LYNN MOORE, SHANQUE KING, and JEFFREY AKWEI, Plaintiffs-Appellants, v. TRADER JOE’S COMPANY, Defendant-Appellee.
No. 19-16618
United States Court of Appeals for the Ninth Circuit
Filed July 15, 2021
D.C. No. 4:18-cv-04118-KAW. Argued and Submitted October 15, 2020 San Francisco, California.
Before: Kim McLane Wardlaw, Daniel P. Collins, Circuit Judges, and Richard K. Eaton, Judge.
Appeal from the United States District Court for the Northern District of California Kandis Westmore, Magistrate Judge, Presiding
Opinion by Judge Wardlaw
*Richard K. Eaton, Judge of the United States Court of International Trade, sitting by designation.
Product Labeling
The panel affirmed the district court’s
The panel held that Trader Joe’s Manuka Honey labeling would not mislead a reasonable consumer as a matter of law. By the Food and Drug Administration’s own definition, Manuka honey is a honey whose “chief floral source” is the Manuka flower. Trader Joe’s Manuka Honey met this standard. The panel agreed with the district court’s conclusion that Trader Joe’s label was accurate because there was no dispute that all of the honey involved was technically manuka honey, albeit with varying pollen counts.
Even though Trader Joe’s front label was accurate under the FDA’s guidelines, plaintiffs maintained that “100% New Zealand Manuka Honey” could mislead consumers into thinking that the honey was 100% derived from Manuka flower nectar. The panel held that a reasonable consumer would be dissuaded from this unreasonable interpretation by three key contextual inferences from the product itself: (1) the impossibility of making a honey that is 100% derived from one floral source; (2) the low price of Trader Joe’s Manuka Honey, and (3) the presence of the “10+” on the label.
COUNSEL
C. K. Lee (argued), Lee Litigation Group PLLC, New York, New York; David Alan Makman, Law Offices of David A. Makman, Redwood City, California; for Plaintiffs-Appellants.
Dawn Sestito (argued) and Collins Kilgore, O’Melveny & Myers LLP, Los Angeles, California, for Defendant-Appellee.
OPINION
WARDLAW, Circuit Judge:
The parties find themselves in a sticky situation. Trader Joe’s Company (“Trader Joe’s”) markets its store brand Manuka honey as “100% New Zealand Manuka Honey” or “New Zealand Manuka Honey,” but Plaintiffs, on behalf of a putative class, claim that because Trader Joe’s Manuka Honey actually consists of only between 57.3% and 62.6% honey derived from Manuka flower nectar, Trader Joe’s engaged in “false, misleading, and deceptive marketing” of its Manuka honey. Stung by these accusations, Trader Joe’s counters that its labeling is consistent with all applicable Food and Drug Administration (“FDA”) guidelines, which permit labeling honey by its “chief floral source” and with which Trader Joe’s contends its Manuka honey plainly
Because we conclude that Trader Joe’s Manuka Honey labeling would not mislead a reasonable consumer, we affirm.
I.
Honey is a sweet and syrupy food product that bees produce from the nectar of plants that they visit, which is then stored in honeycombs. See U.S. Food and Drug Admin., Proper Labeling of Honey and Honey Products: Guidance for Industry (2018) (the “Honey Guidelines”); Honey, Encyclopedia Britannica.1 While the two are often linked, honey is not made from pollen, but, as here, pollen counts can provide a useful estimation of the underlying floral sources for a particular honey.2 Bees will often forage on different flowering plants, but the FDA permits labeling honey, which is “a single-ingredient food,” with “the name
“Manuka Honey” is a subset of honey whose chief floral source is the flowers of the Manuka bush, a plant native to Australia and New Zealand. Scientific researchers have found that Manuka honey contains an organic compound, methylglyoxal, which is believed to have antibacterial properties and significant health benefits, particularly when applied topically. Specifically, Manuka honey’s “antibacterial potency” gives it significant “efficacy as dressing for wounds, burns, skin ulcers and in reducing inflammation.” As a result of Manuka honey’s beneficial qualities and the geographic barriers to its widespread production, the product is in high demand and low supply, resulting in a price far in excess of other honeys.
