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…
Category Archives Litigation
In an unpublished opinion, the Fifth Circuit Court of Appeals has upheld the dismissal of a biscuit maker’s claim that the Food and Drug Administration’s (FDA’s) negligent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…
According to a news source, a Chinese court began hearing claims on November 27, 2009, in a civil suit brought against a dairy company and supermarket by the parents of a child allegedly sickened by melamine-contaminated milk. The parents are reportedly seeking US$8,080, claiming that the milk caused their 20-month-old son’s kidney stone. The companies have apparently argued in their defense that the injury should be covered under a government compensation program and that no medical records link the child’s kidney problems to drinking tainted milk. The judge has scheduled another hearing for December 9 and requested that the parties produce additional evidence. The case is the first to be heard in the tainted milk scandal, which purportedly resulted in the deaths of six infants, injury to 300,000 children and a worldwide recall of products containing contaminated milk powder. The largest company implicated, the Sanlu Group, paid US$132 million into…
As anticipated, Canada reportedly renewed its request that the World Trade Organization (WTO) establish a panel to resolve a dispute over U.S. country-of-origin labeling (COOL) requirements. The request was accepted, and the panel is expected to issue its report sometime in the second half of 2010, according to a news source. The WTO can authorize those countries winning such disputes to adopt commercial sanctions against countries violating its rules. Canada and Mexico have both challenged COOL, which requires U.S. meat processors to handle and label imported products separately, claiming violations of international trade agreements. Canadian meat producers reportedly contend that the rules have caused many U.S. processors to simply exclude Canadian products, and U.S. Department of Agriculture figures purportedly show that U.S. imports of Canadian livestock were 34 percent lower in the first half of 2009 compared to the same period in 2008. Canada’s agriculture minister was quoted as saying, “We…
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…
Unilever United States, Inc. has asked a federal district court to dismiss a putative class action charging the company with falsely advertising its “I Can’t Believe It’s Not Butter”® product. Rosen v. Unilever U.S., Inc., No. 09-02563 (N.D. Cal, motion filed November 30, 2009). According to Unilever’s motion, this is a “Private Surgeon General” case that seeks refunds for products purchased over the last four years because Unilever allegedly (i) falsely claims that its products are “Made With A Blend of Nutritious Oils,” and (ii) fails to disclose that the products contain trace amounts of trans fatty acids. Unilever argues that the claims are preempted by federal law which requires a “zero” trans fat content label if the product contains less than 0.5 gram per serving. The company also seeks dismissal under the dormant Commerce Clause, contending that, “If successful, Rosen will Balkanize [trans fat] labeling rules—one set of rules for California…
The Ninth Circuit Court of Appeals has determined that animal rights activists and organizations lack standing to challenge the U.S. Department of Agriculture’s (USDA’s) interpretation of a 1958 humane animal slaughtering statute in a manner that excludes poultry from its application. Levine v. Vilsack, No. 08-16441 (9th Cir., decided November 20, 2009). The issue arose in a case alleging that “inhumane methods” of poultry slaughter increased the risk of food-borne illness to plaintiff consumers as well as health and safety dangers to plaintiff poultry workers. The court reversed a district court order granting USDA’s motion for summary judgment and remanded the case with instructions to dismiss. According to the court, the plaintiffs had the burden of establishing that their alleged injury “was likely to be redressed by a favorable court decision.” The key to the court’s redressability determination was that the 1958 law’s only enforcement mechanism was later repealed. If…
Plaintiffs’ lawyer William Marler has apparently filed a second lawsuit against New York-based Fairbank Farms for injury allegedly caused by consumption of E. coli-tainted ground beef. According to Marler, the suit has been filed in a Maine state court on behalf of a woman who was hospitalized for six days after consuming meat produced by Fairbank Farms. Her cultures allegedly tested positive for the same E. coli strain found in the company’s recalled meat. See Food Poison Journal, November 17, 2009. Meanwhile, Representative Rosa DeLauro (D-Conn.) has called on the U.S. Department of Agriculture’s Office of Inspector General to investigate the method that meat processors and the agency use to verify that ground beef is free of the bacterium. In her November 12 letter, DeLauro discusses the Fairbank Farms outbreak and notes that the company’s facility sampled its products every 10 to 20 minutes. She states, “However, despite these precautions, it…
Federal courts in Ohio and Kentucky have remanded putative class claims alleging that Applebee’s International, Inc., DineEquity, Inc. and Weight Watchers International, Inc. misrepresented the calorie and nutritional information on the Weight Watchers menu items available in Applebee’s restaurants. Curry v. Applebee’s Int’l, Inc., No. 09-505 (S.D. Ohio, filed November 17, 2009); Kramer v. Applebee’s Int’l, Inc., No. 09-131 (E.D. Ky., filed November 17, 2009). Each plaintiff filed her complaint in state court and sought to certify a class of statewide residents. In July 2009, more than ten months after the complaints had been filed and after some discovery and an unsuccessful mediation had occurred, the defendants removed the cases to their respective federal courts. Writing for both courts, the Ohio district court determined that the defendants had filed for removal too late under the Class Action Fairness Act, which requires that a notice of removal be filed within 30 days…
