False Food Claim Class Action Lawsuits Are On The Rise

We all hear about lawsuits that may have dubious merit. As a business owner, you may have concern over being sued over a claim that ends up being false, or over a statement that you make in an advertisement that is refuted.

Although these kinds of lawsuits are rare—and highly defensible—that doesn’t stop lawsuits from being filed by Plaintiffs who allege that something a business said was false, and thus, constitutes false advertising.

One Lawyer Has Filed Multiple Suits

A recent article by NPR highlights an attorney who, according to the article, has filed more than 400 cases, alleging false claims by businesses. The attorney’s name is Spencer Sheehan.

According to the article, Sheehan has filed lawsuits that allege:

1. That strawberry Pop-Tarts have not just strawberry, but also apple and pear in them
2. Claims that manufacturers that market “fudge” products are lying, given that the products have no milk in them, and thus, cannot be fudge
3. Multiple lawsuits over the use of the word “vanilla” for products that in fact have no vanilla extract or vanilla bean in them.
4. Lawsuits against tortilla chip makers that sell “lime” flavoring, when there is in fact no lime in or on the product
5. Lawsuits against manufacturers who tout using “real milk,” when in fact the product is made with skim milk.

Critics say these are nitpicky lawsuits, that are only trying to get money from companies that are not making any claims that really deceive or mislead anyone. But consumer groups say that the attorney is standing up for customers, and encouraging companies to be honest about what is and what is not in the products that we buy.

Class Action Lawsuits are on the Rise

Most of the lawsuits are class action lawsuits, and these lawsuits are rising against food manufacturers. There were only 19 such lawsuits in 2008, but 200 even in COVID-stricken 2020. In 2021, there have already been 280 such lawsuits.

Damages in these cases are based on a legal theory of pricing premiums. The theory goes, that if you market a product as having a more expensive ingredient that it has—say, real lime, or real vanilla—you command a higher price for the product than you would if you were honest about what is in or not in your product. Consumers are therefore deceived, and encouraged to pay more for a product than they normally would.

Although damages to the companies can be significant—in the millions of dollars—often, the payouts to individual consumers can be less than $10 each.

Many of these cases get dismissed voluntarily—meaning that it is likely that most of the companies sued, opted to resolve the case, rather than to fight it. This is likely both to avoid trade secrets from being revealed in the process of litigation, and to simply mitigate the possible expense of extended class action litigation.

Call the West Palm Beach business litigation attorneys at Pike & Lustig today to help you market your product or service safely and without legal problems.

Resource:

npr.org/2021/10/30/1050175655/strawberry-pop-tarts-lawyer-spencer-sheehan-vanilla-lime-food-beverage