Claims at issue must be supported by local context, not user search habits
In June 2017, Friends of the Earth (FOE), a sprawling collective of global eco-crusaders, sued Sanderson Farms, a venerable Mississippi-based poultry processing company, in California’s Northern District. The complaint included allegations of violation of California’s unfair competition and false advertising laws. A year and a half of intense litigation followed, including a bitter Rule 11 sanctions battle and two motions to dismiss, before FOE’s third amended complaint was lodged and the latest round of motions began.
FOE’s amended complaint alleges that Sanderson’s advertising, which markets its chicken products as “100% Natural,” is false.
FOE asserts that Sanderson’s “100% Natural” advertisements falsely and misleadingly suggest that its process and resulting product meet reasonable consumer expectations for “natural” poultry, including that no pharmaceutical residues remain in the chicken, that pharmaceuticals are not regularly administered to the chickens during their lives, that Sanderson is not helping spread antibiotic-resistant bacteria and that the chickens are raised naturally, when in reality Sanderson’s industrial production practices routinely use pharmaceuticals, including antibiotics.
Sanderson brought a motion to dismiss, arguing that the full context of its advertisements dispelled any confusion. On the company’s “100% Natural” webpage, for instance, the company claimed that because its assertions about the products – that they were free of hormones, steroids, etc. – are true, FOE could not state a claim that the advertisement is misleading. The court disagreed, denying Sanderson’s motion to dismiss, and stating, “Defendant appears to make an expressio unius argument: that because antibiotics are not included in the list of excluded artificial ingredients, a reasonable consumer could not conclude that antibiotics are also excluded” and that true statements regarding the nonuse of hormones and steroids did not “provide sufficient context for a reasonable consumer to conclude that this chicken product, which is advertised as ‘100% Natural,’ has not been treated with antibiotics ….” The court also found that Sanderson’s “silence on antibiotic use” on the page “undercuts the veracity” of the “100% Natural” claim.
Sanderson didn’t catch a break on its further argument that a link to a FAQ page that disclosed how the company uses antibiotics isolated the company from the charges. “No authority suggests a reasonable consumer is expected to search a company’s entire website (or certainly all of a company’s statements across all forms of advertisements) to find all possible disclaimers,” the court wrote.
Companies should ensure that their advertising claims are not misleading and are not likely to deceive or confuse the public. While statements can be true standing alone, there is the potential that they mislead the public when combined with other messages. For an in-depth treatment of how Sanderson’s other ads were treated in this case, see Rebecca Tushnet’s excellent blog post here.