Vizzy gets no kick from champagne, and that's ok

West v. Molson Coors Beverage Co. USA, No. 23-cv-7547 (BMC), 2024 WL 3718613 (E.D.N.Y. Aug. 7. 2024)

Plaintiffs alleged that Molson deceived consumers into thinking that Vizzy contained champagne (used as a generic term throughout!) when it didn’t. The court found the allegations implausible, using what may become a popular framework recently distilled from the cases about how reasonable consumers think. [This framework isn’t all that bad, but I do note that it is not based on any qualitative or quantitative evidence about how consumers actually think except insofar as a poll of chambers might be qualitative evidence.]

Vizzy costs $17.99 per 12-can box and looks like this:

ingredients list with "alcohol"

First, for standing, plaintiffs didn’t need to allege a price premium over a comparable product. “[C]onsumers suffer an injury in fact when, in reliance on alleged misrepresentations, they buy a product that they otherwise would not have purchased. I fail to see a meaningful distinction between a price-premium injury and a but-for purchasing injury.”

Nonetheless, it was unreasonable to think Vizzy would have champagne, based on five considerations: “(1) the presence or absence of express representations, (2) context of the alleged misrepresentation, (3) etymological analysis, (4) allegations about competitor products and (5) consumer survey evidence.”

There were no express representations about champagne, weighing against plausibility.

Etymology: a mimosa is a champagne drink, or at least a sparkling wine drink.  Molson argued that the phrase “hard seltzer” modified the word “mimosa,” which makes clear to consumers that the beverage is not a mimosa at all.

But what is a hard seltzer? By long tradition, “hard” connotes “alcoholic,” and “seltzer” means “sparkling water.” “The alcohol in a generic hard seltzer could theoretically be any type of consumable alcohol, including champagne. Although defendant’s proffered definitions do not identify the types of alcohol commonly used in hard seltzer, other definitions specify fermented cane sugar and malted barley – not champagne or any other type of wine – as the usual suspects.” Overall, “mimosa” “strongly suggests” the presence of champagne, and “hard seltzer” doesn’t exclude it. So etymology “slightly” favored the plaintiffs.

“But the full context of the packaging, viewed through the eyes of a reasonable consumer, sharply reduces any ambiguity caused by the etymological association between mimosas and champagne.” The court rejected plaintiffs’ argument that the tagline “Brunch Just Got Real” reinforced the champagne connection.

This was basically a familiar issue: “whether a food or beverage ought to include ingredients associated with its purported flavor, or whether the presence of the flavor itself, regardless of its source, is sufficient to make the description accurate.” We also need to know how consumers think about new/unfamiliar products: product categories “act like lenses, modifying how consumers see other aspects of those products and form their reasonable expectations about them.”

True, many cases say that, on a motion to dismiss, “a federal trial judge, with a background and experience unlike that of most consumers, is hardly in a position to declare” what consumers know. But it is proper to consider whether a statement would deceive a reasonable consumer, which requires considering “what reasonable consumers know about the products they purchase.” [This is usually resolved by saying that some situations can be resolved as a matter of law, but not all.]

Reasonable consumers would read “mimosa hard seltzer” together, and there were no allegations that hard seltzers ordinarily, or even occasionally, contain champagne. “Because a champagne-based hard seltzer is not the norm, a reasonable consumer would expect that if a hard seltzer had champagne in it, the packaging would make that fact abundantly clear.” Any ambiguity could be resolved by looking at the ingredient list, which makes no reference to champagne, only to “alcohol.” “[G]iven plaintiffs’ allegation that consumers actively seek out drinks with champagne, in addition to their failure to allege hard seltzers are ordinarily (or ever) made with champagne, it would be odd that Vizzy would have spiked its seltzer with champagne without making that abundantly clear.” A reasonable consumer would have “serious doubts” after reading the ingredients. Similarly, there were no pictures of mimosas, champagne, or grapes anywhere on the packaging. “Vizzy’s direct references to orange juice, juxtaposed against its lack of reference to champagne, should make the confused consumer think again: if the product contained champagne, why not say so?”

Molson argued two additional factors: Vizzy’s allegedly comparatively low price and the location of purchase (stores prohibited by NY law from selling beverages containing wine). The latter just didn’t work: “It is unreasonable to assume that an ordinary consumer has a sufficiently intimate familiarity with the New York Alcoholic Beverage Control Law to know that bodegas and grocery stores cannot sell wine.” The former was more persuasive: “Although it is possible that a seltzer made with a particularly inexpensive champagne could sell at the same price point as those made with cheaper forms of alcohol (approximately $1.50 per 12-ounce can), all else equal, a reasonable consumer would assume that a champagne-based seltzer would sell at a price premium.”

The court also weighed the interest in innovation: “Lest we stifle development and distribution of innovative forms of consumer products in the name of avoiding consumer ‘deception,’ we have to give manufacturers reasonable leeway in marketing their products without handcuffing them with lawsuits.” This is a consideration that only fits into a normative conception of the reasonable consumer, not an empirical one: manufacturers should be able to push the definition of terms because that gets us cheaper goods. It has nothing to do with whether people would be materially deceived. That doesn’t mean it’s wrong, but courts that go back and forth between normative and empirical concepts of what’s deceptive to a reasonable consumer become hard to predict.

The court cautioned that it wasn’t endorsing trickery, but rather “tastes like” marketing. “If the manufacturer’s advertising is wrong, and it does not taste like what the label says it tastes like, then the consumer is not going to buy it again and the product will fail. The market is a much more efficient check on that kind of representation than lawsuits.” [GI proponents should strongly object to this argument.]