Watered-Down Beer MDL Dismissed with Prejudice
A multidistrict litigation (MDL) court in Ohio has dismissed with prejudice six putative class actions involving plaintiffs from California, Colorado, Florida, New Jersey, Ohio, Pennsylvania, and Texas, alleging that Anheuser-Busch “routinely and intentionally adds extra water to its finished product to produce malt beverages that ‘consistently have significantly lower alcohol content than the percentages displayed on its labels.’” In re Anheuser-Busch Beer Labeling, Mktg. & Sales Practices Litig., MDL No. 13-2448 (N.D. Ohio, order entered June 2, 2014). Additional details about the litigation and the order consolidating the cases appear in issues 473 and 487 of this Update.
Federal regulations allow malt beverages containing 0.5 percent or more alcohol by volume a tolerance of 0.3 percent in the alcohol content, “either above or below the stated percentage of alcohol,” and the affected jurisdictions have adopted or refer to these regulations in their statutes and regulations. The defendant argued in its motion to dismiss that the plaintiffs failed to “allege any deviation in labeling of the alcohol content of the products at issue that exceeded the regulatory tolerance of 0.3 percent.”
The plaintiffs did not dispute this, but argued that (i) the court should exercise its equitable powers to “create an exception to the tolerance when a misstatement of alcohol content, no matter the degree, is knowing or intentional”; (ii) the tolerance regulation “must be considered in the context of the statutory and regulatory scheme as a whole,” and allowing the tolerance “even in the case of deliberate misstatements would ‘subvert the entire combined statutory and regulatory scheme, which was specifically designed to prevent consumer deception”; and (iii) “tolerance” should be considered a term of art that permits only “unintentional deviations” from the goal of absolute accuracy. The court disagreed, declining to rewrite the law to distinguish between intentional and unintentional deviations and refusing to give the word “tolerance” anything other than its ordinary meaning.
Issue 525
