The litigation arena for the consumer products industry is as active as ever. Each newsletter we bring you a summary of the most important litigation developments from the past two months, from complaint filings and key court decisions to trial results and settlements. For more information about these and other developments, please visit our Food & Beverage Industry Tracking Report.

Filed

Pet Food Company Hit with California Class Action for Advertising Nutrish Dog Food as “Natural”

On February 28, 2017, APN Inc., the company that sells celebrity chef Rachael Ray's dog food brand, was slapped with a putative class action in California federal court for false advertising over the "natural" labeling on Nutrish lines of dog food products when the items allegedly contain harmful additives and synthetic ingredients, including L-ascorbyl-2-polyphosphate, menadione sodium bisulfite complex, and caramel color. Christina Grimm v. APN Inc. et al., Case No. 8:17-cv-00356, U.S. District Court for the Central District of California

Two Complaints in “Food Court” Allege Kona Brewing Falsely Advertises Beer as Brewed in Hawaii

On February 28, 2017, two California consumers filed a putative class action against the parent company of Kona Brewing Co. in federal court, alleging the brand falsely misleads purchasers into thinking the beer is brewed in Hawaii — even though it comes from continental U.S. breweries. Cilloni et al. v. Craft Brew Alliance Inc., Case No. 5:17-cv-01027, U.S. District Court for the Northern District of California

On March 6, 2017, suit was filed against Kona Brewing Co. and its owner, Craft Brew Alliance, Inc., over the beer’s perceived place of origin. The lawsuit alleges that defendants mislead drinkers into thinking Kona beers are brewed in Hawaii when it is made in less exotic places on the U.S. mainland, like New Hampshire and Tennessee. In buying the beer, Plaintiff alleges that he relied on illustrations of the beach and surfers, as well as a map of the major Hawaiian Islands with markings and the words “Kona Brewing Co.” indicating Hawaii brewery locations. Plaintiff further alleges that he paid a premium price for beer he thought was brewed in Hawaii and seeks to represent a nationwide class and a California class. Broomfield v. Kona Brewing Co., Case No. 17-1157, U.S. District Court for the Northern District of California

Settled

California Judge Denies Class Action Settlement in “BOGO” Case for Inadequate Notice

On January 30, 2017, a state judge denied final approval of the proposed settlement agreement because class members did not receive notice that claims not alleged in the original complaint (i.e., that MyPillow deceptively promoted a “Buy One Get One Free” offer by inflating the price of its pillows resulting in consumers actually paying regular price for two pillows) would be included in the settlement agreement. Amiri et al v. MyPillow, Inc. and Does 1-10, Case No. CIV-1606479, Superior Court for the State of California, County of San Bernardino

Heartland Consumer Products Settles Splenda Knock-off Suit Against Dunkin Donuts

On February 17, 2017, Heartland Consumer Products LLC, owners of the Splenda artificial sweetener product, recently dropped its lawsuit against Dunkin’ Donuts, alleging that Dunkin Donuts was misleading consumers by handing out yellow packets of artificial sweetener when customers asked for “Splenda,” even though what Dunkin’ Donuts was distributing was made in China and labeled with “Dunkin’ Donuts.”  The pleadings noted that “Heartland said it had received complaints of actual confusion from Dunkin’ customers who said that they were deceived into thinking the knockoff sweetener, which purportedly had a “funny taste,” was Splenda.”  The details of the settlement have not been disclosed. Heartland Consumer Products LLC v. Dunkin Brands Inc. et al., Case No. 1:16-cv-03045, U.S. District Court for the Southern District of Indiana

Direct Digital Settles Class Action over Effectiveness of Instaflex Supplements

On March 3, 2017, Direct Digital agreed to pay $4.5 Million to settle a class action over claims that its joint health supplements aren’t clinically proven and don’t work as advertised, pending authorization by an Illinois federal court, according to Plaintiff’s motion for preliminary approval of the settlement. Mullins and his attorneys will petition the court for roughly $1.5 Million in fees and costs to be paid from the settlement fund, the memo said. Direct Digital will also agree to stop advertising Instaflex as promoting joint health and may no longer represent the product as “special, revolutionary or exclusively formulated.” Vince Mullins v. Direct Digital LLC, Case No. 1:13-cv-01829, U.S. District Court for the Northern District of Illinois

Dismissed/Stayed

Federal Judge Stays Class Action Against Kraft Pending FDA Input on “Natural”

On March 3, 2017, a Puerto Rico federal judge stayed a false labeling suit over artificially-colored cheese brought against Kraft Foods Group Inc. pending guidance from FDA on the use of the term “natural” on food products. The judge pointed to three recent rulings in support of the company’s argument that the proceedings should be paused pending completion of the FDA’s rulemaking process: the Ninth Circuit's 2016 decisions in Kane v. Chobani and Astiana v. Hain Celestial Group, as well as the Southern District of New York's 2016 ruling in In re Kind LLC "Healthy & All Natural" Litigation. Quinones-Gonzalez v. Kraft Foods Group Inc., Case No. 3:15-cv-01892, U.S. District Court for the District of Puerto Rico