A California district court recently dismissed a consumer’s complaint that Mars, Inc. violated California law by failing to disclose at the point of sale that Mars chocolate products likely contain cocoa beans picked by forced child laborers in Côte d'Ivoire, where it gets some of the cocoa beans used to make its products. The plaintiff alleged that the defendant’s omission violated California’s Unfair Competition Law (UCL), Consumers Legal Remedies Act (CLRA), and False Advertising Law (FAL).
The court clarified that a plaintiff cannot assert a claim under the FAL where the defendant did not make any statement at all about the subject, which is distinguishable from a situation where a defendant makes a statement and omits information that undercuts the truth of the statement. The court found that the defendants did not make a statement about child laborers, and as a result, dismissed the FAL claim.
The plaintiff also claimed that the defendants fraudulently omitted material information about their products, violating the CLRA. The court disagreed and held that because the plaintiff did not demonstrate that the omission pertained to a safety hazard or product defect, the plaintiff failed to state a claim under the CLRA. The court further explained that “the duty to disclose [under the CLRA] does not extend to situations, as here, where information may persuade a consumer to make different purchasing decisions.”
Finally, the court dismissed the UCL claim because the defendants’ omission did not violate public policy. The court reasoned that the omission was neither unethical nor caused a harm sought to be prevented by a specific law. Although the court recognized the “tragedy” of international forced child laborers, the court dismissed the entire case without leave to amend.
TIP: This decision helps clarify a company’s obligations under California consumer protection laws with respect to deception by omissions in advertising. The decision is also a good reminder that companies should be careful not to make statements in advertising that may be misleading because a key piece of information is omitted.