Tag Archives: California

Plaintiffs Join Forces in Class Action Suit Against Chobani for “Evaporated Cane Juice” and “All Natural Ingredients” Claim

FoodNavigator-USA reported that two plaintiffs dismissed their class action lawsuits against Greek yogurt manufacture Chobani, Inc. in order to combine forces as part of a third lawsuit pending in the Northern District of California.  At that venue, the combined Plaintiffs filed a Second Amended Complaint on October 10, 2012 targeting Chobani’s allegedly improper use of the term  (1) “evaporated cane juice” to describe sugar in the ingredient list and (2) “natural” to describe a product that uses natural color additives.

Specifically, Plaintiffs broadly allege that Chobani responded to consumers’ desire for natural and nutritious foods by “actively promoting the naturalness and health benefits of its products.”   On this point, Plaintiffs cite virtually every statement made by Chobani on its labels, advertising and website relating to the “purported naturalness, nutritional, and health qualities of its yogurt products.”  Plaintiffs then allege that such claims are false and deceptive, and the yogurt products misbranded, for two reasons.

First, Plaintiffs allege that Chobani lists “Evaporated Cane Juice” as an ingredient “despite the fact that the FDA has specifically warned companies not to use this term” and, further, that this (1) “the ingredient in question is not a ‘juice,’” and (2) “evaporated cane juice” is not listed in the FDA’s Standard of Identity for yogurt (21 CFR § 131.200) as an allowed nutritive carbohydrate sweetener.  This alleged “deception” is “material,” Plaintiffs allege, because approximately one-third of the product’s calories comes from this ingredient, i.e., “processed sugar with no nutritional benefit.”   It is unclear, however, whether all of those calories come from the “evaporated cane juice” or if some is naturally occurring lactose (i.e., “milk sugar”).

Second, Plaintiffs contend that “[s]ome of Chobani’s Greek Yogurt flavors are unlawfully labeled as ‘all natural’ and/or ‘only natural’ [because they are] artificially colored and/or containing unnatural ingredient including, by way of example, the pomegranate flavor which artificially colors the yogurt product with ‘fruit or vegetable juice concentrate.’”  In this regard, Plaintiffs note that color additives under 21 C.F.R. 70.3(f) are “artificial colors” and include “natural” ingredients “such as beet juice [when] deliberately used as a color, as in pink lemonade.”  Notably, however, Chobani does not appear to have made a blanket “all natural” claim but instead stated that its products contain “only natural ingredients” and contained “no artificial sweeteners” and “no preservatives.”  This qualification will likely be crucial as the case moves forward.

You can read the Second Amended Complaint here.

LA Times: “No on Proposition 37″

The Los Angeles Times is urging California voters to say “no” to Proposition 37, which would mandate the labeling of foods with genetically modified  ingredients.

In most cases, there is no requirement to inform consumers, via labels, about the use of pesticides,  hormones or antibiotics, or about the inhumane conditions in which animals are often kept. But Proposition 37 would make an exception for genetically engineered food, requiring that it be labeled before being sold in California. Although we generally endorse people’s right to know what goes into their food, this initiative is problematic on a number of levels and should be rejected.

One of the problems identified in the Editorial include an issue I raised in earlier posts — that the initiative “is sloppily written” and “contains language that … could be construed by the courts to imply that processed foods could
not be labeled as ‘natural’ even if they weren’t genetically engineered.”

Other problems the LA Times identifies with the proposal include:

  • “Most of the burden for ensuring that foods are properly labeled would fall not on producers but on retailers”;
  • “Enforcement would largely occur through lawsuits brought by members of the public …, a messy and potentially expensive way to bring about compliance”;
  • “there is little if any evidence that changing a plant’s or animal’s genes
    through bioengineering, rather than through selective breeding, is dangerous to the people who consume it”; and
  • “the marketplace already provides ways to inform consumers about their food” and ”food producers are welcome to label their foods as GE-free” and “Organic foods are never genetically engineered.”

Please read the complete Editorial here.

My Article at FoodProcessing.Com: Proposition 37: Food Transparency or Increased Organic Food Sales?

