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For these crusading lawyers, Big Food is the new tobacco
Suits against major food manufacturers assert they are misleading consumers and violating federal regulations by wrongly labeling products and ingredients.
The New York Times
Don Barrett, a Mississippi lawyer, took in hundreds of millions of dollars a decade ago after suing Big Tobacco and winning record settlements from R.J. Reynolds, Philip Morris and other cigarette makers. So did Walter Umphrey, Dewitt Lovelace and Stuart and Carol Nelkin.
Ever since, the lawyers have been searching for big paydays in business, scoring more modest wins against car companies, drugmakers, brokerage firms and insurers. Now, they have found the next target: food manufacturers.
More than a dozen lawyers who took on the tobacco companies have filed 25 cases against industry players such as ConAgra Foods, PepsiCo, Heinz, General Mills and Chobani that stock pantry shelves and refrigerators across the nation.
The suits, filed in the past four months, assert that food makers are misleading consumers and violating federal regulations by wrongly labeling products and ingredients. While they join a barrage of litigation against the industry in recent years, the group of tobacco lawyers is moving aggressively. The lawyers are asking a federal court in California to halt ConAgra's sales of PAM cooking spray, Swiss Miss cocoa products and some Hunt's canned tomatoes.
"It's a crime — and that makes it a crime to sell it," said Barrett, citing what he contends is the mislabeling of those products. "That means these products should be taken off the shelves."
Food companies counter that the suits are without merit, and are another example of litigation gone wild and driven largely by the lawyers' financial motivations.
Barrett said his group could seek damages amounting to four years of sales of mislabeled products, something that could total many billions of dollars.
"It's difficult to take some of these claims seriously, for instance, that a consumer was deceived into believing that a chocolate hazelnut spread for bread was healthy for children," said Kristen Polovoy, an industry lawyer at Montgomery McCracken, referring to a lawsuit two mothers brought against the maker of Nutella. "I think the courts are starting to look at the implausibility of some of these suits."
Berry suit turned back
A federal judge in California in 2009 dismissed a case against PepsiCo that accused the company of false advertising because Cap'n Crunch's Crunch Berries cereal does not contain real berries. He ruled that, "A reasonable consumer would not be deceived into believing that the product in the instant case contained a fruit that does not exist."
While the lawyers are being questioned about their motives, they are not alone in pursuing the food industry.
In recent weeks, the Center for Science in the Public Interest has filed two lawsuits against General Mills and McNeil Nutritionals over their claims on Nature Valley and Splenda Essentials products, and warned Welch's it would sue unless the company changed the wording on its juice and fruit snacks.
The Federal Trade Commission won settlements from companies such as Dannon and POM Wonderful for claims about the health benefits of their products.
PepsiCo and Coca-Cola face dozens of lawsuits over claims their orange-juice products are "100% natural."
The latest playbook — like the one that paid off in the wave of tobacco litigation — could prove potent, as the food companies' own lawyers have warned.
Other plaintiffs' lawyers largely have taken aim at food products marketed as "healthy" or "natural," subjective claims that can be disputed easily by expert witnesses. Unlike foods labeled "organic," there are no federal standards for foods that are called "healthy" or "natural."
"False and misleading"
The new batch of litigation argues that food companies are violating specific rules about ingredients and labels. Barrett's group, for example, has brought a case against Chobani, the Greek yogurt maker, for listing "evaporated cane juice," as an ingredient in its pomegranate-flavored yogurt. The Food and Drug Administration repeatedly has warned companies not to use the term because it is "false and misleading," according to the suit.
"If you're going to put sugar in your yogurt, why not just say it's sugar?" said Pierce Gore, a lawyer affiliated with Barrett's group.
Food companies dispute the accusations, defending their packaging and marketing. Nicki Briggs, a spokeswoman for Chobani, said the lawsuit was "frivolous" and "without merit."
Even so, such cases are raising concerns within the industry.
At a recent food-and-beverage conference attended by more than 100 lawyers, Madeleine McDonough, a lawyer at Shook, Hardy & Bacon who is co-chairwoman of the agribusiness and food-safety practice, warned in a session on fraud litigation that it was imperative for companies to comply with federal regulation. "Otherwise, we are dead in the water," she said, according to two lawyers who attended the event, including J. Price Coleman, who is working with Barrett's group.
If the lawsuits prove successful, the liability could be sizable. The lawyers are looking to base damages on products' sales. While companies do not typically break out figures for individual items, Chobani's revenues are expected to total $1.5 billion this year. The lawsuit filed by Barrett cites 18 flavors of yogurt, more than half its line.
The lawyers are being selective about where these suits are filed. Most cases have been filed in California, where consumer-protection laws tend to favor plaintiffs. Food companies already are fighting a legal battle in that state, spending tens of millions of dollars to scuttle a ballot initiative that would require them to specify genetically modified ingredients.
Health concerns on rise
The lawyers who took on Big Tobacco decided the time was ripe to go after Big Food. Consumers are increasingly conscious of their eating habits as rates of heart disease, type 2 diabetes, obesity and other health problems rise. State and local governments are becoming alarmed at the escalating costs of caring for people with those diseases and are putting pressure on food companies.
"People want to put good, healthy, nutritious food in their bodies," said Keith Fleischman, a former federal and state prosecutor now working with the tobacco group. "They are very aware of what's on labels."
Plaintiffs' lawyers realize critics may counter that their lawsuits do not have real victims.
Barrett fought tobacco cases for years on behalf of smokers dying of cancer — and lost because juries agreed with the tobacco companies that smoking was a personal choice.
Not until he and Richard Scruggs sued on behalf of states, which had spent hundreds of millions of dollars caring for sick smokers, did they win their record settlement.
"Food companies will argue that these are harmless crimes; the tobacco companies said the same thing," Barrett said. "But to diabetics and some other people, sugar is just as deadly as poison."
Consumers such as Christine Sturges, one of the plaintiffs in a suit against ConAgra, has gluten allergies and reads labels vigilantly.
"Oh my God" moment
When she heard about the California lawsuit involving PAM cooking spray, she took a closer look. "There was nothing scary on it, just this innocuous word, 'propellant,' " said Sturges, a hairdresser from Los Gatos, Calif.
After some digging, she learned that "propellant" included petroleum gas, propane and butane. "I'd been spraying that on muffin tins to make muffins for my grandchildren — oh my God!"
The only way Sturges could have known what the "propellant" consists of was to have read the materials-data safety sheet ConAgra files separately with the government, according to Gore.
The suit also claims, among other things, that Swiss Miss and Hunt's labels bear improper claims about nutrients and antioxidant properties.
"We researched regulations and labels for two years before filing our first case, and our cases don't remotely resemble the Cap'n Crunch's Crunch Berries case," Gore said. "Frankly, that one made me laugh."