reasonable consumers of manuka honey know its price and grading scheme

Moore v. Trader Joe’s Co., 4 F.4th 874 (9^th Cir. 2021)

Trader Joe’s markets its store brand Manuka honey as “100% New Zealand Manuka Honey” or “New Zealand Manuka Honey,” but Moore alleged that because Trader Joe’s Manuka Honey actually consists of only between 57.3% and 62.6% honey derived from Manuka flower nectar, Trader Joe’s engaged in “false, misleading, and deceptive marketing” of its Manuka honey. FDA guidelines permit labeling honey by its “chief floral source,” given that busy bees cannot be prevented from foraging on different types of flowers, despite their keepers’ best efforts, and plaintiffs’ own tests indicated that Manuka was the chief floral source. The court concluded that the 100% claim wouldn’t deceive a reasonable consumer, with some plausible arguments and one really bad argument (it was so cheap that no reasonable consumer would believe it was Manuka honey, which assumes a lot of highly calibrated knowledge among consumers that seems a bit inconsistent with a motion to dismiss).

100% New Zealand Manuka Honey and New Zealand Manuka Honey jars

Identical nutrition panel on both showing the only ingredient as manuka honey

Manuka honey supposedly has antibacterial properties and health benefits; this, plus geographic barriers to widespread production, result in high demand and low supply and “a price far in excess of other honeys.” Manuka honey producers grade the purity of Manuka honey on the Unique Manuka Factor (UMF) grading system, from 5+ to 26+ based on the concentration of honey derived from Manuka flower nectar. A bottle of Manuka honey 92% derived from Manuka flower nectar costs approximately $266, or $21.55 per ounce.

TJ’s Manuka Honey is labeled with a UMF grade of 10+, “a relatively low grade, and sells for the comparatively low price of $13.99 per jar, or $1.59 per ounce.”  The ingredient statement lists Manuka honey as the sole ingredient.

Plaintiffs brought the usual California claims. I think that the court wouldn’t have to rest on factual claims about the details of what consumers understand about Manuka honey if it had admitted that what is really going on here is balancing: given the unique production/collection of honey products, there’s no simple way to explain to consumers what’s going on, so requiring a more complicated explanation would obscure more than it prevented deception. (Though a 5 to 26 scale is pretty weird, LSAT-level weird, and perhaps it really would be more helpful if they indicated that 10+ wasn’t all that Manuka-y.)

Anyway, TJ’s Manuka Honey met the FDA standard, being derived from between 57.3–62.6% Manuka flower nectar (as estimated by pollen count). Taking into account “all the information available to consumers and the context in which that information is provided and used,” “other available information about Trader Joe’s Manuka Honey would quickly dissuade a reasonable consumer from the belief that Trader Joe’s Manuka Honey was derived from 100% Manuka flower nectar.”

Specifically, “information available to a consumer is not limited to the physical label and may involve contextual inferences regarding the product itself and its packaging.” Though, as the Seventh Circuit has held, “[d]eceptive advertisements often intentionally use ambiguity to mislead consumers while maintaining some level of deniability about the intended meaning[,]” as with the “100% Grated Parmesan” full of non-cheese, there was nothing like such conduct here. “Bees make the Manuka honey, without input from Trader Joe’s or any other manufacturer. Trader Joe’s does not insert any additional ingredients to produce the product or mix Manuka honey with other, non-Manuka honeys to dilute it.” And a consumer wouldn’t make an unreasonable or fanciful interpretation of “100% New Zealand Manuka Honey” because of: (1) the impossibility of making a honey that is 100% derived from one floral source, (2) the low price of Trader Joe’s Manuka Honey, and (3) the presence of the “10+” on the label, all of which is readily available to anyone browsing the aisles of Trader Joe’s.

“Although a reasonable consumer might not be an expert in honey production or beekeeping, consumers would generally know that it is impossible to exercise complete control over where bees forage down to each specific flower or plant.” Of course, consumers are unlikely to think of (1) when they browse the aisles. They may very well assume to the contrary even if they’d see the unlikelihood—surely not the impossibility; are there not greenhouses and fields of monocultures around the world?—if forced to work the problem through. (1) is really a cost-benefit analysis: consumers may assume the wrong thing, but correcting that assumption isn’t worth the information costs especially given that there are no single-source honeys.

(2) assumes a really high degree of calibration of understanding, beyond “it is expensive” to “I know the right retail price for high grade honey and I understand that this goes beyond what TJ, a savvy buyer known for its good deals on house brands, could do.” I think that’s a bad idea on a motion to dismiss; it, as with the truffle oil case that invented this consideration, authorizes sellers to deceive bargain-hunters because they aren’t as sophisticated about pricing as the court thinks (without actual evidence) they should be. But plaintiffs didn’t help themselves by alleging that manuka honey consumers “know[s] that the concentration of manuka [nectar, as measured by pollen,] as opposed to other honey pollens can vary significantly from brand to brand depending on what measures have been taken to maximize manuka purity” and “attach importance to representations that communicate a higher purity level.”

The court here thought that consumers of Manuka honey, “a niche, specialty product, are undoubtedly more likely to exhibit a higher standard of care than ‘a parent walking down the dairy aisle in a grocery store, possibly with a child or two in tow,’ who is ‘not likely to study with great diligence the contents of a complicated product package.’ … Rather, an average consumer of Manuka honey would likely know more than most about the production of the product and the impossibility of a honey that is 100% derived from Manuka flower nectar.” In a footnote, the court pointed to Broad City’s parody of the “perceived high-brow nature of the product,” where a main character under the influence of heavy medication buys it at Whole Foods in a grocery trip costing $1,487.50; it’s sarcastically described as “so reasonably priced.” Yeah, that’s real motion-to-dismiss-worthy evidence, speaking of sarcasm. Anyway, the $1.59 per ounce cost of the honey should have signaled relatively low pollen count.

(3) assumes that consumers know the rating scheme, and don’t think it’s 1-10, which is possible though not necessary given the allegations of the complaint. I myself had certainly heard of manuka honey and its purported special properties, but I had no idea of a 5-26 rating scale. The court:

While there are no other details on the jar about what “10+” means, the presence of this rating on the label puts a reasonable consumer on notice that it must represent something about the product. Reasonable consumers of Manuka honey would routinely encounter such ratings and would likely have some knowledge about them. … Thus, even a consumer with cursory knowledge of the UMF scale would know Trader Joe’s Manuka Honey was decidedly on the lower end of the “purity” scale.

Why is a reasonable consumer of Manuka honey someone used to encountering the expensive stuff, rather than someone who’s read about it and happy to find an affordable version in the local TJ’s?

Anyway, the name was ok, and so was the use of “Manuka Honey” as the sole ingredient on the ingredient statement, as provided for by the FDA’s Honey Guidelines.