In an effort to regulate and communicate the concentration of Manuka in Manuka Honey products sold to consumers, Manuka honey producers have created a scale to grade the purity of Manuka honey called the Unique Manuka Factor (“UMF”) grading system. The UMF system grades honey on a scale of 5+ to 26+ based on the concentration of methylglyoxal that is itself related to the concentration of honey derived from Manuka flower nectar. Thus, among Manuka honeys, higher concentrations of honey derived specifically from Manuka flower nectar, i.e., higher concentrations of methylglyoxal and higher UMF grades,
Trader Joe’s primarily sells grocery products, among them its own brand of Manuka Honey. Trader Joe’s branded Manuka Honey is labeled with a UMF grade of 10+,3 a relatively low grade, and sells for the comparatively low price of $13.99 per jar, or $1.59 per ounce. Some jars of Trader Joe’s Manuka Honey are labeled as “100% New Zealand Manuka Honey” while others are simply labeled “New Zealand Manuka Honey.”
Lynn Moore, Jeffrey Akwei, and Shanque King (“Plaintiffs”), allege that they were misled by the product’s label when they purchased Trader Joe’s Manuka Honey. In July 2018, Plaintiffs filed this lawsuit against Trader Joe’s on behalf of a putative class of all United States Trader Joe’s consumers in the District Court for the Northern District of California, claiming that Trader Joe’s engaged in deceptive marketing practices in violation of a variety of state
Specifically, Moore claims to have been misled by the label’s statement that the product was “100% New Zealand Manuka Honey” while Akwei and King—who purchased bottles without the “100%” label—claim to have been misled by the ingredient list, which lists “Manuka Honey” as the sole ingredient. Plaintiffs claim that both labeling choices were misrepresentations based on their independent testing, which revealed that only between 57.3% and 62.6% of the honey came from Manuka flower nectar, as estimated by pollen content, with the remainder coming from other floral sources. Plaintiffs allege that the label and ingredient list created the false impression that Trader Joe’s Manuka
In June of 2019, the district court granted Trader Joe’s motion to dismiss Plaintiffs’ complaint for failure to state a claim under
II.
We have jurisdiction under
III.
We address one primary issue on appeal: whether the district court erred in holding that Trader Joe’s representations on its label and ingredient statement were not misleading as a matter of law. Because we conclude Trader Joe’s representations are not misleading to a reasonable consumer as a matter of law, we do not reach whether Plaintiffs’ claims are also preempted by federal labeling laws.7
The district court did not err in concluding that Trader Joe’s Manuka Honey label, which advertised its contents as “100% New Zealand Manuka Honey,” was not misleading to a reasonable consumer as a matter of law.
The district court based much of its decision on the FDA’s Honey Guidelines. The FDCA and its implementing regulations set the standards for “the proper labeling of honey and honey products,” Honey Guidelines at 3, and, although the Honey Guidelines are not themselves binding, compliance with them constitutes compliance with the misbranding provisions of the FDCA. See
Trader Joe’s Manuka Honey meets this standard. As Plaintiffs’ own tests reveal, Trader Joe’s Manuka Honey is derived from between 57.3–62.6% Manuka flower nectar (as estimated by pollen count); therefore the honey’s “chief
Even though Trader Joe’s front label is accurate under the FDA’s guidelines, Plaintiffs maintain that “100% New Zealand Manuka Honey” could nonetheless mislead consumers into thinking that the honey was “100%” derived from Manuka flower nectar. Under the consumer protection laws of California, New York, and North Carolina, the states in which Plaintiffs reside, claims based on deceptive or misleading marketing must demonstrate that a “reasonable consumer” is likely to be misled by the representation. See Ebner v. Fresh Inc., 838 F.3d 958, 965 (9th Cir. 2016) (holding that “claims under the California consumer protection statutes are governed by the ‘reasonable consumer’ test” (citation omitted)); Solum v. CertainTeed Corp., 2015 WL 6505195 at *5 (E.D.N.C. Oct. 27, 2015) (“Under North Carolina law, reliance upon a representation is reasonable only when the recipient of the representation uses reasonable care to ascertain the truth of that
