The company that makes Four Loko, a caffeinated malt liquor beverage allegedly responsible for the deaths of five consumers, has reached a settlement with two Liberty Mutual Insurance Co. units which had sought a declaration that a policy exclusion freed them from defending or indemnifying the beverage maker in the underlying lawsuits. The Netherlands Ins. Co. v. Phusion Projects, Inc., No. 12-7968 (N.D. Ill., stipulation of dismissal filed March 11, 2014). The settlement terms have not been disclosed. Details about a Seventh Circuit ruling on the insurance carriers’ duty to defend appear in Issue 508 of this Update. Issue 517
Tag Archives Illinois
The Seventh Circuit Court of Appeals has determined that Phusion Projects’ commercial liability insurance carriers have no duty to defend the company in actions alleging that intoxication attributable to consumption of its Four Loko® alcoholic product caused death and personal injury. Netherlands Ins. Co. v. Phusion Projects, Inc., No. 12-1355 (7th Cir., decided December 16, 2013). Applying Illinois law, the court ruled that the liquor liability exclusions in the relevant insurance contracts unambiguously excluded coverage for bodily injury or property damage when the company “may be held liable by reason of: (1) causing or contributing to the intoxication of any person.” So ruling, the court affirmed the lower court’s grant of the insurance carriers’ motion for summary judgment. Issue 508
A federal court in Illinois has denied a request that it reconsider an earlier order denying certification of a multi-state class of single-serve coffee purchasers allegedly deceived into believing that the product was ground coffee and not instant; the court has also granted the defendants’ motions for summary judgment. Suchanek v. Sturm Foods, Inc., No. 11-565 (S.D. Ill., decided November 20, 2013). Information about the court’s previous ruling appears in Issue 496 of this Update. According to the court, “[t]he problem with the proposed class here is that showing reliance or causation—as required to establish liability requires an investigation of each purchaser.” The court details the purchasing experiences of each named plaintiff in this consolidated action and finds that most did not read the packaging, understood what the word “soluble” means or purchased the product due to price, shelf placement, imagery, or because they liked to try new things. Finding that…
An Illinois appeals court has reversed a trial court determination that Illinois would not be an inconvenient forum for the defendants in a wrongful death lawsuit filed by the parents of a 15-year-old boy who allegedly drank two cans of the alcohol energy drink Four Loko and was killed on a Virginia highway after becoming disoriented. Rupp v. Phusion Projects, LLC, No. 1-12-2056 (Ill. App. Ct., order entered September 27, 2013) (not precedential). Additional information about the lawsuit appears in Issue 395 of this Update. According to the appeals court, while the trial court correctly weighed most of the private-interest factors presented, it should have considered the defendant’s choice-of-law issue under the public-interest factor analysis. The appeals court also found that the trial court erred in stating that other defendants had not joined Phusion’s forum non conveniens motion, because the record showed that they had done so. And finally, the…
A federal court in Illinois has refused to certify a multistate class of consumers who were allegedly deceived under the consumer protection statutes and unjust enrichment laws of eight named states by a company that, at one time, either misrepresented or failed to indicate that its single serving coffee product contained “instant” or “soluble” coffee rather than fresh ground coffee and a filter. McManus v. Sturm Foods, Inc., No. 11-565 (S.D. Ill., order entered August 26, 2013). According to the court, the class, defined as all consumers in the eight states who purchased the product from September 2010 until the present, included many who had no injury or had not relied on any product representations. Among the putative class members were individuals who (i) knew that the product was instant coffee and bought it anyway because it made no difference to their purchasing decision, (ii) purchased the product after the…
A divided Illinois appeals court has determined that Jimmy John’s Enterprises and one of its franchisees must continue to defend four of seven claims in a personal injury suit arising from a motor vehicle accident involving one of its delivery drivers. Reynolds v. Jimmy John’s Enters., LLC, No. 4-12-139 (Ill. App. Ct., 4th Dist., decided April 2, 2013). The plaintiff, who was riding a motorcycle when the accident occurred and purportedly sustained permanently disabling injuries, alleged that the driver was negligently supervised and trained and thus made an illegal turn into his path in an effort to comply with the food company’s promise of “freaky fast” food delivery, that is, that “deliveries will be made within 15 minutes of receiving the sandwich order.” Finding that the defendants did not properly bring their motion to dismiss under the state’s procedural rules, the court majority found that the trial court erred in…
A firearms company that holds the Tommy Gun™ trademark has brought an infringement action against a company selling its vodka products in 19-inch bottles shaped like Tommy guns. Saeilo Enters., Inc. v. Alphonse Capone Enters., Inc., No. 13-2306 (N.D. Ill., filed March 27, 2013). The plaintiff seeks damages, treble damages, profits, attorney’s fees, and costs under state and federal law, as well as a permanent injunction, cancellation of the vodka maker’s trademark registrations and the destruction of remaining stock. According to a news source, the plaintiff has been aggressive in protecting its brand and, in 2008, sued a company making Tommy gun replicas. It has also apparently trademarked the term “Chicago Typewriter,” a slang expression for the submachine gun. See ABA Journal, April 5, 2013.
A U.S. attorney in Illinois has announced charges filed against two companies and five individuals in a five-year investigation of imports that allegedly circumvented $180 million in anti-dumping duties on honey from China and involved purportedly “adulterated” honey containing the antibiotics chloramphenicol and tetracycline. Groeb Farms, Inc., described as the largest industrial honey supplier in the United States, knowingly avoided more than $78.8 million in antidumping duties by buying mislabeled honey imported from China and has agreed to pay a $2 million fine and “to dispose of any illegally-entered Chinese-origin honey in its possession.” It will also institute a corporate compliance program to ensure supply chain integrity and conduct “reasonable inquiries to safeguard against any illegal activity.” Jun Yang, Urbain Tran and Hung Yi Lin were all charged with brokering or transporting illegal Chinese-origin honey in the United States. Yang will plead guilty and has agreed to a fine of $250,000…
As consumers around the world have begun posting images online of their Subway “footlong” sandwiches with rulers showing that the restaurant’s offerings are actually 11 or 11.5 inches in length, several have taken their claims to court. Buren v. Doctor’s Assocs., Inc., No. 13 498 (N.D. Ill., filed January 22, 2013); Pendrak v. Subway Sandwich Shops, Inc., No. ___ (N.J. Super. Ct., filed January 22, 2013). Plaintiff Nguyen Buren filed his lawsuit in a federal court in Chicago, claiming that his sandwich was less than 11 inches long and alleging a “pattern of fraudulent, deceptive and otherwise improper advertising, sales and marketing practices.” New Jersey residents John Farley and Charles Pendrak allege in state court, “Despite the repeated use of uniform language by Subway stating that this sandwich is a ‘footlong,’ the product in question is not, in fact, a foot long. Rather this product consistently measures significantly less than…
Chicago Alderman Edward Burke (14) has introduced a proposed ordinance that would prohibit the distribution of energy drinks in the city. Citing the popularity of the drinks among teenagers and young adults and the dangers they purportedly pose to health, the ordinance defines “energy drink” as “a canned or bottled beverage which contains an amount of caffeine exceeding or equal to 180 milligrams per container and containing Taurine (2-aminoethanesulfonic acid) or Guarana.” The proposed ordinance also states that those violating the ordinance would face fines of $100 to $500 per offense with a mandatory revocation or suspension of business licenses for repeat offenders. Some legal commentators and critics reportedly claim that the proposed ban is rife with legal flaws and misrepresentations about the law regarding energy drinks and that the ambiguity surrounding the regulation of these products needs to be addressed. The proposal was assigned to the City Council Committee…
