The Wall Street Journal and a handful of legal blogs have recently reported on a new wave of lawsuits targeting companies that sell food and beverage products labeled as “all-natural,” “natural,” or “100% natural.”1 These lawsuits accuse food and beverage makers of using a wide variety of allegedly synthetic ingredients in products marketed and labeled as “natural.” While earlier consumer lawsuits focused predominantly on fruit juices, fruit flavors, corn sugar and a handful of other well-known ingredients, these new cases target a number of essential vitamins and minerals as well as products made using genetically modified crops. A fact not reported in this latest round of media attention is that the leading case to consider class certification of “all natural” claims resoundingly denied class certification. Weiner v. Snapple Beverage Co., No. 07-cv-8742, 2010 WL 3119452 (S.D.N.Y. Aug. 5, 2010). The lessons from the Weiner case are readily applicable to this latest crop of “all natural” cases.
Among the new “all natural” lawsuits are the following:
- A July 14, 2011 New Jersey lawsuit accusing ConAgra of mislabeling its Wesson cooking oil as “natural” because it is made from genetically modified crops.2
- Two recent California lawsuits against the Kashi Company, which makes “natural” snack food and breakfast products, accusing Kashi of using allegedly “synthetic” ingredients such as beta-carotene (vitamin A), folic acid (a B vitamin), ascorbic acid (vitamin C), riboflavin and alkalized cocoa.3
- A September 21, 2011 California lawsuit against Bear Naked, Inc. alleging that that company’s “100% Pure & Natural” granola bars are mislabeled because they contain alkalized cocoa, glycerin and soy lecithin.4
- A September 27, 2011 California lawsuit alleging that PepsiCo subsidiary Naked Juice Company mislabeled its juice products as “natural” because they contain such ingredients as inulin (a type of fiber), ascorbic acid (vitamin C) and calcium pantothenate (vitamin B5).5
These and other lawsuits illustrate that even the most conscientious food and beverage makers with “natural,” “all natural,” and “100% natural” products in their portfolios face a substantial risk of consumer litigation. This risk was heightened by the refusal or some federal courts to allow a preemption defense based on the FDA’s longstanding guidance providing a well-understood definition of “natural.”6 Accordingly, companies facing litigation risks associated with “natural” labeling should be prepared to deploy a variety of litigation strategies to defend such actions. These defenses should include removal under the Class Action Fairness Act (“CAFA”), challenges to the pleadings under Rule 12(b)(6), aggressive but limited class discovery involving both fact and expert witnesses, and aggressive challenges to class certification based on such issues as lack of common misrepresentations, injury, and damages, inadequacy of proposed class representatives,7 and absence of manageability and ascertainability.
The new wave of consumer lawsuits should face strong resistance in the courts given the Weiner court’s refusal to certify a class of consumers suing a company for “all natural” product labeling. In Weiner v. Snapple Beverage Co., No. 07-cv-8742, 2010 WL 3119452 (S.D.N.Y. Aug. 5, 2010), the United States District Court for the Southern District of New York denied the plaintiffs’ motion for class certification, finding that the plaintiffs had failed to satisfy the “predominance” requirement of Rule 23(b)(3). Specifically, the Court concluded that the plaintiffs had failed to demonstrate that class-wide proof could be used to establish that Snapple purchasers had suffered injury caused by Snapple’s “all natural” labeling. Id. at *10. In reaching that conclusion, the Court excluded the expert testimony of the plaintiffs’ economist as unreliable, finding that he had failed to present evidence of a methodology suitable to determine causation and injury on a class-wide basis. Id. Absent that critical expert testimony, the plaintiffs’ claims disintegrated into myriad individual inquiries regarding the various prices paid by individual consumers for Snapple and the prices of similar “benchmark” products. Id.8 The court also found that even if the plaintiffs could hurdle the predominance requirement, the resulting class would be unmanageable due to its immense size and geographical dispersion, and unascertainable because there was no practical way to identify the members of the putative class. Id. at *12–*13.9 The court followed its denial of class certification with a case-ending summary judgment. Weiner v. Snapple Beverage Co., No. 07-cv-8742, 2011 WL 196930 (S.D.N.Y. Jan. 21, 2011).
In the absence of further FDA guidance regarding “natural” foods, the filing of consumer class action litigation concerning natural labeling is likely to continue. Companies faced with such litigation should respond quickly and forcefully by removing the case to federal court, if appropriate, under the Class Action Fairness Act (“CAFA”), challenging the complaint under Rule 12(b)(6) and Twombly and Iqbal standards should it fail to meet those standards, raising preemption and primary jurisdiction defenses to the extent applicable FDA regulations or other guidance govern a particular ingredient or labeling practice, challenging consumer expert witness submissions when those submissions fail to meet the required Daubert standards, and directing appropriate discovery to inquire into each class member’s ability, adequacy, typicality and knowledge to serve as a putative class representative.