Court Amends Order Against Oil Producer, Pomace Products to Be Recalled

A federal court in New York has amended the preliminary injunction entered
against Kangadis Food Inc., doing business as The Gourmet Factory, originally
requiring that the company send stickers to affix to all products sold as “100%
Pure Olive Oil” and provided to wholesalers and retailers before March 1, 2013,
because those products were actually made from Pomace, a processed oil
made from olive pits, skins and pulp. N. Am. Olive Oil Ass’n v. Kangadis Food
Inc., No. 13-868 (S.D.N.Y., order entered May 7, 2013). Additional
information about the earlier injunction appears in Issue 482 of this Update.
The stickers were intended to inform consumers that the products were not
“100% Pure Olive Oil.”

The parties sought reconsideration after Kangadis indicated that it would
prefer to recall its products from wholesalers and replace them with tins and
bottles that do not contain Pomace. The plaintiff trade association agreed to
allow this “voluntary” recall instead of a sticker program, but argued that the
recall program must extend to retailers. The court allowed the recall, stating,
“[B]y removing mislabeled tins and bottles from the marketplace altogether,
a recall may actually achieve the Court’s goal even more completely than the
sticker program.”

The court also determined that the recall must be extended to retailers.
“Kangadis previously represented that ‘very little’ mislabeled product
remained in its distribution chain,” the court stated, “but now acknowledges
that whole pallets of mislabeled product may still remain in distributors’
warehouses. Moreover, whether mislabeled tins are in the possession of
wholesalers or retailers, they are not less mislabeled, and will, when sold,
cause no less irreparable harm to unwitting consumers and to [plaintiff].”
The court also noted that “Kangadis has a written recall policy, and just a few
weeks ago told the USDA that a recent mock recall required only ‘3.5 hours
to account for all product.’ Under these circumstances, Kangadis’ speculation
about the quantity of mislabeled product held by retailers cannot justify
curtailing the scope of the Court’s prior injunction.”