Food manufactures facing deceptive food labeling claims under the Missouri consumer fraud statute were recently dealt a setback by the Missouri Court of Appeals for the Eastern District of Missouri. On November 8, 2016, the appellate court issued an opinion in Murphy v. Stonewall Kitchen, LLC, reversing the trial court’s adoption of the so-called “ingredient list” defense. Although the ingredient list defense may be relevant at trial, the court held that the defense does not defeat a consumer fraud claim under the Missouri Merchandising Practices Act (“MMPA”) arising from the use of “all natural” labeling. Finding that the plaintiff’s allegations were sufficient to survive a motion to dismiss, the court remanded the case back to the trial court for further proceedings.
In Murphy, the plaintiff filed a putative class action under the MMPA alleging that Stonewall Kitchen misrepresented its vanilla cupcake mix as “all natural” when the mix contained sodium acid pyrophosphate (“SAPP”), a synthetic leavening agent found in commercial baking powders. Stonewall Kitchen in turn filed a motion to dismiss for failure to state a claim, asserting, in part, that plaintiff failed to allege an unlawful act under the MMPA because SAPP was included on the product’s ingredient list and the plaintiff’s proposed definition of “natural” was “fatally subjective and unworkable.” Stonewall Kitchen further argued that the plaintiff failed to plead facts showing that his alleged loss was caused by any alleged wrongful act. Agreeing with Stonewall Kitchen, the St. Louis Circuit Court determined that plaintiff failed to plead an unlawful act within the meaning of the MMPA. Noting that the terms “natural” and “all natural” are ambiguous and lack any generally accepted meaning in the food labeling context, the court reasoned that the cupcake mix’s packaging, when taken as a whole, was not deceptive or misleading, because it disclosed that SAPP was an ingredient.
In reversing the trial court, the Missouri Court of Appeals determined that the assertion that the term “all natural” is subjective and ambiguous did not cause plaintiff’s claim to fail, as “a reasonable consumer’s understanding of the term ‘all natural’ or whether a practice is unfair or deceptive are questions of fact.” The court further held that that the parties needed to conduct more discovery to flesh out the facts needed to resolve those questions.
The appellate court also expressly rejected the assertion that the ingredient list defense defeated plaintiff’s claim as a matter of law. Relying on case law from the Ninth Circuit, the court stated that the U.S. Food and Drug Administration (“FDA”) does not require food manufacturers to provide an ingredient list on their products “so that manufacturers can mislead consumers and then rely on the ingredient list to correct those misrepresentations and provide a shield from liability for that deception.” The court further noted that a reasonable consumer would expect an ingredient list to comport with the representations made on a product’s packaging and explained that the manufacturer is in a superior position to know whether the ingredients comport with its packaging. Acknowledging that the ingredient list ultimately may be relevant to Stonewall Kitchen’s defense at trial, the court determined that the ingredient list defense could not defeat a MMPA claim as a matter of law.
Additionally, in response to Stonewall Kitchen’s argument that plaintiff failed to allege that SAPP is both artificial and synthetic and that it would not normally be expected in the cupcake mix, the court held that there was no requirement that the plaintiff plead that SAPP would not normally be expected in the cupcake mix. Finally, the court noted that plaintiff adequately pled an ascertainable loss under the benefit-of-the-bargain rule by asserting that he paid a premium price for Stonewall Kitchen’s “all natural” products out of a desire to purchase “healthy food products that do not contain potentially harmful synthetic ingredient.”
The appellate decision in Murphy is significant for any food manufacturer involved in litigating food labeling claims brought under the MMPA, as it reduces the claims that food manufacturers can make on their products without potentially incurring liability. In the wake of the Murphy decision, food manufacturers may want to closely monitor the activities of FDA in case the agency breaks from its longstanding policy of declining to formally define the term “natural” given the agency’s recent request for comments on the use of the term “natural” on food labeling. As FDA has previously mentioned, however, defining the term “natural” would require involving other federal agencies such as the United States Department of Agriculture, as well as considering any strictures flowing from the First Amendment. Thus, even if FDA ultimately decides to formally define the term, it will likely take the agency a number of years to do so.
Husch Blackwell and its cross-disciplined team of litigators across our offices have been assisting food and consumer product manufactures in their defense in the latest round of putative class action filings, including for clients sued by the same Plaintiff’s law firm that filed and briefed the Murphy case. These cases have involved, among other things, claims directed to “Natural” and “Made in America.” The latest trend locally now seems to focus on “slack filling” claims and “evaporated cane juice” language.
Please contact a member of our team for further information or updates.