5 Lawsuits That Could Change The Food Industry

Lillianna Byington@lil_byington

Dec. 11, 2018

From unwanted ingredients and debatable labels to the spreading of salmonella and E. coli, food companies have been in the crosshairs of litigation this year with cases that can both change recipes and the way manufacturers do business.

Lawyers told Food Dive they have kept busy with issues ranging from food that caused outbreaks to lawsuits challenging label claims, nonfunctional slack fill and contamination with glyphosate. When it comes to lawsuits associated with foodborne illnesses, attorney Bill Marler — a leader in that space — can attest to the recent increase. 

"It's been a bad year for food safety and it's more than anecdotal," Marler told Food Dive. "I've had to hire three more lawyers and two more paralegals in the last six months. It's always a bad sign if Bill Marler is hiring more lawyers. That tells you that in the food system, there's something wrong."

But it hasn't just been foodborne illness lawsuits that have had an impact on the industry. There have also been many labeling lawsuits, challenging product claims including "natural," "healthy" and "nothing artificial."

Kevin Laukaitis, an attorney at Kohn, Swift and Graf who focuses on class action consumer litigation involving defective products, told Food Dive the healthy product trend has led to an increase in mislabeling cases. More companies have been advertising better-for-you claims to attract consumers, and that will likely lead to more lawsuits challenging the validity of those labels, he said.

This year alone, there have been many lawsuits filed and numerous resolved that could factor into future cases and help answer some of the big questions looming over the industry. What makes a valid label claim? Who is responsible for foodborne illness? How much empty space can be used in packaging? Here are five cases moving the industry toward answers.

1.) Is LaCroix "natural"?

Credit: Flickr user Tony Webster

What happened: LaCroix came under fire this year in a lawsuit that claimed it mislabels its water as "natural," though the actual ingredients are non-natural and synthetic compounds — not what its cult fan base wants to hear. The legal complaint, filed Oct. 1, says the product contains items including ethyl butanoate, limonene, linalool and linalool propionate. Linalool is used in cockroach insecticide. 

The class-action suit was filed in Cook County, Illinois against National Beverage Corp., the parent company of LaCroix. National Beverage Corp. denies the claims, saying all essences in LaCroix sparkling waters are 100% natural. But this case has already brought the company into a negative light for consumers. The case is ongoing and hasn't reached trial yet, but LaCroix plans to fight, writing on Twitter days later, "please stand with us as we defend our beloved LaCroix."

What it means: LaCroix has advertised its product as a "natural" alternative to soda, but it may be up to a jury to decide whether the compounds found in the sparkling drink indeed come from natural substances, as well as what should be considered "natural." The National Beverage Corporation has said that the ingredients in LaCroix are "derived from the natural essence oils from the named fruit used in each of the flavors" and certified to be "100% natural." The decision could mean that the company may need to change its labeling.

"It is a huge trend now in business where consumers are interested in natural products, and they want to have healthy products, and they might pay a little more for a product that is natural over a product that is not," Laukaitis said. "But when they come to find out that the product ... has synthetic ingredients or is just like all the other products out there, then that is going to anger the consumer and they are going to feel cheated."

Why it matters: There have been reportedly about 300 lawsuits over the use of the word "natural" on food products in the last three years, according to an analysis cited by CBS News. These types of claims about synthetic ingredients are becoming more common. Natural label claims are such a big issue since there's no industry standard for what the word means.  

"The 'natural' cases are going to be a continued trend because that is the new wave of marketing," Laukaitis said.

But any precedent this case sets could be overruled if the Food and Drug Administration comes out with a regulated definition. In 2015, the FDA opened public comments on the definition of "natural," and Commissioner Scott Gottlieb has said the agency will come out with one soon. 

2.) Impact of JBS' massive meat recall

Credit: Jon Sullivan

What happened: In October, JBS Tolleson, Inc. in Arizona recalled about 7 million pounds of raw beef products because of potential salmonella contamination. Then the company expanded the recall this month to more than 12 million pounds of raw beef. The first lawsuit was filed in Arizona Superior Court on Oct. 5 against JBS Tolleson on behalf of Dana Raab, who contracted a salmonella infection after eating ground beef from the company, experiencing severe dehydration, diarrhea, vomiting and abdominal pain. The case was dismissed last week without prejudice, meaning it could be tried again at a later date or that the case could have been settled out of court. Marler's firm, which was one of the firms handling that case, released a statement last week that they would evaluate any cases related to the recall — which means there could be more filed in the near future.  

What it means: When a massive outbreak like this occurs, manufacturers not only have to deal with the immediate clean up and recall of the products but also are open to further scrutiny when lawsuits are filed months later. The company's reputation will likely take a hit again because consumers are reminded of the incident — and the brand may also have to pay the affected consumers. A case like this also means similar manufacturers will closely watch how it unfolds, taking note of what happened and learning from it.

Why it matters: A recall on this scale can bring many lawsuits, especially since the recall was expanded to 12 million pounds. Marler said it's likely similar cases will be filed since many people could have consumed the product.

These cases could also impact what processors do to ensure food safety because the bad publicity and cost of a recall and lawsuit could force change. Contamination in meat seems to be occurring more this year than it has in the past, Marler said. 

