Wednesday, May 28, 2014

Green (yellow) marketing: nonprofit's claims against Chiquita survive

Water & Sanitation Health, Inc. v. Chiquita Brands Int’l, Inc., No. C14–10, 2014 WL 2154381 (W.D. Wash. May 22, 2014)
Chiquita buys millions of pounds of bananas per year, including from a company named COBIGUA in Guatemala.  Chiquita made a number of claims about its environmentally safe business practices, “including, among others, that it protects water sources by reforesting all affected natural watercourses, using solid waste traps at all packaging stations to keep rivers and streams clean, and planting cover crops in all drainage ditches of banana farms rather than allowing chemical weed control.”  Plaintiff WSH is a nonprofit dedicated to providing sustainable clean-water systems to people in impoverished villages around the world.  It avoids buying food from companies that destroy such clean-water systems. 
WSH alleged that it relied on Chiquita’s representations about its environmentally safe practice, then learned that the community in which COBIGUA produced Chiquita bananas had chemicals contaminating the drinking water from large scale, mono-culture banana production.
The court first dismissed WSH’s unjust enrichment claim, which requires the defendant to know or appreciate the benefit conferred on it by the plaintiff.  Though Chiquita allegedly received at least part of WSH’s purchase money, the court found that WSH didn’t plausibly allege that Chiquita had an appreciation or knowledge of the revenue from the purchase.
The other claims fared better.
A claim under Washington’s Consumer Protection Act requires (1) an unfair or deceptive act or practice, (2) occurring in trade or commerce, (3) that impacts the public interest, (4) that injures plaintiff in her business or property, and (5) causation.  Chiquita argued that WSH didn’t plausibly allege injury to business or property, but allegations that WSH relied on the advertising and wouldn’t have bought the bananas had it known the truth were sufficient.
Similarly, the breach of express warranty claim survived.  Chiquita argued that the complaint only speculated that the bananas WSH bought were grown in Guatemala.  But the claim wasn’t limited to the allegation that the bananas were produced in Guatemala.  Rather, WSH alleged that Chiquita advertised that it protected water sources in a number of ways across all its production.  WSH’s allegations of reliance and falsity with respect to a Guatemala site therefore plausibly alleged a claim for breach of express warranty.  So too with the negligent misrepresentation claim.
However, the claim for injunctive relief was dismissed, because WSH didn’t plausibly allege that legal remedies were inadequate.

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