Ferrero has settled a class action lawsuit over its advertising of Nutella for $3m, and has agreed to change the product’s labeling and advertising, according to court documents.
The class action was taken against Ferrero USA last year by a mother of a four-year-old child who claimed to be ‘shocked’ when she found out the chocolate hazelnut spread was unhealthy and “the next best thing to a candy bar.”
The case alleged that the advertising of Nutella violated consumer protection laws by portraying it as a healthy, nutritious breakfast for children, and demanded that Ferrero be barred from advertising Nutella as healthy or nutritious and launch a ‘corrective advertising campaign.’ It also demanded that consumers be refunded for their Nutella purchases, claiming that revenues gained through Nutella sales were “unjustly acquired through acts of unlawful, unfair and/or fraudulent competition.”
Now Ferrero USA has put $3m aside for consumers, who will be able to claim $4 per jar in compensation, up to a maximum of $20. But while $3m may not be a large sum for the Ferrero Group, which reported consolidated turnover of €7.2bn (about $9.5bn) last year, the decision to change its marketing and labeling of the product may be more significant.
Ferrero has agreed to remove the phrase “An example of a tasty yet balanced breakfast” from the back label of Nutella, replacing it with “Turn a balanced breakfast into a tasty one”. The company has also agreed to no longer air the commercials at issue in the lawsuit, and to replace them by July this year with new commercials to be approved by the plaintiffs prior to filming.
Here is one of the commercials that will no longer be aired:
In addition, the company said it would add the Grocery Manufacturers Association’s Nutrition Keys symbols to front-of-pack, indicating calories, saturated fat, sodium and sugar in a standard serving of Nutella.