Introduction to Corruption, definition, types, impact and conclusion
Crafty Lawyers Feed Off Craft Foods
1. Home / Articles / 2015 / Crafty Lawyers Feed Off Craft Foods
Crafty Lawyers Feed Off Craft Foods
'Artisanal', 'handmade' and other adjectives can expose you to class action lawsuits.
By Ronald Levine of Herrick, Feinstein LLP
Sep 22, 2015
MENU
In recent years, consumer fraud class actions challenging food and beverage labeling, focusing on
claims such as “natural,” and “healthy,” have flooded courts nationwide. Plaintiffs’ lawyers have
leveraged ambiguous or non-existent federal labeling standards to claim that consumers were misled
and paid a premium for products, which, for example, contained processed ingredients that were not
“natural.”
Unfortunately, the only real winners in these legal battles have been the plaintiffs’ lawyers who collected
millions of dollars in legal fees. Consumers who take the time to make a claim against a settlement fund
have received payments that are a fraction of the overall amount in the potential fund.
Recently, plaintiffs’ lawyers have become even more creative and are now challenging manufacturers’
label claims about how products are actually made. Alcoholic beverage companies, including beer,
whiskey and vodka manufacturers, are facing lawsuits for claiming that mass-produced products were
“craft,” “handmade” or “small-batch.” Also, plaintiffs' lawyers have challenged major food chains for
selling “artisanal” products that are made in alleged assembly line processes.
Ronald Levine is co-chair of the litigation
dept. at Herrick, Feinstein LLP, with offices in
New York and New Jersey. He concentrates
his practice in defending food and beverage
companies in consumer fraud class action
and false advertising cases. Contact him
through the company website:
www.herrick.com.
Any large company that uses this type of terminology exposes itself to legal challenges that it is
deceiving the public by suggesting that there is something unique and higher quality about how the
company manufactures its goods. In the absence of a formalized legal standard, the use of terminology
that “puffs” the quality of a product using debatable adjectives -- even where there are good reasons to
differentiate the products -- can expose the company to potential lawsuits. Any lawyer, working with a
2. Related Content
Product Focus: Artisanal Foods and Beverages
Artisan is increasingly being used in the marketing of foods, more precisely, specialty foods.
willing consumer to serve as the “class representative,” can drop a costly class action on the doorstep of
almost any company.
Every citizen in the United States has benefited from class actions. The class action procedure makes
the prosecution of the claims possible by enabling an attorney to pool them together into one large case.
Class actions have improved working conditions, cleaned up toxic wastes, and enforced civil rights.
Unlike the usual civil settlements that lawyers negotiate every day behind closed doors, judges must
approve a class action settlement to make sure its terms are fair to the entire class. However, after the
judge signs off on a class settlement agreement, little information is available about how many class
members actually receive compensation and to what extent.
An analysis of the scarce information available on class settlement payouts does not paint a pretty
picture. We find cases in which small cash amounts are rewarded to a consumer class that is largely
unidentified. In many instances, only a small percentage of settlement awards actually go to consumer
class members. While the plaintiffs’ lawyers can receive millions of dollars in compensation, only a
fraction of the class may take home any compensation.
The class take rate typically depends on several key factors: whether the addresses of consumer class
members are known or unknown; the amount of money that can be recovered by a class member filing a
claim (that is, is it worth taking the time to fill out the form?); the ease of submitting a claim; and the
amount of time allocated for filing claims.
Food cases, in which there are no records of the names and addresses of the consumers, and the
individual payments are relatively low, will have the lowest take rates. It is difficult to advise a consumer
public who did not register their purchases that a settlement has been reached. Even if the consumer
sees the notice in a published advertisement, it is still questionable whether a consumer will make the
effort of filling out the claims forms, no matter how convenient the system may be for filing a claim.
So what should be done?
Congress and regulatory agencies should develop clear and precise regulations that spell out the
adjectives that companies can use in labeling and advertising, and under what circumstances.
Ambiguous or non-existent standards are an invitation for litigation.
In cases involving settlements with monetary benefits, the courts should insist on actual information on
claims filed to determine the benefit to class members and should use that information both to place a
value on the settlement and to award attorney fees. The courts should be active gate keepers in
discouraging legal actions that wind up with millions of dollars for the lawyers, and little or nothing for
consumers.
“Crafty” plaintiffs’ lawyers should be restrained from their push to declare open season on the food
industry by playing off typical promotional claims that may appear on a package.
3. Past 7 Days Past 30 Days Past 6 Months All Time
E-Book: Make Your Labels Clean, Your Intentions Clear
What began as a trickle has turned into a tidal wave of food & beverage processors…
Artisanal Foods Increase in Popularity
As consumer concern for healthy eating escalates, so does the interest in natural and…
Even 'Better-for-You' Foods Appear Suspect
New NPD Group research finds less interest in positively 'altered' foods, growing concern over…
Most Popular
Walmart to Lettuce Suppliers: Use Blockchain
Walmart's suppliers of fresh leafy greens must start using the encrypted…01
$425 Million Cheese and Whey Plant Begun in Michigan
Spartan Michigan LLC is a joint venture of Glanbia Plc, Select Milk…02
FDA Petitioned to Ban the Non-GMO Label
A technology-advocate group wants the FDA to stop letting food marketers…03
Keurig Dr Pepper Buys Core Nutrition for $525 Million
Two-month-old KDP makes its first acquisition, a maker of enhanced bottled…04
Hormel to Expand Pizza Toppings Plant
Hormel is almost doubling the size of a plant in Nevada, Iowa, that makes…05
4. Keep up on Industry News
Your source for Food & Beverage Industry News
Campbell Gadfly Keeps Up the Pressure
The Wall Street hedge fund head who wants to drastically change Campbell Soup has released a report
accusing the current board of incompetence.
FDA Petitioned to Ban the Non-GMO Label
A technology-advocate group wants the FDA to stop letting food marketers put "non-GMO" on labeling.
UK Names Brexit Food Czar
England is apparently getting nervous about its food supply as Brexit looms, possibly without a deal.
5. About
Contact Us
Advertise with us
User Preferences
Media Kit
Content
Voices and Blogs
Humor
Webcasts
Products
White Papers
Supplier Source Guide
Manufacturers
Vendor News
Magazine
Subscribe to Food Processing
Special Reports/E-Books
Reprints
Magazine Customer Service
Issue Archive
Current Issue
Site Tools
Site Map
Top 100 Interactive List
Supplier Source Guide
Manufacturer Listings