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July 2, 2014 / Blake Gaines

Federal Judge Refuses to Dismiss Chocolate Mislabeling Claims Against Mars

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On June 17, 2014, U.S. District Judge Lucy Koh refused to dismiss a class action lawsuit alleging that Mars mislabeled calorie and nutrient information on M&Ms, Twix, Snickers, and Dove chocolates. The complaint attacks Mars’ advertisements that the chocolates are “natural source(s) of cocoa flavanols.”

The class representative, Phyllis Gustavson, claims to have spent over $25 dollars on these products, which purportedly violate Food & Drug Administration (FDA) requirements by using undefined terms, like “source,” and by making nutritional content claims for the nutrient flavanol without a fixed percentage of the established daily value.

Gustavson claims that the Mars chocolates in question cannot contain sufficient flavanols to meet the FDA’s requirements because the FDA has yet to establish a recommended daily value for flavanols. Mars filed a motion to dismiss, arguing that its advertisements simply inform customers that flavanols are naturally present in the chocolate, but at no specific level. Nevertheless, Judge Lucy Koh disagreed, denying Mars’ motion, stating that the term “natural source” arguably “implies that the nutrient is present in substantial quantities.”

Additionally, Gustavson claims that Mars violated FDA regulations by not including directions prompting customers to read the full nutrition information regarding the high levels of fat contained in the products located on the back of the packaging.

Gustavson also accuses Mars of not identifying “polyglycerol polyricinoleic acid” by its known name.  Mars made no efforts to challenge this claim.

If you or someone you know has been misled by nutritional representations made by Mars, you may be entitled to relief. Please call Khorrami Boucher, LLP for a confidential consultation.

June 10, 2014 / Blake Gaines

New Regulations Prohibit Insurance Companies from Delaying or Refusing Necessary Treatment for Individuals with Autism

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California insurance companies have denied coverage for treatment of autism with increasing regularity. In response to this serious issue, the California Department of Insurance and the Office of Administrative Law recently bolstered the Mental Health Parity Act by requiring health insurance plans cover behavioral health treatments for individuals with autism. These regulations will enable more rigorous enforcement practices and impose stricter penalties on insurance companies that delay or refuse coverage for necessary autism treatments.

Industry professionals have credited Insurance Commissioner, Dave Jones, with the recent regulatory improvements. For example, Julie Kornack, a senior public policy analyst at the Center for Autism and Related Disorders, stated “This really is making the state law and making the public policy clear. You shouldn’t underestimate that we have an insurance commissioner who is committed to the autism community and to make health plans behave. That’s not something you find in every state.”

The new regulations forbid “unreasonable” denials and delays of necessary behavioral health treatments. For example, the regulations identify “unreasonable” delays as delays due to an alleged need for IQ testing and “unreasonable” denials as encompassing refusals due to the experimental nature of certain treatments. “Unreasonable” denials also include refusals of treatment from an appropriately accredited treatment provider not specified as a doctor or one who does not have a specific license.

Furthermore, the new regulations bar insurance companies from imposing limitations on coverage for necessary treatment visits, or from instituting monetary caps on treatment unless the limit uniformly applies to an entire policy.

Multiple non-profit autism organizations, such as Autism Speaks, recognize the necessity of neurological, language and speech therapy, and occupational therapy treatments, which can decrease a variety of issues that autistic individuals face. In accordance with the recently approved regulations, if these treatments are deemed medically necessary they should be covered by health insurance plans offered in California.

Commissioner Jones believes that the recent regulatory changes “will help end improper insurer delays and denials of medically necessary treatments for autistic individuals.” Additionally, the Commissioner stated, “This regulation provides clear guidance to the industry, stakeholders and consumers on the requirements of the Mental Health Parity Act.”

If you or someone you know has been denied coverage for necessary autism treatment forApplied Behavioral Analysis (ABA), speech therapy, or occupational therapy, you may be entitled to relief. Please call Khorrami Boucher, LLP for a confidential consultation.

 

June 5, 2014 / Alexis Domb

The Skinny on Laci Le Beau Diet Tea: California Federal Court Allows Consumer Class Action to Proceed

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On May 14, 2014, a California federal judge declined to dismiss a putative class action against Natrol Products, Inc.—a nutritional supplement company—alleging that advertising of its Laci Le Beau Super Dieter’s Tea as a weight loss aid designed to support reduction of excess body fat and accumulated toxins is false and misleading.

