false advertising – Animal Law Developments

September 19, 2022 by Rebecca E. Bazan

VEGGIE Doesn’t Mean “Made of Vegetables,” California Judge Rules

In a somewhat surprising ruling, a judge in the Northern District of California last week dismissed with prejudice a false advertising case about certain MorningStar Farms products such as VEGGIE BURGERS, VEGGIE DOGS, AND VEGGIE CHIK’N. Kennard v. Kellogg Sales Co., No. 21-cv-07211 (N.D. Cal. Sept. 14, 2022), Dkt. No. 46.

The plaintiff alleged that naming the products “VEGGIE” leads reasonable consumers to believe that the products are made primarily of vegetables. Id. at 2. Because the products are actually composed primarily of non-vegetable ingredients like wheat gluten, oil, and corn syrup solids, the plaintiff alleged that the packaging is false or misleading in violation of, among other things, California’s False Advertising Law (“FAL”), Unfair Competition Law (“UCL”), and Consumer Legal Remedies Act (“CLRA”). Id. at 1-2. The FAL, UCL, and CLRA are very common vehicles utilized by California plaintiffs to bring lawsuits over statements they believe are false or misleading (a defendant can be liable even if its statements are technically true if they are misleading).

The defendant argued that the VEGGIE labels were not misleading because reasonable consumers understand the term VEGGIE to refer to vegetarian or meat substitute foods, not a reference to being made primarily of vegetables. Id. at 2, 5.

The Court previously dismissed the complaint once, agreeing with the defendant that reasonable consumers would not understand VEGGIE to mean made primarily from vegetables. He gave the plaintiff another chance to re-plead her case, however, to add facts showing why a significant portion of the public acting reasonably could be misled into thinking that the products were made from vegetables as opposed to grains, legumes, and oil. Id. at 2-3.

In the Amended Complaint, the plaintiff bolstered her allegations about consumer understanding with a survey that the she said demonstrated that consumers are misled by VEGGIE labeling, thinking that the products are made primarily from vegetables rather than non-vegetable plant-based ingredients. Id. at 3. The Court was not swayed, finding that the claims in the Amended Complaint were “implausible and do not support a reasonable inference that some significant portion of consumers would be misled into thinking the VEGGIE products are made primarily from vegetables as opposed to being vegetarian meat substitutes made from grains, oils, legumes, or other ingredients,” and dismissed the complaint again, this time with prejudice. Id. at 6, 14-15.

What makes this decision surprising is that the Court ruled definitively for the defendant at the motion to dismiss stage. At that stage, which usually happens early in a case before the actual facts are known, the Court is required to assume the truth of all well-pleaded factual allegations. How reasonable consumers interpret a label usually is a factual issue, not a legal one. Here, however, the plaintiff commissioned a survey prior to amending her complaint and even incorporated the survey findings into her complaint (which the Court had to accept as true when ruling on the motion to dismiss). One might have thought this would make the case particularly difficult to dispose of on a motion to dismiss.

So how did it happen? First, the Court said the label “VEGGIE” was not misleading because consumers could look for context clues. Even if the term VEGGIE was ambiguous, said the Court, consumers could look at the ingredient list on the packaging and therefore would not be misled. Id. at 6-7, 10. Second, the Court found that the plaintiff’s survey did not ask the right question. Id. at 10. The survey asked what plant-based ingredients consumers believed were primarily in the product, when it should have asked whether the term VEGGIE, taking into account the product packaging, “conveyed that the Veggie Products were meat-alternative or … were made with vegetables as opposed to other ingredients.” Id. at 10. The Court bolstered that opinion by citing to other cases where courts had determined that surveys cannot save “otherwise facially implausible consumer deception claims.” Id. at 9.

What can we take from this decision? First, both the defendant and the Court noted that it is rare for courts to decide as a matter of law that a reasonable consumer would not be deceived by a defendant’s packaging or marketing. Id. at 2, 5. Second, while it may be rare, it is not unprecedented. This decision made sure to cite as support for its position other cases holding that advertising was not misleading as a matter of law, many of which are very recent. Cases like these might be indicators that California federal courts are pushing back a bit against the wave of non-meritorious false/misleading advertising cases brought by plaintiffs under the UCL/CLRA/FAL. Look for these cases to be cited by future defendants when moving to dismiss false advertising-type cases.