As noted by the district court, there is some ambiguity as to what “100%” means in the phrase, “100% New Zealand Manuka Honey.” In that context, 100% could be a claim that the product was 100% Manuka honey, that its contents were 100% derived from the Manuka flower, or even that 100% of the honey was from New Zealand. To analyze whether this ambiguity could mislead a reasonable consumer, the district court adopted the reasoning of In re 100% Grated Parmesan Cheese Mktg. & Sales Practices Litig., in which the court considered other information readily available to the consumer that could easily resolve the alleged ambiguity. 275 F. Supp. 3d 910, 926 (N.D. Ill. 2017). Although the Seventh Circuit ultimately reversed 100% Grated Parmesan Cheese’s “ambiguity rule for front-label claims” in Bell v. Publix Super Markets Inc., 982 F.3d 468 (7th Cir. 2020),
Here, reasonable consumers would necessarily require more information before they could reasonably conclude Trader Joe’s label promised a honey that was 100% derived from a single, floral source. And, although Trader Joe’s ingredient label listed “Manuka Honey” as the only ingredient, which Plaintiffs argue “reinforc[es] the deception created by the front label,” information available to a consumer is not limited to the physical label and may involve contextual inferences regarding the product itself and its packaging. See Bell, 982 F.3d at 476 (“[T]he context of the entire packaging is relevant.”); Becerra, 945 F.3d at 1229 (holding that a reasonable consumer would understand the word “diet” on a soda label in context to make a comparative claim only about the product’s caloric content, not to make a claim that the soda promotes weight loss generally).
While we agree with the Seventh Circuit that “[d]eceptive advertisements often intentionally use ambiguity to mislead consumers while maintaining some level of deniability about the intended meaning[,]” it also
Even setting that distinction aside, a reasonable consumer would be quickly dissuaded from Plaintiffs’ “unreasonable or fanciful” interpretation of “100% New Zealand Manuka Honey” based on three key contextual inferences from the product itself: (1) the impossibility of making a honey that is 100% derived from one floral source, (2) the low price of Trader Joe’s Manuka Honey, and (3) the presence of the “10+” on the label, all of which is readily available to anyone browsing the aisles of Trader Joe’s.
Notably, the Seventh Circuit in Bell was careful to “stress[] that consumers are likely to exhibit a low degree of care when purchasing low-priced, everyday items,” including “low-cost groceries” like shelf-stable parmesan cheese. 982 F.3d at 479. Consumers of Manuka honey, a niche, specialty product,11 are undoubtedly more likely to exhibit a higher standard of care than “a parent walking down the dairy aisle in a grocery store, possibly with a child or two in tow,” who is “not likely to study with great diligence the contents of a complicated product package.” Danone, US, LLC v. Chobani, LLC, 362 F. Supp. 3d 109, 123 (S.D.N.Y. 2019). Rather, an average consumer of Manuka honey would likely know more than most about the production of the product and the impossibility of a honey that is 100% derived from Manuka flower nectar. Regardless, given the sheer implausibility of Plaintiffs’ alleged interpretation, a consumer of any level of sophistication could not reasonably interpret Trader Joe’s label as Plaintiffs assert. See Gitson v. Trader Joe’s Co., No. 13-CV-01333-VC, 2015 WL 9121232, at *1 (N.D. Cal. Dec. 1, 2015) (“The reasonable consumer (indeed, even the least
Second, the inexpensive cost of Trader Joe’s Manuka Honey would signal to a reasonable consumer that the product has a relatively lower concentration of honey derived from Manuka flower nectar. Trader Joe’s Manuka Honey costs just $13.99 per jar ($1.59 per ounce) while a jar of approximately 92% honey derived from Manuka flower nectar, as estimated by pollen count, costs around $266 ($21.55 per ounce). As Plaintiffs’ complaint alleges, the reasonable consumer of Manuka honey, a specialty product, “know[s] that the concentration of manuka [nectar, as measured by pollen,] as opposed to other honey pollens can vary significantly from brand to brand depending on what measures have been taken to maximize manuka purity.” “[T]hey attach importance to representations that communicate a higher purity level.” A reasonable consumer in the market for Manuka honey, who is well aware of the varying concentrations of Manuka in different Manuka honeys, would thus not reasonably expect a jar of honey that is “100%” derived from Manuka to cost only $13.99. See, e.g., Jessani v. Monini N.A., Inc., 744 Fed App’x. 18, 19 (2d Cir. 2018) (noting that no reasonable consumer would believe a bottle of truffle flavored olive oil contained real truffles, “the most expensive food in the world,” in part because of its inexpensive price).
