The Ninth Circuit has reversed the dismissal of a putative class action alleging that Gerber’s baby food labels misled consumers about the nutritional value of its baby foods despite being “technically correct.” Bruton v. Gerber Prods. Co., No. 1515174 (9th Cir., order entered April 19, 2017). The plaintiff argued that the presence of impermissible nutrient claims on Gerber labels combined with the absence of such claims on competitors’ products misled the public into believing Gerber products were of higher quality. The district court dismissed the action, finding no genuine dispute of material fact because the labels were accurate, but the Ninth Circuit found that “even technically correct labels can be misleading.” The appeals court also reversed the lower court’s dismissals of claims for unjust enrichment and class certification. Issue 632
Category Archives Litigation
A Pennsylvania federal court has dismissed without prejudice a consumer lawsuit alleging Herr Foods Inc. labels its snack products as free from added preservatives despite containing citric acid. Hu v. Herr Foods, Inc., No. 165037 (E.D. Pa., order entered April 24, 2017). Additional information on the complaint appears in Issue 609 of this Update. Herr moved for a judgment on the pleadings, arguing that the citric acid in its products was not serving as a preservative. The court dismissed the claim for unjust enrichment but granted leave to amend claims for alleged violations of New York laws governing deceptive acts and practices, noting that the deficiency “is a lack of allegations supporting plaintiff’s conclusory statement that citric acid functions as a preservative in the products, which plaintiff could remedy by pleading appropriate supporting facts.” Issue 632
An Ohio company has filed a lawsuit alleging Wisconsin’s ban on sales of ungraded butter violates the Commerce Clause, due process, equal protection and free speech. Minerva Dairy, Inc. v. Brancel, No. 17299 (W.D. Wis., filed April 20, 2017). In early 2017, Wisconsin began enforcing a 1954 law requiring all butter sold in the state to bear either a state or a U.S. Department of Agriculture (USDA) grade mark, telling retailers and producers to remove out-of-state butter from store shelves or risk fines and imprisonment. Minerva Dairy, Inc. argues that the ban serves no rational or legitimate governmental interest. “In contrast to butter inspection, which ensures that the butter comports with health and safety regulations, butter grades are used only to ensure a government-mandated taste,” the complaint argues. Minerva alleges that small companies are unable to afford obtaining USDA grading and creating separate labels solely for Wisconsin sales. Accordingly, the…
A federal court has ruled that three environmental groups lack standing to intervene in a lawsuit to block implementation of the Seafood Import Monitoring Program. Alfa Int’l Seafood v. Ross, No. 170031 (D.D.C., order entered April 17, 2017). The court held that the Natural Resources Defense Council, Oceana and the Center for Biological Diversity failed to establish concrete or particularized injuries “fairly traceable” to the possible vacating of the proposed program, known as the Seafood Traceability Rule. Even if they could, the court found, the groups still had not made a minimal showing that defendant U.S. Department of Commerce was unable to adequately represent their interests in the case. The groups argued that the new administration “might adopt policies that negatively affect the force of the Rule,” but Commerce reported that it supported the program. The court also dismissed the groups’ disagreements with Commerce about the program’s scope and timing…
The World Trade Organization (WTO) has held that Mexico can impose $163 million in trade sanctions against the United States for enacting tougher “dolphin-safe” requirements on fish caught in a part of the Pacific Ocean used primarily by Mexican fishers. The decades-long dispute began when international conservation efforts pressured countries to protect dolphins, which commonly swim with yellowfin tuna in that area. In response, the United States implemented stringent rules for tuna catches and imports, which Mexico argues has shut its fishing businesses out of an import market worth $680 million in 2014. The U.S. revised its requirements after WTO found in favor of Mexico in 2012, but Mexico argued that the revisions still improperly restricted tuna imports and asked for $472 million in sanctions. WTO rejected a U.S. argument to decide the dispute based on 2016 revisions that expanded the same requirements to all countries, but an expected July…
