Court Approves Class Certification in Fraud Suit Against Olive Oil Co.
A federal court in New York has certified a consumer-fraud class action against Kangadis Food Inc., d/b/a The Gourmet Factory, alleging that the company falsely labels its products as “100% Pure Olive Oil” when they actually contain the industrially processed substance “olive-pomace oil,” “olive-residue oil” or “Pomace.” Ebin v. Kangadis Food Inc. d/b/a The Gourmet Factory, No. 13-2311 (S.D.N.Y., order entered December 11, 2013). The court approved the named plaintiffs as class representatives and indicated that a memorandum stating the reasons for its ruling “will issue in due course.” Additional information about the lawsuit appears in Issue 492 of this Update.
On the day the order issued, the court also filed a memorandum explaining its reasons for dismissing certain claims and allowing others to proceed in an order entered in July 2013. The court dismissed for insufficient pleading the plaintiffs’ New York breach of warranty claims, express and implied; breach of implied warranty of fitness for a particular purpose under New Jersey law; and unjust enrichment under New York and New Jersey law.
The court refused to dismiss claims relating to labeling a product as “100% Pure Olive Oil” because it “is a written warranty sufficient to survive a motion to dismiss” and because every relevant labeling standard regards the defendant’s products as mislabeled. According to the court, the plaintiffs adequately pleaded “that Kangadis’s label breaches the implied warranty of merchantability under New Jersey law.” The court also found sufficiently pleaded claims that the company violated the deceptive acts and practices statutes of both states and claims alleging negligent misrepresentation and fraud under New York and New Jersey law. In the court’s view, “the Complaint fully specifies who made the false statement (here, Kangadis), what the false statement was (the labeling describing the product as ‘100% Pure Olive Oil’), when the statement was made (in late 2012 or early 2013), where the statement was made (on the Capatriti containers plaintiffs purchased from the local grocery store), and how that statement was false (the product was Pomace rather than pure olive oil).”