Consumer Victory: Largest Federal Appeals Court Rules That “All Natural” Labeling Can Mislead Public

The United States Ninth Circuit Court of Appeals, the largest federal appeals court in the country, issued its long-awaited “All Natural” decision.   Brazil v. Dole Packaged Foods, LLC (“Dole”) (9.30.2016), the 9th Circuit, unanimously, reversed part of the lower court’s decision. The court  determined that the lower court had “incorrectly granted summary judgment to Dole on the merits of Brazil’s claims under the California” consumer claims (UCL, FAL and CLRA) because “a trier of fact [][could] conclude that Dole’s description of its products as ‘All Natural Fruit’ is misleading to a reasonable consumer.”  The court also noted that “a trier of fact [][could also] find that the synthetic citric and ascorbic acids in Dole’s products were not ‘natural.’”

Since District Judge Lucy Koh, N.D. Cal., overturned several of her previous decisions and surprisingly decided that the “All Natural Fruit” representation on Dole’s fruit cups was not deceptive, consumers and companies have waited for guidance from the 9th Circuit.   Judge Koh had reasoned that the Federal Food and Drug Administration’s (“FDA”) warning letters to other companies regarding products labeled “Natural,” the FDA’s policy statement on ”Natural,” and plaintiff Chad Brazil’s deposition testimony together did not constitute sufficient evidence of consumer deception.  

The 9th Circuit however disagreed and resurrected Brazil’s class claim for injunctive relief and sent it back to the lower district court for further decision.  The Dole decision cautions companies producing and marketing “natural” products that the term can mislead consumers.   Further, the court reasoned that it might not be worth it to put the label on food products that contain preservatives and other chemicals while the FDA further evaluates whether it will formally define the term “natural.”  Since the FDA first issued its policy in 1991, November 2015 was only the second time in the FDA’s history that it requested public comments after consumer advocacy groups and federal courts asked the FDA to define “natural.”

Also helpful to consumers was the 9th Circuit’s ruling that consumer cases do not need to be stuck in limbo or dismissed under the Primary Jurisdiction Doctrine.  Citing to U.S. Supreme Court case Reiter v. Cooper for support, the 9th Circuit held that applying the doctrine is a discretionary decision for the district courts to make.  

Resolving a split among the federal courts across the state, the 9th Circuit also restated its position that unjust enrichment is a valid claim.  “The district court did not have the benefit of our decision in Astiana v. Hain Celestial Grp., Inc., in which we held that unjust enrichment claims may be pleaded in the alternative in quasi-contract” noted the court.

About Faruqi & Faruqi, LLP

Faruqi & Faruqi focuses on complex civil litigation, including securities, antitrust, wage and hour, and consumer class actions as well as shareholder derivative and merger transactional litigation.  The firm is headquartered in New York, and maintains offices in California, Delaware and Pennsylvania.  Since its founding in 1995, Faruqi & Faruqi has served as lead or co-lead counsel in numerous high-profile cases which ultimately provided significant recoveries to investors, consumers and employees.  To schedule a free consultation with our attorneys and to learn more about your legal rights, call our offices today at (877) 247-4292.

About Barbara Rohr

Barbara Rohr is a partner in Faruqi & Faruqi’s Los Angeles office and focuses her practice on complex civil litigation on behalf of consumers in the area of consumer fraud.

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