"I'm worried that because there have been so few outbreaks and recalls linked to hamburger in the last decade, you wonder if perhaps companies were getting a little complacent and not paying attention as they should have," Marler said.

3.) Fewer slack-fill cases

Credit: Windell Oskay

What happened: A man in Missouri filed a federal lawsuit claiming that Hershey intentionally sold semi-full packages of candy like Whoppers and Reese's Pieces that contained too much nonfunctional slack fill. The consumer claimed that Hershey was "misleading, deceptive and unlawful." The lawsuit accused Hershey of only filling a $1-sized box of Whoppers about 59% full. His $5 million class action lawsuit moved forward in May 2017. But on Feb. 16, the case was thrown out. The final ruling said the "unjust enrichment claims" were dismissed and could not be brought up in another court. 

What it means: The U.S. district judge on this case ruled that the plaintiff wasn't harmed by partially full packages because he kept buying them. In fact, he purchased more than 600 packages of Hershey candy in a decade. Future rulings could follow this precedent — if consumers are able to see the package and continue to buy it regardless of how full it is, then the consumer can't claim harm. 

Why it matters: More courts are shutting down slack-fill cases like this one,according to Laukaitis. Companies have become more transparent about what is in their packages with serving size, product weight, volume or piece count printed on the outside of the product, so the consumer has a better idea of what he is getting. This specific dismissal also shows that there may be a higher burden of proof for the consumer to show he was harmed and/or misled. 

4.) A potential change in glyphosate litigation

Credit: Flikr

What happened: A California jury awarded a former school groundskeeper $289 million in August because glyphosate in Monsanto's Roundup weed killer likely caused his cancer. Just a few days later, a Florida woman sued General Mills for failing to reveal the presence of glyphosate in its Cheerios products. After the case was filed, a spokesman for General Mills told Food Navigator that the company's products are safe and meet regulatory safety levels. The suit was filed in the Southern District Court of Florida and most recently, General Mills filed a motion to stay the discovery period Monday in order to hear a resolution of its motion to dismiss. 

What it means: This plaintiff may not have a great shot at success given the way previous glyphosate cases in food have concluded. Companies generally prevail by arguing the amount of glyphosate in their products is extremely small and would have no health impact on consumers. But if this case sees a different outcome, it could reverse the trend. 

Why it matters: Regardless of how the ruling comes down, the negative publicity could have already done damage to the reputation of any products that contain residual glyphosate. If consumers don't trust products with ingredients that may have been exposed to glyphosate, then recipes and formulation might need to change no matter the legal decision. 

"Companies should not wait for a mandate from the federal government to do what's right for their consumers," the Environmental Working Group said in a statement after the Monsanto ruling. "People don’t like to eat pesticides. They don't like to drink pesticides. Despite the benefits they often have, pesticides have no place in people."

This is also not the first time General Mills has faced a lawsuit over glyphosate in its products. In August 2016, consumer groups sued the company for labeling Nature Valley granola bars as "natural" when they contained residues of the chemical. In that case, General Mills settled. A settlement shows the manufacturer is interested in making the case go away, and perhaps other manufacturers will want to go that route. Companies usually don't benefit from a long legal challenge, which can be pricey for them and tends to harm a brand, even if the case ends up being ruled in their favor. 

5. E. coli romaine outbreak litigation

Credit: Megan Poinski

What happened: An E. coli outbreak linked to romaine lettuce from Arizona sickened 149 people in 29 states earlier this year. The litigation phase has just begun for many victims who have filed suit from this outbreak. Marler has formally filed about a dozen lawsuits against various suppliers in the romaine supply chain, restaurants and retailers who sold the green. In total there are at least 31 cases tied to the romaine grown in Arizona, the U.S. Centers for Disease Control said. There are several different state and federal jurisdictions involved in these cases, which means there will likely be different rulings. In defense, some restaurants have revealed their suppliers' names to protect themselves and shift the blame and legal responsibility. 

What it means: These cases could end up costing those in the romaine business a lot of money in damages depending on the rulings in the various cases and how sick the greens made the individuals. 

What could help the plaintiffs even more is that the U.S. Centers for Disease Control and Prevention recently warned consumers again to not eat romaine lettuce — the third time in recent years. With repeated outbreaks like this, consumers have claimed in lawsuits before that the product seems to be prone to contamination and nobody is protecting them. The Lange Law Firm already filed an E. coli lawsuit in federal court against a Florida restaurant in the the current outbreak after a patron got sick from eating a salad.

For the court cases, the repeated occurrence of these outbreaks only shows that this is a continuing issue with romaine and could put more fault on suppliers, grocery stores and restaurants for not finding a solution sooner.

Why it matters: The lettuce outbreaks have already sparked changes. Companies and retailers saw the need to implement better processes to limit food safety issues in the supply chain. Walmart asked lettuce suppliers to trace products using blockchain and an environmental assessment was released on how another outbreak like this could be prevented. Most recently, the FDA and the produce industry have introduced a new voluntary labeling plan for romaine lettuce to help clarify whether the product is contaminated. But even with this new plan, these court cases will continue to put a spotlight on the safety of romaine lettuce, and could bring more change, since the outcome could cost growers, shippers, retailers and restaurants big bucks.