Why Consumers Are Filing Class Action Lawsuits with Food Manufacturers

Today’s consumers are vigilant. In fact, cases that have been filed against the food industry have increased since 2008. The class action lawsuits filed in 2008 went from 19 to 158 in 2015. According to food litigation group Perkins Coie LLP, the food industry has compiled 114 class actions since October last year (2016).

Examples of these lawsuits include Hershey’s not putting a lot of Kisses in their bags and P.F. Chang adding an extra charge to their gluten-free products. So why are food and beverage companies facing class action lawsuits from consumers? Many attorneys are also wondering the same thing.

Food companies are now becoming the target for the plaintiff’s bar. According to Yvonne McKenzie from Pepper Hamilton LLP, a legal firm that counsels food businesses that are in trouble, there are many reasons why food companies are facing a lot of legal lawsuits.

The Food Industry Has Untapped Deep Pockets

One of the most obvious reasons is that food companies have deep pockets. They have become a lucrative target for litigations. There are a lot of gray areas regarding federal regulation. For instance, the term “natural” has no official definition from the Food and Drug Administration (FDA), and consumers use this to file against companies making erroneous claims about their food and beverage made from natural ingredients. Other examples include the class action lawsuit against KIND Snacks for using the claim “Healthy” on their packaging and website.

Some Courts Are Willing To Entertain Claims In Lawsuits

Another reason for the rise in food and beverage lawsuits recently is some courts are just willing to consider even the most frivolous claims. For instance, one of the ridiculous lawsuits the food industry experienced last year was when plaintiffs accused Starbucks of putting too much foam in their lattes and too much ice in their iced coffee. In general, courts are quiet when it comes to getting rid of the cases and grant the motion to dismiss the case. Even entertaining the lawsuit is giving class action attorneys precedent to take more cases to court.

Increasingly Health-Conscious Public

So far this article has probably sounded like the big bad consumers are taking advantage of the food business, right? It would be too unfair to say that. In fact, one of the greatest reasons for increases in lawsuits is the increasing awareness of the consumers about the food and drinks that they buy.

Today, there are more health conscious consumers than ever. They scrutinize just about anything in their food. Many consumers feel that companies are not transparent enough and mislead consumers with catchy packaging and marketing.

Many factors interplay the complexity of legal actions filed against food and beverage industries, and since there will likely be more class actions that will be lodged in the future, food companies should be prepared.

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Misleading Labeling Claims Can Land Food Companies in a Lawsuit

In today’s modern society, most consumers are driven to purchase healthy foods. Customers take the time to read and compare food labels to decide which products are right for them. Food producers use labels as a marketing ploy. Food manufacturers love to claim different kinds of health benefits to boost their products’ sales. Unfortunately, many of these claims are misleading.

The Problem with Misleading Food Labels

Food and beverage brands come up with the latest buzzwords that are designed to boost product sales. Consumers expect the labels to be truthful so that they can make healthier choices. Moreover, they assume that the government is keeping a strict eye on the food manufacturers.

While there is some truth to this, what’s good to know though is the system is currently working to make companies accountable for their misleading food labeling.  On August 12, 2016, the company Nature’s Way falsely labeled its coconut oil as healthy; thus, a California federal judge found that the firm’s advertising and labeling are misleading.

The company branded their products as a healthy alternative to shortening, margarine, butter and other cooking oils despite the fact that it is not much better than those products. Moreover, the company’s advertising and product labeling violated several state food regulations in Canada.

Food Labeling Laws

Food manufacturers are expected to evaluate their foods and make their nutrition labels.  They are allowed to make a margin of error of plus or minus 10%. The Food and Drug Administration imposes that all food producers are straightforward when it comes to labeling their food products. For instance, products that are labeled as “natural” may contain surprisingly unnatural ingredients. Moreover, food manufacturers should also include the exact serving size and calories on the label as part of FDA regulations.

FDA food label nutrition facts panel update for 2017 2018 2019 food companiesFDA Issues Public Warning

With the increasing trend of using misleading labels, the FDA strictly defines the term “natural” in food products, and it restricts many food manufacturers to abuse such claim. Those who do not comply with the agency often suffer repercussions.

For instance, the agency issued a public warning letter in 2014 to Premier Organics about its product named Arisana Coconut Butter Whole Coconut Flesh is not healthy because it contains high amounts of saturated fat per serving.

Another company that has found itself in hot water with the FDA was General Mills. The company experienced a lawsuit when it allegedly claimed that the product Cheerios Protein is a protein-rich version of the regular Cheerios when, in fact, it does not contain significant amounts of added protein.

The false advertising of many companies has led to the proposal of the Food Labeling Modernization Act to streamline food labeling and create a standard labeling requirement for all food products. With this proposal, food manufacturers will be more careful in using buzzwords like “natural” and “healthy.”


Just Mayo Struggles with Nutrient Content Claims

In August 2015, Hampton Creek was delivered a warning letter by the Food and Drug Administration for multiple inaccurate claims by its brand, Just Mayo. Just Mayo has been in the news over the past 2 years for developing a revolutionary food product and causing a lot of controversy in the process.


