Category: Reasonable Consumer
Tough Nut to Crack: First Circuit Panel Splits on Reasonable Interpretation of Flavored Coffee Packaging
We have written previously about application of the “reasonable consumer” standard when labeling statements are claimed to be false or misleading, despite the presence of clarifying information elsewhere on the product label. We’ve observed the inconsistent standards courts apply in ruling on a motion to dismiss, particularly as to whether a “reasonable consumer” views the alleged misstatement in the context of the entire product packaging and ingredient list.
Many companies take pride in the geographic origin of their products (e.g., cars that are “Made in the USA”), or in their products’ capacity to evoke a certain region (e.g., “Hawaiian style” pizza). Claims about the origin or provenance of products seem to pose a relatively low risk of consumer deception: these typically do not implicate health or safety, nor do they convey anything concrete about the products’ qualities. Nevertheless, these “origin” and “provenance” claims have drawn scrutiny from the Federal Trade Commission, state regulators, and – most recently – class action plaintiffs’ lawyers. Below, we’ve highlighted some guidance from regulators and the courts that may be helpful to manufacturers when they consider highlighting their geographic origins in their product branding.
Last month, Misbranded co-editors Josh Kipnees, Jonah Knobler, and Jane Metcalf presented a live-streamed webinar via Bloomberg Law titled “Hot Topics in Consumer False Advertising Litigation.” The free hour-long webinar, now available on demand, covers the following subjects, some of which should be familiar to regular readers of this blog:
- “Natural” / “no artificial ingredients” claims
- “No preservatives” claims
- Ingredient claims (“made with [X]”)
- Geographic origin claims (e.g., “Made in the USA”)
- Slack-fill claims
- Claims involving nondisclosure of morally troubling/offensive facts
- What’s next in consumer false advertising litigation?
We encourage you to check it out (and obtain some CLE credit in the process).
A frequent target of consumer class actions are “structure/function” claims made in connection with dietary supplements. These claims describe a nutrient or dietary ingredient and its role in the body’s structure or function: for example, “glucosamine promotes healthy joints.” Plaintiffs may allege that a product’s labeling is misleading because the typical consumer already receives enough of the nutrient or ingredient from her diet. At the same time, those plaintiffs will seek a refund on behalf of everyone who bought the product—even if many in the class have received a benefit. A recent decision out of the Southern District of California, Alvarez v. NBTY, Inc., 2019 U.S. Dist. LEXIS 87420 (May 22, 2019), suggests that this disconnect between the proposed class and the plaintiffs’ theory of liability and damages may no longer be tolerated at the class-certification stage.
Another One Bytes the Dust: Court Dismisses Flash Drive False Advertising Suit Based On Back-Of-Package Clarifying Disclosures
A few months ago, we wrote about courts’ inconsistent application of the “reasonable consumer” standard when labeling statements are claimed to be false or misleading, despite clarifying information elsewhere on the product label. In Williams v. Gerber Products Co., 552 F.3d 934 (9th Cir. 2008), the Ninth Circuit (in)famously held that a “reasonable consumer” should not be “expected to look beyond misleading representations on the front of the box to discover the truth … on the side of the box.” Id. at 939-40. As we explained in our prior post, Williams is in tension with longstanding authority that “reasonable consumers” are expected to read the entire advertisement, including disclaimers and clarifying language. We observed that numerous lower-court decisions, recognizing Williams’ shaky foundation, have sought to distinguish it and narrow it to its facts.
Add to this list Dinan v. SanDisk LLC, No. 5:18-cv-5420 (BLF), 2019 U.S. Dist. LEXIS 91633 (N.D. Cal. May 31, 2019), a recent decision out of the Northern District of California. While Dinan was not a food, drug, or cosmetic case, its discussion of Williams and the “reasonable consumer” test bears directly on such cases, and should help manufacturers dispatch some false advertising claims at the pleadings stage when their packages include proper clarifying disclosures.
Speak of the Devil and he doth appear. Today, it’s just a figure of speech. In medieval England, by contrast, people meant it literally—as a warning that uttering the Prince of Darkness’s name would conjure his evil presence. Maybe those Anglo-Saxons had a point. A few weeks ago, we wrote a post about a remarkable string of defense victories in “slack-fill” cases—i.e., lawsuits complaining of too much empty space in product packaging. In particular, we noted that “every slack-fill case to reach the class-certification stage ha[d] flunked Rule 23’s rigorous test for certification,” and we wondered aloud “how a slack-fill class could ever be certified.” Well, speak of the Devil: just four days later, a California court certified a class in a slack-fill case for the first time ever. We apologize for any causal role we may have had in this truly diabolical development. The good news is that the decision may not stick—and even if it does, it’s likely to remain an outlier.
Unless you were born yesterday, you know that packaged goods usually contain some empty space in the box, bottle, or bag. This has been true for as long as there have been packaged goods. What is relatively new is that consumers—or, rather, a small cadre of specialized plaintiff’s lawyers—are suing over it. But as Newton said, for every action, there is an equal and opposite reaction. And the more that lawyers have inundated courts with these suits, the more aggressively courts have responded to shut the silliness down. This post examines the regulatory underpinnings of these so-called “slack-fill” suits and the many bases that courts have found for letting the air out of them.
By law, packaged foods and beverages must bear an accurate list of their ingredients “in descending order of predominance by weight.” 21 C.F.R. § 101.4. Consumers routinely sue food and beverage companies alleging that they were misled about the presence or absence of particular ingredients—even though a mere glance at the ingredient list would have averted any confusion. Do such plaintiffs have a plausible claim for relief under false advertising laws, or should these claims be dismissed at the threshold?