In Kane v. Chobani, LLC, No. 14-15670, a three-judge panel of the U.S. Court of Appeals for the Ninth Circuit vacated the trial court’s dismissal of a lawsuit alleging that Chobani deceptively and unlawfully used the terms “natural” and “evaporated cane juice” to describe its yogurt. The class action lawsuit, filed in 2012 on behalf of people who purchased Chobani Greek yogurt, alleged that the products labeled as “all natural” actually contained artificial ingredients, artificial colors, and contained added sugar under the guise of “evaporated cane juice.”
The U.S. District Court for the Northern District of California dismissed the plaintiffs’ case in February 2014, explaining that the plaintiffs had not set forth sufficient factual allegations to recover against Chobani for using the allegedly misleading food labels. Observing that the U.S. Food and Drug Administration (“FDA”) had indicated its intent to issue guidance on the terms “natural” and “evaporated cane juice,” the Ninth Circuit reversed course and vacated the dismissal. However, the Ninth Circuit remanded with an instruction that the case be stayed indefinitely, explaining that the labeled terms “implicate technical and policy questions” that were better decided by the FDA than the judicial system. By resurrecting the plaintiffs’ claims while awaiting FDA guidance, the Ninth Circuit re-opened the door for consumers to bring expensive, open-ended, and uncertain lawsuits against companies that use allegedly “misleading” words. These types of suits will continue to proliferate, with varying results, unless and until the FDA issues the guidance the courts are seeking. Here’s hoping that happens…sooner rather than later.