Please see my “Power Lunch” article at FoodProcessing.com on the GMO-labeling ballot initiative in California titled Proposition 37: Food Transparency or Increased Organic Food Sales?

My Article in Packaging Digest on Potential Impact of California GMO Labeling Ballot Initiative

Please see my feature article in the August 2012 issue of Packaging Digest on the “extreme” labeling requirements that might result if California voters approve Proposition 37, also known as the “California Right to Know Genetically Engineered Food Act.”

In related news, various entities are awakening to the fact that the language of Prop. 37 could potentially be read as precluding any “processed food” from being labeled or advertised as “natural,” “all natural,” or “naturally made” regardless of whether it includes GMO ingredients.  See here and here.  In fact, the Legislative Analyst’s Office of California, a non-partisan fiscal and policy advisor, specifically found that, “[g]iven the way the measure is written, there is a possibility that these restrictions  [on "natural" labeling and advertising] would be interpreted by the courts to apply to all processed foods regardless of whether they are genetically engineered.”  See here.  Expect this issue to be the subject of much more discussion as the election approaches.

Craft Brewers Settle “Idiot” Trademark Dispute

Two months after Coronado Brewing Co. filed a Complaint for trademark infringement against Elysian Brewing Co., the two companies have formally settled their dispute.  Coronado operates microbreweries and brewpubs in California and is the owner of a U.S. trademark registration for “IDIOT” in connection with beer and related beverages.  One of the beers sold in connection with its IDIOT mark is an India pale ale.   The lawsuit was prompted by a new India pale ale from Elysian called “Idiot Sauvin.”  Coronado alleged that consumers were likely to believe that beers sold by Elysian under the “Idiot Sauvin” name were provided by, approved by, sponsored by, and/or affiliated with Coronado in light of its more senior and registered IDIOT trademark.

According to BeerPulse.com, the dispute has now been resolved, with one of Elysian’s co-founders stating:

I can say that we’ve agreed not to use the word Idiot in the future.  The beer in question will be called Savant. As we would with any of our colleagues in the craft brewing industry we will welcome our friends at Coronado to our local market, once they get here.  I doubt that we will be collaborating with them on any projects.

The court was formally informed of the settlement on 7/16/12.

Putting aside the merits of the allegations, this case highlights the importance of conducting trademark clearance when selecting a brand name for new products and before any marketing of the product.

Freakonomics: “How California’s GMO Labeling Law Could Limit Your Food Choices and Hurt the Poor”

There’s an excellent article posted today by Steve Sexton on the Freakonomics website titled “How California’s GMO Labeling Law Could Limit Your Food Choices and Hurt the Poor.”  Here’s a snippet:

More devastating than the label itself, could be the cost of avoiding the label on non-GE foods that may nevertheless contain trace amounts of GE material. In the U.S., the highest-grade corn can contain as much as 2% foreign material, like crop residues. In Europe, a food product can containas much as 0.9% genetically engineered material and avoid a GE label. But the California law would impose a nearly twice as stringent purity standard, tolerating only 0.5% GE content in non-GE food.

Such a high purity standard would likely require farmers to invest in separate planting, harvesting, storage, hauling, processing, and packaging equipment for GE production in order to avoid revenue losses and liability from contaminating their non-GE operations or those of competitors. Because the costs of risk reduction generally increase exponentially in the level of safety, California’s stringent purity standard may be a death sentence to GE producers who could spread the high fixed costs of contamination avoidance across only the low levels of production that the market would initially support.

Please read the entire piece in full here.

“No reasonable consumer would be misled by PepsiCo’s ‘all natural’ Claims” — Judge Dismisses Class Action Suit Over SoBe Lifewater Drink

Food companies received some good news regarding the recent onslaught of “all natural” class action litigation.  A federal judge has dismissed with prejudice the Complaint against PepsiCo and its subsidiary South Beach Beverage Co. (“SoBe”) over the claim that the SoBe Lifewater beverage is deceptively labeled as ”all natural.”   See complete ruling here.

