Last month, the Ninth Circuit Court of Appeals revered (in part) a lower court decision finding that Dole’s “all natural” labeling was not deceptive to consumers – reviving a four-year-old litigation, Brazil v. Dole Packaged Foods LLC.
Although the decision was not a total win for consumers (and was not a published decision and therefore not binding precedent), we expect it will lead to a resurgence of “natural” labeling litigation against food product companies.
The flurry of litigation over “natural” labeling began several years ago. Regulators were not formally defining the term and plaintiff’s attorneys were all over it – claiming that food products were improperly labeled as “natural” where they contained “synthetic” ingredients, genetically modified ingredients or ingredients that were overly processed in such a way that they were no longer “natural.” The Northern District of California became a mecca for these misled “natural” food consumers. That is, until our judges started getting rid of the cases – primarily by finding that reasonable consumers were not likely to be misled by the term or by denying class certification.
One such case was Brazil. In 2012, Plaintiff Chad Brazil filed a class action complaint against Dole, alleging that its “all natural fruit” labeling deceived consumers where the products contained synthetic citric and ascorbic acid. District Court Judge Lucy Koh initially certified the case as a class action, but subsequently decertified the damages class, finding that plaintiff’s regression analysis did not sufficiently demonstrate any price premium attributable to the “all natural fruit” label, which significantly reduced the economic value of the case. Following that, Judge Koh dismissed the case it its entirety on summary judgment, finding that Brazil failed to show that reasonable consumers were likely misled by Dole’s use of “natural.”
These decisions set a high bar for plaintiffs in labeling litigation. Dozens of cases were stayed pending the outcome of Brazil’s appeal (and two related Ninth Circuit appeals, in Kosta v. Del Monte Foods Inc. and Jones v. ConAgra Foods Inc.), and new filings subsided. But get ready for them to pick back up.
The Ninth Circuit reversed Judge Koh’s decision on summary judgement, ruling that a jury should decide whether Dole’s labels were misleading. The panel explained that, taken together, Brazil’s own testimony, Dole’s label, and the FDA’s policy and warning letters on “natural,” could allow a jury to find that Dole’s products were not “natural.” However, it upheld Judge Koh’s class certification decisions – meaning there will be no class recovery for monetary damages; class damages are limited to injunctive relief.
Plaintiff’s attorneys will likely interpret the decision as lowering their evidentiary bar on summary judgement, and, therefore, we expect the decision will encourage more labeling litigation – on “natural” claims and otherwise. It also gives a preview of how the Ninth Circuit will approach the Kosta and Jones appeals.