A California federal court has rejected a settlement agreement between Trader Joe’s and consumers who alleged that the store’s tuna cans contained too much slack fill. In re Trader Joe’s Tuna Litig., No. 16-1371 (C.D. Cal., entered April 1, 2019). The court rejected the agreement on choice-of-law grounds, finding that the plaintiff failed to “conduct the required analysis” needed to apply California law to a nationwide class of purchasers. The denial was issued without prejudice, and the court granted leave to refile within 60 days of the order.
A lawsuit alleging that StarKist misleads consumers by paying to feature the American Heart Association's (AHA's) Heart-Check Mark will continue after a New York federal court refused to dismiss the complaint. Warner v. StarKist Co., No. 18-0406 (N.D.N.Y., entered March 25, 2019). The court refused to dismiss the plaintiff's allegation that the Heart-Check Mark materially misleads consumers—finding "StarKist’s failure to argue that the omission of language indicating it paid to place the Heart Check-Mark on its products would not mislead a reasonable consumer"—but noted that "this is a close call, which could be revisited at the summary judgment stage." The court dismissed the plaintiff's request for an injunction because it found "no 'real and immediate' threat of future injury" because the plaintiff's "own allegations indicate that he will not purchase or pay as much for the product going forward."
The U.S. Department of Justice has announced that StarKist Co. has agreed to plead guilty to charges alleging the company conspired to fix prices of packaged tuna. The company will face a fine of up to $100 million. "Our citizens' confidence in the ability to buy goods within an unbiased market is key to sustaining an efficient and fair economy,” a press release quotes a special agent as saying. “This investigation stands as a symbol of our commitment to holding corporations and senior leadership accountable and ensuring that activities such as price fixing will not be tolerated.”
Trader Joe's has agreed to pay $1.3 million to settle allegations that it underfills its five-ounce tuna cans. In re Trader Joe's Tuna Litig., No. 16-1371 (C.D. Cal., motion filed September 14, 2018). Under the agreement, class members will receive $29, which will be diluted pro rata if the total amount of claims exceeds the available funds. According to the motion for preliminary approval, the plaintiffs' investigation included "commissioning pressed weight testing of Trader Joe's Tuna and reviewing numerous pressed weight test reports in cooperation with qualified experts from the U.S. National Oceanic and Atmospheric Administration."
Christopher Lischewski, president and CEO of Bumble Bee Foods, has been indicted by a federal grand jury in California and charged with one count of felony price-fixing for his alleged role in a scheme to fix the price of canned and packaged seafood sold in the United States. U.S. v. Lischewski, No. 18-0203 (N.D. Cal., filed May 16, 2018). The felony charge alleges that Lischewski and co-conspirators engaged in "an unreasonable restraint of interstate commerce" in violation of the Sherman Act; the maximum penalties include up to 10 years' imprisonment and a fine of $1 million. Lischewski's indictment follows guilty pleas on similar charges from Bumble Bee and its former senior vice president.
The World Trade Organization (WTO) has ruled that the United States can use the “dolphin-safe” tuna labeling regulations revised in 2016, deciding they are part of a “legitimate conservation effort.” Mexico began the dispute in 2008 when it asserted that U.S. regulations governing tuna fishing in the Eastern Tropical Pacific Ocean were more stringent than in other areas of the world and unfairly barred Mexico’s fishing industry from the market. Although WTO has previously ruled in Mexico’s favor, the new opinion stated that the regulations are “calibrated to the levels of risks posed by different fishing methods in different parts of the ocean, [so] we do not see any reason to find that the same measure is applied in a manner that constitutes a means of arbitrary or unjustifiable discrimination.” In April 2017, WTO awarded Mexico $163 million in trade sanctions over the regulations; that award may now be appealed.
Dollar General Corp, Moran Foods LLC and Krasdale Foods, Inc. have filed lawsuits alleging that the makers of Bumble Bee, StarKist and Chicken of the Sea illegally conspired to fix prices for their products, echoing ongoing litigation alleging similar facts. Dollar General Corp. v. Bumble Bee Foods LLC, No. 17-1744 (S.D. Cal., filed Aug. 29, 2017); Moran Foods LLC v. Bumble Bee Foods LLC, No. 17-1745 (S.D. Cal., filed Aug. 29, 2017); Krasdale Foods, Inc. v. Bumble Bee Foods LLC, No. 17-1748 (S.D. Cal., filed Aug. 30, 2017). The plaintiffs seek compensatory damages and attorneys’ fees. Nine putative class actions and related individual cases alleging price-fixing by the tuna companies were consolidated in multidistrict litigation in December 2015.
A California federal court has granted a motion to dismiss a consolidated proposed class action alleging Trader Joe’s underfilled its five-ounce cans of tuna, holding the plaintiffs’ claims are preempted by the Federal Food, Drug and Cosmetic Act (FDCA). In re Trader Joe’s Tuna Litig., No. 16-1371 (C.D. Cal., order entered June 2, 2017). The plaintiffs commissioned the National Oceanic and Atmospheric Administration to test several varieties of Trader Joe’s canned tuna, and the agency apparently determined that some cans were filled as much as 25 percent below the U.S. Food and Drug Administration (FDA) minimum. Additional information on one of the consolidated complaints appears in Issue 589 of this Update. Trader Joe’s argued that the weights listed on the labels were accurate and that the plaintiffs’ claim was preempted by federal law because it was based on an alleged violation of FDA standards. The court agreed, finding the FDCA…
A California federal court has approved a plan to publicize the settlement of a proposed class action filed against Safeway alleging the supermarket chain underfilled its canned tuna. In re Safeway Tuna Cases, No. 15-5078 (N.D. Cal., order entered May 4, 2017). The judge approved the settlement in March 2017 but was concerned that potential class members would be unaware of the dismissal of the case. The publicity plan requires the parties to issue press releases to major news outlets and legal publications in California and nationwide and post notice on a publicly searchable website. When that plan is complete, the court said, the action will be dismissed. Additional details on the settlement appear in Issue 628 of this Update. Issue 634
Bumble Bee Foods, LLC has agreed to plead guilty to one felony count for its role in a conspiracy to fix prices of shelf-stable tuna and will pay a minimum $25 million fine. U.S. v. Bumble Bee Foods LLC, No. 17-CR-249 (N.D. Cal. May 8, 2017). According to the U.S. Department of Justice, Bumble Bee conspired with other seafood companies and their executives to inflate prices for canned and pouch tuna. Two Bumble Bee executives have already pleaded guilty to criminal charges; details appear in Issue 625 of this Update. “Today’s charge is the third to be filed—and the first to be filed against a corporate defendant—in the Antitrust Division’s ongoing investigation into price fixing among some of the largest suppliers of packaged seafood,” Acting Assistant Attorney General Andrew Finch said in a May 8, 2017, press release. “The division, along with our law enforcement colleagues, will continue to hold…