The U.S. Supreme Court has denied a petition for a writ of certiorari asking the court to resolve a split among circuit courts on the question of whether putative class action plaintiffs must propose an administratively feasible method to identify potential class members. Conagra Brands, Inc. v. Briseno, No. 16-1221 (U.S., denial entered October 10, 2017). The case centers on a consumer's allegation that Conagra Brands, Inc.'s Wesson cooking oil is mislabeled as "100% Natural" because it contains genetically modified ingredients. Conagra appealed a Ninth Circuit decision that joined the Sixth and Seventh Circuits in holding that independent administrative feasibility is not needed for a class action to succeed. The Second, Third, Fourth and Eleventh Circuits have allowed the additional requirement, which companies have used to argue that their putative class actions should be dismissed.
Chicago officials have voted to repeal a sugar-sweetened beverage (SSB) tax approved in November 2016 by the Cook County Board of Commissioners but delayed by a lawsuit arguing that the tax was unconstitutional. The tax took effect in August 2017 after a court dismissed the Illinois Retail Merchants Association's lawsuit. Retailers reportedly saw SSB sales decline 25 to 50 percent, while retailers with locations in surrounding counties not subject to the tax saw sales increase. In addition, the Chicago Tribune reported, "Internal polling for one Cook County commissioner showed more than 90 percent of constituents opposed the soda tax.” The repeal will take effect December 1, 2017. Other jurisdictions continue to experiment with SSB taxes. In April 2018, Ireland will begin taxing non-alcoholic, water- and juice-based drinks with an added sugar content of 5 grams or more per 100 milliliters. Pure fruit juices and dairy products will be exempt from the…
In a settlement with California, The Gatorade Co. has agreed to stop suggesting that drinking water harms athletes. California v. Gatorade Co., No. BC676734 (Cal. Super. Ct., Los Angeles Cty., entered September 21, 2017). Gatorade launched a mobile game featuring Usain Bolt that featured the runner speeding up when he ran over the Gatorade logo and slowing down when he touched water droplets. The complaint alleged that players were instructed to “Keep Your Performance Level High By Avoiding Water” and claimed Gatorade violated state unfair competition and false advertising laws. Under the settlement agreement, Gatorade will no longer make the “Bolt!” app available in any form that “creates the misleading impression” that water will hinder athletic performance or that water should be avoided. Gatorade also agreed not to make “statements that disparage water or the consumption of water” and will include a provision in contracts with endorsers that “clearly and…
Penguin Trading, Inc., the maker of Fruit Bliss organic dried fruits, faces a putative class action alleging the company’s products contain as much as 80 percent slack-fill. Buso v. Penguin Trading, Inc., No. 17-7025 (C.D. Cal., filed September 22, 2017). The plaintiff argues that he would not have bought Fruit Bliss’ Organic Deglet Nour Dates, sold in opaque containers, if he knew the container was “substantially empty.” Asserting violations of California consumer-protection laws, the plaintiff seeks class certification, compensatory and punitive damages, injunctive relief and attorney’s fees.
Jimmy Buffett’s Margaritaville Enterprises, which owns trademarks on the phrase “It’s Five O’Clock Somewhere" and several variations, has challenged The Veteran Beverage Company's application to register "It’s 1700 Hours Somewhere.” Margaritaville Enters. v. Veteran Beverage Co., No. 91236809 (T.T.A.B., filed September 22, 2017). The notice alleges that the trademark application is for beer, which is closely related to Margaritaville’s beverage and bar services marks, and that the only difference is that it shows 5:00 p.m. in military time.
Cookie Do Inc., which sells raw cookie dough desserts, allegedly caused consumers to feel gastrointestinal pain after they ate the products, which are advertised as “ready to eat,” with “NO chance of salmonella” and “NO chance of food-borne illness.” Canigiani v. Cookie Do, Inc., No. 17-7182 (S.D.N.Y., filed September 21, 2017). The complaint cites Yelp posts to argue that other consumers experienced similar symptoms and illnesses. Claiming violations of New York consumer-protection laws, fraudulent concealment, fraudulent inducement, negligent misrepresentation and unjust enrichment, the plaintiffs seek class certification, damages, injunctive relief and attorney’s fees.
An Illinois federal court has dismissed with prejudice a lawsuit alleging that Mondelez International falsely advertises Belvita breakfast biscuits and cookies as providing “four hours of nutritious steady energy.” Spector v. Mondelez Int’l, No. 15-4298 (E.D. Ill., entered September 27, 2017). The court held that the plaintiff failed to allege plausible facts to support her claim of false advertising and could not “rely on mere allegation of falsity, which is conclusory and thus not entitled to the assumption of truth.” The plaintiff "appears to draw her own conclusions” about daily calorie requirements, the court noted, and her arguments about variability of metabolism that would cause a consumer to receive fewer than four hours of energy “proceed as if the inherent inconsistency is self-evident.”
A New York federal court has denied class certification to a plaintiff alleging that Fifth Generation, Inc. falsely advertised Tito's Handmade Vodka, ruling that the plaintiff failed to propose a model to measure the alleged price premium. Singleton v. Fifth Generation, Inc., No. 15-474 (N.D.N.Y., entered September 27, 2017). The court noted that the plaintiff had satisfied certification requirements, but because he testified that he did not intend to purchase the product again, he had no standing to seek injunctive relief. In addition, the plaintiff's failure to provide a "suitable model to measure the alleged price premium for Tito’s vodka due to the ‘handmade representation’” led the court to rule that common issues did not predominate over individual ones. Additional details appear in Issue 590 of this Update.
The National Advertising Division (NAD) has recommended that French’s Food Company pull Facebook and print advertising claiming that its ketchup and mustard products are “better” than their competitors, preferred by children and free from high-fructose corn syrup. NAD found that French’s was unable to substantiate several claims—“Tastier Meals,” “Greatest Tasting Ketchup” and “America’s #1 mustard has the greatest tasting ketchup"—and could not support the contention that the absence of GMO ingredients or high-fructose corn syrup made the products “better” than those of competitors. NAD also noted that the Facebook ad did not refer to any improvements or changes in French’s products that would make them “better” than previous versions. French’s has agreed to discontinue the ads.
The U.S. Food and Drug Administration (FDA) has proposed an additional extension for compliance with the menu labeling rules required by the Affordable Care Act. Under the proposed rule, the current compliance deadline of July 26, 2018, would be extended to January 1, 2020, for manufacturers with $10 million or more in annual food sales; for manufacturers with less than that amount, the date would be extended to January 1, 2021.
