The U.S. Food and Drug Administration (FDA) has extended from February 16 to February 22, 2016, the comment period regarding requirements for fermented and hydrolyzed foods or those containing fermented or hydrolyzed ingredients that carry the “gluten-free” claim. The proposed rule would apply to foods such as sauerkraut, yogurt, pickles, cheese, green olives, vinegar, and FDA-regulated beers. Intended to address the uncertainty of interpreting test methods in terms of intact gluten, the finalized rule would mandate manufacturers to maintain records demonstrating: (i) “the food meets the requirements of the gluten-free labeling final rule prior to fermentation or hydrolysis”; (ii) “the manufacturer has adequately evaluated its process for any potential gluten cross-contact”; and (iii) “where a potential for gluten cross-contact has been identified, the manufacturer has implemented measures to prevent the introduction of gluten into the food during the manufacturing process.” The agency also intends to evaluate the compliance of distilled…
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A New York federal court has denied Fifth Generation, Inc.’s motion to dismiss a lawsuit arguing that its Tito’s Handmade Vodka® is falsely advertised as handmade because machines are used in the process of manufacturing the product. Singleton v. Fifth Generation, Inc., No. 15-0474 (N.D.N.Y., order entered January 12, 2016). The court rejected the company’s claim that its adherence to U.S. Alcohol and Tobacco Tax and Trade Bureau standards does not relieve it from liability for false advertising claims. Further, the court found that “Tito’s labels could plausibly mislead a reasonable consumer to believe that its vodka is made in a hands-on, small-batch process, when it is allegedly mass-produced in a highly-automated one.” Accordingly, the court allowed several claims to continue, but dismissed allegations of breach of express warranties and negligent misrepresentation. The decision echoes a November 2015 ruling from a California federal court, which also refused to find that the safe harbor provision excused Fifth Generation from liability. Hofmann v. Fifth…
The U.K. Chief Medical Officers have advised consumers to drink less than 6 pints of beer per week under new guidelines for alcoholic beverage intake. Revising previous standards that set weekly limits at 21 units of alcohol for men and 14 units for women, the updated recommendations urge all consumers to imbibe fewer than 14 units weekly and warn that drinking even a moderate amount of beer, wine or spirits on a regular basis allegedly raises the risk of developing certain cancers. They also caution individuals to spread consumption over three or more days instead of engaging in “binge” drinking sessions. “Drinking any level of alcohol regularly carries a health risk for anyone, but if men and women limit their intake to no more than 14 units a week it keeps the risk of illness like cancer and liver disease low,” said Chief Medical Officer of England Sally Davies in…
The U.S. Court of Appeals for the Second Circuit has ruled that a Russian state-owned company can sue U.S. distributors of Stolichnaya vodka in a dispute over which entity inherited the brand after the Soviet Union collapsed—the Russian Federation or private companies successive to the company that sold the product before the dissolution. Fed. Treasury Enter. Sojuzplodoimport v. Spirits Intl. BV, No. 14-4721 (2nd Cir., order entered January 5, 2016). A lower court previously held that the Russian Federation’s Federal Treasury Enterprise Sojuzplodoimport (FTE) did not have standing to sue, but the appeals court disagreed. “The declaration of a United States court that the executive branch of the Russian government violated its own law by transferring its own rights to its own quasi-governmental entity (FTE) would be an affront to the government of a foreign sovereign,” the appeals court held. “Even an inquiry into whether Russian law permitted the Assignment…
The U.K. Advertising Standards Authority (ASA) has dismissed a complaint alleging that Diageo Great Britain Ltd.’s holiday commercials for Baileys™ liqueur “implied that the success of a social occasion depended on the presence or consumption of alcohol.” Despite Alcohol Concern’s claim that the tagline “IT’S NOT CHRISTMAS WITHOUT YOU… BAILEYS” was “irresponsible,” the agency agreed with Diageo Great Britain and Clearcast that consumers were likely to understand “Christmas” as a reference to the entire holiday season as opposed to a specific social occasion. “We considered that consumers would interpret the claim “IT’S NOT CHRISTMAS WITHOUT YOU” as a play on words referring to getting together with friends over the festive period, as well as referring to the fact that the drink had been traditionally associated with the Christmas period,” ASA said. “We noted that the ad showed the women enjoying one drink together, and there was no suggestion that the…
