Dole ‘All Natural'Ruling Draws Mixed Reviews

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By Julie A. Steinberg

Oct. 5 — The chance that a consumer class can stop alleged ongoing deceptive advertising is the big takeaway from the Ninth Circuit's recent opinion reinstating claims over Dole's “All Natural” packaged fruit, according to one plaintiffs' attorney.

In the last sentence of the unpublished opinion, the court remanded the false advertising case to allow the plaintiff to “pursue injunctive relief on behalf of the class,” Stephen Gardner, head of the food law practice at The Stanley Law Group in Dallas, said.

“Stopping fraud is always a better value than the monetary relief,” Gardner—who is not involved in the Dole case and was not speaking about the marketing in that suit in particular—told Bloomberg BNA.

The U.S. Court of Appeals for the Ninth Circuit Sept. 30 revived claims alleging the “All Natural” label misleads consumers because the fruit products contain two synthetic ingredients, ascorbic acid and citric acid ( Brazil v. Dole Packaged Foods, LLC , 2016 BL 325189, 9th Cir., No. 14-17480, unpublished 9/30/16 )(See related story).

It limited Chad Brazil to his own claim for monetary damages, saying he couldn't explain how the damages—the price premium attributable to the “natural” statement—could be calculated classwide.

Stop Fraud

Gardner said the possibility that Brazil can get Dole to stop marketing its products with the natural label is much more significant than the dismissal of the class monetary damages claims.

“Defendants would rather pay money, as long as they can keep up the practice,” he said.

Yet, Gardner said, courts are increasingly saying that once a plaintiff learns about the alleged deception, the plaintiff can't be fooled again.

Once a plaintiff has “wised up,” many courts say the plaintiff has no standing, or basis, to bring injunctive relief claims on behalf of a class. So the defendant can continue to sell food with the contested label statement, Gardner said.

Gardner said he wishes there had been more discussion on this point, but said, “That last sentence may have more impact on food litigation that intends to stop an ongoing practice.”

William Stern of Morrison & Foerster in San Francisco, who represented Dole, said he couldn’t comment on the opinion.

However, he told Bloomberg BNA, this case is now unlikely to be tried before a jury because there is no right to a jury trial for an injunctive relief claim.

Attorneys for the plaintiff didn’t respond to requests seeking comment.

Deception Point Contested

Defense attorney Dale Giali of Mayer Brown in Los Angeles told Bloomberg BNA he disagrees with the Ninth Circuit's conclusion that the label could be found to fool reasonable consumers.

Gali said the court relied in part on warning letters sent by the Food and Drug Administration to other companies who labeled as “all natural” products containing synthetic citric acid, one of the ingredients at issue in the Dole case.

The court also relied on an informal FDA policy from 1993 that defined “natural” to mean “that nothing artificial or synthetic has been included in, or has been added to, a food that would not normally be expected to be in the food.”

This isn’t evidence of how consumers think, Giali said. “Consumers don’t think like the FDA.”

Giali, who represents food and beverage companies but isn't involved in this case, also said the Ninth Circuit wasn’t saying as a general matter that juries should decide questions of deception.

These kinds of questions are just as appropriate for summary judgment as any other, he said.

Don't Put Case on Hold

The court also said the case shouldn’t wait while the FDA decides whether to regulate use of the term “natural.”

Other courts, including a different panel of Ninth Circuit judges, have stayed cases under the “primary jurisdiction” doctrine, to let the FDA have the first word on whether and when companies should be allowed to call products “natural.”

In March, a different Ninth Circuit panel put a yogurt case on hold, Kane v. Chobani, Inc., No. 14-15670 (17 CLASS 339, 4/8/16).

The agency received thousands of comments in May, in response to its November 2015 call for public input.

But at oral argument in this case, attorneys for both sides told the court they didn’t want the case stayed, and Giali said he thinks the court followed the parties’ wishes.

However, Giali said he wouldn't be surprised if the case gets stayed when it goes back to the Northern District of California, an outcome he would deem appropriate.

FDA is looking at whether ascorbic acid and citric acid are “natural,” he said.

Pratt & Associates, Neal & Harwell, and others, represented the plaintiff.

Morrison & Foerster LLP represented Dole.

To contact the reporter on this story: Julie A. Steinberg in Washington at jsteinberg@bna.com

To contact the editor responsible for this story: Steven Patrick at spatrick@bna.com

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