A federal court in Illinois has determined that insurers providing coverage to Phusion Projects, Inc., which makes Four Loko, an alcoholic beverage with large amounts of caffeine and other stimulants, do not have a duty to defend the company in lawsuits alleging injury from intoxication. Netherlands Ins. Co. v. Phusion Projects, Inc., No. 11-1253 (N.D. Ill., decided January 17, 2012). The insurers filed a declaratory judgment action against Phusion claiming that they had no duty to defend or indemnify it in five lawsuits because of an unambiguous exclusion from coverage in the applicable insurance policies. Phusion brought a counterclaim, arguing that they did have a duty to defend it. According to the court, the exclusion applies to any case alleging injury arising from intoxication. Because four of the five cases filed against Phusion involve injury attributable to intoxication, the court found that the insurers have no duty to defend the beverage…
Category Archives Litigation
Putative class actions have been filed in New Jersey and California federal courts against Tropicana Products, Inc., alleging that the company misleads consumers by labeling and marketing its orange juice as “100% pure and natural,” when it actually “undergoes extensive processing which includes the addition of aromas and flavors.” Lynch v. Tropicana Prods., Inc., No. 11-07382 (D.N.J., filed December 19, 2011); Lewis v. Tropicana Prods., Inc., No. 12-00049 (E.D. Cal., filed January 6, 2012). Both plaintiffs seek to certify nationwide classes. The New Jersey plaintiff alleges unjust enrichment, breach of express warranty, violation of the New Jersey Consumer Fraud Act, and injunctive and declaratory relief. He requests compensatory, treble and punitive damages; prejudgment interest; restitution; injunctive relief; attorney’s fees; and expenses and costs of suit. The California plaintiff, who also seeks to certify a subclass of California consumers, alleges unjust enrichment; breach of express warranty; violation of the state Consumers…
Seeking to certify a nationwide settlement class, excluding California consumers, in litigation against the company that makes the hazelnut spread Nutella®, two named plaintiffs alleging deceptive product marketing have filed their brief in support of preliminary approval of a class settlement. In re: Nutella Mktg. & Sales Practices Litig., No. 11-1086 (D.N.J., brief filed January 10, 2012). According to the plaintiffs, the company has agreed to cease the advertising at issue, begin a revised and corrective labeling and advertising campaign, change its website, and establish a $2.5 million settlement fund. Under the proposed agreement, settlement class members could submit claims for $4 per jar purchased during the class period and recover up to a maximum of $20. Nutella would also apparently agree not to oppose class counsel fees less than $3 million. According to the plaintiffs’ brief, similar litigation pending in California is also being settled. Twelve named plaintiffs in four…
According to news sources, the Center for Food Safety, which lost its challenge to the U.S. Department of Agriculture’s (USDA’s) decision to deregulate without restriction genetically engineered (GE) alfalfa, plans to appeal the matter to the Ninth Circuit Court of Appeals. A federal court in California determined on January 5, 2012, that the law does not require the agency to “account for the effects of cross-pollination on other commercial crops” in assessing whether a new crop poses risks. U.S. District Judge Samuel Conti also reportedly said that USDA lacks the authority to require a buffer zone between GE crops and conventional or organic crops. Noting that the Environmental Protection Agency (EPA) has approved the use of glyphosate on Roundup Ready® alfalfa, Conti further observed, “If plaintiffs’ allegations are true, then it is disturbing that EPA has yet to assess the effects of glyphosate on most of the species found near…
A California resident who claims economic injury from purchasing Frito-Lay snack and chip products advertised as “All Natural” while allegedly containing genetically engineered (GE) corn and vegetable oil seeks to certify a nationwide class in a consumer fraud action filed in a California federal court. Gengo v. Frito-Lay N. Am., Inc., No. 11-10322 (C.D. Cal., filed December 14, 2011). According to the complaint, the company’s tortilla chips, sun chips and multigrain snacks are prominently labeled as “made with ALL NATURAL ingredients.” Because they are instead purportedly made with corn, soybean and canola oils “made from genetically modified plants and organisms,” the plaintiff contends that “she did not get the ‘all natural’ Tostito's and SunChip’s products that were advertised and she paid for.” Alleging violations of the California Business & Professions Code (misleading advertising and unfair competition) and Consumers Legal Remedies Act, breach of express warranty, and violation of the Magnuson-Moss…