The complaint — filed by the same law firm as the Jamba Juice class action suit –  asserted claims under California’s consumer protection laws (of course) alleging that (1) the “all natural” label is potentially deceptive because SoBe Lifewater contains ingredients that are “synthetic or created via chemical processing”; specifically,  ascorbic acid, cyanocobalamin, calcium pantothenate, niacinamide, pyrioxine hydrochloride, and xanthan gum; (2) the names of various fruits are used to describe the different flavors of Lifewater even though Lifewater does not contain any actual fruit or fruit juice, which is likely to deceive consumers into “believing that Defendants’ SoBe Beverages are, indeed, ‘All Natural’”; and (3) the use of the common vitamin name (e.g., B12) on the labels is misleading because the vitamins added to Lifewater are synthetic or created via chemical processing. 

The court ruled that the plaintiffs’ claims relating to the second and third points were both preempted.  Specifically, “FDA regulations explicitly permit manufacturers to use the name and images of a fruit on a product’s packaging to describe the characterizing flavor of the product even where the product does not contain any of that fruit, or contains no fruit at all.”   Likewise, 21 C.F.R.  § 101.9(c)(8)(v) recognizes that “Vitamin C” and “Ascorbic acid” are “synonym[s]” that may be used in the alternative in a product’s nutritional information labeling.

Significantly, the Court concluded that “Plaintiff cannot avoid preemption of these claims by arguing that his claim relates solely to Defendants’ ‘all natural’ representations and that he included his fruit name and vitamin name claims only as support for his ‘all natural’ claim” because that would “would effectively allow Plaintiff to avoid preemption of those claims, and would undermine the purpose of the federal labeling standards which includes avoiding a patchwork of different state standards.”

As for the “all natural” claim, the Court noted that “once the preempted statements regarding fruit names and vitamin labeling are removed, this claim is based on a single out-of-context phrase found in one component of Lifewater’s label”  — “all natural with vitamins.”   The court declined to consider the “all naturual” claim “in a vacuum” and concluded that ”no reasonable consumer would read the ‘all natural’ language as modifying the ‘with vitamins’ language and believe that the added vitamins are … ‘all natural vitamins.’”  

The court further held that, “to the extent there is any ambiguity, it is clarified by the detailed information contained in the ingredient list, which explains the exact contents of Lifewater.”   This last point is notable because of precedent holding that misleading front-of-package labeling will not be excused or “cured” by disclosures on the FDA-mandated ingredient list.  Here, however, the relevant claim was, at worst, ambiguous and it was therefore appropriate to consider the impact of the ingredient list on a reasonable consumer.  On this score, the court cited Williams v. Gerber for the proposition that “reasonable consumers expect that the ingredient list contains more detailed information about the product that confirms other representations on the packaging.”  552 F.3d 934, 939-40 (9th Cir. 2008).  

Although this ruling is relatively fact specific, it underscores that compliance with FDA labeling regulations can provide a safe harbor, of sorts, against various class pursued by class action attorneys.  More importantly, it takes the strong but very sound position that the ingredient list can dispel any ambiguities created by FOP claims.  

Note that this ruling is similar in to the ruling three weeks ago on another motion to dismiss in which a district court dismissed numerous claims on preemption grounds but held that General Mills must defend its “made with real fruit” claim for Fruit Roll-Ups.

NY Times: “Battle Brewing Over Labeling of Genetically Modified Food”

Today’s New York Times includes an excellent story on the “Battle Brewing Over Labeling of Genetically Modified Food.”  As the article notes:

Regulators and many scientists say [GMO ingredients] pose no danger. But as Americans ask more pointed questions about what they are eating, popular suspicions about the health and environmental effects of biotechnology are fueling a movement to require that food from genetically modified crops be labeled, if not eliminated.

Although GMO labeling bills are percolating in several state legislatures,  the most significant “battle” is the upcoming ballot initative in California, discussed in a prior post.  Significantly:

Biotechnology companies say that the California labeling initiative, while portrayed as promoting consumer choice, is really an effort by some consumer and environmental groups and organic food growers to drive genetically modified foods off the market.

“These folks are trying to use politics to do what they can’t accomplish at the supermarket, which is increase market share,” said Cathleen Enright, an executive vice president at the Biotechnology Industry Organization, which represents Monsanto and DuPont.

Persons on the other side of the issue, of course, assert that they just want “transparency” in the food system in light of potential health and environmental concerns. 

Please see the complete article here.