The Seventh Circuit Court of Appeals has revived a data breach lawsuit against P.F. Chang’s China Bistro, Inc., finding that the two plaintiffs have standing to sue despite eating at a restaurant apparently not linked to the breach. Lewert v. P.F. Chang’s China Bistro, Inc., No. 14-3700 (7th Cir., order entered April 14, 2016). Additional details about the breach appear in Issue 526 of this Update. The plaintiffs ate at an Illinois location of P.F. Chang’s two months before the company announced its payment system had been hacked, revealing personal information and credit card numbers. One plaintiff noticed fraudulent charges on his card and purchased credit-monitoring services, while the other alleged that he spent time and effort monitoring his card statements and credit report. Each brought separate lawsuits, which were later consolidated then dismissed for lack of standing. Following its announcement about the data breach, P.F. Chang’s identified 33 restaurants…
Category Archives U.S. Circuit Courts
Ganeden Biotech Inc. has filed a lawsuit against American Brewing Co., Inc. and its 2015 acquisition, B&R Liquid Adventure, alleging the companies infringe its patents on a particular strain of probiotic bacteria through the marketing and sale of their búcha® beverage. Ganeden Biotech, Inc. v. Am. Brewing Co., Inc., No. 16-0876 (N.D. Ohio, filed April 13, 2016). Ganeden asserts that it holds a patent on a specific GBI-30 strain of Bacillus coagulans as used in tea and another patent on the strain as used in all other products. B&R began selling búcha® in 2013 and lists the GBI-30 strain as an ingredient, according to the complaint. “Because Ganeden holds a patent on GBI-30 and is the legitimate source of GBI-30, Ganeden believes that Defendants’ products likely contained Bacillus coagulans (which Defendants could have obtained elsewhere) but not always the GBI-30 strain as labeled,” the biotech company argues. For allegations of patent infringement and unfair…
A consumer has filed a putative class action alleging Outernational Brands, Inc. mislabels its Vivaloe aloe-vera beverages as “All Natural” and preservative-free even though the products contain citric acid. Chen v. Outernational Brands, Inc., No. 16-1634 (E.D.N.Y., filed April 4, 2016). “The term ‘All Natural’ only applies to those products that contain no non-natural or synthetic ingredients and consist entirely of ingredients that are only minimally processed,” the complaint asserts. The plaintiff argues that the presence of citric acid, “which is not extracted from citric fruits but industrially synthesized via complex chemical synthetic routes and thus cannot be considered ‘minimally processed,’” precludes Outernational from labeling Vivaloe as “All Natural” or free of preservatives. The complaint admits the U.S. Food and Drug Administration has not defined “natural,” but argues “there is no reasonable definition of ‘All Natural’ that includes ingredients that, even if sourced from ‘nature,’ are subjected to extensive transformative…
A putative class action against Melitta USA Inc. alleges the company’s coffee product packaging fails to distinguish between “natural and/or artificial flavor” per federal regulations. Decerbo v. Melitta USA Inc., No. 16-0850 (M.D. Fla., filed April 11, 2016). The plaintiff argues that under U.S. Food and Drug Administration rules, food manufacturers must “accurately identify or describe, in as simple and direct terms as possible, the basic nature of the food and its characterizing properties or ingredients,” including whether a characterizing flavor is natural or artificial. However, “‘Hazelnut Crème’ is not flavored with hazelnuts, there is no vanilla in ‘French Vanilla,’ and ‘Pumpkin Spice’ flavor contains neither nutmeg nor cinnamon, or pumpkin or any customary pumpkin spice either, as these Products’ labels would explicitly lead a consumer to conclude,” the complaint argues. The plaintiff further notes that other coffee-product manufacturers “have responsibly decided to correctly label their products,” purportedly giving the…
A California federal court has dismissed a lawsuit alleging that Diageo PLC misrepresents Red Stripe® beer as brewed in Jamaica, finding “no reasonable consumer would be misled into thinking that Red Stripe is made in Jamaica with Jamaican ingredients based on the wording of the packaging and labeling.” Dumas v. Diageo PLC, No. 15-1681 (S.D. Cal., order entered April 6, 2016). Details about the complaint appear in Issue 574 of this Update. Bottle trays for six and 12-packs of Red Stripe® include, as the court explained, “the language ‘Jamaican Style Lager and ‘The Taste of Jamaica,’” the Diageo-Guinness USA logo and a disclaimer on the bottom of the packaging that states, “Brewed and bottled by Red Stripe Beer Company Latrobe, PA.” Citing a Second Circuit opinion finding that the description of a knife as a “Swiss Army knife” does not imply it was made in Switzerland, the court found that the “mere…
