Southern discomfort: class certified over malt beverage dressed like Southern Comfort whiskey

Andrews v. Sazerac Co., 2025 WL 1808797, No. 23-cv-1060 (AS) (S.D.N.Y. Jul. 1, 2025)

Plaintiffs alleged that Sazerac deceived consumers by selling a malt beverage that looks like Southern Comfort whiskey but in fact contains only “whiskey flavor.” The court certified a class of “[a]ll persons who purchased the Southern Comfort Malt Products in the State of New York at any time during the period February 8, 2020, to the date of judgment” with one named plaintiff.

The malt beverage comes in three sizes: 50ml, 100ml, and 355ml. The 50ml bottle is cylindrical, while the two larger sizes are relatively flat. But each has “colors, themes, fonts, symbols[,] and spacing” identical to Southern Comfort whiskey bottles. Each bottle has a statement of composition, which until April 2023 described the drink as a “malt beverage with natural whiskey flavors, caramel color and oak extract.” Inclusion of the “whiskey flavors” and “oak extract” language allegedly contributed to this misleading impression.

Addressing only the parts that interest me:  

Sazerac argued that there was no classwide proof that the bottles’ labeling was materially misleading. Although plaintiff’s survey found that 62.9% of consumers believed that the malt-beverage mini bottles contained whiskey, Sazerac argued that it was fatally flawed, and anyway only applied to the 50ml bottles.  The 50ml bottle is cylindrical, while the larger bottles have “relatively flat front[s],” and the statement of composition, which says that the drink contains “malt beverage,” appears in larger font on the bigger bottles. But the court didn’t find these differences to be material:

That the larger bottles are flat, instead of round, might be material if their shape would tend to indicate to reasonable consumers that the bottles contain malt beverage, not whiskey. But Sazerac doesn’t say that its whiskey is only sold in round bottles, so it’s not clear why the bottle shape makes a difference here. Sazerac’s observation that the statement of composition appears in larger font on the larger bottles seems similarly irrelevant. On the one hand, “malt beverage” is in larger font. But so too were the allegedly misleading “whiskey flavor” and “oak extract” phrases, at least until April 2023. Regardless, the Court sees no reason why the impression created by a specific combination of elements on a small bottle would vary “significantly” from the impression created by those same elements on a larger bottle.

Anyway, misleadingness was a merits question.

Plaintiffs offered a choice-based conjoint survey to measure their claimed damages, which estimated a 8.8% price premium from false beliefs that there was non-malt liquor in the beverage. Sazerac argued that this study failed to (1) show that the price premium is attributable to the beverage’s misleading packaging, as opposed to flavor and convenience, or (2) consider supply-side factors. The court disagreed. Plaintiffs’ theory was that the overall packaging contributed perceived value, and the survey tested that theory. Even if the study asked respondents to assume that the products were all available in the same store (and thus didn’t control for convenience), that was a matter of ultimate persuasiveness, not a matter of whether it tested the plaintiffs’ theory. “If [the] model missed the mark, then it did so in one fell swoop for the entire class.” Likewise, an alleged failure to measure supply-side factors can be accounted for “when (1) the prices used in the surveys underlying the analyses reflect the actual market prices that prevailed during the class period; and (2) the quantities used (or assumed) in the statistical calculations reflect the actual quantities of products sold during the class period,” as the survey here did. After all, “[a] conjoint survey that asks respondents whether they would rather pay x for a product labeled ‘100% Fruit Juice’ or y for a similar product labeled ‘50% Fruit Juice’ ... would account for supply-side factors if both x and y reflect the prices for which juice companies actually sell similarly labeled products in the marketplace.” Sazerac argued that it would refuse to sell its malt beverage at the lower price of a generic competitor. But again, that was not relevant to whether the survey was good enough for class certification. “Moreover, it would be improper to give Sazerac the benefit of the doubt—and to take its CEO’s self-interested statements as controlling—at this stage.”