Product Labeling

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video projectorMany of you are no doubt familiar with ANSI testing, which is often touted as the gold standard in assessing product performance. However, other types of third-party tests exist, even if they have not risen to the level of being an “industry standard.” A recent NAD decision sheds some light on when and how advertisers can use such tests in their advertising.

Epson America, Inc. was challenged by Texas Instruments, Inc. (TI) for advertising its 3-chip 3LCD projectors as superior to TI’s 1-chip DLP imagers. 3LCD and 1-chip DLP are the two leading types of projectors and compete based on a number of attributes. TI alleged that Epson improperly relied upon Color Light Output (CLO) as a measure of brightness performance. (CLO is a relatively new method of assessing the brightness of individual colors which can then be compared to the overall lumens, or white brightness of a projector. (Still with us?)). TI also alleged that Epson made overall image superiority claims even though it only tested specific performance attributes. Finally, TI also alleged that Epson inadequately disclosed its affiliation with native advertising websites.Continue Reading NAD Okays Use of Non-Industry Standard Test

orange splashJoining a growing trend in federal court jurisprudence, the U.S. District Court for the Central District of California dismissed a class action complaint because it found that the Mott’s fruit snacks at issue did not affirmatively misrepresent their contents. In short, the court held that Mott’s fruit snacks’ labels could not deceive consumers because they were literally true.

The plaintiff in the Mott’s case asserted allegations similar to claims that had successfully withstood motions to dismiss in the past. He alleged that the fruit snacks’ use of phrases like “made with real fruit and vegetable juice” misled consumers to believe the products contained more fruits and vegetables than they did, and representations like “100% of your daily value of Vitamin C” falsely conveyed to consumers that the products were healthful and nutritious. Based on these allegations, the plaintiff brought consumer protection claims and related common law claims on behalf of himself and all California consumers who purchased Mott’s fruit snacks.Continue Reading The Tide Is Slowly Turning Against Food Labeling False Advertising Claims That Do Not Involve Affirmative Misrepresentations

James Bond Goes to CourtJames Bond is best known for the cars, the adventures, the spy gadgets, and the villains he (generally) defeats by the end of the movie. And, like most big-screen heroes, James Bond is only as good as the unique adversaries, from men with golden guns to odd fellows, he faces in the 26 24 all the franchise’s movies. One particular adversary however, Mary Johnson, a self-described Bond fan, may be James Bond’s biggest rival to date.

In April, Johnson filed a class action suit in Washington State against several entertainment companies that own the rights to the James Bond franchise, including MGM Holdings, Inc. and 20th Century Fox Home Entertainment. Johnson claims that she and other members of the class purchased two James Bond DVD boxed sets that promise: “[ALL] the Bond films gathered together for the first time in this one-of-a-kind boxed set – every gorgeous girl, nefarious villain and charismatic star from Sean Connery, the legendary actor who started it all, to Daniel Craig.” (Emphasis Added). The problem is that the sets don’t include 1967s Casino Royale or 1983s Never Say Never Again films. Some Bond connoisseurs would argue that the two excluded films are not part of the franchise because Casino Royale was a spoof produced by a different movie studio and Never Say Never Again was the result of a complicated rights dispute between MGM and the movie’s writer, Kevin McClory. Nevertheless Johnson claims, the fact that the box sets don’t include literally “all” of the franchise’s movies, the use of the word is deceptive and therefore constitutes a violation of Washington’s Consumer Protection Act. Johnson seeks class certification, an award of damages, including punitive damages, and court costs and attorneys’ fees.Continue Reading Fan Was Expecting Goldfinger, but Instead Got Oddjob: Woman Sues Movie Studios over James Bond Movie Collection

diamond ringsTiffany & Co., a world-renowned jeweler and specialty retailer, successfully won a judgment that Costco was appropriating its Tiffany® trademark. Federal Judge Laura T. Swain ordered Costco to pay Tiffany & Co. $19.4 million for trademark infringement and trademark counterfeiting under the Lanham Act, as well as unfair competition under New York state law, in the latest round in a long-running legal battle over the sale of engagement rings bearing the mark “Tiffany” as a standalone term. The decision reaffirms the strength of the Tiffany® trademark and will likely have a drastic effect on the way Costco and other wholesalers conduct business.

The world-famous Tiffany® mark has been used in commerce in the United States since 1868. In 1886, Tiffany & Co. introduced an engagement ring that highlights the diamonds by lifting the stone off the band. This famous ring was named the Tiffany®. This six-prong configuration has been called the “Tiffany setting” by other jewelers.Continue Reading Tiffany Setting the Standard

sunshineThe coming of spring has been accompanied by good news for two food marketers—ConAgra and Bumble Bee Foods—in their respective court fights in California.

In the Northern District of California, a federal judge dismissed a putative class action against ConAgra alleging that the marketer’s Crunch N’ Munch product violated California’s unfair competition law since it contains partially hydrogenated oil (PHO), a food additive high in trans-fat. The complaint, filed by Tony Walker, specifically stated, “although safe, low-cost, and commercially acceptable alternatives to PHO exist, including those used in competing brands and even in other ConAgra products, ConAgra unfairly elects not to use safe alternatives in Crunch ‘n Munch in order to increase its profits at the expense of the health of consumers.”Continue Reading Springtime for Food Marketers? Two Big Wins in California in Recent Days

capsulesMany businesses acquire commercial liability insurance coverage to protect against “advertising injury” resulting from their marketing practices. But while the term “advertising injury” on its face may sound comprehensive, its definition in the insurance policy may be narrower than you think. As a result, some businesses have received a rude awakening after learning: (1) they are being sued for false advertising; and (2) their insurance company is not going to pay for it.

