Here at the Product Liability Monitor, we have been following plaintiffs’ continuing attempts to find a viable claim against food and beverage companies for allegedly misleading and deceptive advertising on product labels. Thus far, food and beverage companies have been largely able to avoid liability on grounds that labelling requirements fall under the FDA’s purview and the various suits that have been brought are preempted by FDA regulations. Nevertheless, plaintiffs continue to press forward with these types of claims. Recently, two similar class actions were filed against Greek yogurt makers Fage and Chobani. The twist in these actions is that the claims were brought in New York – the companies’ primary place of business — rather than California – where the vast majority of the labelling-related complaints have been brought.
In Stoltz v. Fage Dairy Processing, S.A., the plaintiffs bring a putative class action seeking to represent all consumers, nationwide, who purchased Fage “Total 0%” Greek yogurt products. According to the allegations, Fage’s use of “0%” on the label is misleading because it misleads consumers into thinking that the products are “healthy and nutritious when [they] are not.” Because the 0% does not specify what it pertains to, plaintiffs allege that “[r]easonable consumers are left to impute any meaning to the prominent ’0%’ on the Products.” According to the plaintiffs, because other products use 0% to refer to calorie counts and sugars, the use of 0% on the Fage Greek yogurt product would indicate to a reasonable consumer that it may also be calorie- and sugar-free. Plaintiffs also complain that the nutrition label, which lists all of the ingredients, as well as nutrition information such as calories, fat content, and sugar, indicates that the yogurt has 0% of numerous items, such as vitamins and other nutrients. Plaintiffs do not explain in their complaint, however, how it is reasonable to be mislead by the use of “Total 0%” without explanation for what that term applies to, but yet acknowledge the information contained on the nutrition label which indicates precisely how much of the complained of ingredients are included in Fage’s product.
In Stoltz v. Chobani LLC, the same plaintiffs bring a similar putative class action on behalf of all consumers, nationwide, who purchased various Chobani Greek yogurt products. The main thrust of the plaintiffs’ allegations against Chobani relate to its use of the term “evaporated cane juice” rather than sugar on its label, which according to the complaint makes the “Product appear healthier than others that contain ‘sugar’ as an ingredient in order to increase sales and charge a premium.” We recently wrote about similar complaints filed against food and beverage companies in California related to the use of “evaporated cane juice” on their labels. These cases were dismissed under the primary jurisdiction doctrine, with the courts holding that the FDA – which has indicated an intent to address the issue surrounding the use of “evaporated cane juice” on labels – had primary jurisdiction over these labelling issues. Plaintiffs also point to statements made on Chobani’s website about the product, which reference all natural ingredients and the absence of artificial sweeteners — items which the plaintiffs dispute — to support their claims of deceptive advertising. Based on these factors, the plaintiffs allege that they — and all other members of the class – were misled into paying a premium price for the Chobani’s products.
Food and beverage companies have largely been successful thus far in avoiding liability from these types of deceptive labeling suits. However, the companies have certainly been forced to spend significant resources in defending against the suits and may have suffered some damage to their brands as a result. The interesting dynamic in these cases – which has not really been fully vetted given that very few of these labeling cases have gone to trial – is how juries will analyze the “reasonable consumer” aspect that is present in most of the statutes plaintiffs have sued under. The main thrust of the plaintiffs’ arguments are that companies’ labels are designed to deceive consumers either by highlighting certain information to the exclusion of other information (as is the case here) or by using terms that deceive customers into believing that a product is healthier than it actually is (by using terms such as “all natural” or “evaporated cane juice”). However, all of the ingredients contained in any products are printed on the label in some form, as required by the FDA. Plaintiffs pick out certain information on a product’s label — or even a company’s website — that they claim was deceptive, but ignore all of the other information contained on those labels and websites that inform consumers exactly what is contained within a product. How such a selective review of information could meet a “reasonable consumer” test at the individual level — much less on a class-wide basis — is an interesting question that plaintiffs will have to answer. Thus far, food and beverage companies have been able to fend off these claims with what appears to be minimal damage to brand reputation. But if plaintiffs’ lawyers are one thing, it is persistent. They will no doubt continue searching for a way to get a case through, and if one does, you can bet there will be plenty of copycat claims ready to follow.