The U.S. Supreme Court has decided not to hear a putative class action lawsuit involving claims that Tri-Union Seafoods LLC fails to warn consumers about mercury concentrations in its canned tuna fish products. Tri-Union Seafoods, L.L.C. v. Fellner, No. 08-889 (U.S., cert. denied April 20, 2009). The plaintiff filed her claims in 2006, alleging that she developed severe mercury poisoning after eating Chicken of the Sea® canned albacore tuna almost exclusively for five years. The district court dismissed the case on federal preemption grounds, but the Third Circuit Court of Appeals reinstated it after finding that the Food and Drug Administration (FDA) had taken no action about alleged risks posed by mercury in fish and thus, that the lawsuit would not conflict with FDA’s “regulatory scheme.” More information about the Third Circuit’s ruling appears in issue 272 of this Update. At least one legal commentator responded to news about the rejection…
Category Archives Litigation
The Eleventh Circuit Court of Appeals has turned aside a constitutional challenge to the statutory damages provisions of the Fair and Accurate Credit Transactions Act in litigation against a food establishment that allegedly printed more than the last five digits of a customer’s credit card number on an electronically generated receipt. Harris v. Mexican Specialty Foods, Inc., Nos. 08-13510 & -13616 (11th Cir., decided April 9, 2009). The district court had granted the merchants’ motions for summary judgment and dismissed the claims with prejudice, after finding the statutory damages provision unconstitutionally vague and excessive. According to the appeals court, which addressed only the facial challenge to the law, by providing for a range of damages (from $100 to $1,000), the law does not deprive potential defendants of notice of the consequences of violations or result in arbitrarily assessed damages awards. The court remanded the litigation for further proceedings.
Finding that a trial court erred in admitting evidence and instructing the jury in a lawsuit involving claims that milk permeate sickened or killed calves that were fed the product as a source of dietary energy, protein and minerals, the Ninth Circuit Court of Appeals has returned a breach-of-warranties lawsuit to the lower court for a new trial. Millenkamp v. Davisco Foods Int’l, Inc., Nos. 07-35299 & -35318 (9th Cir., decided April 14, 2009). The defendant allegedly advised the owners of a cattle operation about the use of milk permeate as a food source for their calves and then sold the product to them. When their calves fell ill and some died, the plaintiffs learned that they had stored the product at an improper temperature, “which allowed lactose to ferment into a harmful lactic acid that caused the calves to fall prey to rumen acidosis.” The plaintiffs sued for breach…
A federal court in Pennsylvania has certified for immediate appeal its denial of the defendants’ motion to dismiss in multidistrict litigation (MDL) alleging price-fixing by chocolate manufacturers. In re Chocolate Confectionary Antitrust Litig., MDL No. 1935 (M.D. Pa., April 8, 2009). The defendants in these 87 consolidated lawsuits reportedly supply 75 percent of the chocolate candy consumed by Americans each year. The lawsuits allege that the companies conspired to raise prices in 2002, 2004 and 2007 by as much as 10 percent and rely on information generated by government investigations in the United States and Canada to bolster their conspiracy allegations. At least one company spokesperson has been quoted as saying, “You can’t just infer the existence of a price-fixing conspiracy from the fact that independent competitors in concentrated industries independently choose to raise their prices.” The question certified to the Third Circuit Court of Appeals is whether the U.S.…
The D.C. Circuit Court of Appeals has determined that the owners of a dairy are not required to first exhaust administrative remedies before bringing a constitutional challenge to Agricultural Marketing Agreement Act amendments. Hettinga v. U.S., No. 07-5403 (D.C. Cir., decided April 3, 2009). The amendments codified certain rule changes that the Secretary of Agriculture made to a program that regulates payments from milk handlers (processors and distributors) to milk producers (farmers) and is intended to protect producers from price fluctuations. The plaintiffs sought an injunction against enforcement of the secretary’s rule, and, while that proceeding was pending before a federal court in Texas, Congress amended the law. The plaintiffs then filed a complaint in a D.C. district court alleging that “the Amendments are unconstitutional as a bill of attainder and a denial of due process and equal protection because only the Hettingas are subject to them.” The district court…
