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Companies Brace For "Onslaught" of Food-Based Class Action Law Suits
Corporate counsel are bracing for an "onslaught" of food-based class action law suits, with this "next wave" up 15% in just the past year, reports the attorney who's been called "The Man Who Is Taking Fat to Court"
By: Professor John Banzhaf, GWU Law School
Those were some of the major results of a new survey of in-house [corporate] lawyers, who reportedly are bracing for an “onslaught”
As the lawyer who oversaw the survey of general counsels and chief legal officers at more than 300 companies pointed out, “there is a heightened awareness of food labeling and ingredients.”
Fortune magazine's prediction that food might become the "next tobacco" appears to be coming true, with litigators who helped wrest multi-billion dollar settlements from big tobacco having turned their guns on big food – including ConAgra, PepsiCo, McNeil Nutritionals, Heinz, General Mills, and Chobani – and are seeking to recover billions, says Banzhaf, whom the media has called "the Law Professor who Masterminded Litigation Against the Tobacco Industry," and “a Driving Force Behind the Lawsuits That Have Cost Tobacco Companies Billions of Dollars."
While some of the newly filed law suits charge – often in states with strong and permissive consumer protection laws – that customers are mislead when undefined terms like "healthy" or "natural" are used on products like a calorie-laden chocolate hazelnut spread for young children [Nutella], and others are based upon alleged violations of specific regulations, some of the suits involve especially serious hazards.
For example, one charges that, to avoid warning customers – including those with breathing difficulties as well as various allergies – that Pam [a cooking spray] contains petroleum gas, propane, and butane, ConAgra said on the label only that it contained "propellant."
Another law suit says that Chobani should have told consumers that its yogurts contain sugar, rather than hiding that fact by listing as an ingredient only “evaporated cane juice,” a term the Food and Drug Administration [FDA] has determined is both "false" and "misleading."
Indeed, not long ago, the FDA issued a warning that a food product labeled as "natural' or "all natural" may be "false and misleading, and therefore . . misbranded" if it contains anything "artificial or synthetic . . . [something] not normally to be expected to be in the food"; a move lending support to and encouraging an ever-growing number of major class action law suits being filed on these grounds.
These class action law suits are being filed, and upheld by judges, against companies including PepsiCo Inc., Kellogg, Coca-Cola, ConAgra, Ben & Jerry, Breyers, and others over the allegedly deceptive use of words like “natural” and "all natural" to describe food products – a development likely to both increase transparency in food advertising and ultimately to reduce obesity, predicts Banzhaf.
Recently, courts have upheld suits charging that Coke-Cola's very use of the name Vitaminwater is deceptive, that claims by both Ben & Jerry's and Breyers that their ice creams were "natural" were fraudulent because the products contained alkalinized cocoa powder, and suits alleging that ads by Cargill, Inc. and Archer-Daniels-
Suits were reportedly also pending against Trader Joe's over claims that some of its cookies aren't really "all natural" because they contain synthetic ingredients such as potassium carbonate, and against Kellogg's Bear Naked and Kashi brands, PepsiCo's Naked Juice Company, and ConAgra Food Inc.'s Pure Wesson Oil brand for their use of the term "natural."
As the American Lawyer magazine has noted, the exploding number of "all natural" law suits seems to have grown out of the movement started by Prof. John Banzhaf several years ago to use legal action as a weapon against the problem of obesity, just as he had earlier done in leading the use of legal action as a weapon against smoking. In the article's words, "Spurred in part by the obesity epidemic, suits such as this one target some of the biggest producers . . ."
The movement which Banzhaf started has now resulted in at least ten successful fat law suits which have forced food companies to fork out more than $20 million, and make major changes in the way their products are formulated, advertised, promoted, and sold.
“The newer 'natural' law suits could force companies to think twice before simply slapping an 'all natural' label on their products and their advertising, seeking to take advantage of vagueness in the definition of the word 'natural,' and in the hope that people will be tricked into thinking that an 'all natural' product is safer or healthier," says Banzhaf.
To win these law suits, plaintiffs may not necessarily have to show that the claim is demonstrably false, and/or that some identified plaintiffs were in fact mislead to their detriment.
Under many state statutes, all the plaintiff must show is that the ad or label has a propensity or tendency to mislead. In applying this standard, even statements which are technically true can nevertheless be illegal, and the judgment obviously isn’t based on the brightest and most educated consumer, but rather on those who, because they may not be quite as smart or as educated, may be deceived by the wording and are therefore even more in need of legal protection, says Banzhaf.
JOHN F. BANZHAF III, B.S.E.E., J.D., Sc.D.
Professor of Public Interest Law
George Washington University Law School,
FAMRI Dr. William Cahan Distinguished Professor,
Fellow, World Technology Network,
Founder, Action on Smoking and Health (ASH)
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