San Francisco City Attorney Dennis Herrera has filed a consumer-fraud lawsuit on behalf of the people of the state of California against Monster Beverage just one week after the company sued Herrera to halt his investigation into company advertising practices and demands. People v. Monster Beverage Corp., No. CGC-13-531161 (Cal. Super. Ct., San Francisco Cnty., filed May 6, 2013). According to Herrera’s press release, Monster Beverage’s preemptive suit constituted “‘forum shopping’ and a bid to win the race to the courthouse.” Details about Monster Energy’s lawsuit appear in Issue 482 of this Update.
The new lawsuit alleges that the company “aggressively markets” its energy drink products to children and teenagers, fails to adequately warn consumers about the purported risks of consuming such products, and illegally sold its beverages until earlier this year as a dietary supplement. According to the complaint, product labels claim that three 16-ounce cans can be safely consumed, but with 480 milligrams of caffeine, this “is nearly five times the maximum daily caffeine limit recognized for children and adolescents, and exceeds the 400 milligram daily caffeine limit recognized by the Food and Drug Administration as safe for healthy adults.”
Herrera alleges that (i) Monster energy drinks labeled as dietary supplements remain on store shelves and are misbranded, (ii) its products sold as conventional beverages violate the state’s Sherman Law because they contain additives that do not satisfy the generally recognized as safe standard, (iii) the company aggressively markets its products to children as young as age 6 without properly warning about the drinks’ “dangerous side effects,” (iv) its marketing to “underage persons using alcohol and drug references offend the legislative premises of multiple statutes and regulations aimed at preventing drinking and drug use among youth,” and (v) labeling and promotions with unsubstantiated claims about boosting energy and enhancing physical performance are misleading. The complaint seeks a declaration that the company has engaged in unfair and unlawful business acts and practices in violation of the state’s Unfair Competition Law, an injunction to stop the company from performing acts in violation of the law, restitution, costs, and an order requiring the company “to pay $2,500 in civil penalties for each act of unfair and unlawful competition.”