June 30, 2011
Although properly-documented health and nutrient content claims may promote food product sales, consumers and competitors may sue your company for false advertising and unfair competition if it exaggerates those claims. The Food and Drug Administration may also issue a warning letter that may require costly remedial measures. Proactively determining that your product’s claims are truthful, accurate, and well-documented may help your company promote its product while reducing the risk (and expense) of litigation and government investigation.
Consumers read product labeling and health/nutrient claims
Some studies have found that72% of consumers “often” or “sometimes” rely on food labeling nutrient claimslike “low fat” when deciding whether to buy a product. Similarly,a recent poll found that almost 70% of consumers read product nutrition facts and ingredients .
Consumers and competitors can sue companies for falsely advertising health/nutrient claims
The California Supreme Court recently held that plaintiffs who can truthfully allege that a product’s label deceived them into buying a product they would not have otherwise purchased can sue that product’s manufacturer for false advertising and unfair competition. (Kwikset v. Sup. Ct. (Benson) (2011) 51 Cal.4th 310, 316 [“Kwikset”].) In Kwikset, the plaintiffs alleged the Kwikset Corporation falsely labeled and advertised its locksets as “Made in U.S.A.,”although it manufactured some parts in other countries. (Id.) These alleged false representations purportedly violated country of origin labeling laws. (Id.) Plaintiffs claimed they relied on the company’s alleged misrepresentations in choosing to buy the locksets. (Id. at p. 319.)