California consumers have filed a putative class action against Van’s International Foods and retailers Whole Foods Market California, Inc., Trader Joe’s Co., and Costco Wholesale Co., alleging that Van’s frozen waffles did not accurately state the calorie and nutrient content throughout 2007 and into 2008. Hodes v. Van’s Int’l Foods, No. 09-01530 (C.D. Cal., filed March 4, 2009). According to the complaint, which seeks certification of a nationwide class, the sale in late 2006 of the company that made Van’s frozen waffles involved a change in personnel that required “reverse engineering the recipes for Van’s existing product lines.” That process allegedly resulted in findings that the nutritional information on the product packaging “contained numerous substantial inaccuracies.” The calorie, fat, sodium, carbohydrates, calcium, iron, and fiber content listed purportedly varied by 20 to 100 percent or more from the actual nutritional values. The plaintiffs allege that the company continued to “distribute…
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The Center for Science in the Public Interest (CSPI) has sent letters to retailers, calling on them to use their membership and bonus card data, which track customer purchases, to provide targeted warnings when tainted foods are subject to recall. Noting that some companies with bonus card programs already issue food safety alerts and, in fact, notified their affected customers by phone and mail “in response to the peanut recall,” CSPI expressed its hope that “your company will do its part to protect your customers’ health and help restore their confidence in the food supply.” According to a CSPI staff attorney, “It would be outrageous if some of the deaths in this latest [contaminated peanut butter] outbreak could have been prevented had a supermarket just used the phone numbers and addresses in its database to notify its customers. It’s not enough just to take the tainted product off the supermarket shelf.…
The D.C. Circuit Court of Appeals has reportedly denied a Whole Foods Market, Inc. petition that sought to stop the Federal Trade Commission’s (FTC) antitrust proceedings against the company’s merger with Wild Oats Markets, Inc. The FTC’s administrative trial is scheduled to begin April 6, 2009, and Whole Foods contends that the commission has pre-judged the outcome. According to a Whole Foods spokesperson, “There is no question our due process and equal protection rights have been violated and we intend to pursue this case until we can get a hearing in a federal court about those violations.” According to a news source, Whole Foods is considering reframing and refiling its lawsuit. See Dow Jones Newswires, January 23, 2009.
Whole Foods Market, Inc. has reportedly withdrawn from U.S. district court its due process challenge to the Federal Trade Commission’s (FTC) antitrust proceedings against the company’s merger with Wild Oats Markets, Inc. The case was then refiled before the D.C. Circuit Court of Appeals. According to a Whole Foods executive, “Whole Foods Market is interested in getting to the merits of this case as quickly as possible rather than spending everyone’s valuable time and resources arguing about jurisdiction. Filing with the Court of Appeals, which the FTC concedes has jurisdiction over the case, saves time and we want to move this case forward in the most expeditious manner for all concerned.” Additional details about Whole Foods’ petition appear in issue 285 of this Update. The FTC’s administrative hearings are scheduled to begin April 6, 2009, and Whole Foods claims that the commission has already prejudged the case. See PR Newswire, January…
The Federal Trade Commission (FTC), continuing to challenge the merger of Whole Foods Market, Inc. with Wild Oats Markets, Inc, has reportedly indicated in court filings that it will seek a court order requiring Whole Foods to rename the Wild Oats stores that were changed into Whole Foods stores and rebrand them as Wild Oats. The FTC also apparently said that a trustee should be appointed to separately manage Wild Oats assets to preserve the status quo in the organic foods market until all legal proceedings have concluded. The $565 million merger has been completed, but the FTC convinced an appeals court in 2008 to allow the administrative antitrust proceedings to resume. Responding to the latest filing, Whole Foods reportedly stated, “Not only have they found us guilty before the final evidence is in, now they want to impose a burdensome remedy even before the first word of final evidence…
