A California federal court has certified a class of consumers challenging the “natural” label on Kraft’s fat-free cheddar cheese product but limited the class only to consumers who relied on that labeling when purchasing the product. Morales v. Kraft Foods Grp., Inc., No. 14-4387 (C.D. Cal., order entered June 23, 2015). The complaint had asserted that artificial coloring in the product precluded Kraft from labeling the cheese as “natural.” The court found that the proposed class met the numerosity, commonality, typicality and adequacy of representation standards, then focused on whether the common issues predominate over any individual issues. Kraft argued that the plaintiffs could not show that every member of the proposed class relied upon the “natural” representation because the term “natural” may mean different things to different people. The court disagreed but noted that Kraft could make that argument later in the legal process. Kraft also challenged the ascertainability of…
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Anheuser-Busch has settled a class action alleging that the company misrepresented Beck’s® beer as brewed in Germany after a 2012 move to a St. Louis brewing facility. Marty v. Anheuser-Busch Cos., LLC, No. 13-23656 (S.D. Fla., preliminary approval entered June 23, 2015). The uncapped settlement will provide payouts to U.S. purchasers of bottles or packages of Beck’s® since May 2011, with a $50 limit for households with proofs of purchase and $12 limit for those without. Anheuser-Busch will include the phrase “Brewed in USA” or “Product of USA” on the bottles, boxes and website for at least five years. Plaintiffs’ attorneys will receive $3.5 million. Details about a similar lawsuit Anheuser-Busch settled about the origin of Kirin® beer in January 2015 appear in Issue 550 of this Update. Issue 570
The Wisconsin-based Cornucopia Institute has asked the Federal Trade Commission (FTC) to investigate labeling associated with Whole Foods Market, Inc.’s Responsibly Grown fresh produce rating system for potential consumer fraud and mislabeling. According to a June 23, 2015, letter to the director of FTC’s Bureau of Consumer Protection, Cornucopia is “concerned that Whole Foods has not met the standards set forth in its recently developed ‘Responsibly Grown’ produce rating system in violation of its stated guidelines, thus grossly misrepresenting the production practices utilized in growing some of the produce it offers for sale to its customers.” Cornucopia suggests that “expedited communication” with Whole Foods resulting in a consent agreement under which signage and labeling related to the rating program are immediately removed “might best serve the public rather than investing taxpayer resources in a time-consuming comprehensive investigation that might result in monetary fines or other penalties.” Issue 570
The New York City Department of Consumer Affairs (DCA) has alleged that Whole Foods Market, Inc. “routinely overstated the weights of its prepackaged products—including meats, dairy and baked goods— resulting in customers being overcharged.” According to a June 24, 2015, press release, DCA found mislabeled weights on 80 different types of products sold at New York City locations, with 89 percent purportedly failing to meet federal standards “for the maximum amount that an individual package can deviate from the actual weight.” “The overcharges ranged from $0.80 for a package of pecan panko to $14.84 for a package of coconut shrimp,” claims the agency. “The fine for falsely labeling a package is as much as $950 for the first violation and up to $1,700 for a subsequent violation. The potential number of violations that Whole Foods faces for all pre-packaged goods in the NYC stores is in the thousands.” In particular,…
Shook, Hardy & Bacon attorneys Madeleine McDonough and Jara Settles have co-authored a chapter in the Food and Drug Law Institute’s Top 20 Food and Drug Cases, 2014 and Cases to Watch, 2015. They discuss the district court’s decision in Khasin v. Hershey, in which a consumer challenged the confectioner’s label claims of health value and antioxidant content in several products. McDonough and Settles detail factors in the court’s rationale for dismissing most of the case, including a detrimental admission that the plaintiff did not rely upon the labeling when purchasing the products at issue. “Khasin highlights the importance of demonstrating actual reliance in putative consumer protection class actions,” they explain. “After months of briefing and discovery, a simple conversation (in the form of a deposition) destroyed the vast majority of plaintiff’s claims.” The court later dismissed the rest of the plaintiff’s claims as well. Details of the dismissal appear in Issue…
