A judge in the Northern District of California rejected most of Whole Foods Market Inc.’s challenges to a proposed class action claiming it misleadingly labels baked goods “all natural” when they allegedly contain artificial and synthetic ingredients. In a ruling issued on June 2, 2014, Judge Vince Chhabria rejected Whole Foods’ preemption, primary jurisdiction, and standing arguments, among others, concerning certain banana muffins, chocolate chip cookies, apple pies, and other products it shelves. The complaint alleges the products contain artificial and synthetic ingredients rendering them not “all natural.”
Significantly, however, the court dismissed the claim for injunctive relief, finding no indication of a future threatened injury that could be remedied with an injunction. While the named plaintiffs in this case alleged that had they known the Whole Foods products they purchased contained artificial and synthetic ingredients, they would not have purchased them, the court held, “[n]ow they know. There is therefore no danger that they will be misled in the future.” In other words, with this dismissal, this suit cannot compel Whole Foods to change any of it labeling practices. Also dismissed was the unjust enrichment claim where the judge held it was duplicative of other claims in the suit.
Notably, however, the court concluded that named plaintiffs Mary Garrison and Grace Garrison had standing to bring claims on behalf of class members who purchased any of the named allegedly mislabeled Whole Foods products despite having bought only a subset of those products. California federal courts have ruled inconsistently on the issue of whether labeling lawsuits can include purchasers of similarly advertised foods that were not actually purchased by the plaintiff. Judge Chhabria determined that the labels on the products purchased by the named plaintiffs were nearly identical to those on the other products identified in the complaint. In making this determination, he held that so long as those products that were not purchased did not implicate a “significantly different set of concerns” than those bought by the named plaintiffs, they could be included.
“If Whole Foods' labeling was misleading, the named plaintiffs suffered the same injury from the products they purchased as unnamed class members suffered from purchasing different products bearing the same label,” the judge said.
Analogizing to asbestos and product defect cases, the court then arrived at the somewhat dubious conclusion that “[b]y establishing that any of the labels were misleading, the plaintiffs would necessarily establish that they all were. The named plaintiffs therefore have the ‘necessary stake in litigating’ the class's claims required to confer standing.” While this statement was isolated to the issue of standing, it will undoubtedly be touted by the plaintiffs as the case proceeds. However, it should be noted that this decision is based only on the pleadings, and the plaintiffs will be required to prove that the labeling on each of the named products is likely to mislead.
The court also held that claims based on an allegedly misleading “all natural” label are not preempted by the federal Food, Drug, and Cosmetic Act. It likewise held, in rejecting Whole Foods’ primary jurisdiction argument, that since there is no clear indication the FDA intends to revisit the “all natural” issue any time soon, there is no "resolution of [the] issue" pending before the agency to which the court could defer. The court also noted that while the federal government may enforce the FDCA, the statute does not preempt all state law and expressly contemplates that states will enforce their own food labeling requirements.
The products at issue are “all natural” gluten-free apples, gluten-free cheddar biscuits, gluten-free corn bread, gluten-free molasses ginger cookies, and gluten-free chocolate and vanilla cupcakes. In a related suit filed in January 2014, the Garrisons sued over six additional foods: banana bran, blueberry and coffee cake mini-muffins, and chocolate chip, oatmeal raisin, and snickerdoodle soft-baked cookies. Judge Chhabria’s ruling applies to both suits.
The cases are Garrison v. Whole Foods Market Inc., case number 3:13-cv-05222, and Garrison v. Whole Foods Market California Inc. et al., case number 3:14-cv-00334, both in the U.S. District Court for the Northern District of California.