Mayo vs. Mayonnaise

Last year, Just Mayo faced a lawsuit from Unilever, parent company of Hellman’s mayonnaise, for fraud of not meeting F.D.A. regulations for mayonnaise. Unilever would later drop the suit, but the F.D.A. picked up where they left off with a warning letter to Hampton Creek. The F.D.A. claims that Just Mayo products purport to be standardized food mayonnaise due to the use of misleading imagery and name on the label.

Hampton Creek has fired back on the mayo warnings with the following:

“While there is a food standard of identity for “mayonnaise,” there is no current standard for “mayo.” Hampton Creek does not use the term “mayonnaise” on any of its products or any of its marketing materials … If FDA had intended to cover products that use the term “mayo” in its standard for mayonnaise, it could have done so, yet it did not.”

We will wait and see how this plays out, but they must also improve and change their nutrient content claims.

Nutrient Content Claims

On top of the mayonnaise madness, Just Mayo was asked to correct two other nutrient content claims. They do not meet the standards for “cholesterol-free” and a heart health claim on their website. Hampton Creek could face huge consumer lawsuits with these unauthorized health claims. KIND saw aggressive consumer lawsuits after a similar warning letter from the F.D.A. earlier this year. It’s important to verify and confirm any nutrient content claims that your brand is making on its label. If you are not, it could cost your brand millions of dollars in lawsuits in the future.

NutriFusion® to the Rescue

Most of the companies like KIND and Hampton Creek are trying to create innovative food products that are healthy but appeal to our current eating habits. We applaud them for advancing the food industry and running with the trends in healthy eating. We are here to help you make important health claims with your food products going forward. Our fruit and vegetable blends are revolutionizing processed food products because of their micronutrient and phytonutrient stabilization. Our products give you the ability to make claims like “50% of your daily value in 6 different vitamins, equivalent to 2 servings of fruits and vegetables, etc.” We use organic, non-GMO produce in our products to meet the highest standards of health conscious consumers. Contact us today for more information on our blends and how we can help you create healthier, better for you food products.

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KIND Bars in Trouble with “Healthy” Snacks

Earlier this year in April, KIND bars was asked by the FDA to make changes to its labeling of four products. The 4 bars  in violation of the “healthy” labeling rules include: almond and apricot; almond and coconut; peanut butter and dark chocolate + protein; and dark chocolate cherry cashew + antioxidants. We read a few articles from Food Business News and Quartz on the issue and we will be sharing some of the key information in our post.


“According to the F.D.A., a product only may feature the term “healthy” as an implied nutrient content claim on the label if, among other things, it is “low saturated fat” as defined in the federal Food, Drug, and Cosmetic Act (i.e., the food has a saturated fat content of 1 gram or less per reference amount customarily consumed (RACC) and no more than 15% of the calories are from saturated fat).

In its review, the F.D.A. found that Kind’s almond and apricot bar and peanut butter dark chocolate + protein bar both contained 3.5 grams of saturated fat per serving, while its almond and coconut bar contained 5 grams of saturated fat and its dark chocolate cherry cashew + antioxidant bar contained 2.5 grams.”

The FDA also indicated in their letter that Kind must remove labels such as “anti-oxidant rich,” “good source of fiber,” and “no trans fats” from the four products. Using an ingredient like NutriFusion® would allow KIND to make claims like “anti-oxidant rich” because our products are made from all natural fruits and vegetables.

KIND’s Response

“The F.D.A. is requesting adjustments to the labeling language on four of our bars and our web site, and we’re workinwebsite bring all items to compliance,” the company said. “Please know that there are no quality or safety issues relating to our snack foods or their ingredients. Kind snacks remain a safe and nutritious choice for our fans and their families.”

In working to come into compliance with the F.D.A.’s labeling rules, Kind pointed out that nuts are partly to blame for the violations.

“Nuts, key ingredients in many of our snacks and one of the things that make fans love our bars, contain nutritious fats that exceed the amount allowed under the F.D.A.’s standard,” the company said. “This is similar to other foods that do not meet the standard for use of the term healthy, but are generally considered to be good for you like avocados, salmon and eggs.”

Kind said it will keep its recipes the same even as it makes updates to its packaging and web site.

Lawyers are Filing Lawsuits for Consumers

Quartz covered the story from the consumer’s perspective and it looks like the FDA letter is going to lead to a few lawsuits. Of course consumers are not pressing the issue, but lawyers are on their behalf.

“In California, three separate class action suits have been filed against the company, all within 10 days of the letter’s publication, all making the same basic argument: KIND’s misleading marketing deceives consumers into buying food that isn’t healthy, at least by FDA standards. Consumers would receive the value of their KIND purchases back if the lawsuits were ever to prevail.”

Why Does This Matter?

KIND is relatively small in the energy and nutrition category and a young player in the industry. Their products are not necessarily bad for you. They just do not meet the FDA standards for saturated fats. Saturated fats are still going through on-going research, so science is not completely settled. This was simply a slap on the wrist by the FDA, but it has caused a lot of harm for KIND. They now have to do extensive work in new packaging and website design as well as manage consumer complaints. All of this could have been avoided by using the right ingredients and the approved claims by the FDA.