Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—DNJ: Tropicana May Be Liable For Failing to Disclose the Use of Flavor Packets in its “100% Pure and Natural” Orange Juice, (Jun 13, 2013)

By Jody Coultas, J.D.

Tropicana orange juice purchasers stated consumer protection claims against Tropicana Products, Inc. for allegedly misrepresenting that its orange juice was pure and all natural, according to the federal district court in Newark (Lynch v. Tropicana Products, Inc., June 12, 2013, Cavanaugh, D.).

Tropicana claimed that its orange juice was 100% pure and all natural and used marketing phrases suggesting that there were no additives or preservatives used. The purchasers alleged that the orange juice contained chemically-engineered flavor packs and chemical coloring and was pasteurized, deaerated, and stored for long periods of time. Based on the marketing claims, the purchasers alleged that they were harmed by paying a premium price for the orange juice that they would not have paid absent the marketing claims.

In its motion to dismiss, Tropicana argued that the purchasers’ consumer protection claims were expressly preempted by the Food, Drug, and Cosmetic Act (FDCA), as amended by the Nutrition Labeling and Educational Act (NLEA). Specifically, the claims were preempted because they would impose requirements not identical to the FDA’s pasteurized orange juice standards. The NLEA

Because the purchasers’ claims were based on Tropicana’s alleged failure to meet the federal law requirements, the court held that the claims were not preempted. FDA standards require that the orange juice label identify that the product is pasteurized, and that the ingredient label be accurate and complete. The purchasers argued that the claims did not fall outside the NLEA’s express preemption provision because they were seeking to enforce the a standard identical to the FDA standard, and that the NLEA allows for state law claims that protect consumers from misleading labeling and deceptive advertising.

State laws are not preempted when identical to federal requirements, and Tropicana was unable to show that the purchasers were seeking to assert anything more than the federal requirements. The purchasers’ claims were based on Tropicana failing to accurately and completely label the orange juice’s ingredients by leaving out the flavor packet.

The purchasers stated New York General Business Law, New Jersey Consumer Fraud Act, and Wisconsin Unfair Trade Practices Act claims against Tropicana, according to the court. The purchasers specified what they purchased, that the advertising was uniform on all the orange juice labeling and packaging, and that they paid a premium price for the juice. The alleged injury stemmed from the purchasers not receiving the product they bargained for as a result of the misrepresentations. Payment of a premium price meets the injury and ascertainable loss requirements. Federal Rule of Civil Procedure 9(b)’s heightened pleading standard was also met.

Tropicana’s motion to dismiss the Wisconsin Fraudulent Representations Act was granted by the court because the statute does not apply to articles of food.

The case is No. 2:11-cv-07382 (DMC) (JAD).

Attorneys: Caroline F. Bartlett (Carella Byrne) for Dennis Lynch. Liza M. Walsh (Connell Foley, LLP) for Tropicana Products, Inc.

Companies: Tropicana Products, Inc.

Cases: StateUnfairTradePractices NewJerseyNews