December 4, 2020December 5, 2020 by Michelle Pardo

Animal Activist Group’s “Open Rescue” Violates California’s Unfair Competition Law

by Michelle C. Pardo

Animal activist group Direct Action Everywhere (“DxE”), which made headlines for its members’ multiple criminal charges as a result of trespassing and removing animals from agriculture operations, has been enjoined for its violation of California’s Unfair Competition Law (“UCL”) for its “open rescue” actions against Diestel Turkey Ranch. After targeting Diestel’s turkey farms with its tactics, and launching an “investigation” of its turkey raising practices, back in January of 2017, DxE sued Diestel in the Alameda County Superior Court under the UCL and the False Advertising Law (FAL). DxE alleged that Diestel Turkey Ranch’s marketing had made misleading and deceptive claims about how its turkeys are raised. Direct Action Everywhere SF Bay Area v. Diestel Turkey Ranch (RG17847475) (Superior Court, Alameda County). Continue reading “Animal Activist Group’s “Open Rescue” Violates California’s Unfair Competition Law”

October 8, 2019October 11, 2019 by Michelle Pardo

Court Rejects Tofurky’s Request for Preliminary Injunction to Halt Enforcement of Missouri’s Meat Advertising Law

By Michelle C. Pardo

We previously blogged about the case of Turtle Island Foods, et al. v. Mark Richardson, 2:18-cv-04173, pending in federal court in the Western District of Missouri. Turtle Island Foods, doing business as The Tofurky Company (“Tofurky”) which produces plant-based products, together with The Good Food Institute (an organization founded in part by Bruce Friedrich, former director of PETA’s vegan campaigns), sued Missouri prosecutors over its 2018 amended meat advertising law. The law requires that in order for a product to be labeled as “meat” it must come from “any edible portion of livestock, poultry, or captive cervid carcass or part thereof.” Mo. Rev. Stat. § 265.300(7). Under the amended law, plant based products, such as Tofurky’s veggie burgers or sausage, would be deemed to be misleading unless the labels contain an appropriate qualifier such as “plant-based,” “veggie,” “lab grown,” or “lab created.” Lab-grown or cultured meat products (also referred to as “clean meat”) is a new technology in which meat is grown from in vitro animal cell culture instead of from slaughtered animals. These products have not yet debuted in the marketplace. Continue reading “Court Rejects Tofurky’s Request for Preliminary Injunction to Halt Enforcement of Missouri’s Meat Advertising Law”

August 23, 2019August 23, 2019 by Michelle Pardo

Goodbye Big Food, Hello Lawsuit: Animal Rights Group Files Case Over Dairy Product Marketing

By: Michelle C. Pardo

Known for its “Dairy Done Right” marketing campaign, Tillamook County Creamery Association (“Tillamook”), which produces dairy products like cheese, yogurt, ice cream and butter, is the latest target of a consumer fraud lawsuit filed this week in Oregon state court (Multnomah County). Animal rights group Animal Legal Defense Fund (ALDF) is co-counsel to four Oregon residents and a class of similarly situated consumers who claim Tillamook uses deceptive representations when advertising and marketing its dairy products, which is likely to confuse or mislead customers. Continue reading “Goodbye Big Food, Hello Lawsuit: Animal Rights Group Files Case Over Dairy Product Marketing”

August 2, 2019 by Rebecca E. Bazan

100% Natural Case 100% Dismissed: You Can’t Have a False Advertising Case Without Advertising

A federal judge in the Northern District of California recently dismissed a false advertising case brought by two non-profit groups, finding that their own testimony sunk their claims.

The two plaintiffs, the Center for Food Safety and Friends of the Earth, sued Sanderson Farms Inc. (“Sanderson”), alleging that Sanderson’s advertisements of its chicken as “100 percent natural” was misleading in violation of California’s Unfair Competition Law (“UCL”) and False Advertising Law (“FAL”). The organizations alleged that reasonable consumers would interpret the statement “100 percent natural” to mean that the chicken was raised without any antibiotics ever, whereas Sanderson’s chicken products are raised with antibiotics, but such antibiotics have cleared prior to sale. In December 2018, the judge denied Sanderson’s motion to dismiss, finding that the organizations had adequately alleged violations of the UCL and FAL. The case then proceeded into discovery.

On July 31, 2019, however, the judge granted Sanderson’s new motion to dismiss, holding that the organizations lacked standing to bring the case. Friends of the Earth, et al. v. Sanderson Farms, Inc., No. 3:17-cv-03592-RS (N.D. Cal. July 31, 2019) (ECF 221). While the organizations alleged in their complaint that they had diverted resources to combat Sanderson’s allegedly misleading advertising, the evidence produced in discovery revealed that to be false. The judge found that the activities the organizations undertook were related to antibiotic use generally, and were not in reaction to Sanderson’s advertising. “Perhaps most damaging,” the judge found, were the organizations’ own depositions, in which they admitted “they did not divert resources because of Sanderson’s advertising” and stated that “they would have undertaken the same advocacy activities—including advocating against the use of antibiotics in animal agriculture and discouraging consumers from purchasing meat raised with routine antibiotics—even if Sanderson had never aired the challenged advertisements,” and that “they would have encouraged Sanderson’s customers to avoid Sanderson and other products that used routine antibiotics regardless of the existence of the advertising.” Id. at 5-6. In other words, the organizations’ real issue was with Sanderson’s practices, not its advertising. But, as the judge found, “This is a false advertising case, and Plaintiffs must establish that their alleged injury is traceable to the challenged ads at issue.” Id. at 6. Because the organizations fatally undercut their own claim that any “injury” they had was caused by Sanderson’s advertising, the judge dismissed their case.

