481 F.Supp.3d 94
E.D.N.Y2020Background
- Plaintiffs (purchasers of A&W root beer and cream soda) allege the front label “MADE WITH AGED VANILLA” falsely implies the characterizing vanilla flavor is derived from real, aged vanilla beans.
- Independent laboratory testing (alleged in the complaint) showed the vanilla flavor predominantly or exclusively comes from ethyl vanillin, a synthetic substitute.
- Labels also disclose “Natural and Artificially Flavored”; plaintiffs say that disclosure does not communicate that artificial flavoring overwhelms any natural vanilla, and in some product photos it is not readily visible from the front.
- Plaintiffs brought a putative class action under New York General Business Law §§ 349 and 350 and unjust enrichment, seeking monetary relief and injunctive relief (plus an FDA-based claim).
- Defendants moved to dismiss for lack of standing to seek injunctive relief and as a matter of law arguing a reasonable consumer would not be misled given the “Natural and Artificially Flavored” disclosure.
- Court: dismissed plaintiffs’ request for injunctive relief for lack of Article III standing; denied dismissal of GBL §§ 349/350 and unjust enrichment claims (plausible misrepresentation under Mantikas); dismissed any private cause of action to enforce FDA regulations; reduced previously imposed sanctions to $1,000.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing for injunctive relief | Plaintiffs will repurchase if defendants change labeling or formulation, so injunctive relief redresses future injury | Plaintiffs admit they will not repurchase absent changes, so no certainly impending injury | No standing; injunctive relief dismissed (plaintiffs unlikely to repurchase as pleaded) |
| Whether “MADE WITH AGED VANILLA” is misleading | Phrase conveys to reasonable consumers that vanilla flavor comes predominantly from natural aged vanilla; testing shows synthetic ethyl vanillin predominates or natural vanilla is de minimis/absent | The label is truthful because any vanilla (if present) is technically accurate and the package discloses “Natural and Artificially Flavored” | Misleading claim plausibly alleged; complaint survives motion to dismiss under Mantikas (front-panel prominence can mislead despite side disclosures) |
| Effect of “Natural and Artificially Flavored” disclosure | That disclosure does not quantifiably indicate artificial flavor predominates and may not be visible from the front | The disclosure cures any deception by informing consumers flavors are artificial | Disclosure insufficient at pleading stage to defeat deception claim; reasonable consumer could be misled |
| FDA regulation-based claim | Plaintiffs alleged violation of FDA labeling rules | No private right of action to enforce FDA regulations | FDA-based claim dismissed (no private enforcement) |
Key Cases Cited
- Mantikas v. Kellogg Co., 910 F.3d 633 (2d Cir. 2018) (front-of-package representations can be misleading even when side-panel disclosures are technically accurate)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must state a plausible claim)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (complaints must contain more than conclusory allegations)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (Article III standing requirements)
- Kommer v. Bayer Consumer Health, [citation="710 F. App'x 43"] (2d Cir. 2018) (no standing for injunctive relief absent intent to repurchase)