Augustine filed her class action complaint in December 2013 (Augustine et al v. Natrol Products, Inc., Case No. 13-cv003129, S. D. CA.), alleging false advertising and labeling of the Dieter’s Tea. The class action claims that the product’s marketing is “false or deceptive” and that regular use of the product is not only ineffective for weight loss and appetite suppression, but can actually cause dependence on stimulant laxatives and serious health problems.

According to the complaint, the tea’s main ingredient, Senna, is “an herbal laxative that does not assist in weight loss and actually causes chronic bloating and constipation.” As confirmed by the National Institute of Health, Senna is not safe for long-term use, despite that Natrol’s packaging encourages regular use as part of a “lifestyle.” The class action suit claims studies reveal that regular consumption of Senna has been tied to health dangers, such as toxicity, hepatitis, liver failure, arthritis and finger “clubbing,” laxative dependency, and even cancer.

In the recent motion to dismiss, Natrol argued to the court that Augustine’s claims were too vague and that the statements on the tea’s packaging are not likely to deceive consumers, but merely contained nonactionable puffery. The court rejected this argument concluding that a reasonable consumer may be deceived by the statements on the tea’s packaging. The court has allowed the case to move forward, giving Augustine a chance to pursue her claims against Natrol on behalf of herself and others who purchased the Dieter’s Tea.

If you or someone you know has purchased a product in reliance on misleading labeling or advertising, you may be entitled to relief. Please contact Khorrami Boucher, LLP for a confidential consultation.

 

 

May 13, 2014 / Scott Tillett

“Death Wobble” Class Action Filed Against Chrysler for Dodge Ram Steering System Defects

2009 Dodge Ram Laramie

In a class action filed in California federal court, five consumers who purchased Dodge Ram vehicles from dealerships located in California, Texas, and Utah sued Chrysler Group, LLC for defective steering system components found in certain Dodge Ram vehicles manufactured between February 14, 2008 and January 21, 2012. The defect at issue concerns the failure of tie rods in the steering linkage system of these vehicles, which can cause unexpected loss of steering control at high speeds, termed a “death wobble.”

According to the complaint, Chrysler became aware of the defective tie rods shortly after releasing the 2008 model year Dodge Rams, but “opted to conceal the existence of the Defect from Plaintiffs and the general public.” After a January 2011 recall of model year 2008-2011 4500/5500 vehicles and a National Highway Traffic Safety Administration investigation leading to the expansion of that recall to 2008-2011 Dodge Ram 2500/3500 vehicles in August 2011, the problem still was not remedied and tie rod defects continued to occur in several vehicles.

In October to December 2013, Chrysler issued a recall of 2008-2012 Dodge Ram 2500/3500/4500/5500 vehicles, again citing safety issues related to steering tie rod fractures. Despite promising to repair vehicles free of charge, Chrysler conceded that “the parts required to provide a permanent remedy for this condition are currently not available.” Chrysler then allegedly secretly advised dealers of “an order restriction on the parts needed for the recalls,” and that the parts were not expected to be available until April 14, 2014, after “recertifying the part and developing a new part number,” and then only in “limited quantities.”

The plaintiffs filed their class action on behalf of all persons within the US who purchased or leased model year 2008 to 2012 Dodge Ram 2500 4×4, 3500 4×4, 3500 Chassis Cab 4×2 or 4500/5500 4×4 vehicles in the United States on or after June 10, 2009. The complaint seeks actual and consequential damages, rescission, restitution and disgorgement of profits, injunctive relief, and attorneys’ fees for Chrysler’s alleged violations of the Magnuson-Moss Warranty Act, various State warranty statutes, California’s Consumer Legal Remedies Act, California’s Unfair Competition Law, and other causes of action.    

If you or someone you know has purchased an unsafe product or been involved in an accident, you may be entitled to relief. Please call Khorrami Boucher, LLP for a confidential consultation.

May 6, 2014 / Scott Tillett

California Court Certifies Consumer Class Action Against Twinings Tea for Labeling Violations

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On April 24, 2014, a California federal court certified a consumer class action against Twinings North America Inc., makers of Twinings tea products. Plaintiff, Nancy Lanovaz filed the class action in 2012 claiming that Twinings falsely advertised the health benefits of antioxidants in its teas.

According to the complaint, Twinings violated FDA regulations against nutrient content claims about flavanoids, a type of antioxidant, because the FDA has not established a recommended daily intake for flavanoids. The FDA has published industry guidelines for food labeling, which state:

“Can I make an antioxidant nutrient content claim for any ingredient in a food? No. An antioxidant nutrient content claim can only be made for nutrients for which there is an RDI established in 21 CFR 101.9 (21 CFR 101.54(g)(1)).”

