Class Action and Product Insights for Your Business
February 15, 2016 - FDA, Food Misbranding, Retail

Reviving a Forgotten Fad: Three Judges Lift Stays of Evaporated Cane Juice Claims

Reviving a Forgotten Fad: Three Judges Lift Stays of Evaporated Cane Juice Claims

We’ve all heard about food fads:  Paleo, artisanal, farm-to-table.  But what about food litigation fads?  Plaintiffs’ lawyers must scour the same grocery aisles, judging from their past “sweet tooth” obsession with “evaporated cane juice” (ECJ).  But—with most courts in this District staying ECJ cases pending the U.S. Food and Drug Administration’s (FDA’s) review of its ECJ draft guidance—the ECJ litigation fad appeared to have faded as abruptly as it began.

Not so fast, Plaintiffs’ lawyers will say.  While the majority of courts have maintained stays pending FDA’s final review, recent decisions to the contrary may portend the revival of this forgotten trend.  Will ECJ have another “moment”?

We provide further background and discuss the implication of these decisions below.

Plaintiffs’ ECJ Allegations. Plaintiffs bringing ECJ claims allege that ECJ is actually sugar, so listing ECJ as an ingredient misleads consumers into believing that these products are healthier than those listing sugar as an ingredient. Plaintiffs assert that FDA has explicitly stated that ECJ is not a common or usual name for sugar, and thus cannot be listed as an ingredient at all.

FDA’s Position. Despite these assertions, FDA’s position on ECJ is in flux. Although FDA issued draft guidance in 2009 suggesting that ECJ is not the common or usual name for sugar, as we have previously posted, FDA subsequently issued a notice in 2014 reopening the comment period for its draft guidance, indicating that it would reconsider the issue.

ECJ Stays. Following FDA’s notice, courts facing ECJ claims stayed or dismissed the claims pursuant to the primary jurisdiction doctrine, finding that, based on FDA’s authority over product labeling and its expertise in the area, courts should permit FDA to at least finalize its stance on ECJ before passing judgment. At least 18 ECJ claims were dismissed or stayed between 2014 and 2015.

After issuing stays, one Northern District court judge who had stayed an ECJ case—Judge Chen—requested an update from FDA on the status of its review. In July 2015, FDA confirmed that it anticipated finalizing its guidance by the close of 2016. At least six Northern District courts continued stays since that update — all over plaintiffs’ objections. One court, however, departed from the trend: in August 2015, Judge Chhabria lifted a stay in an ECJ case.  See Gitson et al. v. Trader Joe’s Company, No. 3:13-cv-01333-VC (N.D. Cal. Aug. 18, 2015), Dkt. No. 123.

Updates. Until recently, Judge Chhabria was the lone dissenter in the ECJ debate. But on January 4 and 5, 2016, Judges Henderson and Donato, respectively, also lifted ECJ stays. See Figy v. Lifeway Foods, Inc., No. 3:13-cv-4828-TEH (N.D. Cal. Jan. 4, 2016), Dkt. No. 57; Swearingen v. Pacific Foods of Oregon, Inc., No. 13-cv-04157 (N.D. Cal. Jan. 5, 2015), Dkt. No. 61. While neither decision contains substantial analysis, Judge Donato did note that he considered the issues “in light of the FDA’s continued delay in providing final guidance.” Id. at 1:18. These courts appear to have become impatient with the pace of FDA’s review.

Two other courts, however, have continued stays subsequent to these three rulings. See, e.g., Gitson, et al. v. Clover-Stornetta Farms, Inc., Case No. 3:13-cv-01517-EDL (N.D. Cal. Jan. 7, 2016) (extending ECJ stay for an additional 180 days, until August 2016) (Laporte, J.); Swearingen v. Amazon Preservation Partners, Inc., Case No. 13-cv-04402-WHO (N.D. Cal. Jan. 11, 2016) (Orrick, J.) (extending ECJ stay and continuing case management conference until July 2016). The new year has thus brought divergence in Northern District courts’ treatment of ECJ cases.

Implications. The future of ECJ claims is unclear: while Judges Orrick and Laporte’s decisions upholding stays suggest that the pendulum has not shifted towards reviving these claims, Judges Chhabria, Henderson, and Donato’s rulings to the contrary may suggest that ECJ stays will not remain in place indefinitely. This means that a slew of dormant ECJ claims could come back to life this year, especially if FDA fails to make headway on its draft guidance.  We may see a revival of the ECJ fad after all.

But another trend may nonetheless keep these cases quiet. Many district courts have stayed misbranding cases pending the Ninth Circuit’s decisions in misbranding appeals, including Jones v. ConAgra, Brazil v. Dole, and Kosta v. Del Monte. These appeals concern class certification issues—including ascertainability and the proper measure of damages—that district courts must consider when assessing a plaintiff’s proposed class certification motion. Courts have therefore found it appropriate to wait for the Ninth Circuit’s guidance before deciding these issues. See, e.g., Ham v. Hain Celestial Grp., Inc., 3:14-cv-02044-WHO (N.D. Cal. Dec. 10, 2015), Dkt. No. 59. (staying putative class action pending Ninth Circuit appeals and collecting decisions in accord). ECJ cases are no exception. See Thomas v. Costco Wholesale Corp., No. 12-CV-02908-BLF, 2015 WL 6674696 (N.D. Cal. Nov. 2, 2015) (staying entire action based on Ninth Circuit appeals after staying ECJ claims in November 2014). Thus, even if FDA-based stays are lifted, Ninth Circuit stays may continue to keep ECJ claims at bay.