OAKLAND, Calif.Ben & Jerry's has effectively won an "all-natural" lawsuit that alleged the ice cream company misled consumers through its advertising and packaging claims. Earlier this month, U.S. District Judge Phyllis Hamilton denied a request by the plaintiff to certify a class of consumers who purchased Ben & Jerry's ice cream, frozen yogurt and popsicles.
The Jan. 7 ruling dealt a blow to the plaintiff's lawyers, whose 3-year-old case is worth practically nothing without class certification.
In the lawsuit before the Northern District of California, the named plaintiff Skye Astania alleged Ben & Jerry's advertising and packaging for its ice cream products were deceptive and misleading due to the presence of a cocoa that was alkalized with a synthetic agent. The complaint alleged "non-alkalized cocoa" is a "non-natural processed ingredient that additionally contains potassium carbonate, a man made, synthetic ingredient."
Hamilton didn't rule on the merits of the plaintiff's allegations. Instead, she found the class of consumers allegedly injured by Ben & Jerry's deceptive practices could not be ascertained. She also ruled plaintiff failed to show "common issues predominate over individual issues." Both criteria must be satisfied in order to certify a class.
"The class is defined as persons who bought Ben & Jerry's labeled 'all natural' which contained alkalized cocoa processed with a synthetic ingredient. However, plaintiff has provided no evidence as to which ice cream contained the allegedly 'synthetic ingredient' (assuming that alkaline can be considered an 'ingredient'), Hamilton wrote in the 23-page order denying class certification. "More importantly, plaintiff has not shown that a means exists for identifying the alkali in every class member's ice cream purchases."
Certification of a class is a critical juncture in a proposed class-action lawsuit because it swings the pendulum in favor of plaintiffs, giving them leverage in negotiations for a settlement, food lawyers say. Denial of a class is virtually fatal to a suit because only the named plaintiffsin this case, Astianacan proceed and damages in such food labeling cases are minimal. According to the complaint, while residing in California from 2006 through 2007, Astiana purchased Ben & Jerry's All Natural Chocolate Fudge Brownie Ice Cream and other products at a Whole Foods Market grocery store near her home.
"If you don't have a class certification, proceeding as an individual really doesn't make much sense," said William Dance, a trial lawyer who is a member of the Food, Beverage and Cosmetics Group with Tucker Ellis LLP in Los Angeles. "If class certification is granted, the defendants usually prefer to settle than to go to trial."
Hamilton's ruling is particularly painful for plaintiff's lawyers because they were close to settling the case in 2012. But the court denied a request for final approval of the settlement and the parties were unable to resolve the court's concerns.
Ben & Jerry's and lawyers for the plaintiff did not immediately respond today to a request for comment.
Food companies have been overwhelmed with class-action lawsuits that allege use of the term "all natural" is misleading. Earlier this month, the U.S. Food and Drug Administration (FDA) declined to rule in three separate lawsuits whether food can be labeled all natural if it contains genetically modified organisms (GMOs).
In the cases filed against Gruma Corp., Campbell Soup Co. and General Mills, Inc., the plaintiffs alleged labeling of "Natural", "All Natural" or "100% Natural" was misleading because the food contained corn grown from seeds that had been genetically modified.
FDA's letter implied the agency doesn't plan to define "all natural" in the near future and makes it harder for defendants to argue that courts should defer to FDA's expertise in "all natural" lawsuits under a doctrine known as primary jurisdiction, Dance said.
Food lawyers point out that the actual merits of such labeling lawsuits rarely, if ever, are decided due to the extraordinary costs and uncertainty of bringing a case to a jury or judge for a decision. The lawsuits either get dismissed on procedural grounds such as for failure to state a claim, settle or class certification is denied, said Ricardo Carvajal, a Hyman, Phelps & McNamara, P.C. lawyer who provides FDA and FTC regulatory counseling and litigation support to companies specializing in foods, cosmetics and OTC drugs.
Carvajal said food companies that decide to use "all natural" labels should identify ways to mitigate risks associated with the claim.
"I wouldn't advise a client not to use the claim because I think ultimately that is a business decision," Carvajal, a former Associate Chief Counsel in FDA's Office of Chief Counsel, said. "Each company has to look at the benefits and the risks associated with the use of the claim and make a decision, 'is that a claim that I want to use?'"