Class action litigation vs food & beverage brands ‘continued unabated’ in 2018, says Perkins Coie

By Elaine Watson contact

- Last updated on GMT

Lawsuits taking issue with the term 'Diet' on top soda brands did not make headway in 2018
Lawsuits taking issue with the term 'Diet' on top soda brands did not make headway in 2018

Related tags: lawsuits, slack fill, all-natural claims

The number of class action filings against food and beverage companies rose 9% to 158 in 2018, with firms vulnerable to legal action on a host of fronts, from slack fill to natural claims, says law firm Perkins Coie.

In an analysis of 2018 filings, Perkins Coie said that despite some favorable rulings at the motion to dismiss stage, “on balance, indicators suggest that these filing trends will continue in 2019 and beyond.”

The ‘reasonable consumer’ defense remained at the forefront in decisions on motions to dismiss, said Perkins Coie, noting that judges had rejected lawsuits challenging the use of the term ‘diet’ on various sodas,​ concluding that no reasonable consumer would expect drinking Diet Coke or Diet Pepsi would cause weight loss.

The Northern District of California likewise disagreed that Perfect Bar had misled consumers about its sugar content, describing the plaintiffs’ theory as “untenable​”:  “The actual ingredients were fully disclosed. Reasonable purchasers could decide for themselves how healthy or not the sugar content would be.”

However, the deterrent effect of such victories was likely offset to some degree by class certification rulings in food and beverage cases: “Several courts this year accepted plaintiffs’ proposed damages models as sufficient to certify food and beverage class actions, even where those models were not supported by an actual analysis of whether or how they might work at trial.”

False labeling: From grass fed claims to probiotics

False labeling claims rose again in 2018, spanning everything from challenges over grass-fed claims on dairy and queries over how much time hens spend outdoors to well water advertised as spring water, probiotic claims, and origin claims on olive oils, said the law firm, which noted that most cases are still filed in California, but that New York is fast catching up, with a nearly 33% increase in filings there in 2018.

Slack fill... is the tide turning?

Plaintiffs continued to target alleged nonfunctional slack fill​ in food packaging in 2018, but defendants “secured consistent wins at the federal level​,” said Perkins Coie.

Armed with favorable decisions, defendants have been increasingly willing to litigate slack-fill actions, which may impact filing trends in 2019​.”

In one notable case* vs Immaculate Baking Company (represented by Perkins Coie), the court found that its cake mix packaging (claimed to contain 50% non-functional space) was not deceptive, because no reasonable consumer would be misled when the packaging included a chart showing exactly how many cakes and how many cupcakes the mix would yield upon baking, and prominently disclosed the product’s net weight on the front of pack.

Prop 65: Lead, acrylamide and cadmium cases on the rise 

There was a significant spike in Proposition 65​ pre-litigation notices involving lead, acrylamide and cadmium, which now account for the vast majority of the pre-litigation notices involving food and beverage products, said Perkins Coie.

“Another noteworthy trend is … that the number of filings involving dietary supplements in 2018 was double the total number of filings in 2017.”

That said, Perkins Coie secured an important Prop 65 victory in Post, et al. v. Superior Court, in which the California Court of Appeals held that Prop 65 warnings for cereal based on the presence of acrylamide would conflict with the FDA's longstanding policy encouraging the consumption of whole grain cereals as part of a healthy diet.

"The court then entered summary judgment in favor of the food industry’s leading cereal makers. The decision later withstood plaintiff’s attempted appeal to the California Supreme Court."

All natural... still worth watching

Filings taking issue with brands 'all-natural' claims held steady in 2018 vs 2017 at 33 total filings, with foods with multi-function ingredients such as malic acid​and ascorbic acid remaining a focus, as well as foods alleged to contain trace amounts of pesticides such as glyphosate. However, several courts extended primary jurisdiction stays in deference to the FDA’s open docket on defining ‘natural’ in food labeling.

* Reider v. Immaculate Baking Co., ​No. 8:18-cv-01085- JLS-AS (C.D. Cal. Nov. 8, 2018)

LEGAL VOX POP: Will 2019 be a bumper year for class action lawsuits? Top attorneys weigh in

lawsuit-GettyImages-zimmytws

"​In 2019 ​​I'm watching for lawsuits over trace elements of any supposed ‘contaminants’ —part per billion levels that make no difference whatsoever, but which can be detected by suspicious labs or by enhanced analytical techniques.​​.."

We quizzed leading food law attorneys to find out what food manufacturers should keep on the radar in 2019, from slack fill, CBD, malic acid, and Prop 65, to natural claims. Read more HERE.

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