A California resident is seeking to certify a nationwide class in a lawsuit alleging that Walgreens Co. 100% Grape Juice and 100% Apple Juice contain “dangerously high levels” of lead and arsenic. Boysen v. Walgreen Co., No. 11-6262 (N.D. Cal., filed December 13, 2011). According to the complaint, the levels of lead and arsenic in these beverages are higher than FDA limits on these chemicals in bottled water, and the company fails to disclose information about the contaminants on product labels or in advertising. The plaintiff alleges that California includes lead and arsenic on the list of those substances known to the state to cause cancer or reproductive harm, but does not otherwise include a Proposition 65 claim. Alleging unfair business acts or practices and false or misleading advertising under California law, breach of implied warranty, and unjust enrichment, the plaintiff seeks restitution; actual, statutory and punitive damages; injunctive relief; attorney’s…
A federal court in Alabama has granted in part a motion to stay discovery in litigation alleging that an orange juice maker misrepresented that its product is not made from juice concentrate, but is rather “100% pure Florida squeezed.” Leftwich v. TWS Mktg. Group, Inc., No. 11-1879 (N.D. Ala., order entered December 12, 2011). The court will allow discovery as to “general personal jurisdiction” over the non-resident beverage maker to proceed, while staying discovery as to all other matters. Residents of Indiana and Alabama brought the putative class action after the Food and Drug Administration warned the company in November 2010 that its labeling violated the Federal Food, Drug, and Cosmetic Act. According to the court, if jurisdiction over the defendant is lacking, it will dismiss the Indiana plaintiff, “leaving [the Alabama plaintiff] to proceed only on the count of unjust enrichment—which itself is still subject for consideration in [the…
A federal court in Georgia has determined that it has personal jurisdiction over a Michigan food-packaging company that was sued as a third party defendant in litigation over a recalled baby food product. IPN USA Corp. v. Nurture, Inc., No. 11-501 (N.D. Ga., decided December 12, 2011). A Food and Drug Administration investigation apparently concluded that the third-party defendant (Liquid) had violated agency regulations on the manufacture of acidified and acid food products. While the baby food manufacturer (Nurture) allegedly sustained millions in damages in the recall, it was the packaging supplier (IPN) that brought the lawsuit against Nurture for breach of contract. According to the court, Liquid had sufficient contacts with Georgia for the court to exercise jurisdiction over the company. For purposes of packaging Nurture’s baby food, Liquid had purchased a machine, packaging supplies and other equipment from IPN’s Georgia-based entity, which referred a “significant number” of prospective customers…
Denying an employer’s motions for summary judgment in an employment discrimination suit, a federal court in Louisiana has determined that severe obesity, regardless of its basis, qualifies as a disability under the Americans with Disabilities Act. EEOC v. Res. for Human Dev., Inc., No. 10-03322 (E.D. La., decided December 7, 2011). The court did not decide whether the employer had terminated the obese employee’s employment because she was regarded as disabled, finding that the matter presented a genuine issue of fact to be decided by a jury. The employee, now deceased, weighed more than 400 pounds when she was hired by the defendant, which owned and operated a long-term residential treatment facility for chemically dependent women and their children. Some eight years later, the employee was terminated from her position; at the time, she weighed 527 pounds. She filed a discrimination claim with the Equal Employment Opportunity Commission (EEOC) alleging…
McDonald’s Corp. has reportedly responded to a San Francisco ban on giving away toys with its Happy Meals® by allowing parents to purchase the toys with a 10-cent charitable contribution when they buy a Happy Meal®. While the toy purchase is purportedly a separate transaction that complies with the new ordinance, it will still require a Happy Meal® purchase because toys cannot not be obtained by those who do not purchase the meal for their children. Previously, the toys could be purchased without buying a Happy Meal®. According to the company, the donations will help build a new Ronald McDonald House where parents of sick children at a University of California, San Francisco, hospital currently under construction will be able to stay. At least one public health advocate, evidently unhappy with the company’s action, was quoted as saying that McDonald’s “has developed a response to the law that allows them…
