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

Image by lungstruck [CC BY 2.0] via flickr
Image by lungstruck [CC BY 2.0] via flickr

C.S. Lewis once wrote that “[t]ea should be taken in solitude.”  A California federal court agrees, ruling Tuesday that a consumer’s false labeling claims against tea manufacturer R.C. Bigelow could not proceed as a class action due to the lack of an acceptable classwide damages model as well as standing.

The consumer’s complaint targeted two antioxidant claims on Bigelow’s green tea product labels: “Healthy Antioxidants” and “Mother Nature gave us a wonderful gift when she packed powerful antioxidants into green tea.”  Plaintiff alleged that these were unlawful and unapproved health claims under California law because Bigelow’s green tea products “fail[ed] to meet the minimum” nutritional and antioxidant requirements to make such claims.  According to plaintiff, he based his purchase decision “in substantial part” on these claims.

Plaintiff moved to certify a statewide class of all persons in California who purchased a variety of Bigelow’s green tea products, which Bigelow opposed.  The court denied the motion, concluding that plaintiff had failed to show that damages were capable of being measured on a classwide basis.
Continue Reading Consumer’s Green Tea Class Action De-Caffeinated

While we love our male colleagues, I am delighted that the women partners and associates in our adlaw group easily outnumber them.  It seemed appropriate to close out Women’s History Month by taking a look at issues involving women in advertising (for the FTC’s take on Women’s History Month click here).

Gender equality was clearly absent from early advertising.  One ad from 1912 encouraged men to light a cigarette in front of a suffragette and watch her say “I wish I were a man.” 
Continue Reading Women’s History Month – A Look at Women in Advertising

Chobani
Image by theimpulsivebuy [CC BY-SA 2.0] via flickr

The pitter patter of class action footsteps that food companies hear may have gotten a bit quieter, at least for now, based upon a Ninth Circuit decision in Kane v. Chobani this week.  The lawsuit centers on Chobani’s use of the terms “evaporated cane juice” and “only natural ingredients” on its yogurt labels.  According to the plaintiffs, the yogurt included color additives that allegedly did not qualify as “natural.”  The plaintiffs further argued that Chobani’s use of “evaporated cane juice” is simply code for sugar, and Chobani therefor misled them about the healthiness of its products.  In oral arguments Chobani argued that the term “evaporated cane juice” fully complies with federal regulations and that “sugar” would be an inaccurate term because it indicates a refined sugar, while Chobani’s ingredient is not a refined sugar.  The District Court dismissed the case, holding that plaintiffs had failed to plead sufficiently reliance upon the allegedly misleading terms.  Plaintiffs appealed to the Ninth Circuit.
Continue Reading Ninth Circuit Stays Class Action Food Labeling Lawsuit Until the FDA Completes Review

By V4711 (Own work) [CC BY-SA 3.0], via Wikimedia Commons
By V4711 (Own work) [CC BY-SA 3.0], via Wikimedia Commons

On February 1, 2016, the Federal Trade Commission (FTC) filed an action against Chemence, Inc., an Ohio-based manufacturer, advertiser, and distributor of cyanoacrylate glues (often referred to as “superglues”). In its complaint, filed in the United States District Court for the Northern District of Ohio, the FTC alleges that Chemence is deceiving consumers by claiming that all, or virtually all, of its glue products are American-made. Chemence’s glue products, which include Kwik Frame, Kwik Fix, and Krylex, purport to be “Made in the USA” or “proudly made in the USA.” According to the FTC, these claims are unqualified, and thus deceptive, since a “significant proportion”—approximately 55%—of the chemical components in Chemence’s glues are attributable to imported chemicals essential to the way the glues function.

The FTC also claims that Chemence provided the “means and instrumentalities” for others to deceive consumers through its unqualified Made in USA claims by providing deceptive promotional materials to retailers for use in marketing the glues. The complaint asks the court to issue an order permanently prohibiting Chemence from making deceptive Made in USA claims and seeks other relief, including monetary relief and rescission or reformation of contracts.

Continue Reading Working Toward a Cohesive Approach to “Made in USA” Claims

By Boyd Amanda, U.S. Fish and Wildlife Service [Public domain], via Wikimedia Commons

No, PETA will not be in an uproar.  But if you certify Green claims or use someone else’s certification on your products you may want to continue reading.

In the past we have noted that third-party certifications and endorsements relating to environmental or “green” attributes are heavily scrutinized by the FTC as more “green” products continue to hit the market. Last year, we wrote about the FTC taking action against a plastic lumber marketer and a manufacturer for misleading advertising and marketing that claimed products to be made almost entirely out of recycled plastics. 
Continue Reading FTC Goes Seal Hunting: Issues Warning Letters About Green Seals