A California federal court has dismissed a putative class action against Diamond Foods Inc. alleging that its Kettle tortilla chips are mislabeled as “All Natural” despite containing synthetic ingredients. Surzyn v. Diamond Foods Inc., No. 14-cv-136 (N.D. Cal., order entered May 28, 2014). Citing a lack of basic factual assertions such as which product was the subject of the lawsuit, the court granted plaintiff Dominika Surzyn leave to amend within 21 days. Diamond Foods argued that its “All Natural” label is not misleading within the context of the rest of the packaging, which lists some of the ingredients—maltodextrin and dextrose—at issue in the case, and cited a Federal Trade Commission (FTC) determination that consumers’ understanding of “natural” is context-specific. The court rejected Diamond Foods’ assertions, finding that FTC had reached its conclusion not to dismiss any meaning and implication of the world “natural” but to decline to offer guidance on the…
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Kashi Co. and its unit Bear Naked Inc. have both settled class actions stemming from their claims that their products are “All Natural” and include “Nothing Artificial.” Astiana v. Kashi Co., No. 11-1967 (S.D. Cal., settlement filed May 2, 2014). Thurston v. Bear Naked Inc., No. 11-2890 (S.D. Cal., settlement filed May 2, 2014). The plaintiffs alleged in California federal court that the companies, both part of Kellogg Co., advertised their products as all natural and charged higher prices based on that quality while inserting synthetic material into their foods. A judge certified both classes in July 2013 after ruling that the plaintiffs had proved the artificiality of some of the “natural” ingredients, including hexane-processed soy ingredients and pyridoxine hydrochloride. Kashi has agreed to pay $5 million to California consumers who purchased its products and to alter its labeling and advertising to remove the claims at issue; in a similar…
Vermont lawmakers have reportedly passed the nation’s first state bill (H.B. 112) to require mandatory labeling of foods made with genetically modified (GM) ingredients. Passed in the Vermont House of Representatives, 114-30, and in the state Senate, 28-2, the bill would require foods containing GM ingredients sold in retail outlets to be labeled as either “partially produced with genetic engineering,” “produced with genetic engineering,” or “may be produced with genetic engineering.” The legislation would also make it illegal to describe any food product containing GM ingredients as “natural” or “all natural.” Backers of the legislation reportedly expect Governor Peter Shumlin (D) to sign it within the next few weeks, with the law taking effect July 1, 2016. “I am proud of Vermont for being the first state in the nation to ensure that Vermonters will know what is in their food,” Shumlin was quoted as saying. “The even more thrilling…
A federal court in California has granted in part and denied in part the motion to dismiss filed in a putative class action against Whole Foods Market. Pratt v. Whole Foods Mkt. Cal., Inc., No. 12-5652 (N.D. Cal., order entered March 31, 2014). The claims relate to a number of 365 Everyday Value® products that the plaintiff purchased and involve the following allegedly unlawful or misleading label representations: “evaporated cane juice” (ECJ), “natural” and “no sugar added.” Because the plaintiff abandoned in his amended complaint all claims regarding the defendants’ whipped topping product, the court dismissed all claims based on this product with prejudice as to the plaintiff and without prejudice as to any putative class member. The “no sugar added” claims were thus dismissed, “as the only product alleged to have such a misleading claim was the whipped topping.” The court also emphasized that, per its August 2013 order, any claims…
Snack maker Snyder’s Lance, Inc. has filed a motion to dismiss an amended class complaint filed by representative plaintiffs alleging that the company misleads consumers by labeling its products as “natural” when they contain genetically modified ingredients. Barron v. Snyder’s Lance, Inc., No. 13-62496 (S.D. Fla., Miami Div., motion filed March 10, 2014). Among other matters, the company argues that the plaintiffs’ “premium price” theory of harm is not plausible, they lack standing to seek injunctive relief and their failure to address their understanding of the term “natural” is fatal to their claims. As to the price theory, Snyder’s-Lance contends that the plaintiffs’ claims require the court to assume that price differences between its products and those of “rival brands” are based solely on the “natural” labeling. According to the company, the alleged price differential could be due to any number of other factors, such as better taste, more appealing…
