Jamba Juice settles ‘all-natural’ lawsuit, but will pay no damages

By Elaine Watson contact

- Last updated on GMT

Jamba Juice settles natural lawsuit, but will pay no damages

Related tags: Plaintiff, Class action

Jamba Juice has agreed to settle a class action lawsuit filed in California alleging it misled shoppers by labeling its smoothie kits as ‘all-natural’.

Under the deal - in which is does not admit any liability - Jamba Juice will stop describing as 'all-natural' smoothie kits containing ascorbic acid, xanthan gum, steviol glycosides, modified corn starch, and gelatin, from March 31. It will also cover the plaintiffs’ legal fees.

However, Jamba Juice will not have to pay damages to consumers, as the plaintiffs were unable to present a viable model for calculating them – a phenomenon observed in several recent ‘all-natural’ cases.

In an order granting a motion for preliminary approval of the settlement ahead of a hearing on May 14, US district judge Jon S. Tigar said the Court had certified a class for the purpose of determining liability, but had declined to certify a damages class, prompting the two parties to thrash out a deal last fall.

Life in the food court...

There have been more than 200 class action lawsuits filed against food and beverage companies over allegedly deceptive labeling since 2012, 60 of which have been dismissed at various stages, and 25 of which have been settled, but none have yet gone to trial, delegates were told at a legal webinar last month.

Speaking at the event, hosted by the State Bar of California’s Food Law Committee, Robert S. Niemann, a partner at Keller and Heckman LLP, said more than half of these cases - many of which are about ‘all-natural’ claims - were filed in California.

And of these, the vast majority were filed in the Northern District, which has earned the nickname ‘the food court’ (although Florida and New York are also popular places to file).

US legal landscape
While some judges have asked the FDA to define ‘natural’ to stop scores of lawsuits clogging up the court system, it has not, to date, shown any enthusiasm for doing so. In a letter to three federal judges penned in January 2014, the FDA chose to “respectfully decline” their requests to come to an administrative determination of whether GMOs belong in ‘all-natural’ foods.

He added: “In fact there are more dismissals than there are settlements, and in the 25 we’ve looked at the dollar ranges are all over the place, from $15,000 to $9m.

“Some have offered money to the plaintiffs, but some have offered no ​[monetary] relief to the class, only injunctive relief ​[eg. where the company agrees to change its labels/marketing] and attorneys’ fees.”

In the cases where a class is certified, defendants typically choose to settle rather than see a case go any further.

The case is: Aleta Lilly et al vs Jamba Juice Company et al, 13-cv-02998, filed in the northern district of California in June 2013.

CSPI: ‘A ‘natural’ definition would not be perfect, but we shouldn’t let perfect be the enemy of the good’

If GMOs were involved in any way in the production of your product and you’re calling it ‘natural’, be prepared for a lawsuit

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