Third, Trader Joe’s label includes a sticker saying “10+,” which represents the honey’s rating on the UMF scale. While there are no other details on the jar about what “10+” means, the presence of this rating on the label puts a reasonable consumer on notice that it must represent something about the product. Reasonable consumers of
For these reasons, a reasonable consumer could not be left with the conclusion that “100% New Zealand Manuka Honey” represents a claim that the product consists solely of honey derived from Manuka. Rather, a reasonable consumer would be left only with the conclusion that “100% New Zealand Manuka Honey” means that it is 100% honey whose chief floral source is the Manuka plant, which is an accurate statement, as Plaintiffs themselves concede. In Plaintiffs’ words, “[t]he Product is ‘100% Manuka Honey’ only in the attenuated legalistic sense that the FDA Honey Guidance may authorize Trader Joe’s to market each and every tablespoon of honey in the product as ‘Manuka Honey’ notwithstanding that 40% of the honey is non-manuka.”
Thus, the district court did not err in dismissing Plaintiffs’ claims regarding the front label. See Ebner, 838 F.3d at 966.
B.
The district court also properly held that Trader Joe’s representation of “Manuka Honey” as the sole ingredient on its ingredient statement was not misleading as a matter of law.
Plaintiffs nonetheless argue that while “Manuka Honey” may be permissible as a “common or usual name” for a label, listing it as the sole ingredient may nevertheless mislead a reasonable consumer because it creates a misleading impression that the product contains a higher percentage of honey derived from Manuka flower nectar than it actually does. Plaintiffs are correct that FDA regulations do require that “[t]he common or usual name of a food shall include a statement of the presence or absence of any characterizing ingredient(s) or component(s)” that have a “material bearing on price or consumer acceptance” or when the labeling might “create an erroneous impression that such ingredient(s) or component(s) is present.”
Moreover, Trader Joe’s cannot reasonably be said to have claimed in its ingredient statement that the percentage of honey derived from Manuka flower nectar is 100%. Reasonable consumers would understand that Trader Joe’s listing Manuka honey as the sole ingredient merely represents the accurate statement that Manuka honey is the only ingredient, i.e., that there are no additives or other honeys present in the product, not that it is exclusively derived from Manuka. See Ebner, 838 F.3d at 966. Thus,
Nonetheless, Plaintiffs argue that listing “‘Manuka Honey’ in the ingredients statement” could still mislead consumers into believing that “the product consists entirely of manuka honey,” particularly when taken together with the statement “100% New Zealand Manuka Honey” when present on the front label. As we have concluded, Trader Joe’s Manuka Honey entirely consists of Manuka honey, so the ingredients statement does not “display any affirmative misrepresentations” that would mislead a reasonable consumer. Workman v. Plum, Inc., 141 F. Supp. 3d 1032, 1036 (N.D. Cal. 2015). Thus, the ingredients statement simply confirms what the front label of Trader Joe’s Manuka Honey accurately conveys, i.e., that the product in fact does “100%” consist of honey whose chief floral source is Manuka. Williams v. Gerber Products Co., 552 F.3d 934, 939–40 (9th Cir. 2008) (holding that “reasonable consumers
Accordingly, the district court did not err in holding that Trader Joe’s properly listed Manuka honey as the sole ingredient and that the ingredient statement is therefore not misleading as a matter of law.
IV.
In sum, the district court properly dismissed this action under
AFFIRMED.