This case is a good reminder of two points for companies who might find themselves on the defense side of a federal case brought by an advocacy group—

First, for a plaintiff to have a successful case, not only must they have a substantive claim (here, alleged violation of false advertising statutes), but they also must have a valid theory of standing. In federal court, to have standing a plaintiff must have an injury that is caused by the action of the defendant and redressable by a favorable ruling. See Lujan v. Defs. of Wildlife, 504 U.S. 555, 560-61 (1992). For cases involving individual plaintiffs, standing theories can often be straightforward (e.g., “I sustained a physical injury when the defendant ran the red light and hit me” or “I spent money on this product that was falsely advertised that I wouldn’t have spent if it was truthfully advertised”). When organizations decide to become plaintiffs, they often have to use other standing theories. Some common theories: informational injury standing (a statute requires that the organization be provided certain information that was withheld). See, e.g., Federal Election Commission v. Akins, 524 U.S. 11 (1998)); organizational injury standing (defendant’s conduct frustrates the organization’s mission and caused it to divert resources away from programmatic activities towards combatting the defendant’s conduct). See, e.g., La Asociacion de Trabajadores de Lake Forest v. City of Lake Forest, 624 F.3d 1083 (9th Cir. 2010)); and associational standing (at least one of the organization’s members has standing to sue in their own right; the interests at stake are germane to the organization’s purpose, and neither the claim asserted nor the relief requested requires the participation of individual members). See, e.g., Friends of the Earth v. Laidlaw Envtl. Servs., (TOC), Inc., 528 U.S. 167 (2000).

It is important for defendants to think not just about how to defend themselves on the substance/merits of the claims in a lawsuit, but also to think about whether the person/entity bringing the lawsuit actually has the right to do so. If the plaintiff does not have standing, the case should be dismissed regardless of the strength of the underlying claim. In the Sanderson case, the judge previously found that the plaintiff organizations had adequately alleged their substantive UCL and FAL claims, but ultimately dismissed the entire case because the organizations could not establish the organizational injury standing they pled—they could not show that they had diverted organizational resources as a result of the alleged false advertising.

Second, a defendant can raise a plaintiff’s lack of standing at any point in the case. Defendants often want to bring such a challenge in a motion to dismiss at the beginning of a case before expending resources on discovery. However, on a motion to dismiss, the judge is required to assume that the allegations in the complaint are true. For example, if an organizational plaintiff alleges that it diverted funds from one of its activities to combatting a defendant’s false advertising, the judge must assume that is true, making it difficult for a defendant to succeed in getting a well-pleaded case dismissed for lack of standing at the motion to dismiss stage. However, defendants should take heart that if forced to go into discovery on the merits, they should take the opportunity to get discovery on the plaintiff’s standing theory. The deposition testimony given by the plaintiffs in the Sanderson case is ultimately what led to their demise and the dismissal of the case. Defendants should remember that even if they fail at getting a case dismissed for lack of standing early in the case, that they should try, try again. The burden to prove standing is on the plaintiffs throughout a case, and the bar for what they must demonstrate gets raised at each stage. Adequately alleging standing is not the same thing as proving it. Sometimes, as in the Sanderson case, discovery can reveal that it is a plaintiff’s standing theory (not the defendant’s advertising) that is false.

July 24, 2019 by Michelle Pardo

The Beef Goes On: Tofurky Challenges Arkansas Meat Labeling Law

by Michelle C. Pardo

Tofurky goes to court – again. On July 22nd, Turtle Island Foods (doing business as The Tofurky Company) filed a federal lawsuit in the Eastern District of Arkansas against the Arkansas Bureau of Standards to challenge the constitutionality of an amended Arkansas law that prohibits “purveyors of plant- or cell-based meats” from using the words “meat” and related terms like “beef,” “pork,” “roast,” and “sausage.” See Ark. Code Ann. § 2-1-305. Violations of the law, which goes into effect on July 24, 2019, may be punished by civil penalty up to $1,000. Counsel for Tofurky includes animal activist group Animal Legal Defense Fund, the ACLU Foundation, and The Good Food Institute, a Washington, DC based advocacy group (whose founder previously ran vegan campaigns for PETA). All of these organizations previously teamed up with Tofurky to challenge Missouri’s amended meat advertising law. Continue reading “The Beef Goes On: Tofurky Challenges Arkansas Meat Labeling Law”

