Class Action Targeting ‘Recyclable’ Claims Used in Connection With Single-Serve Coffee Pods Moves Forward

Arent Fox
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Arent Fox

In September 2018, a consumer filed a putative class action in California against Keurig Green Mountain, Inc.
 

The consumer alleged that the company is participating in deceptive business practices by marketing, advertising, and selling single-serve coffee pods that are misleadingly labeled as “recyclable.” After rejecting Keurig’s motion to dismiss, the Court granted the plaintiffs’ motion for class certification in September 2020.

The Consumer’s Allegations

Some of Keurig’s single-serve plastic coffee pods (“K-cups” or “Pods”) are marketed, sold, and labeled as “recyclable.” The consumer alleged that the Pods are, in fact, not recyclable because (i) less than 60% of municipal recycling facilities (MRF) will accept the Pods for recycling; (ii) the Pods’ size prevents them from being properly sorted by recycling programs; and (iii) there is a lack of end markets to recycle the Pods.

Based on the foregoing assertions, the consumer alleged seven causes of action in her complaint, including: “(i) breach of express warranty; (ii) violation of California Consumers Legal Remedies Act (“CLRA”); (iii) violation of California’s Unfair Competition Law (UCL) based on fraudulent acts and practices; (iv) violation of UCL based on the commission of unlawful acts; (v) violation of the UCL based on unfair acts and practices; and (vi) unjust enrichment.”

Keurig’s “Recyclable” Claims

The US Federal Trade Commission’s (FTC) Green Guides establish standards for “recyclable” claims. Specifically, they “advise marketers to qualify recyclable claims when recycling facilities are not available to a ‘substantial majority’ of consumers or communities where a product is sold,” and that ‘substantial majority,’ as used in this context, means at least 60 percent.” The Guides further state that “if a product is rendered non-recyclable because of its size or components…then labeling the product as recyclable would constitute deceptive marketing.”

Keurig asserted that their Pods’ labels are compliant with the Guides because they contain the proper qualifying statements. Specifically, along with the “recyclable” claims, Keurig’s labels contained the statement “Check locally* to recycle empty cup,” with the asterisk allegedly indicating to consumers that the Pods may not be “recycled in all communities.” This argument failed, in part, because if, as the consumer alleges, the Pods’ size and materials render them non-recyclable, then such a disclaimer could mislead a consumer into falsely believing that there is reason to check their local recycling facilities in the first place.

As a result, the Court denied Keurig’s motion to dismiss, finding that the complaint adequately alleged that the Pods’ size and design render them non-recyclable; which, if true, would make their “recyclable” claims non-compliant with the Green Guides.

Takeaway

“Recyclable” claims and other “green” advertising claims are compelling to consumers, but they are also closely scrutinized by regulators and class action attorneys. In addition to “recyclable” claims, the FTC’s Green Guides provide specific and detailed guidance on a large number of green claims including “compostable” and “degradable” claims, renewable energy claims, carbon offset claims, and the use of third-party certifications and seals of approval. Before disseminating any such claims, marketers should ensure that the claims are adequately substantiated and reflect FTC guidance.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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