“Natural” Juice Manufacturer Gets Squeezed

Last month, my colleagues here at Goldberg Segalla wrote about food labeling litigation and offered suggestions about to how to defend it.  Their article, entitled “The New Food Fight: Defending Against Labeling Litigation,” is available here.  In it, they note that only a small portion of food litigation involves manufacturing defect claims.  The bulk of it is based on advertising claims that have little to do with health or nutrition.  While various claims have been targeted, a common one is the claim that a product is “all natural.”  As fellow bloggers have noted, companies including General Mills (granola bars), Smuckers (cooking oils), and Johnson & Johnson (personal care products) have all had to defend challenges to “all natural” claims.

A recent example is Lynch v. Tropicana Products, Inc., currently pending in the United States District Court for the District of New Jersey.  The plaintiffs in Lynch assert that Tropicana falsely claims that its “not-from-concentrate” orange juice is “100% pure and natural.”  The problem with that claim, according to the plaintiffs, is that the juice is processed, colored, and flavored.  The plaintiffs assert that, in deciding to purchase the juice, they read and relied upon the “100% pure and natural” claim as well as the accompanying image of an orange pierced by a straw.

Tropicana filed a motion to dismiss, arguing that plaintiffs’ efforts to impose additional state law-based labeling requirements were preempted by the federal Nutrition Labeling Education Act of 1990 (NLEA), which requires only that the label identify that the product is pasteurized.  Plaintiffs, on the other hand, argued that their state law claims are entirely consistent with the federal regulations becasue they are based on the common requirement that labels disclose every ingredient contained in the product, including the flavor packs that were not disclosed by Tropicana.  The court analyzed the FDA labeling requirements for “pasteurized orange juice” and found plaintiffs’ state law claims to be entirely consistent with them.  Accordingly, the court concluded that those claims are not preempted.  And for similar reasons, the court denied defendant’s argument that those claims are precluded under the safe harbor doctrine.  

Tropicana further argued that because its juice is labeled “pasteurized,” it is not reasonable for a consumer to claim that he thought “100% pure and natural” meant the juice was akin to fresh-squeezed.  The court rejected the argument, finding that the word “pasteurized” does not “provide a shield for liability” if ingredients, such as added flavoring, were not disclosed.  And since consumers may not understand the intricacies of juice processing, the court ruled that discovery is needed to determine whether, despite the “pasteurized” labeling, consumers may reasonably expect that the juice is fresh.

The court also refused to dismiss the complaint on the grounds that plaintiffs did not establish that they suffered an ascertainable loss or injury, noting that the New Jersey Consumer Fraud Act does not require a plaintiff to prove an actual out-of-pocket loss in order to successfully state a claim.  And the court similarly rejected Tropicana’s argument that the plaintiffs’ unjust enrichment claim should be dismissed, determining that the plaintiffs’ lack of a direct relationship with Tropicana was not dispositive under New Jersey law.

While Tropicana was able to eliminate some of the plaintiffs’ claims – the court dismissed as factually insufficient the claim that Tropicana violated various states’ consumer protection laws – most of the claims survived.  This case is thus a good example of the difficulties that a defendant could face in defending against the growing threat of food labeling claims.

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