Antitrust Law Daily Wrap Up, ADVERTISING—N.D. Cal.: Consumer’s low sodium claims dismissed in action over Nature’s Path cereal labeling, (Jun 8, 2015)

By Linda O’Brien, J.D., LL.M.

In an action by a consumer against an organic food company for allegedly mislabeling its cereal products, the consumer failed to sufficiently state claims that the products did not meet federal regulatory requirements for low sodium labeling, the federal district court in San Jose, California has ruled. Thus, the claims were dismissed and the case stayed pending the disposition of two food labeling cases in the Ninth Circuit (Leonhart v. Nature’s Path Foods, Inc., June 5, 2015, Freeman, B.).

After purchasing EnviroKidz Panda Puffs cereal and Heritage Flakes cereal produced by organic food company Nature’s Path Foods, consumer Susan Leonhart filed California Unfair Competition Law (UCL), False Advertising Law (FAL), and Consumers Legal Remedies Act (CLRA) class action claims on behalf of purchasers of the cereals and a variety of Nature’s Path’s other products. Leonhart alleged that (1) the term “evaporated cane juice” was misleading that the products did not contain sugar; (2) the products did not meet federal regulatory requirements for low sodium labeling; and (3) the use of slack fill was misleading as to the amount of product the packaging contained.

In November 2014, claims based on the use of the term “evaporated cane juice” were stayed by the court pending the issuance of Food and Drug Administration (FDA) guidelines. Nature’s Path moved to dismiss the plaintiff’s low sodium claims and stay the action pending disposition of appeals in the Ninth Circuit.

Low sodium claim. The Food, Drug & Cosmetic Act (FDCA) governs the labeling of food, drugs, cosmetic products, and medical devices and provides that no state may establish any requirement for the labeling of food that was not identical to the federal requirements. Federal regulations set forth product categories and corresponding reference amounts for the level of sodium that may be used on the label, the court explained.

According to the court, the complaint failed to identify either the applicable category of cereal or reference amount for Panda Puffs, instead equated “serving size” with the reference amount in claiming that the cereal exceeded the maximum amount of sodium for products labeled “low sodium.” The court noted that it could not assume that the serving size and reference amount were identical for purposes of the regulations’ requirements and dismissed the claim with leave to amend.

Motion to stay. The court found that it was appropriate to stay the action pending the Ninth Circuit’s disposition of two food labeling cases: Jones v. ConAgra Foods, Inc., Case No. C12-01633 (N.D. Cal. 2014) and Brazil v. Dole Packaged Foods, LLC, Case No. 12-CV-01831 (N.D. Cal. 2014). The plaintiff failed to identify any harm that a stay may impose, such as the unavailability of witnesses or other actual damage to her case. Furthermore, guidance from the Ninth Circuit would aid in the just resolution of the case and a partial stay of the litigation had already been imposed with respect to the “evaporated cane juice” claims, the court concluded.

The case is No. 13-cv-00492-BLF.

Attorneys: Colin Harvey Dunn (Clifford Law Offices, PC) for Susan Leonhart. William Lewis Stern (Morrison & Foerster LLP) for Nature's Path Foods, Inc.

Companies: Nature's Path Foods, Inc.

Cases: Advertising CaliforniaNews