The D.C. Circuit Court of Appeals has affirmed a Federal Trade Commission (FTC) order that found POM Wonderful’s advertising to be misleading for claiming that its products treat or reduce the risk of several medical conditions, including prostate cancer and heart disease. POM Wonderful, LLC v. FTC, No. 13-1060 (D.C. Cir., order entered January 30, 2015). In 2013, FTC ordered POM to stop making misleading health claims about its product, and POM challenged the ruling. POM argued that its ads were protected by the First Amendment, but the court dismissed this argument, finding that deceptive and misleading ads have no First Amendment protection. The juice company also asserted that it had clinical studies to support its health claims. The circuit court affirmed FTC’s finding that POM had cherry-picked its results when presenting them to the public, which invalidated them as support for the claims. The court agreed with POM, however, that…
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The Robert Wood Johnson Foundation’s (RWJF) Healthy Eating Research initiative has published a January 2015 report seeking to close alleged loopholes in industry efforts to regulate the marketing of foods and beverages to children. Focusing on children younger than age 14, Recommendations for Responsible Food Marketing to Children notes that although new advertising standards have led to improved nutritional profiles for many products, these guidelines often exclude product packaging, in-store promotions, toy incentives, and other strategies from their definitions of child-directed marketing. To this end, the report offers model definitions that aim to cover diverse brand architectures as well as new media and venues for marketing activities. The authors recommend that companies restrict their advertising to products that meet nutritional criteria when (i) “children constitute 25 percent or more of the audience (e.g., viewers, listeners, readers, participants, or visitors) at the time of ad placement based on projected attendance,” (ii) “children are…
District attorneys in California’s Yolo, Sacramento and San Joaquin counties have reportedly filed a lawsuit in state court alleging that R.F. Palmer Co. advertised its “Too Tall Bunny” product in violation of the unfair business practices, false advertising and unfair competition provisions of the California Business and Professions Code. The chocolatier apparently packaged the chocolate bunny in a box similar in size to its competition but asserted that the bunny was “Too Tall” and displayed the ears in plastic popping out of the top of the box. The bunny sat on a cardboard insert at the bottom of the box, and without that insert, the bunny was the same size as other similar products, the prosecutors argued. The district attorneys reportedly reached an agreement with the Pennsylvania-based chocolatier bore filing the case to ensure compliance; the court issued a final judgment the same day—a civil penalty of $2,500 for each…
Sens. Edward Markey (D-Mass.), Dick Durbin (D-Ill.) and Richard Blumenthal (D-Conn.) have released a report asserting that while 12 of 16 companies that responded to a series of questions from the lawmakers have made progress in reducing marketing and promotion activities targeting children younger than age 12 and children in K-12 school settings, they have failed to voluntarily eliminate such efforts geared toward teenagers (ages 13-18). “Despite energy drink makers’ claims of not marketing their products to teenagers, a quick glance at social media or a drop by at a local concert shows that those claims just aren’t based in fact,” Senator Durbin was quoted as saying. “The truth is that in the absence of federal regulation, energy drink companies are using effective marketing tactics to reach young people—and sadly it’s working. It is past time for this industry to heed the advice of public health experts across the country…
Anheuser-Busch Cos. has reportedly settled a consumer class action alleging that Kirin® beer is represented as a Japanese import even though the products sold in the United States are brewed with domestic ingredients in California and Virginia. Suarez v. Anheuser-Busch Cos., No. 2013-33620-CA-01 (Fla. Cir. Ct., 11th Jud. Cir., settlement preliminarily approved December 17, 2014). The October 2013 complaint alleges that Kirin’s labeling falsely implied that its products remained imported despite a 1996 agreement between the Japanese company and Anheuser-Busch to manufacture the beer in the United States and a 2006 deal that gave Anheuser-Busch the brand’s marketing and sales responsibilities. The complaint alleges that the packaging includes, in fine print, a statement clarifying that the beer is “[b]rewed under Kirin’s strict supervision by Anheuser-Busch, in Los Angeles, CA and Williamsburg, VA,” but that the statement is not visible to consumers before purchase. Under the proposed settlement agreement, consumers will…