The complaint cites an FDA warning letter sent to Unilever, the maker of Lipton teas, for similar claims of antioxidant content on its tea labels. The warning letter sparked a class action against Unilever for misbranding and misleading labeling practices, including claims that flavanoids in Lipton teas are “generally associated with helping maintain normal, healthy heart function,” and “may help maintain healthy vascular function.”

Lanovaz’s complaint sought monetary and injunctive relief against Twinings on behalf of California “All persons in the State of California who, since May 23, 2008, purchased Defendant’s green, black and white tea products,” for alleged violation of California’s Unfair Competition Law, False Advertising Law, and the Consumer Legal Remedies Act. However, the court limited the remedies available to injunctive relief, holding that Lanovaz was unable to demonstrate that consumers paid more money for Twinings’ tea products than they would have absent the allegedly misleading statements. This means that Twinings may be required to change its product labels, but will not be required to refund or reimburse consumers for tea purchases.

If you or someone you know has purchased a falsely advertised or mislabeled product, you may be entitled to relief. Please call Khorrami Boucher, LLP for a confidential consultation.

April 29, 2014 / Scott Tillett

US Supreme Court Food Labeling Decision May Aid California Consumer Protection Class Actions

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On April 21, 2014, the U.S. Supreme Court heard an argument in POM Wonderful LLC v. Coca-Cola Co. The lawsuit by POM Wonderful alleges Coca-Cola mislabeled its Minute Maid Pomegranate Blueberry juice blend, engaging in unfair competition. POM argued that Coca-Cola had violated the Lanham Act by labeling its product “Pomegranate Blueberry,” despite the product consisting of approximately 99% apple and grape juice, and only 0.3% pomegranate juice and 0.2% blueberry juice.

POM argued that consumers were likely to be deceived by Coca-Cola’s labels, which prominently read “Pomegranate Blueberry,” stating “Flavored Blend of 5 juices” in much smaller font. POM contends that consumers will purchase the less expensive of the two products if they believed they are the same, as Coca-Cola’s labeling suggests. This seems like a fairly straight-forward argument, but both the California federal court and the Ninth Circuit Court of Appeals held that the Coca-Cola product’s name and labeling complied with FDA regulations designed to prevent deceptive labeling and that POM’s claims under the Lanham Act may not “usurp, preempt or undermine FDA authority.”

The U.S. Supreme Court did not agree. The Supreme Court has not issued its ruling yet, but according to  SCOTUSblog, we can expect a unanimous reversal of the Ninth Circuit ruling. Apparently, Justice Kennedy slammed Coca-Cola’s arguments that federal labeling laws were designed to promote uniformity, protecting companies like Coca-Cola from unfair competition laws, even for product “labels that cheat the consumers like this one did.” Justice Kennedy went on to say “I think it’s relevant for us to ask whether people are cheated in buying the product. Because Coca-Cola’s position is to say even if they are, there’s nothing we can do about it.” Chief Justice Roberts seemed to agree, stating a “label that fully complies with the FDA regulations” could also be “misleading on the entirely different question of commercial competition… that has nothing to do with health.”

While this lawsuit focuses on competing federal statutes, the Food Drug and Cosmetic Act and the Lanham Act, the outcome will doubtless affect consumer protection class actions brought under State law as California’s consumer protection statutes contain prohibitions similar to the “likelihood of confusion” language contained in the Lanham Act.

If you or someone you know has purchased a falsely advertised or mislabeled product, you may be entitled to relief. Please call Khorrami Boucher, LLP for a confidential consultation.

April 24, 2014 / Scott Tillett

Pesticides Found in Celestial Seasoning “100% Natural” Teas

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Hain Celestial Group, Inc., makers of Celestial Seasonings teas, advertises its sleepy time/kids teas, various green teas, wellness teas, k-cups, and other teas as “100% Natural.” However, the results of a December 2012 analysis by EuroFins, a worldwide analytic testing company, indicate that 10 of the 11 teas tested contained pesticide levels that exceed U.S. Federal limits.