Texas chain Torchy’s Tacos, which uses the tagline “Damn Good Tacos” in its restaurants and merchandising, has filed suit against Colorado restaurant Dam Good Tacos for trademark infringement, claiming consumer confusion. Success Foods Mgmt. Group, LLC v. Dam Good Systems, LLC, No. 170842 (D. Colo., filed April 5, 2017). Asserting that it registered the “Damn Good Tacos” trademark in 2008, Torchy’s alleges federal trademark infringement, unfair competition, and violation of the Colorado Consumer Protection Act, and it seeks injunctive relief, damages and destruction of Dam Good Tacos’ infringing URLs, email addresses and all packaging, promotional and advertising materials. Issue 631
The Irish distributor of Kerrygold butter won an emergency restraining order against a Wisconsin creamery after alleging the creamery backed out of an agreement to process Kerrygold locally and later created its own nearly identical product, “Irishgold,” infringing Kerrygold’s trademark. Ornua Foods N. Am., Inc. v. Eurogold USA LLC, No. 170510 (E.D. Wis., filed April 10, 2017). A Wisconsin federal court granted the order after finding Ornua Foods, Kellygold’s maker, likely to win the trademark case it filed on the merits. After Kerrygold became the top-selling imported butter in the United States, Wisconsin removed Kerrygold butter from stores under a statute requiring all butter sold in the state to bear either a Wisconsin or federal grade mark. After the ban, Ornua Foods began working with Wisconsin state officials and defendant Old World Creamery to process the Irish-made butter a second time, making it eligible for a state grade mark. The…
A consumer has filed a projected class action alleging Asahi Beer U.S.A., Inc. misleads customers into believing that Asahi Super Dry beer is made in Japan despite being produced in Canada. Panvini v. Asahi Beer U.S.A., Inc., No. 17-1896 (N.D. Cal., filed April 5, 2017). The plaintiff claims that although most of the Asahi Dry beer sold worldwide is brewed in and exported from Japan, the product sold in the United States is made in Toronto, Canada. The complaint alleges that Asahi misleads consumers by using Japanese lettering on labels and packaging and by describing it as the “most popular high-quality beer in Japan.” Claiming violations of California’s consumer-protection statutes, the plaintiff seeks injunctive and equitable relief, restitution, damages and attorney’s fees. Issue 631
The Trademark Trial and Appeal Board (TTAB) has affirmed a refusal by the U.S. Patent and Trademark Office (USPTO) to register a trademark for La Finca wines on the grounds that the winemaker failed to show evidence that the brand has acquired distinctiveness. In re Finca La Celia, S.A., No. 86130560 (opinion issued March 31, 2017). Argentina-based winemaker Finca La Celia, which sells its La Finca wines in Trader Joe’s stores, applied for registration of the mark in 2013 and appealed after a second reconsideration was denied. TTAB reversed USPTO’s refusal to register the mark on the ground that it was generic, holding that even though the term “la finca,” which means “the estate” in Spanish, is “merely descriptive,” the term is “not perceived by the relevant public as a generic name for a type of wine.” TTAB affirmed the USPTO ruling that the maker had failed to show La…
A federal court in California has given preliminary approval to a proposed $8.25-million settlement of a class action claiming that kombucha tea products manufactured by Millennium Products, Inc. and sold at Whole Foods were mislabeled. Retta v. Millennium Products, No. 15-1801 (C.D. Cal., order entered January 31, 2017). The plaintiffs claimed that the kombucha labels (i) used the term “antioxidant” when the product contained none; (ii) used the term “non-alcoholic” when the fermented tea product allegedly contained alcohol in excess of the amount permitted for nonalcoholic beverages; and (iii) understated the amount of sugar in the product. In its order, the court granted class certification and approved monetary and injunctive relief, including Millennium’s agreements to (i) add warning labels that the product contains alcohol and must be refrigerated because it is under pressure; (ii) conduct regular sample testing to ensure the accuracy of the products’ sugar content; and (iii) adopt…
