Litigation challenging “all natural” advertising claims has been filling courthouses for years, but the suits have incorporated another trend recently, by targeting manufacturers that use genetically modified organisms.
In the new suit, Sandahl Nelson said she purchased Campbell’s Prego-branded sauces in part because of the representation that the product line was “100% Natural.” But the company deceived consumers with the claim, as the sauces contain canola oil made from genetically modified canola, Nelson alleged.
“A reasonable California consumer, like Plaintiff, would not expect a Product labeled ‘100% Natural’ to contain ingredients made from genetically modified crops, which are, by definition, artificial and synthetic,” according to the complaint. “Furthermore, Plaintiff and other California consumers would not have purchased the Products if they had known that the Products contained ingredients made from genetically modified crops.”
Citing violations of California’s Consumers Legal Remedies Act, False Advertising Law, and Unfair Competition Law, the complaint seeks damages and restitution for a statewide class.
A few days earlier, the parties in a similar case told the court they had reached a deal.
Two plaintiffs sued Kashi Co. arguing that the labeling of products like Trail Mix Chewy Granola Bars and Pumpkin Spice Flax Crunchy Granola Bars as “All Natural” was false and deceptive because the products were made with GMO ingredients. After three years of litigation—including multiple motions to dismiss filed by the defendant, amended complaints from the class, and a trial set for June 1—the parties filed a joint motion in support of preliminary approval of their deal, calling it “a tremendous result for the Class.”
Kashi agreed to provide full reimbursement for customers who can produce a receipt for the covered products or pay $0.55 per product, up to $27.50, for those who can’t provide proof of purchase. The total payout for the deal will depend on the number and type of claims, but Kashi said it would pay at least $2 million and no more than $4 million.
Notice and administrative costs will be shouldered by Kashi, along with $5,000 awards for the named plaintiffs and attorneys’ fees up to $1.5 million.
Kashi will also remove the “All Natural,” “100% Natural,” and “Nothing Artificial” claims from the challenged products (unless a federal agency or controlling regulatory body designates the included ingredients as “natural”). For additional consideration to the class, the company will participate in a supervised non-GMO verification program and provide plaintiffs’ counsel with compliance information about its products for a three-year period.
The nationwide class excludes California residents, who were covered in a separate $5 million settlement last year.
To read the complaint in Nelson v. Campbell Soup Co., click here.
To read the motion for preliminary approval of settlement in Eggnatz v. Kashi Co., click here.
Why it matters: GMO-related cases have filled court dockets and kept the false advertising litigation of “all natural” claims alive and well. In addition to Kashi’s earlier $5 million settlement, a New York federal court denied Smucker’s motion to dismiss in a false advertising suit alleging that the company’s vegetable oil, corn oil, and canola oil contain GMOs. Advertisers should use caution when adding “all natural” language to a product label when GMOs are involved, particularly since states like Connecticut and Vermont have enacted GMO labeling legislation.