In two suits alleging false advertising over “All Natural” claims, two defendants received very different results, with one suit going forward and another stalled for the time being.
In the first suit, a California federal judge refused to dismiss a class action against Frito-Lay over claims that the label on a variety of snack products – including Fritos original corn chips and Lay’s potato chips – were falsely advertised as “All Natural.”
U.S. District Court Judge Samuel Conti disagreed with the defendant that the claim “All Natural” was not false or misleading because it was part of a longer phrase, “Made with All Natural Ingredients” and that reasonable consumers would read that statement in context and check the nutrition box for further information.
“The label is ambiguous because the phrase ‘all natural,’ lacking a hyphen, could suggest either that the labeled product is exclusively natural or that the product simply includes some all-natural ingredients,” the court said. “A reasonable consumer could interpret a bag of chips claiming to have been ‘Made with All Natural Ingredients’ to consist exclusively of natural ingredients, contrary to the reality described in the nutrition box. Even though the nutrition box could resolve any ambiguity, the Court cannot conclude as a matter of law…that no reasonable consumer would be deceived by the ‘Made with All Natural Ingredients’ labels.”
Judge Conti also allowed the suit to continue based on Frito-Lay’s “No MSG” and “0 Grams Trans Fat” claims.
The decision wasn’t a total plaintiffs’ victory, however. The court narrowed the suit by eliminating generic claims made by the plaintiffs about “other varieties” of Frito-Lay snack products. The court ruled that the allegations about unidentified products failed for lack of specificity. And Judge Conti held that content on the defendant’s Web sites did not “accompany” the products sufficiently to constitute labeling.
“The Court does not find that the language on the http://www.fritolay.com/ website constitutes labeling under the [Food, Drug, and Cosmetic Act], because as cited by plaintiffs, none of the website language explains or supplements the individual named products such that the website could generally be found to ‘accompany’ the named products. . . . Even though the named products’ labels ask consumers to visit the website, they do not state that the website will inform consumers of the details of the named products’ nutritional facts.”
In a second suit, Arizona Iced Tea won a renewed motion for summary judgment in a class action over “All Natural” claims for its beverages. The plaintiffs argued that the defendant’s drinks were falsely advertised because they contain high fructose corn syrup and citric acid.
Although the court had previously certified a statewide class of consumers who purchased the drinks over a seven-year period, U.S. District Court Judge Richard Seeborg changed his mind.
The plaintiffs argued that both citric acid and high fructose corn syrup are not natural products because they require processing by human beings. Enzymes are added to processed corn starch to create HFCS, while certain strains of the mold Aspergillus niger produce citric acid.
But the plaintiffs failed to back up their allegations with evidence that either ingredient was not natural, Judge Seeborg said, other than pointing out that patents have been issued for the process of making HFCS. In addition, the defense produced an expert report and multiple declarations that both citric acid and HFCS are natural ingredients.
“Plaintiff’s request is properly characterized as an argument that HFCS is not natural as a matter of law. . . . But plaintiffs have cited no legal authority supporting their contention… In the face of a motion for summary judgment, rhetoric is no substitute for evidence.”
The plaintiffs similarly failed to meet their burden of proving damages, offering “not a scintilla of evidence from which a finder of fact could determine the amount of restitution or disgorgement to which plaintiffs might be entitled if this case were to proceed to trial,” Judge Seeborg determined.
Granting the defendant’s motion for summary judgment, the court went one step further and decertified the class. “Since the class was certified, the Court has found that plaintiffs’ counsel has been dilatory and has failed to prosecute this action adequately,” Judge Seeborg wrote. In lieu of creating a res judicata effect against the class, he chose the “more appropriate” option of decertification.
To read the court’s decision in Wilson v. Frito-Lay, click here.
To read the court’s order in Ries v. Arizona Beverages USA, click here.
Why it matters: Suits challenging “All Natural” advertising claims continue to fill the courts, and both the Frito-Lay case and the Arizona Iced Tea suit will likely continue for the foreseeable future. The Frito-Lay plaintiffs survived the defense’s preemption motion and have already filed a second amended complaint in response to the court’s dismissal of certain claims without prejudice. The Arizona Iced Tea plaintiffs face a more daunting uphill battle to success. But by decertifying the class instead of granting summary judgment against it, Judge Seeborg reserved their ability to continue the suit.