Seeking to represent a statewide class of product purchasers, a California resident has filed a putative class action against Costco, alleging that the company falsely sells its Kirkland Signature Kettle Brand Potato Chips®, which purportedly contain “more than 13 grams of fat per 50 grams,” with a “0 Trans Fat” label. Thomas v. Costco Wholesale Corp., No. 12-2908 (N.D. Cal., filed June 5, 2012). Citing 21 C.F.R. § 101.13(h), plaintiff Karen Thomas contends that the defendant is “prohibited from making the unqualified nutrient claims of ‘0 grams Trans Fat’ on its food products if they contain fat in excess of 13 grams, saturated fat in excess of 4 grams, cholesterol in excess of 60 milligrams, or sodium in excess of 480 mg per 50 grams, unless the product also displays a disclosure statement that informs consumers of the product’s fat, saturated fat and sodium levels.” She alleges that the product…
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The Sixth Circuit Court of Appeals has determined that the Roskam Baking Co. did not infringe a trademark by using the term “Texas Toast” in selling its packaged croutons. T. Marzetti Co. v. Roskam Baking Co., No. 10-3784 (6th Cir., decided May 25, 2012). Marzetti apparently began using the Texas Toast mark for its frozen garlic bread in 1995 and then adopted the term for use with a crouton product sold in 2007. The company attempted to register the mark in 2009, but the applications were initially denied “because of the potential likelihood of confusion with the mark Texas toast for bakery goods.” Thereafter, they were approved for publication as, “at a minimum, suggestive.” The defendant filed an opposition to the trademarks in 2010, and Marzetti, learning about the company’s Texas Toast croutons, filed this trademark infringement action. The Sixth Circuit agreed with the district court that the mark is not…
The Center for Environmental Health has reportedly sued several grocery chains in California alleging that independent testing has shown that the honey they were selling contains high levels of lead in violation of Proposition 65 (Prop. 65). Some of the honey purchased and tested allegedly contained lead levels more than double the legal limit. According to the center, honey suppliers sometimes use metal barrels with lead solder that can leach into the honey. It is seeking agreements that would bind the companies to use non-leaded containers for their honey and to test their supplies for lead content. See Center for Environmental Health News Release, May 2, 2012.
Chipotle Mexican Grill, Inc., which operates 1,250 “fast-casual” restaurants throughout the United States, has sued The Kroger Co. in Colorado federal court, alleging that the grocery store chain has infringed the CHIPOTLE® trademark by using the descriptor on its spicy fried chicken take-out products. Chipotle Mexican Grill, Inc. v. The Kroger Co, 12-930 (D. Colo., filed April 5, 2012). According to the complaint, Chipotle has invested “tens of millions of dollars” “to create and maintain the goodwill of its CHIPOTLE® national brand,” which evidently includes a commitment to sourcing ingredients “in the most ethical and sustainable manner possible.” In addition to claiming monetary damages, Chipotle argues that Kroger’s use of the word “Chipotle” on its chicken entrée packaging has caused “irreparable harm to the value and goodwill of Plaintiff’s CHIPOTLE® Marks, as well as irreparable harm to Chipotle’s business, goodwill and reputation.” “Kroger’s use of CHIPOTLE… can only be explained by…
A federal court in the District of Columbia has denied a motion to certify a class of Los Angeles County Whole Foods shoppers alleging that the company’s 2007 merger with Wild Oats “substantially lessened competition” in violation of the Clayton Act, “created an unlawful monopoly” under the Sherman Act, and “constituted an unlawful agreement in restraint of trade” in violation of both acts. Kottaras v. Whole Foods Mkt., Inc., No. 08-1832 (D.D.C., decided January 30, 2012). The plaintiff, a California resident and patron of both stores, claims that the merger unlawfully raised prices on certain products by foreclosing competition in the premium, natural and organic supermarket sector. According to the court, injury to individual class members “cannot be proven through classwide evidence” and thus the action fails to “satisfy Rule 23(b)(3)’s requirement that common questions predominate over individual ones.” The court also found that the methodology of the plaintiff’s expert…
