Antitrust Law Daily Wrap Up, ADVERTISING—N.D. Cal.: Consumer could intervene in Ghirardelli white chocolate mislabeling class action, (Dec 27, 2013)

By Linda O’Brien, J.D., LL.M.

The federal district court in San Francisco has granted permission to a third-party consumer to intervene in a class action against Ghirardelli Chocolate Company for allegedly mislabeling its white chocolate baking products in violation of the state consumer protection statutes, including the California Unfair Competition Law (UCL) (Miller v. Ghirardelli Chocolate Company, December 20, 2013, Beeler, L.).

Consumer Scott Miller filed suit against the Ghirardelli Chocolate Company, alleging that the company misrepresented the contents of its white chocolate and white chocolate flavored products in violation of the UCL and other state consumer protection statutes. During discovery in May 2013, Ghirardelli produced a communication from another consumer, Steve Leyton, expressing his dissatisfaction with a white chocolate product he purchased. A pretrial schedule set June 10, 2013 as the last day to seek leave to add new parties or amend the pleadings. In October 2013, after the cut-off date for filing amended pleadings, Leyton moved to intervene as an additional class member and to file an amended complaint to add new claims that Ghirardelli falsely labeled certain products as “all natural.” Leyton alleged that Ghirardelli marketed and sold numerous products as containing all natural ingredients even though the products were not natural. He also alleged that he relied on the packaging when he purchased the products.

Intervention. In finding that Leyton may not intervene as a matter of right, the court stated that Miller could adequately represent Leyton’s interests in the litigation since their objectives were the same and they sought identical remedies. However, Leyton was granted permissive intervention in the action. Leyton had “a claim or defense that shares with the main action a common question of law or fact” and his intervention did not unduly delay or prejudice the adjudication of the defendant’s rights.

Amended complaint. The court declined to allow Leyton to amend the complaint as an attempt to “shoehorn” new claims by a new plaintiff into the existing and much narrower white chocolate labeling case. The new claims involved many new products sold in different grocery stores, marketed differently by Ghirardelli, and sold to different consumers. Additionally, the “all natural” claims were larger and more complex that would require significantly more and different discovery before class certification. Finally, since the parties acquiesced to the splitting of the white chocolate labeling and “all natural” claims, Leyton was not precluded from raising the claim in a separate lawsuit.

The case is No. C 12-04936 LB.

Attorneys: Adam Gutride and Kristen Gelinas Simplicio (Gutride Safier LLP) for Scott Miller. Deborah Kristina Barron (Farella Braun and Martel LLP) for Ghirardelli Chocolate Company.

Companies: Ghirardelli Chocolate Company

Cases: Advertising StateUnfairTradePractices CaliforniaNews