“The U.S. Supreme Court recently deviated from its historically stringent view on class certification and affirmed an Eighth Circuit decision to uphold certification of a class of Tyson Foods, Inc. employees who brought suit against Tyson for a violation of the Fair Labor Standards Act of 1938 (FLSA),” Shook Miami attorneys Frank Cruz-Alvarez and Rachel Canfield explain in an April 13, 2016, analysis for the Washington Legal Foundation’s Legal Pulse. The article first describes the suit’s origins; Tyson initially paid all employees for an equal amount of time spent donning and doffing protective gear but later adjusted the policy to pay some employees for additional “don and doff” time. Cruz-Alvarez and Canfield note that “Plaintiffs alleged Tyson’s failure to compensate them for time spent performing this ‘integral and indispensable’ work activity violated the FLSA by lengthening their workweek beyond forty hours without providing them with overtime pay.” They also note…
A California federal court has granted The Kroger Co.’s motion to dismiss a lawsuit alleging the company’s breadcrumbs product includes partially hydrogenated oil, which contains trans fat, despite labeling the product as “0g Trans Fat.” Hawkins v. Kroger Co., No. 15-2320 (S.D. Cal., order entered March 17, 2016). The court found that the mislabeling claims failed for two reasons. First, a challenge to a “0g Trans Fat” labeling claim is preempted, the court said, because U.S. Food and Drug Administration regulations require that foods with less than one-half of a gram of trans fat be labeled as “0g.” Second, the plaintiff failed to prove actual reliance on the allegedly deceptive statements, the court found, rejecting her argument that she “is a busy person and cannot reasonably inspect every ingredient of every food that she purchases” despite having bought the bread crumbs six times per year for 15 years but only noticing…
A Florida federal court has rejected a Florida dairy farmer’s challenge to the state’s standard of identity for skim milk, which dictates that its nutrient content must be the same as that of unfortified whole milk, requiring the addition of vitamin A after processing. Ocheesee Creamery v. Putnam, No. 14-0621 (N.D. Fla., Tallahassee Div., order entered March 30, 2016). The farmer’s company, Ocheesee Creamery, skimmed the cream from milk and sold the leftover product as “skim milk” without fortifying it with vitamin A. Florida inspectors told the dairy farmer she must adjust the nutrient level or label the milk “imitation,” and she filed a lawsuit challenging the rule. Additional details on the case appear in Issue 555 of this Update. The court found that the state standard of identity and its federal counterpart in the federal Food, Drug, and Cosmetic Act “easily pass muster” under the First Amendment test for…
A California federal court has refused to certify a class of consumers alleging that R.C. Bigelow Inc. misled them by over-representing the amount of antioxidants contained in its green tea. Khasin v. R.C. Bigelow, Inc., No. 12-2204 (N.D. Cal., order entered March 29, 2016). The court previously refused to allow the plaintiff to seek financial records to calculate damages. Additional details appear in Issue 575 of this Update. In its certification analysis, the court found fault with the plaintiff’s three suggested damages models: (i) a restitution calculation, (ii) statutory damages or (iii) a nominal alternative. The plaintiff argued that the restitution calculation model should amount to payments of the full purchase price of the product because the tea is allegedly “legally worthless” for failing to meet U.S. Food and Drug Administration requirements on antioxidant nutrient claims. The court refused to find that consumers received no benefit from drinking the tea, “in…
A Georgia federal court has reportedly ruled that four former executives of Peanut Corp. will not be forced to pay restitution to the victims of a Salmonella outbreak linked to nine deaths and 714 illnesses. The executives—Stewart Parnell, Michael Parnell, Samuel Lightsey and Daniel Kilgore—are each serving federal prison terms for knowingly shipping Salmonella-tainted peanut butter and faking related lab-test results. The court reportedly found that the loss estimates provided by the prosecutors were invalid because they included unrecoverable costs, including attorney’s fees. Further, the victims received more than $12 million from Peanut Corp.’s insurer, and the punitive factor of restitution would be reduced because requiring payment “would ultimately be for naught or close-to-naught,” as the executives received long prison sentences. See Associated Press, April 7, 2016. Issue 599
