Whole Foods Market Group and a consumer have reached a settlement agreement in a lawsuit alleging the company defrauded customers by calculating and adding sales tax to purchases before deducting any discounts from coupons. Wong v. Whole Foods Mkt. Grp., No. 15-0848 (N.D. Ill., stipulation filed October 12, 2015). The parties filed a joint stipulation of dismissal to the court but did not disclose the agreement's terms. The lawsuit is one of several alleging claims of consumer fraud, common law fraud and unjust enrichment against various retailers. Issue 582
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A California federal court has dismissed without leave to amend several claims in a lawsuit alleging that Whole Foods Market fraudulently and misleadingly labeled its 365 Everyday Value ketchup, oatmeal and chicken broth as containing “evaporated cane juice” (ECJ) rather than “sugar.” Pratt v. Whole Food Mkt. Cal., Inc., No. 12-5652 (N.D. Cal., San Jose Div., order entered September 30, 2015). The plaintiff alleged that because Whole Foods failed to use the most common name for the ingredient—as mandated by U.S. Food and Drug Administration rules—the products were misbranded and “cannot be legally sold, possessed, have no economic value, and are legally worthless.” The court first dismissed strict liability allegations, finding that the plaintiff sought to impose a requirement inconsistent with federal law. Turning to the plausibility of the plaintiff’s allegations, the court found his reliance claims contradictory because one claim required him to know nothing about ECJ while the…
People for the Ethical Treatment of Animals Inc. (PETA) has filed a lawsuit against Whole Foods Market claiming the grocery chain’s “5-Step® Animal Welfare Rating System” is a “sham” because Whole Foods fails to enforce the program against its chicken, turkey, pork and beef suppliers. PETA v. Whole Foods Mkt., Inc., No. 15-4301 (N.D. Cal., filed September 21, 2015). The complaint asserts that “the entire audit process for Whole Foods’ animal welfare standards is a sham because it occurs infrequently and violations of the standards do not cause loss of certification. Indeed, a supplier can be out of compliance for multiple years without losing its certification.” Further, the certification standards “barely exceed common industry practices, if at all.” The complaint coincides with an investigative report from PETA that purportedly exposes several program violations at a Pennsylvania pig farm that supplies to Whole Foods. “‘Humane meat’ is a myth that dupes…
A Chilean appellate court has ruled that the nation’s National Fisheries and Agricultural Services must issue its data about antibiotics in Chilean salmon, which revealed that 50 salmon firms jointly used 450.7 metric tons of antibiotics in 2013. Chile’s Council for Transparency previously refused to release the information to conservation organization Oceana, arguing that the disaggregated data could be used against individual companies. The court disagreed, reportedly ruling, “The reasons given by the claimed party to refuse the requested information are not consistent with what establish the applicable regulations.” The report comes months after Costco Wholesale Corp. announced it would reduce the proportion of its salmon stock from 90 percent Chilean salmon to 40 percent in favor of salmon from Norway, whose fish-farming companies on average use lower amounts of antibiotics. See Fish Information & Services, September 11, 2015; Undercurrent News, September 21, 2015. Issue 579
A California federal court has determined that Safeway is liable for $30 million in damages for claims alleging that the company charged different prices for products sold online despite a contractual agreement that in-store and online prices would be the same. Rodman v. Safeway Inc., No. 11-3003 (N.D. Cal., order entered August 31, 2015). The court granted partial summary judgment to the plaintiffs in December 2014, finding that Safeway breached the contract. Details about the decision appear in Issue 549 of this Update. The court arrived at the damages amount by calculating the sum that Safeway earned from the concealed markup between April 2010 and December 2012. The court also rejected the plaintiffs’ attempt to expand the class to include purchases before 2006, when Safeway switched from paying a third party to manage online sales to running the website in-house. Issue 578