July 9, 2019July 9, 2019 by Michelle Pardo

No Meating of the Minds: Settlement Reaches An Impasse In Missouri Meat Advertising Lawsuit

By Michelle C. Pardo

We previously blogged about the case of Turtle Island Foods d/b/a Tofurky Company, et al. v. Richardson, 2:18-cv-04173-NKL, pending in the Western District of Missouri and the parties efforts to settle the lawsuit since late 2018. The lawsuit, brought by the plant-based food producer and the advocacy group, The Good Food Institute (Executive Director, Bruce Friedrich, was the former leader of PETA’s vegan campaigns) and represented by the animal rights group Animal Legal Defense Fund (ALDF)and the ACLU of Missouri Foundation, filed a status report this month informing the court that “the parties do not believe that additional time will allow for resolution of the impasse. The parties are grateful for the Court’s patience as they attempted to reach a final settlement agreement.” The Joint Status Report also asks the court to resume the litigation that was originally filed in August of 2018, the day after the Missouri statute went into effect.

The case, which has received widespread media and industry attention, sought to challenge Missouri’s first-in-the-nation meat advertising law that prohibited companies from “misrepresenting a product as meat that is not derived from livestock or poultry.” Mo. Rev. Stat. § 265.494(7). The plaintiffs allege that the statute is unconstitutional and argue that it was not enacted to address consumer confusion, but rather to protect and favor the agriculture industry. Plaintiffs claim that the law is overly broad and that no plant or cell-based producer can determine whether their food labeling would leave them exposed to criminal prosecution. This is despite the fact that the Director’s Office of the Missouri Department of Agriculture (MDA) issued guidance to plant-based and cell-based producers on how to modify their labels to avoid referrals for criminal prosecution. MDA indicated that it would not refer products with labels that contain, for example, prominent statements that the product is “plant based”, “veggie”, “lab grown” or a comparable qualifier.

Tofurky products include terms such as “burgers”, “chorizo style sausage”, “slow roasted chick’n” “hot dogs” and “ham roast”, some of which are coupled with qualifiers such as “veggie”, “plant-based” and “vegetarian”.

ALDF, an animal rights organization representing plaintiffs, has stated that the law “stifles innovation” from cell-based producers. Cell-based or lab-grown meat has been touted as an industry game-changer in overhauling the way in which animal protein products are developed and provided to consumers, though none are commercially available yet. Ironically, Washington, DC-based plaintiff, The Good Food Institute, has stated that the Missouri law is unnecessary because “misbranding is already prohibited by federal law.” But animal and environmental activist groups have frequently litigated consumer fraud lawsuits against animal protein producers, despite the fact that the producers’ labels and advertising have complied with federal law, rejecting arguments that federal preemption invalidates their lawsuits.

The Missouri Cattlemen’s Association Executive Vice President Mike Deering has disagreed with the animal activist group and plaintiffs’ position:

The legislation does not stifle technology, but it ensures the integrity of our meat supply and reduces consumer confusion. . . The use of traditional nomenclature on alternative products is confusing to consumers and weakens the value of products derived from actual livestock production.”

Two months after the complaint was filed, the plaintiffs filed a preliminary injunction, alleging that they face irreparable harm absent preliminary injunctive relief. Tofurky’s harm, plaintiffs allege, is the conundrum the amended statute presents: risk criminal prosecution or change the way Tofurky does business by creating specialized marketing and packaging for the state of Missouri or refraining from selling products in Missouri entirely, both of which create additional cost and potential market disadvantages.

The parties had commenced settlement negotiations in late 2018 and had been providing the court with monthly status updates about their progress. The court has not yet issued a scheduling or other order resuming deadlines in the case.

September 7, 2018September 10, 2018 by Michelle Pardo

“What’s Your Beef”? Legal Challenge to Missouri’s New Meat Advertising Law

by Michelle C. Pardo

Animal rights and environmental activists have long led the charge into federal and state courts with consumer fraud actions challenging representations made about animal products, ostensibly arguing that consumers are misled by animal welfare claims on labels, but often with the ultimate goal of removing from a label something that the activists fear is influencing consumers’ purchase of an animal product.

Missouri’s new, first-in-the-nation law (amending its prior meat advertising law) prohibits companies from “misrepresenting a product as meat that is not derived from harvested livestock or poultry.” Mo. Rev. Stat. § 265.494(7). This amendment may put animal and environmental activist groups on their heels as it changes the way that products not derived from animals can be labeled.

Continue reading ““What’s Your Beef”? Legal Challenge to Missouri’s New Meat Advertising Law”