Vitamin Health faced this exact situation after it was sued by Bausch & Lomb based on advertising that promoted the health benefits of its Viteyes® supplements for eye health. Vitamin Health’s ad campaign promoted the supplements as “AREDS 2-Compliant,” which means they contained a combination of vitamins recommended by the National Eye Institute’s Age-Related Eye Disease Study (AREDS). Bausch & Lomb filed suit against Vitamin Health for patent infringement, but later amended its complaint to add a false advertising claim after Vitamin Health “change[d] the formulation” of its eye supplement so that it was no longer AREDS-2 Compliant. According to Bausch & Lomb, Vitamin Health reduced the level of zinc in Viteyes® from the AREDS-recommended 80 mg to 25 mg, rendering the product no longer compliant with AREDS 2.Continue Reading Insurance Coverage for “Advertising Injury” May Still Leave Businesses on the Hook for False Advertising Claims

In case you were like Alabama football coach Nick Saban and unware, there was an election last week. One post-election issue has been the use of “fake news” to try and sway voters and possible steps to prevent those types of stories going forward. The FTC has been trying to stop “fake news” advertising for some time; see our earlier posts on the Lean Spa case, Lord & Taylor case, and Native Advertising Statement. Earlier this month, a court affirmed those efforts. The case provides a list of lessons on what not to do when advertising your products.

The FTC sued a company called Pure Green Coffee and others in 2014 alleging that they violated the FTC Act by making unsubstantiated and false weight loss claims and through the use of deceptive advertorials and testimonials in the sale of Green Coffee Weight Loss products. Apparently, the defendants entered the business after having seen an excerpt of the Dr. Oz Show touting the effects of Green Coffee Extract. The company’s advertising made claims that the product could cause dramatic weight loss including: 17 lbs. in 22 weeks; 17 lbs. in 12 weeks, 16% of body fat in 22 weeks, 20 lbs. in four weeks, and 1-2 inches of belly fat in one month.

In 2015, most of the defendants settled for judgments in the amount of $30 million, with almost all of that suspended based on the inability to pay. One defendant, Nick Congleton, chose to fight. In early November, the court entered summary judgment against him for $29 million, a HUGE amount.Continue Reading FTC and Courts Remain Real Serious About Fake News Advertising

orange splashWhen courts decide to stay actions to await FDA guidance in an area, it’s only natural that our ears perk up. Which has been going on a lot, with cases such as Kane v. Chobani and Swearingen v. Santa Cruz Natural, Inc.

Last week, however, the Ninth Circuit Court of Appeals, which had previously opted to wait for FDA guidance with respect to evaporated cane juice, decided there was no need to wait for FDA to provide further guidance on “natural” claims in Brazil vs. Dole. In 2013, the lower court had granted in part, and denied in part, Dole’s motion to dismiss or strike the first amended complaint. (More about the significance of the 2013 date below.) The Ninth Circuit found that a decision not to stay or dismiss the case under the doctrine of primary jurisdiction was not an abuse of discretion.Continue Reading Ninth Circuit Decides Not To Stay Natural Case, But Read the Fine Print

brown and white sugar

Earlier this year, we discussed the Ninth Circuit’s decision staying a consumer class action against Chobani challenging its listing of “evaporated cane juice” as an ingredient on its yogurt labels. According to the plaintiffs in that case, “evaporated cane juice” was simply code for sugar, and Chobani therefore allegedly misled them about the healthiness of its products. The Ninth Circuit reasoned that a stay was necessary on primary jurisdiction grounds in order to allow the FDA time to complete its review of draft guidance on the use of the term. This decision was viewed as a temporary breather for food companies facing class actions challenging the use of the term. The Northern District of California’s recent decision in Swearingen v. Santa Cruz Natural, Inc., issued after the FDA published its final guidance, may signal a revival of such cases.Continue Reading Class Action Labeling Claims Partially Evaporated, But What’s Left May Signal a Revival of “Evaporated Cane Juice” Claims

By m01229 from USA [CC BY 2.0], via Wikimedia Commons
While the Food and Drug Administration (FDA) is still considering whether to issue guidance over the use of the term “natural” in food products, the Federal Trade Commission (FTC) is steamrolling ahead this week with a flurry of settlements and a complaint over deceptive use of the terms “all natural” and “100% natural” in the advertising of sunscreens, shampoos, and other styling/beauty products. However, while there have been vigorous debates in the courts and elsewhere over whether natural ingredients must be non-GMO, and whether certain highly processed natural ingredients such as high fructose corn syrup qualify as “natural,” the FTC’s cases went after some low-hanging, not very natural, fruit. The FTC’s four proposed settlements and new administrative complaint over the use of the phrase “all natural” all involved products that appear to contain clearly synthetic ingredients. (In this regard the FTC’s actions parallel the warning letter FDA issued to Alexis Foods and their frozen potato product.)

The four proposed settlements are with Trans-India Products, Erickson Marketing Group, ABS Consumer Products, and Beyond Coastal.Continue Reading It’s Not Nice to Fool Mother Nature: FTC Takes Aim at “All Natural” Claims