A federal court in California has approved the settlement of class claims against Wendy’s International, Inc. involving its use of trans fats in fried food products. Yoo v. Wendy’s Int’l, Inc., No. 07-04515 (C.D. Cal., filed March 13, 2009). In its revised order and final judgment, the court overruled objections to the settlement, certified a nationwide settlement class and dismissed the complaint with prejudice. The defendant was ordered to add $450,000 plus interest to the $1.8 million already in an escrow account to be divided equally among the American Cancer Society, American Diabetes Association, American Dietetic Association, and American Heart Association. The court also ordered the defendant to ensure that its fried foods are cooked in oil containing a level of trans fat per serving that “can be represented as 0 grams of trans fat,” under Food and Drug Administration regulations. Wendy’s was further ordered to “pay for and subject its…
KFC U.S. Properties, Inc. has filed a lawsuit in federal court against the company that allegedly supplied defective food containers for the sale of Popcorn Chicken® to KFC customers; the containers apparently burst into flames when the product is reheated in a microwave. KFC U.S. Props., Inc. v. Paris Packaging, Inc., No. 09-00249 (W.D. Ky., filed April 3, 2009). According to the complaint, in February 2009, the defendant began using an ink with high carbon content for the graphics printed on the containers. After receiving customer complaints, KFC tested the containers and established that they “spontaneously combusted in a microwave within 13-20 seconds of reheating.” While no personal injuries have been alleged, the company is seeking damages in excess of $75,000 for breach of contract.
The Food and Drug Administration (FDA) has announced that U.S. marshals executed an inspection warrant at Westco Fruit and Nuts, Inc., in Irvington, New Jersey, after the company refused to recall its peanut products or provide access to distribution documents in the wake of the Salmonella outbreak involving peanuts from the Peanut Corp. of America (PCA). An FDA spokesperson said, “FDA’s enforcement action against Westco Fruit and Nuts is an appropriate step toward removing potentially harmful products from the marketplace, especially when, as in this case, a company is unwilling to share information FDA needs to ensure food safety. FDA uses all appropriate legal means necessary to obtain information and fully investigate firms or individuals who put the health of consumers at risk.” Apparently, Westco purchased oil-roasted and salted peanuts from PCA in November and December 2008. It sold them in various sizes and packages and used them as an…
The International Trade Commission (ITC) has reportedly ruled that Chinese manufacturers and U.S. distributors did not infringe the sucralose patents owned by Tate & Lyle. The ITC’s April 6, 2009, ruling affirms an administrative judge’s September 2008 preliminary ruling about the sweetener patents. More details about the case appear in issue 276 of this Update. According to a news source, Tate & Lyle is reviewing the latest determination and will decide whether appeals through the Federal Circuit Court of Appeals are feasible. Numerous sucralose competitors are apparently ready to try to break what has been characterized as Tate & Lyle’s near monopoly of the global $1.3 billion sucralose market. The company’s president called the ruling a disappointment, but, referring to the quality of its product and the efficiency of its manufacturing processes, was quoted as saying, “intellectual property is just one of the many components which define Tate & Lyle’s…
Companies that produce honey, mushroom, garlic, and crawfish products have filed a putative class action against major insurance companies and the U.S. government, alleging that the negligent issuance of customs surety bonds allowed the sale of massive quantities of competing, lower-cost Chinese products. Sioux Honey Ass’n v. Hartford Fire Ins. Co., No. 09-00141 (Ct. Int’l Trade, filed April 7, 2009). Filed in the U.S. Court of International Trade, the lawsuit claims that for eight years, insurers issued hundreds of the bonds to “thinly capitalized” and inexperienced shippers, guaranteeing the payment of any anti-dumping duties the government might decide were owed by U.S. importers for specific Chinese goods. The plaintiffs contend that the insurers failed to follow underwriting standards and thus issued bonds to importers posing an unacceptable risk of default. Had the insurers not issued the bonds to importers, “little if any of the imports that were secured by those bonds…