The pesticides found in Hain Celestial’s teas include Propachlor, found in Sleepytime Kids Goodnight Grape tea, a chemical that was placed on the Proposition 65 list as known to the State of California to cause cancer or reproductive toxicity. Propachlor is also listed by the Pesticide Action Database as a Bad Actor Chemical (meaning it is toxic, carcinogenic, or a known reproductive or developmental toxicant), a carcinogen, and a developmental or reproductive toxin. Other Hain Celestial teas tested, including English Breakfast Black K-Cup, Green Tea Peach Blossom, Green Tea Raspberry Gardens, Antioxidant Max Blackberry Pomegranite, Antioxidant Max Blood Orange, and Antioxidant Max Dragon Fruit contained Propargite, another chemical on the Proposition 65 list, known by the State of California to cause cancer and developmental toxicity. Despite these findings, to this day, Celestial Seasonings markets its products as “100% Natural Teas.”

Hain Celestial Group responded to consumer concerns about toxic chemicals found in its tea products by indicating that it had its own tea samples tested by the National Food Lab, which was supposedly “an industry-leading third-party lab…” However, The National Food Lab was not exactly a “third-party lab” as its website had prominently listed Celestial Seasonings as one of its clients (compare The National Food Labs’ current “Our Clients” webpage, not listing specific client names, to this web archive of the same webpage, specifically listing Celestial Seasonings).

Khorrami Boucher Sumner Sanguinetti, LLP is currently investigating false advertising, unfair competition, and other claims on behalf of consumers who purchased Hain Celestial Group teas advertised as “100% Natural.” If you purchased an adulterated Celestial Seasoning tea product, you may be entitled to relief. Please call Khorrami Boucher, LLP for a confidential consultation.

April 24, 2014 / Corina Valderrama

Lawsuit Filed Against Wells Fargo for Loan Modification Violations

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Henry and Renee Garcia have filed a potential class action lawsuit in California federal court against Wells Fargo alleging it violated California consumer laws by billing late fees to, or foreclosing on, state homeowners who had loan modification applications pending with the bank.

According to the lawsuit, Wells Fargo practices “dual tracking”, which is when a bank pursues a foreclosure while simultaneously processing loan modifications. On January 1, 2013, the California Homeowner Bill of Rights was enacted, prohibiting this conduct.

The Garcias allege that they applied for a loan modification with Wells Fargo but the bank charged them $840 in late fees and prepared to foreclose on their property before their application process was complete. The lawsuit seeks to establish two subclasses: one for alleged victims of dual tracking and another for homeowners who were illegally charged late fees.

If you or someone you know has suffered from a similar experience, please contact Khorrami Boucher, LLP for a private consultation.

April 24, 2014 / Corina Valderrama

Bayer Sued for Mirena IUD Birth Control Complications

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Nine women have filed a lawsuit in California federal court against Bayer Healthcare Pharmaceuticals Inc. alleging complications related to its birth control device, Mirena IUD.

Mirena is designed to be inserted into the uterus by a physician to prevent pregnancy through hormonal actions and can remain in place for up to five years. The lawsuit itself does not discuss the details of the plaintiffs’ injuries but other lawsuits and complaints have listed several alleged complications with the device. Among these are claims that the device can perforate the uterus or punch its way through the walls of the organ and cause damage to other organs of the pelvis and abdomen. Other alleged complications include permanent damage to the reproductive systems that can cause sterility.

The litigation against Bayer over the Mirena IUD has taken the form of a multidistrict litigation comprising of hundreds of individual Mirena lawsuits filed across the country.

If you or someone you know has suffered injury as a result of a defective product, please contact Khorrami Boucher, LLP for a private consultation.

April 24, 2014 / Cathy Kim

Takeda to Pay $6 Billion in Actos Cancer Lawsuits

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On April 7, 2014, a federal court in Louisiana ordered Japanese drug maker Takeda Pharmaceutical Co. Ltd. to pay $6 billion in punitive damages in settlement of allegations that the company concealed information regarding the risk for cancer associated with its diabetes drug Actos.  Eli Lilly and Co., a co-defendant in the case, was ordered to pay $3 billion in punitive damages and $1.45 billion in compensatory damages.  This was the first federal case to be tried in a consolidated multidistrict litigation comprising of more than 2,900 lawsuits. 

Actos is a member of class of drugs known as thiazolidinediones, used to treat type 2 diabetes.  The side effects of Actos include increased risk for bladder cancer, congestive heart failure, serious liver problems, and fractures.  According to Eli Lilly and Co., 75 percent of the liability was allocated to Takeda and 25 percent to Lilly.  Takeda plans to appeal the award, stating that judgments were entered in its favor in all three previous Actos trials. 

If you or someone you know has been affected by the drug Actos, please contact Khorrami Boucher, LLP for a consultation.

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