WHAT IF I PURCHASED A PRODUCT I THOUGHT WAS VERIFIED BUT IT WASN’T?
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In recent years, consumers have used their purchasing power to demand foods that meet certain independent verifications like “natural,” “organic,” “vegan,” “gluten-free,” amongst others. Those independent verifications are often represented prominently on the front of a product’s packaging and are designed to attract consumers’ attention resulting in purchases. Unfortunately, some companies may use deceptive marketing techniques to capitalize on related consumer preferences. That can create consumer confusion and lead to frustration, especially if a consumer purchases a product with a prominent representation that is not actually an independent verification. When that happens, consumers may wonder if they have recourse.
Fortunately, California’s consumers are protected by robust consumer statutes like California’s Legal Remedies Act (the “CLRA”), set out at California Civil Code, §§ 1750-1784. The CLRA is meant “to protect consumers against unfair and deceptive business practices and to provide efficient and economical procedures to secure such protection.” Relevantly, Section 1770(a)(2) prohibits practices such as “misrepresenting the source, sponsorship, approval, or certification of goods or services.” That section is complemented by Section 1770(a)(5), which makes it unlawful to represent “that goods or services have sponsorship, approval, characteristics . . . that they do not have.” Likewise, Section 1770(a)(7) precludes companies from “representing that goods or services are of a particular standard, quality, or grade . . . if they are of another.” Finally, Section 1770(a)(16) prohibits “representing that the subject of a transaction has been supplied in accordance with a previous representation when it has not.”
In addition to the CLRA, California has its False Advertising Law (the “FAL”), provided at California Business and Professions Code, § 17500, and its Unfair Competition Law (“UCL”), set forth at California Business & Professions Code § 17200. The FAL prohibits the dissemination of any information “which is untrue or misleading, and which is known, or which by the exercise of reasonable care should be known, to be untrue or misleading.” And the UCL, a broadly drawn statute, forbids “any unlawful, unfair or fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising.”
The court’s decision in Latiff v. Nestle USA, Inc., 2019 WL 4544544 (C.D. Cal. Sept. 19, 2019) provides an illustration of how these consumer protection statutes apply in the context of allegedly misleading seals. In Latiff, a consumer alleged that Nestle created “its own deceptive seal that was affixed to products which falsely represented that the product is certified as non GMO by a neutral third party, when in fact the seal” was created by Nestle. The consumer argued that by “creating its own seal that mimics the Non-GMO Project’s seal,” Nestle had “misrepresented its products to consumers as having been certified by a neutral third party.”
Ultimately, the court found that the consumer plausibly alleged her claims under the CLRA, FAL, and UCL. In doing so, the court determined that “a reasonable consumer is not expected to know how to inspect or judge a product or know the process of the product’s preparation or manufacture.” And given that the consumer “deliberately selected and purchased purported non-GMO products from among comparable products,” the consumer had “alleged that she suffered harm by relying on” Nestle’s “misleading seal in purchasing its products.” Nestle argued that its products were nonetheless third-party verified, but the court held that Nestle’s seal “could be misleading because the seal does not reflect the third-party verifier, and as alleged, was” Nestle’s “own creation.”
In light of California’s statutory framework and numerous court decisions like Latiff, consumers may have recourse if they purchased a product with a deceptive seal that mimics an independent verification. Any consumer considering legal recourse should consult a qualified attorney who can evaluate the applicable laws, relevant legal developments, and specific facts of a given case.
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