Health Law Daily Consumers’ mischaracterized reading of coconut milk statements fatal to class action suit
Monday, August 19, 2019

Consumers’ mischaracterized reading of coconut milk statements fatal to class action suit

By Leah S. Poniatowski, J.D.

"Nutrition in every sip" and calcium absorption statements did not violate governing standards or confuse the reasonable consumer vis-a-vis health claims.

A multi-count lawsuit filed against Danone for false advertising and related state law-claims could not stand in light of accurate product statements that met FDA and reasonable consumer standards, a federal district court in California concluded, dismissing consumer’s claims (Andrade-Heymsfield v. Danone US, Inc., August 14, 2019, Bencivengo, C.).

Background. Danone US, Inc., markets, sells, and distributes So Delicious Coconut Milk. Three consumers of the product, who reside in California and New York, filed a putative class action against Danone based on California’s Consumer Legal Remedies Act, Unfair Competition Law, False Advertising Law, and state common law governing express and implied warranties, in addition to New York’s Unfair and Deceptive Business Practices Law, False Advertising Law, and state common law governing express and implied warranties. The consumers alleged that they relied on the products’ statements that there was "nutrition in every sip," and that the product was "Naturally Energizing" and provided "Maximum Calcium Absorption," among other claims. The consumers asserted that these claims were false and misleading and likely to confuse consumers because the coconut milk product increases the risk of heart disease and other serious health concerns and "conveys a misleadingly simplistic and incomplete picture of what’s necessary to maintain healthy bones." Danone filed a motion to dismiss.

New York claims. The court, sitting in California, determined that it did not have personal jurisdiction over the New York consumer’s claims. The complaint limited the classes of potential plaintiffs to residents of California and New York respectively. The court explained that governing precedent did not permit jurisdiction over claims by non-resident class representatives against non-resident defendants based on state law. Further, the circumstances of the case did not fall within an exception or meet the standards for pendant personal jurisdiction. Therefore, the New York law-based claims were dismissed without prejudice to allow re-filing in an appropriate jurisdiction.

Fraud pleadings. As an initial matter, the court held that the complaint met the heightened pleading standard for fraud. Specifically, the consumers identified where and how frequently they purchased the product and asserted that they read and relied on the product statements. Because the consumers were specific as to identifying the product, when the product was purchased, and the statements upon which they relied, Danone had sufficient notice to defend the claims subject to the heightened pleading standard.

Health and nutrient content. The consumers contended that the product was misbranded in violation of state and federal law because the product’s label contained unauthorized health and nutrient content statements. The court disagreed. The federal Food, Drug and Cosmetic Act (FDC Act) provides labeling guidance for industry and considers health and wellness claims to be separate from health claims. Similarly, under 21 C.F.R. § 101.65(d)), an implant nutrient content claim is one that "(i) [s]uggest[s] that a food because of its nutrient content may help consumers maintain healthy dietary practices; and (ii) [Is] made in connection with an explicit or implicit claim or statement about a nutrient."

The product’s "Maximum Calcium Absorption" statement did not include mention of any health-related condition, i.e., osteoporosis, and thus, was a permitted structure/function claim under FDA guidance. The "nutrition in every sip" statement also fell within the permitted structural/function claim definition in 21 C.F.R. § 101.93(f), because there was no mention of a specific health condition and it described how the nutrient would maintain a "normal structure or function in humans." Additionally, it was not pegged to an explicit or implicit nutrient content claim otherwise regulated by the FDA. Therefore, the claims that those statements were misleading were dismissed.

Deception. The consumers claimed that the product was misleading with respect to its healthfulness, but the court was not persuaded. The consumers alleged that the bone health claims were misleading because the product made it more difficult to maintain health bones or reduce the risk of osteoporosis and that Danone intentionally omitted martial information about the dangers of consuming the product. The court did not believe that the statements would likely deceive a reasonable consumer or that the consumer would not be able to decide for themselves how healthy the product is. The consumers’ assert that the product was advertised to reduce the risk of osteoporosis, but there was no such statement made by Danone. The company accurately disclosed the amount of fat in the product, the consumption of calcium and vitamin D to support healthy bones is supported by the FDA, and the product made no claim to treat or prevent osteoporosis. Because a reasonable consumer would not be deceived by the product’s statements, the claims dependent on the deception pleading were dismissed.

Warranty claims. Similarly, the breach of express and implied warranty claims failed because the product did not warrant a "perfectly ‘healthy’ product by some undefined measure of cardiovascular health," the court stated. The statements upon which the consumers rely were permissible under FDA standards and accurately described the product. Further, the consumers did not assert facts to infer an injury proximately caused by the alleged warranty breaches. Moreover, the consumers were not in privity or met the privity exception, which necessitated a physical injury from the product. Therefore, the warranty claims were dismissed.

The case is No. 19-cv-589-CAB-WVG.

Attorneys: Paul K. Joseph (The Law Office of Paul K. Joseph, PC) for Evlyn Andrade-Heymsfield. Angela C. Agrusa (DLA Piper LLP) for Danone US, Inc.

Companies: Danone US, Inc.

MainStory: TopStory CaseDecisions FDCActNews FoodNews FoodStandardsNews LabelingNews CaliforniaNews

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