The U.S. Supreme Court has denied a petition seeking review of a California Supreme Court ruling that allowed plaintiffs to pursue putative class claims alleging that grocery stores failed to inform California consumers about the artificial coloring used in the farm-raised salmon they sold. Albertson’s Inc. v. Kanter, No. 07-1327 (U.S., certiorari denied January 12, 2009). The retailers had asked the Court to find the claims preempted by the Food, Drug, and Cosmetic Act. The case should now proceed to trial. Food and Drug Administration regulations allow salmon farmers to augment the normally grayish pigment of farm-raised fish with chemicals, but also require that the use of coloring be indicated on product labels. Federal law does not allow individuals to enforce the law through litigation, but it does not, according to attorneys involved in the case, bar civil lawsuits for violations of state law. The litigation was brought on both federal and…
Plaintiffs in multidistrict litigation against Aurora Dairy Corp. over claims that its “organic” milk products do not meet federal certification requirements have reportedly filed an unopposed notice of voluntary dismissal requesting that the court dismiss Whole Foods Market Group, Inc. from the case without prejudice. In re: Aurora Dairy Corp. Organic Milk Mktg. & Sales Practices Litig., MDL No. 08-1907 (E.D. Mo., motion filed December 13, 2008). While Whole Foods apparently did not sell Aurora’s organic milk, the company was named as successor-in-interest to Wild Oats, Inc., the chain acquired by Whole Foods in August 2007 and alleged to have sold the products. Whole Foods has reportedly argued that Wild Oats retained its assets and liabilities after the merger and has agreed to provide plaintiffs with discovery on that issue. According to plaintiffs’ counsel, “If, after that discovery, we agree with your analysis, we will move the court to strike Whole…
Whole Foods Market, Inc., concluding that it cannot get a fair hearing before the Federal Trade Commission (FTC) in proceedings over the competitive effect of its merger with Wild Oats Markets, Inc., has filed a lawsuit in federal court seeking to terminate the proceedings as fundamentally flawed under the Due Process Clause. Whole Foods Market, Inc. v. FTC, No. 08-02121 (D.D.C., filed December 8, 2008). The FTC lifted a stay on its administrative proceedings shortly after a federal appeals court, reversing a district court ruling denying the FTC’s request to stop the merger, ruled that the commission could proceed with its preliminary-injunction proceeding in the courts. The appeals court remanded the case for the district court to consider whether the equities favor the FTC now that the merger has taken place and Whole Foods has closed or sold a number of Wild Oats stores. Among other matters, Whole Foods claims that…
According to a press report, the D.C. Circuit Court of Appeals has refused the request of Whole Foods Market, Inc. that the court reconsider, en banc, a July 2008 decision by a three-judge appellate court panel reviving the Federal Trade Commission’s antitrust challenge to the company’s merger with Wild Oats Markets, Inc. More information about the panel’s divided ruling appears in issue 269 of this Update. The commission will conduct administrative hearings on the merger in February 2009. While the merger was completed in August 2007, the commission could apparently try to stop further integration of the companies’ operations or require Whole Foods to sell some properties. In a statement, Whole Foods reportedly indicated its intent to vigorously defend the administrative proceedings, “even though we believe it is an unfair process and a violation of the company’s due process rights.” See Dow Jones Newswires, November 21, 2008. Meanwhile, a Chicago…
Whole Foods Market, Inc., which is currently litigating the FTC’s challenge to its merger with Wild Oats Markets, has submitted comments on the commission’s proposed merger rule changes and is urging others to join its “Ad Hoc Committee for FTC Fair Play” to do so as well. Apparently, the FTC will allow comments for only 30 days, which Whole Foods characterizes as “unusually short,” and has proposed (i) setting evidentiary hearings five months from the date of the complaint in merger cases, regardless of complexity, (ii) giving the commission the authority to decide “all dispositive pre-hearing motions,” (iii) giving the commission or an individual commissioner the authority to preside over discovery, and (iv) providing that “the norm should be that the Part 3 case can proceed even if a [federal] court denies preliminary relief.” Whole Foods contends, “The proposed regulatory changes collectively will create an antitrust double standard by exacerbating…
