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From Antitrust Law Daily, August 25, 2017

Class action alleging deceptive cheese marketing 100% dismissed

Although purchasers of grated parmesan cheese that contained a not insignificant amount of fillers had standing to bring suit against product makers and sellers alleging misrepresentation due to product labels stating that the product was "100% Grated Parmesan Cheese," the federal district court in Chicago dismissed the claims because a reasonable consumer would not have been misled by the labeling. The five consolidated class actions against The Kraft Heinz Company, Albertsons Companies, Inc., Supervalu, Inc., Target Corporation, Wal-Mart Stores, Inc., ICCO-Cheese Company, Inc., and Publix Super Markets, Inc. were dismissed without prejudice (In re 100% Grated Parmesan Cheese Marketing and Sales Practices Litigation, August 24, 2017, Feinerman, G.).

Defendants design, develop, manufacture, sell, test, package, label, distribute, promote, market, and/or advertise grated parmesan cheese products labeled "100% Grated Parmesan Cheese." All the products contain other ingredients, most often 3.8% to 8.8% of cellulose used as filler. Each product is labeled with an ingredient list that discloses the non-cheese ingredients. The products are shelf stable and do not need to be refrigerated prior to opening.

The consumers who purchased these products claimed they did so believing the products contained only parmesan cheese. The present suit is the consolidation of five class action complaints which allege violations of various state consumer protection statutes as well as breach of express and implied warranty and unjust enrichment.

Standing. Plaintiffs allege financial injuries arguing that they purchased a product worth less than what they paid due to the non-cheese ingredients as well as having received something less valuable than what they were promised. The court found the allegations sufficient to establish standing as an injury-in-fact that is concrete, particularized, traceable to defendant’s conduct and redressable by the court.

Misrepresentation. The description "100% Grated Parmesan Cheese" is ambiguous, with multiple possible meanings such that a reasonable consumer would need more information from the label—i.e., the listed ingredients—before assuming the label guarantees only cheese and not fillers, according to the court. That the product is packaged and shelf-stable at room temperature despite being marketed as a dairy product would further inform the consumer that the product is not pure cheese. As such, defendants’ labeling and marketing when viewed as a whole is not deceptive and the plaintiffs have failed to state a claim.

Other claims. The express and implied warranty claims also failed because defendants’ labeling is not deceptive, according to the court. Express warranty claims can only succeed if the consumer believed the product contained only cheese. The product was fit for ordinary use as grated cheese, defeating a claim of implied warranty of fitness. Finally the unjust enrichment claim failed because no deception took place.

Plaintiffs have until September 14th to amend their complaint or the dismissal will convert to dismissal with prejudice.

The case is No. 16-cv-05802.

Attorneys: Ben Barnow (Barnow and Associates, PC) for Rosemary Quinn. Gary Hansen (Fox Rothschild LLP) for Albertson Companies, Inc. and Albertsons, LLC.

Companies: The Kraft Heinz Company; Albertsons Companies, Inc.; Albertsons LLC; Supervalu, Inc.; Target Corporation; Wal-Mart Stores, Inc.; ICCO-Cheese Company, Inc.; Publix Super Markets, Inc.

MainStory: TopStory Advertising IllinoisNews

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