Latest Scoop on the “Happy Cows” Lawsuit: Court Dismisses False Advertising Claims Against Ben & Jerry’s
Patrons of Ben & Jerry’s ice cream should be familiar with Woody, the bovine mascot touted by the company as “the most interesting cow in the world.” Ben & Jerry’s packaging has long featured cartoon illustrations of Woody grazing beneath blue skies in bucolic green pastures. This past year, however, Woody ambled into the sights of the plaintiffs’ class action bar. Thankfully, she (and Ben & Jerry’s) emerged unscathed: the district court (D. Vt.) dismissed the case at the pleadings stage, affirming both the authority of district courts to dismiss implausible consumer protection claims and the requirement that plaintiffs seeking injunctive relief demonstrate a probability of future injury.
Seventh Circuit Rejects Court Intervention In Light Beer Ad Wars: Is A New Trend Brewing In False Advertising Law?
The last few years have seen a pitched battle for market share among the manufacturers of America’s leading “light” beers—a battle that’s been waged not only in America’s bars and on the airwaves, but in the courtroom. Earlier this month, in Molson Coors v. Anheuser-Busch, Nos. 19-2200, 19-2713, 19-2782, 19-3097 & 19-3116, 2020 WL 2097557 (7th Cir. May 1, 2020), the Seventh Circuit gave Anheuser-Busch, the maker of Bud Light, a major victory in that battle, wiping out an injunction that the district court had entered in favor of Molson Coors, the maker of Miller Lite and Coors Light. That’s newsworthy in itself—but, because of its novel reasoning, the Molson Coors ruling may have broader significance for false-advertising law.
“Whether reasonable consumers would be deceived by a challenged advertisement is a question of fact that can’t be decided on a motion to dismiss.” This claim is one of the biggest sacred cows in false advertising litigation. But as the Second Circuit has made clear twice in the past year, it’s just a load of bull. Take, for example, Chen v. Dunkin’ Brands, Inc., --- F.3d ----, 2020 WL 1522826, which the Second Circuit decided unanimously earlier this week. In Chen, the court doubled down on its June 2019 holding that a court can decide at the pleadings stage “whether a reasonable consumer would have been misled by a particular advertisement,” Geffner v. Coca-Cola Co., 928 F.3d 198, 200 (2d Cir. 2019), affirming the dismissal of a false advertising claim involving the meaning of “steak.” In the process, the court also served up a tasty side dish of personal jurisdiction doctrine.
Food and beverage advertising, like other forms of speech, is usually entitled to First Amendment protection – even if it may not always enjoy the same caliber of protection as, for example, journalism or political speech. See, e.g., Sorrell v. IMS Health, Inc., 564 U.S. 552, 557 (2011) (“Speech in aid of pharmaceutical marketing . . . is a form of expression protected by the Free Speech Clause of the First Amendment.”)
Grains of paradise (aframomum melegueta), are a peppery, citrusy spice indigenous to West Africa, related to ginger and cardamom. The name purportedly derives from medieval merchants’ claims that the plant grew only in the Garden of Eden. Common to West African cuisine, grains of paradise are also one of the botanicals sometimes used to give gin its characteristic flavor.
In Florida, however, an obscure 1868 law makes it a third-degree felony to “adulterate … any liquor” with certain specified substances, ranging from grains of paradise and capsicum (chili pepper) to potentially deadly opium and “sugar of lead.” Fla. Stat. § 562.455. Some have postulated that this law’s original intent was to prevent consumer deception, as the banned ingredients were once added to liquor to make it taste stronger (more alcoholic) than it actually was. That same practice spurred an 1816 law of Parliament (56 Geo. III, ch. 58) making it illegal for brewers and dealers in beer to possess grains of paradise. Unlike merrie olde England, however, the Sunshine State never got around to repealing its law.
It was only a matter of time. As we anticipated last summer, the plaintiffs’ bar recently filed a slew of false advertising suits against manufacturers of products infused or made with cannabidiol, a/k/a CBD. This development was a fait accompli, given the combination of a booming CBD market, a murky federal regulatory landscape, and a patchwork of state regulatory efforts at varying degrees of development. This confluence of factors has paved the way for at least ten consumer lawsuits in the last six months against producers of CBD products. We expect more suits to follow in the near future as copycat suits are filed, CBD products become increasingly mainstream, and more deep-pocketed players enter the CBD market.
This blog has previously examined the recent spate of so-called “slack-fill” lawsuits, in which consumers claim that a food (or other) product is misleadingly packaged because it contains excess air. We noted that the growing trend is for courts to reject such suits at the motion-to-dismiss stage, for a variety of reasons. For example, courts have found slack-fill complaints deficient for failing to allege, beyond conclusory platitudes, that the package’s empty space serves no legitimate function, or for failing to allege with plausibility that a reasonable consumer would actually be deceived. Late last year, in Benson v. Fannie May Confections Brands, Inc., the U.S. Court of Appeals for the Seventh Circuit issued an important decision affirming the pleadings-stage dismissal of a slack-fill suit, but based on a distinct justification: the failure to plausibly allege any cognizable damages associated with slack-filled packaging.
FDCA Preclusion: When Can a Manufacturer Defeat a Competitor’s Lawsuit by Complying with FDA Regulations?
