and transferred for trial because they were improperly joined and “because trial of these claims as a single action is likely to result in undue prejudice to the litigants and confusion to the jury,” which would have to apply…
