Dannon Forced to Open Wallet and Change Advertising (Again)
.jpg)
The multinational food company Dannon agreed to a 45 million dollar class action settlement earlier this year based on consumer complaints about advertising claims regarding the health benefits of its probiotic line of dairy products. Now the company has entered into a $21 million dollar settlement with the attorneys general from 39 states. The L.A. Times reports that this is the largest-ever multistate attorney general consumer protection settlement with a food producer. The attorneys general alleged that Dannon made deceptive and unlawful claims in advertising which were not substantiated by competent and reliable scientific evidence at the time the claims were made. According to the allegations, the majority of scientific studies showed improvement in intestinal transit time when an individual consumed three servings of the probiotic products per day for two weeks, and did not support Dannon's advertised claims that one serving per day for two weeks improved digestive health. In addition, the attorneys general alleged that Dannon could not substantiate claims regarding improved immunity against the flu and common cold.
Dannon also agreed with the FTC to drop claims that the probiotic foods help prevent irregularity and offer protection against the flu and common cold. The FTC found no substantiation of these claims. This isn’t the first time Dannon has had to alter its advertising; the March settlement required Dannon to remove specific language about the health benefits of the products from labels and advertising.
Between this and the March settlement, Dannon has now agreed to pay $66 million as restitution for the misleading health claims, which comes out to about 1.3% of Dannon reported $5 billion in worldwide net sales of the probiotic line in 2009. This latest settlement should remind companies to keep state governments on the list of watchful eyes monitoring health claims related to food and supplement products.
Federal Court Ends Alleged "Super Berry" Scheme (For Now)
.jpg)
A U.S. District Court in Illinois, at the request of the Federal Trade Commission, has issued a 
.jpg)
preliminary injunction freezing the assets of two individuals and five related companies selling dietary supplements derived from the acai berry. According to the FTC, the defendants engaged in a number of deceptive practices in violation of the FTC Act including advertising false celebrity endorsements by Oprah Winfrey and Rachel Ray, making misleading claims regarding the health benefits of the supplements, and providing misleading information regarding the prevalence and severity of illnesses and health conditions which the supplements were intended to cure and prevent. The FTC’s complaint not only cites misleading health claims regarding the fruit, but also alleges that the companies repeatedly deceived consumers by fraudulently charging their credit cards during and after “risk free trials” of the supplements. In addition to this preliminary injunction, the FTC is seeking a permanent injunction, damages for injured consumers, and costs and attorney’s fees. The defendants’ answer is due August 31, 2010.
This suit is another warning to the supplement industry that the FTC, along with the FDA and consumers, are paying special attention to the claims and practices of dietary supplement companies.
The Show Goes On: USDC Allows Vitaminwater Lawsuit to Proceed
By Guest Blogger Tyler Anderson
In an opinion issued on July 21, 2010, Judge John Gleason of the United States District Court for the Eastern District of New York largely denied the defendant’s motion for dismissal and held that 10 of the 13 claims in a class action suit brought against Coca-Cola for alleged unlawful health claims on its Vitaminwater drinks could proceed. The claims that still must be examined in court include allegations of misleading advertising, fraudulent business acts, and unfair methods of competition.
The plaintiffs in the class action, which include the health advocacy group Center for Science in the Public Interest (“CSPI”) as co-counsel, contended that Vitaminwater’s labeling and marketing is misleading because it (1) communicates a number of purported health benefits (including healthy joints, optimal immune function, and reduced risk of chronic disease), drawing consumer attention away from the significant amount of sugar (33 grams per bottle) in the product; (2) portrays Vitaminwater as healthy when it is essentially a snack food that provides nutritional benefits because it has been specifically fortified to do so; and (3) suggests that Vitaminwater contains nothing but vitamins and water.
While the court concluded, citing applicable Food and Drug Administration (“FDA”) rules and commentary, that sugar was not a “disqualifying nutrient” under applicable FDA regulations, the plaintiffs’ latter two claims were found to accurately describe violations of FDA regulations, and accordingly may serve as a non-preempted basis of state law liability.
The FDA regulations restricting health claims or implied claims of healthiness related to foods that meet certain minimum nutrient levels, colloquially termed “the jelly bean rule,” were developed in an effort to prevent food producers from encouraging the consumption by consumers of junk food by fortifying the food in question with nutrients. The “jelly bean rule” is applicable only to (1) health claims, and (2) nutrient content claims that use the word “healthy” to suggest that a food may help consumers maintain healthy dietary practices because of its nutrient content. Finding that Vitaminwater’s labeling contains claims in each of these two categories, the court ruled the plaintiffs could proceed with this claim.
The plaintiffs alleged Vitaminwater’s labeling is misleading because it uses a product name that includes two of the product’s ingredients (vitamins and water), but fails to mention another notable ingredient (sugar). FDA regulations on this subject recognize that such product names have the potential to mislead consumers. Thus, the court held that the plaintiffs were allowed to pursue this claim. In the aftermath of this ruling, Coca-Cola released a statement expressing their confidence that the plaintiffs’ claims are without merit and will ultimately be rejected. Given that the implications this case could carry into the growing functional food and beverage segments of the market, we will continue to track it closely.
Surprise! U.S. Marshals Pay a Visit to a Wisconsin Supplement Manufacturer
.jpg)
The Feds paid an unwelcome visit last month to Beehive Botanical’s Wisconsin manufacturing facility seizing a wide range of products. According to an April 5th FDA press release, U.S. Marshals, at the FDA’s request, went to the site on March 31 and seized creams, capsules, tablets, gum, throat spray, and hair care products. The seizure was based on a complaint filed by the U.S. Attorney’s Office for the Western District of Wisconsin which alleged that the products were mislabeled and contained new unapproved drugs in violation of the Federal Food, Drug, and Cosmetic Act. On March 26, a judge issued a warrant for seizure of the products under §334 of that same Act.
Continue Reading...
Dannon's Costly Yogurt Claims
If you haven’t seen Jamie Lee Curtis in the commercials, you have seen 
the products in the yogurt section at the grocery store. “It Works Or Your Money Back!” is the guarantee that Dannon makes regarding the ability of Activia, its probiotic line of dairy products, to boost digestive system health and immunity. Now an Ohio judge has signed a settlement agreement (pdf) in which the company agreed to pay up to $45 million as part of a class action settlement.
Understanding Front-of-Package Violations: Why Warning Letters Are Sent to Industry
Ever wonder if what you say on your label or packaging could draw the attention of the FDA? It's always helpful to be able to learn from examples of what's unacceptable before you release your product packaging.
The FDA has a helpful chart that summarizes FDA warning letters for nutrition claims on packaging that provides great examples of what to avoid.
So if, for example, your product is intended for children under 2 years of age, you may want to study the chart to understand why the FDA issued multiple warning letters to companies making nutrition claims for products intended for children under 2 years of age.
