Antitrust Law Daily Wrap Up, ADVERTISING—NDCal: Ghirardelli May Be Liable For Misrepresenting White Baking Chocolate, (Dec 10, 2012)

By Jody Coultas, J.D.

A Ghirardelli Chocolate Premium Baking Chips purchaser stated California consumer protection law claims against Ghirardelli Chocolate Company for allegedly misrepresenting the contents of the product, the federal district court San Francisco has held (Miller v. Ghirardelli Chocolate Co., December 7, 2012, Beeler, L.).

The purchaser alleged that Ghirardelli misrepresented that its white chocolate and white chocolate flavored products actually contained white chocolate in violation of the California consumer protection statutes. The purported class included all persons who, between August 27, 2008 and the present, purchased, in the United States, any of the following products: “Ghirardelli® Chocolate Premium Baking Chips – Classic White,” “Ghirardelli® Chocolate White Chocolate Flavored Confectionary Coating Wafers,” “Ghirardelli® Chocolate Sweet Ground White Chocolate Flavor,” “Ghirardelli® Chocolate Premium Hot Beverage – White Mocha,” or “Ghirardelli® Chocolate Frappé Classico – Classic White.”

Because the purchaser only purchased the baking chips and the products were not of the kind of similarity to confer standing over similar, but unpurchased, products, the court dismissed the claims based on the four products that he did not purchase. To have standing, the party invoking federal jurisdiction must have suffered some actual or threatened injury, the injury must be fairly traceable to the challenged conduct, and a favorable decision would likely redress or prevent the injury. Where the alleged misrepresentations or accused products are dissimilar, courts tend to dismiss claims to the extent they are based on products not purchased. In this case, the products were different, were marketed to different consumers, and the labeling was different. The purchaser alleged that the labels for the wafers and white chocolate flavor employ the words “flavor” and “flavored,” but those words are absent from the baking chips packaging. The mocha mix also had little discernible similarity to the baking chips.

The purchaser stated California consumer protection claims against Ghirardelli, according to the court. In order to state a false advertising claim, a plaintiff must allege that the statements in the advertising are untrue or misleading, and the defendants knew, or by the exercise of reasonable care should have known, that the statements were untrue or misleading. The labeling established a connection between “Premium Baking Chocolate,” the roasting of cocoa beans, the creation of award-winning chocolate, and the “Classic White Baking Chips.” Reading the label as a whole and in context with the marketing, the court could not say, as a matter of law, that no reasonable consumer would be deceived by the baking chips label.

The case is No. C 12-04936 LB.

Adam Gutride (Gutride Safier LLP) for Scott Miller. Benjamin Jefferson Sitter (Farella Braun and Martel) for Ghirardelli Chocolate Company.

Cases: Advertising StateUnfairTradePractices CaliforniaNews