The Kellogg Company has become the latest manufacturer to settle a consumer class-action suit related to the use of nutritional and health terms on food labeling. In addition to establishing a settlement fund of nearly $5.5 million, Kellogg, the world's largest manufacturer of breakfast cereals and other food products, agreed last week to drop certain terms including "all natural" and "nothing artificial" from some of its Kashi and Bear Naked brand products. Kellogg took this step as part of a proposed settlement ending a series of class-action lawsuits asserting that the company's use of those terms on packaging for various products was misleading because the products contained processed or manufactured ingredients.
Loeb & Loeb partner Liv Kiser, who co-chairs the firm's Health and Wellness Marketing Compliance Task Force, believes that consumer class-action lawsuits alleging false and misleading labeling are proliferating for a number of reasons, including that health-conscious consumers are demanding greater accuracy in packaging and advertising. While some courts have dismissed these types of cases at the pleading stage or have denied class certification, they remain attractive - and lucrative - to plaintiffs' lawyers, and companies should expect this trend in class-action litigation to continue.
According to Kiser, Kellogg's resolution of the Kashi and Bear Naked claims is also part of another trend - companies altering the wording on their product packaging and advertising, whether because they are facing actual litigation or attempting to prospectively minimize the risk of similar suits. Because "all natural" and similar terms have been lightning rods for so many lawsuits - including the Kellogg suit, among others - companies are moving away from using absolutes on their labels, replacing phrases like "100 Percent Natural" or "No Artificial Ingredients" with less precise terms, for example by replacing "natural" or "simply natural" with just "simply" in the name of a product.
Historically, companies have focused primarily on complying with applicable government regulations for food labeling. To date, the Food and Drug Administration has not developed a definition for the use of the word "natural" on food products; however, in fact, the agency recently declined to do so in the context of labeling for food that may include ingredients made from genetically modified organisms (GMOs). (Read our recent alert on the FDA's decision here.) While the agency does not have a formal definition for "natural," its stated policy since 1993 is that the use of "natural" on food labeling "means that nothing artificial or synthetic (including all color additives regardless of source) has been included in, or has been added to, a food that would not normally be expected to be in the food."
Given the FDA's refusal to provide an administrative determination on this issue and the risk created by the proliferation of class-action lawsuits regarding the use of "natural" and its various versions (all natural, 100 percent natural, made from all natural ingredients, etc.), Kiser also believes that companies will need to expand their attention to include a risk/threat assessment around the descriptors and adjectives that they are using to distinguish their products.
Kiser serves as a resource to the media on issues of product advertising and labeling within the food, health and wellness categories, and she was quoted in several articles addressing legal implications of the recent Kellogg settlement, including by the New York Times, the Chicago Tribune and USA Today.
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