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…
Category Archives Litigation
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…
According to a news source, the Turkish Competition Authority has concluded a 15-month investigation and imposed a fine of 17.9 million Turkish Liras (US $8.6 million) on Frito-Lay, finding that it engaged in practices to ensure that it was the only salty snack brand available for sale in retail shops. While the initial decision and fine have apparently been issued to the company, a more detailed “reasoned decision” will be forthcoming. The company, which contends that it “has strong policies in place to achieve compliance with the laws and regulations everywhere we do business,” will reportedly have the right to file an appeal. See BakeryandSnacks.com, September 6, 2013.
California’s pesticide regulator has reportedly filed a petition against Whole Foods alleging that several of its pet products, including cat litter and dog and cat flea spray, contain pesticides that have not been registered with the state. Cal. Dep’t of Pesticide Registration v. Whole Foods Mkt. Cal., Inc., No. 2013-00150499 (Cal. Super. Ct., Sacramento Cty., filed September 9, 2013). State law evidently requires pre approval of pesticide products so they can be tested and approved for safe use. The company is reportedly cooperating with the state and has indicated that it “looks forward to addressing the matter before a judge.” If Whole Foods has violated state law, California may impose fines. According to an agency spokesperson, failure to register pesticide products has been an ongoing issue with the Austin-based retail grocery chain and the agency intends to investigate it for a range of purportedly unregistered products. See Huffington Post, September…