Video publisher The Criterion Collection has filed a trademark dilution suit against Whole Foods and an alcohol supplier alleging that a line of wines introduced in June 2015 infringed on its name. The Criterion Collection v. Whole Foods Mkt., No. 15-7132 (S.D.N.Y., filed September 10, 2015). The Criterion Collection has licensed and published classic films with additional “value added” content since 1984, beginning with Citizen Kane. “To the consuming public, ‘The Criterion Collection’ has become, over time, broadly associated with technical excellence, artistic value and cultural importance,” the complaint asserts. In 2015, Whole Foods and Winery Exchange, Inc. began selling “Criterion Collection” wine purported to be hand-selected by the grocery chain’s master sommelier, Devon Broglie. The Criterion Collection alleges that this use infringes its trademark under the Lanham Act and New York law and seeks a permanent injunction and damages. Issue 578
A New Jersey federal court has dismissed putative class actions against Whole Foods Market Group Inc., Wegmans Food Markets Inc. and Acme Markets Inc. alleging that they misrepresented their bread products as “freshly baked” or “baked in-store” despite actually being frozen, processed or baked elsewhere. Mladenov v. Wegmans Food Mkts. Inc., No. 15-0373 (D.N.J., order entered August 26, 2015); Mladenov v. Whole Foods Mkt. Grp. Inc., No. 15-0382 (D.N.J., order entered August 26, 2015); Mao v. Acme Markets Inc., No. 15-0618 (D.N.J., order entered August 26, 2015). Additional information about the three complaints appears in Issue 549 of this Update. The court found holes in each of the plaintiffs’ amended complaints, noting that they lacked “any detail as to what Plaintiffs purchased, the cost of these items, and the supposed value of what they received,” which are necessary to a price-premium claim. “Nowhere in their complaints or opposition do Plaintiffs…
A consumer has filed a putative class action against Costco Wholesale Corp. alleging that the company sells shrimp obtained with slave labor in Thailand. Sud v. Costco Wholesale Corp., No. 15-3783 (N.D. Cal., filed August 19, 2015). Citing documentaries and media reports, the complaint asserts that through its store brand, Kirkland, Costco has been selling seafood from Thailand “derived from a supply chain that depends upon documented slavery, human trafficking and other illegal labor abuses.” Further, Costco “does not advise U.S. consumers, in its packaging or otherwise, that the supply line for farmed prawns has been tainted by the use of slave labor in Thailand, and other nearby locations in international waters, including Indonesia, on Thai-flagged ships, and that there has been no eradication of this plague.” Knowingly selling such products and failing to warn the public of the farming conditions allegedly amount to unlawful business practices, misleading and deceptive…
Bumble Bee Foods, Starkist Co. and Thai Union Frozen Products have been fixing tuna prices since 2011, according to a putative class action brought by Olean Wholesale Grocery Cooperative, Inc. Olean Wholesale Grocery Coop. v. Bumble Bee Foods LLC, No. 15-1714 (S.D. Cal., filed August 3, 2015). The complaint notes that while tuna consumption has fallen in the United States, prices have risen, which cannot be explained by raw material costs, the cooperative says. The complaint also details opportunities for the companies to meet and collude, such as industry conferences and various mergers and acquisitions within the “oligopolistic structure” of the industry. For claims of Sherman Act violations, the cooperative seeks to represent a nationwide class of those affected by the alleged price-fixing, court declarations of conspiracy, treble damages and an injunction from continuing any sort of agreement or understanding about maintaining prices. Issue 574
The Grocery Manufacturers Association (GMA) has petitioned the U.S. Food and Drug Administration (FDA) “to approve specific low-level uses of partially hydrogenated oil (PHOs) in food products.” According to an August 5, 2015, press release, the petition seeks approval to use PHOs for color, flavor and texture when “important for the production of safe food products.” Because FDA revoked the generally recognized as safe (GRAS) status of trans fats on July 16, 2015, food manufacturers must now ask the agency to approve the ingredient for specific purposes. “Our food additive petition shows that the presence of trans fat from the proposed low-level uses of PHOs is as safe as the naturally occurring trans fat present in the normal diet,” said GMA Chief Science Officer Leon Bruner. “It’s important to know that food and beverage companies have already voluntarily lowered the amount of trans fat added to food products by more…