As many readers probably know, when a food or beverage manufacturer gets a consumer class action alleging that its labeling violated state law, one of the first things it should do is consider whether the disputed aspect of the labeling is covered by the federal Food, Drug and Cosmetic Act (“FDCA”). Many provisions of that statute—and, by extension, their implementing regulations—expressly preempt non-identical state-law regulations. If a putative class of consumers is asking a manufacturer to do something different with its labeling than those provisions do, there is a strong argument that the case is preempted: federal law (the FDCA) trumps state law (the relevant consumer protection statute).
In the latest development in the Lanham Act litigation between beer titans MillerCoors and Anheuser-Busch, the district court issued an order enjoining Bud Light from using the “No Corn Syrup” language and icon on product packaging, expanding the existing injunction covering the same claims in print and television advertisements. MillerCoors v. Anheuser-Busch Cos. (MillerCoors II), No. 19-cv-218-wmc, 2019 U.S. Dist. LEXIS 149954 (W.D. Wis. Sept. 4, 2019). However, the court permitted Anheuser-Busch to exhaust its existing supply of packaging with the enjoined image and language (assuming it can be done in 270 days, which Anheuser-Busch has signaled it will). The decision offers an interesting analysis of implied comparative claims and how the defendant’s replacement costs may impact the “irreparable harm” inquiry at the preliminary injunction stage.
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 recent decision, MillerCoors v. Anheuser-Busch Cos., LLC, No. 19-cv-218-wmc, 2019 U.S. Dist. LEXIS 88259 (W.D. Wis. May 24, 2019), denied and granted in part a preliminary injunction enjoining a series of advertisements and commercials depicting corn syrup in MillerCoors’s beer.
While the New England Patriots were besting the Rams in the 2019 Super Bowl, Anheuser-Busch tried to get the upper hand on MillerCoors in a series of ads highlighting the “use of” corn syrup in Miller Lite and Coors Light.
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.
“Contains detectable levels of the weed-killer chemical glyphosate.”
“Contains limonene, which causes kidney toxicity and tumors, and linalool, a cockroach insecticide.”
“Contains a potent biocide and endocrine disruptor, with detrimental health effects that are still becoming known.”
These are the sorts of headline-grabbing allegations the plaintiffs’ bar has recently relied upon in claiming that products advertised or positioned as “natural” are deceptively marketed. At first blush, the presence of allegedly dangerous ingredients in foods, cosmetics, and other consumer products might seem like the basis of a strong false advertising case—especially when those substances are undisclosed. How could a company so deceive the public by promising a “good-for-you” product that contains such “bad” ingredients?
Court Certifies Class Action Over Gerber “Good Start Gentle” Baby Formula, Citing Consumers’ General Exposure to Ad Campaign
A recent decision from the Eastern District of New York, Hoth v. Gerber Prods. Co., 15-cv-2995 (E.D.N.Y.), granted class certification to purchasers of Gerber baby formula in Florida and New York who claimed to have been misled by representations that the formula reduced infants’ risk of developing allergies. The certified class is unusual, however, in that not all of its members actually purchased the product labeled with the alleged misrepresentation. Many courts have concluded that this lack of uniform exposure defeats certification by precluding a showing of classwide injury, but the Hoth court credited evidence that the general “advertising and labeling practice [regarding allergy prevention] allowed a price premium to be charged across the entire line of [challenged] products.” Op. at 41 (emphasis in original).
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.
In Comcast v. Behrend, 569 U.S. 27 (2013), the Supreme Court held that a plaintiff cannot obtain class certification with an inadequate damages model. In the years since, courts have diverged over how much a plaintiff must do to satisfy this requirement. Often, plaintiffs seek class certification with nothing more than a skeletal proposal to develop and perform an analysis at some future point, using information they do not—and might never—possess. While some courts have found such adumbrative “models” sufficient at the class certification stage, the better decisions require more. As Comcast recognizes, Rule 23 “does not set forth a mere pleading standard.” Rather, a plaintiff “must affirmatively demonstrate” through “evidentiary proof” that damages are measurable on a class-wide basis through a common methodology. Faithful application of that principle obligates plaintiffs and their experts to offer a detailed methodology that is tailored to the facts of the case, and to show that any data that the model requires in fact exists and can be obtained.
Many recent consumer class actions against food and beverage manufacturers have related to label claims that a particular category of ingredient is not used in the product—e.g., “No Preservatives,” “No Artificial Flavors.” These lawsuits follow a predictable formula: the plaintiff, relying on the product’s ingredient list, alleges that a particular ingredient in the product functions as an artificial flavor and/or chemical preservative, and that the “no preservatives” or “no artificial flavors” claim is therefore false.
In consumer cases alleging product mislabeling, one frequently litigated question is whether the plaintiff has standing to seek an injunction of the labeling practice that he or she claims is misleading. Over the past decade, consumer protection defendants have often won on this issue by demonstrating that the plaintiff is at no risk of future injury. But last year, in Davidson v. Kimberly-Clark Corp., 889 F.3d 956 (9th Cir. 2018), the Ninth Circuit made this issue tougher for defendants, adopting an exceptionally broad view of plaintiffs’ standing to seek injunctive relief in mislabeling cases. Below, we discuss the aberrant holding in Davidson, and how Ninth Circuit defendants may still be able to distinguish its facts to defeat a claim for injunctive relief.
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?