Photographer Mitchel Gray has reportedly filed a lawsuit against Jeff Koons alleging that one of the artist's works infringes on Gray's copyright to a photo used in a Gordon's® gin advertisement in 1986. The ad portrays a photo of a woman painting on the beach and a man seated next to her, a photo of a bottle of Gordon's® and the tagline "I could go for something cool, crisp and Gordon's." Koons' version, which uses the photo with slightly adjusted colors, a bottle of Gordon's® in a different spot and the tagline "I could go for something Gordon's," sold for $2.04 million at auction in 2008. The complaint reportedly asserts that Koons never contacted Gray for permission to use the photo and never provided him any compensation from the proceeds of the auction, citing for added support Koons' testimony from a similar infringement case filed in 1989 involving a different…
The Seventh Circuit Court of Appeals has upheld an Indiana law restricting the sale of cold packaged beer in convenience stores, pharmacies and groceries in incorporated towns, finding that the statute survives a rational-basis analysis. Petroleum Mktrs. & Convenience Stores Assoc v. Cook, No. 14-2559 (7th Cir., order entered December 14, 2014). The court found that although Indiana does not have "nearly absolute" power to regulate alcohol sales as the state had argued, it may prohibit stores from selling cold beer, even if it also allows the same stores to sell chilled beverages with higher alcohol content such as wine coolers. The court distinguishes between the licenses required by liquor stores, which can sell cold beer, and the licenses available to convenience stores and similar retailers; liquor stores "are subject to stricter regulations designed to enhance the State's ability to limit and control the distribution of alcohol," including minimum ages…
The Sixth Circuit Court of Appeals has denied a request for an en banc rehearing in a lawsuit alleging that the distilleries of two Diageo Americas Supply Inc. brands, J&B® and Johnnie Walker®, caused the growth of a black fungus on outdoor surfaces near the plants. Merrick v. Diageo Ams. Supply Inc., No. 14-6198 (6th Cir., order entered December 7, 2015). Diageo had sought to dismiss the suit by arguing the claims conflicted with emissions regulations under the Clean Air Act, but a lower court and the Sixth Circuit disagreed upon hearing the arguments. Diageo then requested en banc reconsideration, but the one-page denial noted that “the issues raised in the petition were fully considered upon the original submission and decision of the case.” Details about the case appear in Issues 519 and 546 of this Update. Issue 587
Two consumers have filed a putative class action alleging that two lines of kombucha manufactured by Millennium Products and sold by Whole Foods Market contain several defects, including levels of alcohol higher than the label represents and packaging inadequate to properly accommodate the product’s secondary fermentation. Pedro v. Millennium Prods., Inc., No. 15-5253 (N.D. Cal., filed November 17, 2015). Millennium’s kombucha, a fermented tea product, is sold in two lines—a “Classic” line requiring the purchaser to be 21 years old and an “Enlightened” line containing “a trace amount of alcohol” but insufficient amounts to require identification upon purchase (less than 0.05 percent alcohol by volume). The plaintiffs allege that both lines contain more alcohol than the label indicates, which allegedly caused one plaintiff to become sick and experience “among other things, trouble breathing, and increased heart rate.” The plaintiffs further allege the byproduct of kombucha’s fermentation, carbon dioxide, builds up…
An Ohio federal court has dismissed fraud and consumer-protection claims against Fifth Dimension, maker of Tito’s Handmade Vodka®, in a putative class action alleging the beverage company misrepresents the process of making its vodka by calling the product “handmade.” Terlesky v. Fifth Dimension, No. 15-0374 (S.D. Ohio, order entered November 17, 2015). The court analyzed each claim, first finding that the plaintiff did not have standing to sue under the Ohio Deceptive Trade Practices Act. Turning to the Ohio Consumer Sales Protection Act, the court determined that plaintiffs bringing class claims must show the alleged violation was declared to be deceptive by the attorney general or a court before the transaction. Finding no such facts in the case, the court dismissed the class claim but allowed the individual claim to proceed. The court also allowed the plaintiff’s promissory estoppel claim to continue. Turning then to the negligent misrepresentation claim, the…
