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Class Certification In Food Labeling Class Actions Gets Messy In The “Food Court.”

June 24, 2014

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Three recent decisions from two judges in the Northern District of California provide us with a lot of information regarding where food labeling cases are headed in terms of class certification strategy. Notably, two of the decisions are from Judge Lucy Koh and granted class certification.  Of course, these losses from the defense perspective are disappointing, but it is important to understand them in order to develop effective defense strategies. The third decision is from Judge Charles Breyer and denied class certification. That opinion shows us strategies that work from the defense perspective. In addition, however, the opinion is also interesting because Judge Breyer recognizes the Northern District of California’s status as the epicenter of these cases and because he often expressly acknowledges that his reasoning differs from Judge Koh’s.  So bear with me as we go through three important class certification decisions before identifying some best practices

Supreme Court Issues Opinion in Pom Wonderful v. Coca Cola Allowing False Advertising Claims Against an FDCA-Compliant Label

Today, the Supreme Court issued an 8-0 opinion in Pom Wonderful LLC v. Coca-Cola Co., finding that compliance with the substantive advertising and labeling provisions of the Federal Food Drug and Cosmetic Act (“FDCA”) do not preclude a competitor from asserting a false advertising claim under section 43 of the Lanham Act.  This opinion opens the door for a company to assert Lanham Act claims against a competitor even where a product’s labeling and advertising otherwise meet the requirements of a prescriptive statute like the FDCA.

For more analysis on the opinion, see this alert.

When Is Food “Unlawful” or not “Merchantable”: Court Ruling Further Confounds Food Labeling Suit Defendants

Phoenix Partner James Smith and San Francisco Associate Sara Ahmed authored a legal opinion letter published April 25 online by the Washington Legal Foundation regarding food labels. A recent recommendation from the U.S. District Court for the Northern District of California highlights the many difficulties and uncertainties that defendants face in food labeling class actions based on California law. “While this decision highlights the need for clarification regarding the UCL’s [California’s Unfair Competition Law] ‘unlawful’ prong, the implied warranty analysis is more troubling,” they wrote. “In essence, it has turned a warranty remedy designed to address situations where a consumer did not receive what she bargained for into strict liability without any showing of injury.” Click here to read their full article.

DEFEATING CLASS CERTIFICATION IN FOOD LABELING CLASS ACTIONS

April 14, 2014

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DEFEATING CLASS CERTIFICATION IN FOOD LABELING CLASS ACTIONS

April 14, 2014

Authored by: James Smith

In postings in September 2013 and February 2014, I discussed tactics for opposing class certification in food labeling class actions. These tactics included relying on the Supreme Court’s opinion in Comcast Corp. v. Behrend, 133 S. Ct. 1426 (2013), to challenge the sufficiency of the plaintiffs’ damages model, which should be particularly difficult in these types of claims. In late March 2014, the Northern District of California decertified a food labeling class action largely based on those shortcomings.

In re POM Wonderful LLC Marketing & Sales Practices Litigation, 2014 U.S. Dist. LEXIS 40415 (N.D. Cal. Mar. 25, 2014), involves allegations that the defendant falsely advertised that certain of its juice products provide various health benefits and that substantial scientific research demonstrates those benefits.  The plaintiffs alleged familiar theories based largely on California consumer fraud statutes. The court had earlier certified the class, and the plaintiffs proposed two damages models from their

The Need For Actual Reliance For Food Labeling Claims Under The “Unlawful” Prong Of California’s UCL

April 3, 2014

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The tide seems to be turning in favor of food labeling class action defendants with respect to the “unlawful” prong of California’s Unfair Competition Law.  The UCL provides consumers with a claim for “unlawful,” “unfair,” or “fraudulent” business practices.  Cal. Bus. & Prof. Code § 17200.  Since the California Supreme Court’s opinion in Kwikset Corp. v. Superior Court, 51 Cal. 4th 310, 246 P.2d 877 (2011), there has been no doubt that the UCL requires that a named plaintiff prove actual reliance on the challenged advertising when pursuing claims under the UCL’s unfair or fraudulent prongs.  A number of plaintiffs have argued, however, that they need not plead reliance when proceeding under the unlawful prong of the UCL.  Those plaintiffs contend that simply purchasing an “illegal” product that is misbranded in violation of California law is sufficient; thus, they need not prove that they relied on the alleged

FDA consideration of “Evaporated Cane Juice” stops class action (for now)

March 31, 2014

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On March 7, 2014, we reported that the FDA reopened the comment period as to whether Evaporated Cane Juice (“ECJ”) is an appropriate description to include on a food label.  At that time, at least one court had asked parties in a punitive class action to provide supplemental briefs regarding the effect of the FDA’s reopening of the comment period.  Reese v. Odwalla, Inc., No. 13-CV-947-YGR (N.D. Cal. 3/6/14) (directing parties to submit supplemental briefs).  A number of plaintiffs contend that ECJ is an improper term to include on a food label because it is nothing more than sugar.  Because federal regulations generally require labeling ingredients by their common or usual name, these plaintiffs argue that labels with “ECJ” violate federal requirements and California consumer protection laws.  See 21 U.S.C. § 341(i); 21 C.F.R. § 101.4(a)(1).

Following that supplemental briefing, the Reese court recently stayed the