Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—DMinn: Purchasers of “100 % Natural” Food Products with Highly Processed Ingredients Failed to Assert Deception, (Jun 5, 2013)

By William Zale, J.D.

Purchasers of General Mills Nature Valley “100% Natural” products allegedly containing highly processed ingredients failed to assert how they were deceived, in claims under Minnesota consumer protection laws, the New Jersey Consumer Fraud Act, and the common law, the federal district court in Minneapolis has ruled (Chin v. General Mills, Inc., May 31, 2013, Davis, M.). The court dismissed the claims, along with warranty claims under federal and state law.

The purchasers asserted that the Nature Valley products are not “natural” because they contain “highly processed and non-natural sugar substitutes high fructose corn syrup and high maltose corn syrup, as well as the highly processed and non-natural texturizer Maltodextrin.” In a class action complaint, the purchasers, residents of New York and New Jersey, asserted claims under the Magnuson Moss Warranty Act (MMWA), state warranty laws, Minnesota consumer protection laws, the New Jersey Consumer Fraud Act, and New York deceptive practices and false advertising laws. General Mills moved to dismiss the claims.

The purchasers lacked standing to seek relief relating to particular products that they did not allegedly purchase—Protein Chewy Bars and Yogurt Chewy Granola Bars, the court determined. The purchasers failed to identify any case law from the Eighth Circuit or the District of Minnesota that would permit them to assert claims relating to products that they did not purchase.

The court rejected the purchasers’ MMWA claim for violation of a written warranty because labeling a product “100% Natural” is not a written warranty under the MMWA. Claims for breach of an implied warranty of merchantability under New York law, New Jersey law, and the MMWA failed because the plaintiffs were not direct purchasers from General Mills. Breach of express warranty claims under New York and New Jersey Law failed because “100% Natural” had to be read in the context of the entire package, including the ingredient panel.

The requirement of pleading fraud with particularity applied to the claims under Minnesota consumer protection laws and the New Jersey Consumer Fraud Act, as well as claims of unjust enrichment and fraudulent misrepresentation under unidentified state laws. (The court did not expressly address the claims under the New York deceptive practices and false advertising laws in this context.)

The court agreed with General Mills that the purchasers failed to plead how they were deceived by the “100% Natural” claims, what they believed “100% Natural” to mean, what they understood “highly processed” to mean, and how it did or did not relate to the “100% Natural” statement.

The case is No. 12-2150 (MJD/TNL).

Attorneys: Andrea Clisura (Faruqi & Faruqi, LLP) for Tracie Chin. Jerry W. Blackwell (Blackwell Burke PA) for General Mills, Inc.

Companies: General Mills, Inc.

Cases: StateUnfairTradePractices MinnesotaNews