• Lawsuit Accuses Snapple of Unnatural Ads
  • September 16, 2009
  • Law Firm: Manatt, Phelps & Phillips, LLP - Los Angeles Office
  • A federal appeals court has revived a lawsuit accusing Dr Pepper Snapple Group, Inc. of deceptively promoting Snapple iced tea as “all natural.”

    In an August 12 decision, the U.S. Court of Appeals for the Third Circuit restored a consumer fraud suit that had been dismissed in 2008, after finding that Food and Drug Administration regulations covering food labeling did not bar the lawsuit. The complaint contends that the beverage contained an artificial sweetener.

    Dr Pepper Snapple had argued that under the preemption doctrine, federal regulations governing food barred state court suits over such products. The court rejected the defendant’s argument, finding that “neither Congress nor the FDA intended to occupy the field of food and beverage labeling and juice products” in a way that would preempt state court suits challenging the accuracy of product labels, according to the court’s ruling.

    The complaint, which was originally filed in New Jersey state court, charges Dr Pepper Snapple officials with violating state consumer fraud laws by marketing Snapple as “all natural” when one of the ingredients was an artificial sweetener. The case, which sought class-action status, was moved to federal court in 2007, and the next year a federal district court dismissed the case on the grounds that it was preempted by FDA regulations governing food labels. The same year, the company replaced the artificial sweetener with sugar, according to court filings.

    In the Snapple case, the Third Circuit found that Congress had not intended to dominate the regulatory scheme for the food labeling industry so completely that state court suits over label claims were barred. “It does not appear that Congress has regulated so comprehensively in either the food and beverage or juice fields that there is no role for the states,” the court wrote.

    Why it matters: The court’s rejection of Snapple’s preemption argument is obviously not the end of the story. Presumably, the case will now return to the lower court to be decided on the merits – i.e., whether Dr Pepper Snapple violated the state consumer fraud laws by promoting Snapple iced tea as “all natural.”