A federal court in California has dismissed with prejudice the third amended complaint filed by named plaintiffs on behalf of a putative class of purchasers of Chobani Greek Yogurt products, alleging violations of state consumer protection laws because the products were mislabeled under federal law by listing evaporated cane juice (ECJ), instead of sugar, as an ingredient and stating that the yogurts contain only natural ingredients, when they actually contain fruit and vegetable juice—purportedly “highly processed unnatural substances”—as well as turmeric for color. Kane v. Chobani, Inc., No. 12-2425 (N.D. Cal., decided February 20, 2014). The court agreed with Chobani that the plaintiffs failed to sufficiently allege reliance or to plead fraud with sufficient particularity and thus lacked standing to pursue their claims under California’s Unfair Competition Law (UCL), False Advertising Law and Consumers Legal Remedies Act. Apparently annoyed that the plaintiffs had been given numerous opportunities to cure pleading…
A federal court in California has preliminarily approved a $3.375 million settlement of class-action claims that Trader Joe’s misled consumers throughout the United States by selling a number of food products with “All Natural” labels despite the presence of synthetic or artificial ingredients. Larsen v. Trader Joe’s Co., No. 11-5188 (N.D. Cal., order entered February 6, 2014). Additional details about the complaint appear in Issue 415 of this Update. According to a news source, the agreement would provide class members with proof of purchase the average price of the purchased items. Those without proof of purchase would receive between $2.70 and $39.99. The grocery chain has also apparently agreed to stop advertising the products as “all natural.” The final approval hearing has been scheduled for July 9, 2014. See Law360, February 7, 2014. Issue 513
In response to a court order requiring the parties to respond to the U.S. Food and Drug Administration’s (FDA’s) refusal at the court’s request to determine whether foods with genetically modified (GM) ingredients may be labeled “natural” or “all natural,” the parties to litigation involving tortilla chips have filed their pleadings. Cox v. Gruma Corp., No. 12-6502 (N.D. Cal., filed January 24, 2014). Information about FDA’s January 6 letter appears in Issue 509 of this Update. Gruma argues that the case continues to meet “all the factors for invoking primary jurisdiction. . . . The FDA’s response is simply that for its own procedural and budgetary reasons it does not intend to consider the referred issue at the current time in this particular posture. The FDA response, if anything, reinforces why the FDA should be the one to resolve this issue. This is particularly true because the same issue of…
A California resident has filed a putative statewide class action in a California federal court against Diamond Foods, Inc., alleging that the company misleads consumers by prominently labeling its line of TIAS Tortilla Chips® as “All Natural” when they contain artificial ingredients such as maltodextrin and/or dextrose. Surzyn v. Diamond Foods, Inc. No. 14-136 (N.D. Cal., filed January 9, 2014). The complaint has been crafted to avoid some of the pitfalls that other plaintiffs have encountered bringing similar claims, including express references to the defendant making “the exact same ‘All Natural’ claim in the exact same prominently displayed location on the front packaging,” to forestall a court finding that the plaintiff lacks standing to pursue claims for products she did not actually purchase. Alleging economic injury, that is, not receiving the benefit of the bargain, and expressly not seeking “to contest or enforce any state law that has requirements beyond those…
In a January 6, 2014, letter, the U.S. Food and Drug Administration (FDA) responded to three federal courts that stayed litigation involving whether food companies deceive consumers by labeling products with genetically modified (GM) ingredients as “natural,” stating that it would not make a determination on the issue to resolve a private litigation-related request. Cox v. Gruma Corp., No. 12-6502 (N.D. Cal.); Barnes v. Campbell Soup Co., No. 12-5185 (N.D. Cal.); In re General Mills, Inc. Kix Cereal Litig., No. 12-0249 (D.N.J.). Describing the complexities of determining what “natural” means in both a broad and narrow context and the variety of stakeholder interests involved, FDA stated that if it “were inclined to revoke, amend, or add to [current] policy, we would likely embark on a public process” and would have to involve other agencies such as the U.S. Department of Agriculture. Because the agency is devoting significant resources to Food Safety Modernization Act…
