Plaintiffs filed a class action suit against ConAgra
alleging that its website and numerous products, including PAM cooking spray,
Hunt's canned tomato products, and Swiss Miss cocoa, contain deceptive and
misleading labeling information. The
allegedly deceptive practices include: labeling food products as 100% natural,
when they contain petrochemicals or chemical preservatives, synthetic
chemicals, added artificial color and other artificial ingredients; labeling
food products as “organic” or “certified organic,” when they contain
disqualifying ingredients; falsely representing food products to be “free of
artificial ingredients and preservatives;” making unlawful nutrient content
claims; falsely representing foods to be fresh or have a “fresh taste;” and making
unlawful health claims. Plaintiffs
alleged reasonable reliance and actual deception, such that they wouldn’t have
bought the products absent the mislabeling, and paid an unwarranted premium for
them. They alleged the usual California
claims and violation of the Magnuson-Moss Act.
ConAgra argued that the claims were preempted by the Organic
Foods Product Act, the National Labeling and Education Act, and the FDCA. First, as to the organic labeling claims, In re Aurora Dairy Corp. Organic Milk Marketing and Sales Practices Litigation,
621 F.3d 781 (8th Cir. 2010), found claims that retailers were selling a
product as organic when it wasn’t in fact organic were preempted by OFPA. But that was when the source had organic
certification under OFPA. OFPA preempts
state certification requirements, but doesn’t preempt broadly. The claims here were exactly the type of
state claims that other courts have said would be preserved. California law adopts OFPA standards, so
claims based on violation of those standards aren’t conflict preempted. Merely adding another source of enforcement
doesn’t count as an additional state-law requirement.
Similarly, plaintiffs’ claims weren’t preempted by the NLEA
to the extent that state law only paralleled or mirrored the relevant federal
requirements. This preserved their
antioxidant and other ingredient list/propellant claims, since California has
incorporated the NLEA by reference. Some of the claims raised factual disputes:
ConAgra argued that plaintiffs’ rosemary extract claims were preempted because
they sought to require rosemary extract to be labeled as a preservative, when
the relevant regulation states that chemical preservatives do not include
“spices, or oils extracted from spices.”
However, plaintiffs argued that rosemary extract was neither a spice nor
an oil extracted from a spice, and that created a factual dispute. Likewise, ConAgra argued that plaintiffs’
claims that it should have identified citric acid and calcium chloride as
“preservatives” were preempted because the FDA has never required those
ingredients to be identified as such. But the federal regulations require a
food label to disclose ingredients being
used as preservatives, and the complaint alleged that was happening in this
case.
ConAgra then tried the primary jurisdiction doctrine, but no
dice: ConAgra didn’t show that there was a need for uniformity or for the FDA’s
expertise. As for “natural” claims, “various
parties have repeatedly asked the FDA to adopt formal rulemaking to define the
word natural and the FDA has declined to do so because it is not a priority and
the FDA has limited resources. Further, when the FDA considered the term
‘natural,’ ‘it was aware of and had reviewed state regulation of the use of the
term, yet it made no mention of the need for uniformity.’” The continued inaction on the term implies
that the FDA doesn’t believe that uniformity is required. (In a footnote, the court distinguished
Astiana v. The Hain Celestial Group, Inc., because that was about cosmetics.)
“Notwithstanding Defendant's discussion at the motion
hearing of preservatives and firming agents, the Court concludes that this case
is far less about science than it is about whether a label is misleading.” Deceptiveness can be resolved by courts.
ConAgra then argued that plaintiffs failed to state a
claim. Generally, deceptiveness is a
question of fact, but courts can sometimes consider the viability of a claim by
reviewing the product packaging. The
court found that plaintiffs successfully pled falsity as to the antioxidant
claims. They alleged that ConAgra’s
improper use of the term falsely asserted that the products met the minimum
nutritional thresholds for such claims.
Also, the “freshness” claims presented factual questions that couldn’t
be addressed on a motion to dismiss. However, plaintiffs didn’t sufficiently
allege that ConAgra’s website health claims were false or that a reasonable
consumer would be deceived by them, only that they were in fact deceived.
ConAgra argued that plaintiffs couldn’t allege reliance on
the “natural” claims because the allegedly unnatural claims were disclosed in
the ingredient list. The Ninth Circuit
has already rejected this argument:
We disagree ... that reasonable
consumers should be expected to look beyond misleading representations on the
front of the box to discover the truth from the ingredient list in small print
on the side of the box.... We do not think that the FDA requires an ingredient
list so that manufacturers can mislead consumers and then rely on the
ingredient list to correct those misinterpretations and provide a shield for
liability for the deception. Instead, reasonable consumers expect that the
ingredient list contains more detailed information about the product that
confirms other representations on the packaging.
In addition, plaintiffs alleged that the ingredients
themselves were mislabeled.
ConAgra then argued that the FDA has recently stated that
citric acid is natural, defeating plaintiffs’ argument that products containing
it and calcium chloride weren’t “natural.”
But that ignored the calcium chloride aspect, and also the FDA’s letter
said that “naturally-derived citric acid” was consistent with labeling a
product “natural,” but there wasn’t evidence that ConAgra’s products included
the permissible citric acid.
Swiss Miss stated that “Natural Antioxidants Are Found in
Cocoa,” while Hunt's tomato products stated that “The Antioxidants Vitamin C
& Lycopene are found naturally in tomatoes.” Plaintiffs alleged that they were deceived by
the implicit misrepresentation that the tomato and cocoa products that they
were purchasing met the minimum nutritional threshold to make such antioxidant
claims. ConAgra argued that reasonable
consumers wouldn’t know what those minimum thresholds were, since that’s a
matter of detailed FDA regulation. But
this wasn’t a case where the court could conclude that as a matter of law that
the antioxidant claims weren’t deceptive—perhaps because, while consumers might
not know detailed numbers, they would expect ConAgra products to comply with
the rules, meaning that they’d expect that antioxidant claims to be similar to
those found on other (compliant) products.
Then, ConAgra argued that plaintiffs didn’t satisfy Rule
9(b) because they didn’t allege specific dates of purchase. That’s not required because plaintiffs
alleged that they’d bought the products through the class period, except with
respect to PAM products where the label didn’t make the same representation
throughout the class period; ConAgra recently changed the label to include
“(preservative)” after rosemary extract. Also, the plaintiffs failed to provide details
of exactly which products they purchased: they alleged that they bought “Hunt's
Petite Diced Tomatoes in a 14.5 oz can and other Hunt's canned tomato products
such as its tomato paste in an 8 oz. can,” but “other Hunt’s canned tomato
products” wasn’t specific enough. Nor
did they plead with specificity which Hunt’s products contained citric acid
and/or calcium chloride, except for the Diced Tomatoes. They didn’t allege whether the Hunt's tomato
paste in an 8 oz. can that they purchased contained only citric acid, or both
citric acid and calcium chloride. “This information is necessary because
Defendant has submitted a copy of labels from Hunt's tomato paste and Hunt's
tomato sauce that do not contain calcium chloride.” These claims were dismissed with leave to
amend.
The warranty claims were dismissed without leave to
amend. Product descriptions, such as
“all natural” labels, do not constitute warranties against a product
defect. These products were also
excluded as “consumables” under California’s Song-Beverly Act.
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