Advertisers seek out third-party certifications and endorsements for their environmental efforts as a means of providing credibility to green claims made to consumers. Indeed, the FTC’s Green Guides make clear that companies who choose instead to “self-certify” must make that fact clear to consumers precisely because consumers may view self-certification with more skepticism.
But can an environmental seal also operate as a shield against legal liability? Chiquita may be about to find out. The Seattle-based Water and Sanitation Health (WASH) Group has taken issue with green bananas (no one likes the green ones, do they?) and filed a lawsuit against Chiquita alleging that the Company’s claim that its bananas are grown in an ecologically friendly and sustainable manner is deceptive.
Chiquita’s green practices are certified by the Rainforest Alliance (think cute little green frog symbol). Here is what the Rainforest Alliance has to say about its work with banana growers:
In the 1990s, the Rainforest Alliance began working with local NGO partners, scientists, community leaders and farmers to transform the destructive industry by establishing the first standard for responsible banana production. Today, more than 15 percent of all the bananas traded internationally come from Rainforest Alliance Certified™ farms or plantations, like Finca Santa Marta, which conserve wildlife and waterways, reduce agrochemical use and protect the rights of workers and their families.
Notwithstanding this certification, WASH’s complaint alleges that Chiquita’s or its local suppliers’ farms utilize toxic pesticides or fungicides which are applied through aerial spraying and contaminate drinking water in six Guatemalan communities. WASH is also apparently pressuring the Rainforest Alliance to rethink their certification.
We, of course, are not privy to any of the specific facts in this case and Chiquita no doubt has its side of the story yet to tell (Chiquita states on its website that all of its company-owned farms and a majority of its supplier farms are certified). But the case raises an interesting question as to how much marketers should be able to rely upon the third-party certifications they receive.
Chiquita is clearly relying at least in part upon the Rainforest Alliance’s certification to support its green growing practice claims. If the certification had been achieved through fraud or deception (and there is no allegation that it was) then that of course is a different story. But what if a plaintiff such as WASH simply believes that the certifying organization’s standards are too lax or that the certifying agency failed to strictly apply its own standards?
In the former case, Chiquita may likely argue that it should not be liable for green claims that rely upon a third party’s standards simply because another group believes that these standards are not strict enough, particularly if they have relied upon the Green Guides’ admonition to make the criteria for the certification clear. Similarly, if a company’s practices are only partially certified and the certification and claims make that clear, is it more of a public policy issue rather than a legal issue that they are promoting the partial green efforts they have made even though they have not completely adopted these practices?
We’ll let you know how this one turns out.
Finally, in the latter circumstance, the situation is perhaps less clear. Certainly it would not be Chiquita’s fault if the third party failed to adequately do its job. However, the FTC and courts are often more concerned about the truth or falsity of a claim and not whether the advertiser is at fault in making a deceptive claim. For example, in a somewhat analogous situation, the FTC has indicated that it is not a defense to a Section 5 violation if an advertiser relies upon third-party clinical trials that, unbeknownst to the advertiser, had significant flaws (although of course the FTC may exercise discretion in any remedy it may seek).