A consumer has filed a putative class action in Florida federal court alleging that LesserEvil LLC falsely advertises its Chia Crisps as containing “a significant amount of chia seeds, when, in actuality, the Product is primarily composed of black beans, a less expensive ingredient.” Crane v. LesserEvil LLC, No. 14-62854 (S.D. Fla., filed December 16, 2014). The plaintiff asserts that LesserEvil attempted to capitalize on increasing consumer demand for antioxidant-rich chia seeds by creating a black-bean product with an insignificant amount of the seeds and advertising it as a chia-seed product. She alleges unjust enrichment and a violation of the Florida Deceptive and Unfair Trade Practices Act; she seeks class certification, compensatory damages, restitution, an injunction, and attorney’s fees. Issue 549
Three consumers have filed three separate putative class actions against Whole Foods Inc., Wegmans Food Markets Inc. and Acme Markets Inc. in New Jersey state court alleging that the grocery chains falsely represent their bread and bakery products as freshly made in-store. Mladenov v. Whole Foods, docket number unavailable (Super. Ct. N.J., Camden Cty., filed December 16, 2014); Mladenov v. Wegmans Foods Mkts., Inc., docket number unavailable (Super. Ct. N.J., Camden Cty., filed December 16, 2014); Mao v. Acme Mkts., Inc., docket number unavailable (Super. Ct. N.J., Camden Cty., filed December 16, 2014). The complaints allege violations of the New Jersey Consumer Fraud Act based on advertisements indicating that the bread and bakery products sold by the three companies were made in-store daily despite being “frozen, delivered to its stores, and then re-baked or partially baked in store,” according to the complaint against Acme. Each plaintiff seeks class certification, injunctive…
The U.S. Department of Agriculture has proposed a rule that would allow anyone producing, handling, marketing, or importing certified organic products to be exempt from paying the assessments associated with commodity promotion activities like advertising. The exemption would cover all “organic” and “100 percent organic” products certified under the National Organic Program. The current rule allows the exemption to apply only to those who exclusively produce and market products certified as 100 percent organic, but the proposed rule would broaden application to include all organic products regardless of whether the person or company imports or handles nonorganic products as well. Comments on the proposed rule must be received by January 15, 2015. See Federal Register, December 16, 2014. Issue 549
Two consumers have filed a putative class action in California federal court alleging that Maker’s Mark® bourbon whisky is not “handmade,” as the alcohol brand advertises, but is instead manufactured using “mechanized and/or automated processes” with “little to no human supervision, assistance or involvement.” Nowrouzi v. Maker’s Mark Distillery, Inc., No. 14-2885 (S.D. Cal., filed December 5, 2014). Citing photos and a video tour of the distillery as evidence, the plaintiffs argue that because Maker’s Mark® uses machines to make its product, its “handmade” claim and premium pricing amount to misrepresentation and violations of California’s false advertising statute. They allege that they “purchased Maker’s Mark whisky under the false impression that the whisky was of superior quality by virtue of being ‘Handmade’ and thus worth an exponentially higher price as compared to other similar whiskies.” They seek class certification, an injunction requiring discontinuation of the “handmade” description, a corrective advertising…
After a California federal court certified the class for liability but not for damages, the parties to a class action alleging that Jamba Juice mislabeled its smoothie kits as “all natural” despite containing synthetic ingredients like gelatin and xanthan gum have reached a settlement. Lilly v. Jamba Juice Co., No. 13-2998 (U.S. Dist. Ct., N.D. Cal., plaintiffs’ motion for settlement approval filed December 1, 2014). Under the proposed settlement agreement, Jamba Juice will remove “all natural” from its smoothie kit labeling and advertising by March 2015. The agreement will remain in force until the smoothie kits no longer contain the allegedly unnatural ingredients or the U.S. Food and Drug Administration classifies the ingredients as natural. The plaintiffs’ attorneys will also receive $425,000 in costs and fees. Additional information about the class certification appears in Issue 539 of this Update. Issue 547
