Antitrust Law Daily Wrap Up, ADVERTISING—E.D. Mo.: Ingredient list defense crumbles in deceptive muffin mix labelling suit, (Aug 2, 2016)

By: Glenn Sulzer, J.D.

The disclosure of artificial ingredients on the box of a muffin mix labelled as containing "Nothing Artificial" was not sufficient to prevent consumers from litigating a claim that the label was false, deceptive, and misleading in violation of Missouri law, according to the federal district court in St. Louis, Missouri (Thornton v. Pinnacle Foods Group LLC , August 1, 2016, Ross, J.).

Deceptively labelled muffin mix. Duncan Hines Simple Morning Blueberry Streusel Premium Muffin Mix is labelled as containing "Nothing Artificial." However, because the mix actually contains artificial, synthetic substances, consumers brought suit, alleging that the "Nothing Artificial" claim was false, deceptive, and misleading under the Missouri Merchandising Practices Act (MMPA).

Unlawful practice under MMPA. Under the MMPA, a plaintiff must establish an ascertainable loss, resulting from an unlawful practice. An unlawful practice includes the use of deception, fraud, false pretense, false promise, misrepresentation, and unfair practice or the concealment, suppression or omission of any material fact in connection with the sale or advertisement of any merchandise in trade or commerce.

Ingredient list defense. In moving for dismissal, Pinnacle Foods primarily maintained that the plaintiffs failed to plausibly allege that the "Nothing Artificial" label could have deceived a reasonable consumer because the artificial ingredients were actually disclosed on the muffin mix box. Pinnacle relied on a Missouri state court case in which a label describing a cupcake mix as being "all natural" was not viewed as deceptive or misleading because the product packaging contained a listing of the product’s artificial ingredients.

By contrast, the federal district court found it plausible that a consumer might rely on the representation "Nothing Artificial" without looking at the ingredients. A consumer might also not know that the listed ingredients were artificial. Thus, the mere presence of an ingredient statement on the back of a product does not eliminate the possibility that a reasonable consumer may be misled. The effect that an ingredient statement may have on a consumer’s understanding of advertising and product labels involves and necessitates a factual inquiry that precludes dismissal of the claim.

Ascertainable loss. Pinnacle, alternatively, argued that the plaintiffs’ claim should be dismissed for failure to allege an "ascertainable loss." The court, however, found that the plaintiffs satisfied the "benefit of the bargain" threshold standard under the MMPA for stating ascertainable loss, by alleging that the actual value of the product purchased was less than the value of the product as represented.

The case is No. 4:16-CV-00158 JAR.

Attorneys: Matthew H. Armstrong (The Armstrong Law Firm, P.A.) for Erika Thornton. James Muehlberger (Shook, Hardy & Bacon LLP) for Pinnacle Foods Group LLC.

Companies: Pinnacle Foods Group LLC

Cases: Advertising StateUnfairTradePractices MissouriNews