The U.S. Food and Drug Administration (FDA) has announced the availability of industry guidance on food allergen labeling exemptions. Titled “Food Allergen Labeling Exemption Petitions and Notifications,” the guidance reportedly explains the agency’s “current thinking on the preparation of regulatory submissions for obtaining exemptions for ingredients from the labeling requirements for major food allergens in the Federal Food, Drug, and Cosmetic Act (FD&C Act) through submission of either a petition or a notification.” The guidance aims to clarify the criteria for labeling exemption petitions submitted under the Food Allergen Labeling and Consumer Protection Act of 2004, which requires all food and beverage labeling to declare the presence of major food allergens using their common names. Under these rules, companies can obtain labeling exemptions by demonstrating that an ingredient derived from a major allergen ‘‘does not cause an allergic response” or “‘does not contain allergenic protein.” See Federal Register, June 19,…
In an amended complaint, a plaintiff has alleged that Campbell Soup Co.’s Prego® sauces contain canola oil with genetically modified organisms (GMOs) despite the products’ “100% Natural” label claims. Nelson v. Campbell Soup Co., No. 14-2647 (S.D. Cal., amended complaint filed June 8, 2015). The complaint asserts that 90 percent of canola crops in the United States are genetically modified, and because Campbell does not “undertake additional expensive steps to purchase and verify a supply from non-GMO growers,” the canola oil used in Prego® products includes GMOs. The plaintiff argues that a “reasonable California consumer, like Plaintiff, would not expect a Product labeled ‘100% Natural’ to contain ingredients made from genetically modified crops, which are, by definition, artificial and synthetic.” She seeks damages and attorney’s fees for her allegations of unfair competition and false advertising. Issue 568
A consumer has filed a putative class action against Diageo Americas Supply alleging that its Bulleit® bourbon is not produced in Lawrenceburg, Kentucky, as its label states. M’Baye v. Diageo Ams. Supply, Inc., No. 15-1216 (S.D. Cal., filed June 1, 2015). The complaint asserts that Diageo does not operate a distillery in Lawrenceburg and further alleges that Kirin Brewing Co., “a separate and distinct entity,” makes and distributes the bourbon. The plaintiff points to phrases in the bourbon’s marketing—”small batch,” “ingredients of the very highest quality” and “distinctively clean and smooth”—as evidence that the company intended to position it as a high-end product to justify its sale price of about $53. For allegations of false advertising, unfair competition and misrepresentation, the plaintiff seeks class certification, an injunction, restitution, damages and attorney’s fees. ssue 568
The European Court of Justice (ECJ) has found that a correct and complete list of ingredients can be part of an overall misleading food label in a case challenging a German tea company’s “Felix Raspberry and Vanilla Adventure” (“Felix Himbeer-Vanille Abenteuer”) product for having no flavorings derived from raspberries or vanilla. Bundesverband der Verbraucherzentralen und Verbraucherverbände v. Teekanne GmbH & Co. KG, No. C-195/14 (E.C.J., order entered June 4, 2015). Teekanne advertises its tea product as fruit tea with natural flavorings and a raspberry-vanilla taste, and the label features depictions of raspberries and vanilla flowers and a seal indicating the product contains only natural ingredients. The ingredient list includes “natural flavouring with a taste of vanilla” and “natural flavouring with a taste of raspberry,” according to the court. “That list thus expresses, in a manner free from doubt, the fact that the flavourings used are not obtained from vanilla and raspberries but…
New Hampshire Governor Maggie Hassan (D) has reportedly vetoed a bill seeking to allow alcohol beverage labels to depict minors as long as the advertising is not intended to promote underage alcohol consumption. Introduced by Rep. Keith Murphy (R-Hillsborough), the measure (H.B. 122) would have struck language from the state’s rules on alcohol beverage advertising that prohibits “any reference to minors, pictorial or otherwise.” Although Murphy pointed to several labeling designs that use images of children or babies but do not promote underage consumption, New Hampshire Liquor Commission Director of Enforcement and Licensing James Wilson opposed the revision on the grounds that it obscures the agency’s “bright line standard” for labeling. As Hassan argued, “Substance misuse, including alcohol misuse, continues to be one of the major public health and safety challenges facing us as a state. Moreover, statistics suggest that New Hampshire has among the highest rates of underage drinking…