Putative class actions have been filed in New Jersey and California federal courts against Tropicana Products, Inc., alleging that the company misleads consumers by labeling and marketing its orange juice as “100% pure and natural,” when it actually “undergoes extensive processing which includes the addition of aromas and flavors.” Lynch v. Tropicana Prods., Inc., No. 11-07382 (D.N.J., filed December 19, 2011); Lewis v. Tropicana Prods., Inc., No. 12-00049 (E.D. Cal., filed January 6, 2012). Both plaintiffs seek to certify nationwide classes. The New Jersey plaintiff alleges unjust enrichment, breach of express warranty, violation of the New Jersey Consumer Fraud Act, and injunctive and declaratory relief. He requests compensatory, treble and punitive damages; prejudgment interest; restitution; injunctive relief; attorney’s fees; and expenses and costs of suit. The California plaintiff, who also seeks to certify a subclass of California consumers, alleges unjust enrichment; breach of express warranty; violation of the state Consumers…
California residents have filed a putative class action in a federal court against grocery chain Trader Joe’s Co., alleging that a number of its “All Natural” products contain synthetic or artificial ingredients and thus are mislabeled and falsely advertised. Larsen v. Trader Joe’s Co., No. 11-5188 (N.D. Cal., filed October 24, 2011). According to the complaint, “The labeling of products as ‘All Natural’ carries implicit health benefits important to consumers—benefits that consumers are often willing to pay a premium for over comparable products that are not ‘All Natural.’ Trader Joe’s has cultivated and reinforced a corporate image that has catered to this ‘All Natural’ theme and has boldly emblazed this claim on each and every one of its foods identified above, despite the fact Trader Joe’s uses synthetic ingredients in the products identified above.” The listed products include cookies, biscuits, cheese, fruit jellies, and apple juice sold under the Trader…
After Kona coffee growers called for Safeway, Inc. to comply with Hawaiian regulations on labeling Kona coffee, a California resident filed a putative class action against the company in federal court, alleging that its Safeway Select™ “Kona Blend” coffee contains “very little Kona coffee bean content.” Thurston v. Safeway, Inc., No. 11-04285 (N.D. Cal., filed August 30, 2011). Seeking to certify nationwide or statewide classes, the plaintiff calls the company’s labeling false and misleading and contends that she “did not receive the ‘Kona Blend’ she bargained for when she purchased Safeway’s Kona Blend Coffee, and has lost money as a result in the form of paying a premium for Kona Blend coffee” instead of paying less for a non-Kona or low-Kona coffee alternative. The plaintiff alleges common law fraud, violations of various consumer fraud statutes and restitution based on quasi contract or unjust enrichment. She requests restitution, compensatory and punitive…
According to District of Columbia court reporter Zoe Tillman, U.S. District Judge James Boasberg is currently considering a motion to certify a class in litigation filed by a California consumer in 2008 to challenge the merger of Whole Foods Market Inc. and Wild Oats. As Tillman notes, in March 2009 the Federal Trade Commission settled the anti-competition charges it filed against Whole Foods, which the company’s counsel argues could make it difficult for the plaintiffs to proceed on the merits. Named plaintiff Ekaterini Kottaras reportedly contends that the merger violated antitrust laws by forcing shoppers to pay higher prices in the “premium, natural, and organic” products market. This article discusses the FTC proceedings in some detail to provide a context for the putative class litigation. Whole Foods apparently contends that Kottaras’s expert testimony is insufficient to prove her case and that she may not be an appropriate class member due…
The Ninth Circuit Court of Appeals, in a divided en banc ruling, has determined that while an agreement between competitors to share revenues during a labor dispute is not immune from antitrust laws, the district court properly denied a challenge to an agreement between California supermarkets as a per se violation of the Sherman Act or on the basis of a “quick look” antitrust analysis; the Ninth Circuit found that a truncated or abbreviated review process is insufficient to determine whether this type of agreement has affected competition in the relevant market. California v. Safeway, Inc., No. 08-55671 (9th Cir., decided July 12, 2011) (en banc). Details about the court’s previous ruling that the agreement was anticompetitive appear in Issue 361 of this Update. The court’s majority “expressed no opinion on the legality of the arrangement under the rule of reason” (the traditional test for violations of federal antitrust laws) because…
