UPDATE ON CLASS ACTION LAWSUITS IN THE US FOR FOOD MARKETING CLAIMS
Marketing claims that promote the ingredient quality, nutritional value, sourcing and health-related benefits of food have increased significantly in recent years due to consumer expectations, competitive pressure and the posting of extensive information about products on the internet. In the US, hundreds of putative class action lawsuits have been filed by private plaintiffs, under state consumer protection laws, challenging food marketing claims as false, misleading or deceptive. These lawsuits may follow regulatory action against a company (follow-on litigation), or may be initiated without prior governmental enforcement. Recent legal developments involving ‘natural’, ‘healthy’, and ‘organic’ claims are likely to affect class action lawsuit trends.
Most US states have consumer protection laws which authorise a private right of action. Over the past decade, private plaintiffs have been filing putative class action lawsuits with increasing frequency, against food and dietary supplement companies, for allegedly making misleading or deceptive food marketing claims. The remedies under these laws typically include injunctive relief, restitution and damages, as well as attorney fees.
As background, the US Food and Drug Administration (FDA) has primary jurisdiction over the labelling of food (other than meat, poultry and egg products), pursuant to the Federal Food, Drug and Cosmetic Act (FD&C Act). The FD&C Act prohibits labelling that is “false or misleading in any particular”. The Federal Trade Commission (FTC) has primary jurisdiction over food advertising (promotional information other than labelling) under the Federal Trade Commission Act (FTC Act). The FTC Act prohibits advertising that is false, deceptive or constitutes an unfair business practice. Product information on company websites and social media can be regulated as both labelling and advertising.
Jul-Sep 2016 Issue
Keller and Heckman LLP