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Judge Dismisses Half-Baked False Advertising Claims Against Ghirardelli

By Lawrence Weinstein, Jeffrey Warshafsky & Marc Palmer on May 21, 2020
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On April 8, 2020, Judge Phyllis J. Hamilton of the U.S. District Court for the Northern District of California granted Ghirardelli Chocolate’s motion to dismiss a putative nationwide class action brought by several consumers who alleged Ghirardelli deceptively marketed its “premium classic white” baking chips as containing white chocolate. Cheslow v. Ghirardelli Chocolate, No. 19-CV-07467-PJH, 2020 WL 1701840 (N.D. Cal. Apr. 8, 2020).

The complaint alleged that Ghirardelli’s labeling, advertising, and marketing of its “premium classic white” baking chips deceived “reasonable consumers into thinking ‘white’ represents the type of chocolate in the product, i.e., white chocolate,” when in fact the product did not contain chocolate. Plaintiffs asserted violations of California’s Unfair Competition Law, False Advertising Law, and the Consumer Legal Remedies Act. Ghirardelli moved to dismiss the complaint on the grounds that it did not contain any allegations that plausibly show that the product advertising made any statements or representations that were false or misleading.

As a preliminary matter, both sides agreed that there was no affirmative statement or representation on the product that was false. Specifically, the product label did not include the words “chocolate” or “cocoa.” Therefore, the court explained that Plaintiffs carried the burden of proving that the product had “the capacity, likelihood, or tendency to deceive the consuming public.” Applying that standard, the court granted Ghirardelli’s motion and dismissed all of Plaintiffs’ claims because they did not plausibly allege a reasonable consumer would be deceived by the product’s labeling or advertising.

With respect to Plaintiffs’ contention that consumers would reasonably understand “white chips” to refer to white chocolate, the court drew on two recent Ninth Circuit opinions and sided with Ghirardelli, which argued the description simply referred to the color of the chips. Beginning with the dictionary definition of the allegedly deceptive term, as suggested by Becerra v. Dr. Pepper/Seven Up, 945 F.3d 1225 (9th Cir. 2019) (a case this blog covered), Judge Hamilton found that the adjective “white” in “white chips” does not define the food itself but rather defines the color of the food. Any contrary interpretation of the word by plaintiffs was unreasonable, the court held, and therefore could not form the basis of a false advertising claim under Ebner v. Fresh. In Ebner, the Ninth Circuit held that a representation regarding a product is not deceptive merely because it may be “unreasonably misunderstood by an insignificant and unrepresentative segment of the class of persons that may purchase the product.” 838 F.3d 958 (9th Cir. 2016) . Here, “[s]imply because some consumers unreasonably assumed that “white” in the term “white chips” meant white chocolate chips does not make it so.” This was especially true because the package disclosed the product ingredients, resolving any potential for misinterpretation as to the contents of the product.

Judge Hamilton also rejected Plaintiffs’ argument that the product’s label was misleading because it included images of white chocolate chips and baking recipes. Although “deceptive images, especially when combined with deceptive statements, may deceive a reasonable consumer,” the court explained that it is “unreasonable to draw a specific qualitative message about the product from an image on the product.” Thus, although the package included an image of a cookie with white chips, the court held that it was not reasonable for a consumer to conclude anything “about the quality of those chips” because the packaging “makes no affirmative statement that it is a chocolate cookie.”

Finally, Judge Hamilton did not buy Plaintiff’s argument that the use of the word “premium” in the phrase “premium baking chips” conveyed to consumers that the product was real white chocolate made with premium ingredients. Rather, it was mere puffery and thus not actionable.

This opinion is a reminder – like other cases we have covered – that challenges to literally true advertising statements are likely to provoke a motion to dismiss and that such motions are often granted. This is particularly the case where an ingredient list resolves any potential misinterpretations that a consumer may derive from the contested claims. Continue to watch this space for further developments.

***

Want to talk advertising? We welcome your questions, ideas, and thoughts on our posts. Email or call us at lweinstein@proskauer.com /212-969-3240 or akaplan@proskauer.com /212-969-3671.  We are editors of Proskauer on Advertising Law and partners in Proskauer’s False Advertising & Trademark practice.

Photo of Jeffrey Warshafsky Jeffrey Warshafsky

Jeff Warshafsky is a partner in the Litigation Department. A versatile commercial litigator and strategic advisor, Jeff specializes in consumer class actions, sports litigation, false advertising, trademark, and other intellectual property disputes.

Jeff defends companies in connection with consumer class actions involving advertising…

Jeff Warshafsky is a partner in the Litigation Department. A versatile commercial litigator and strategic advisor, Jeff specializes in consumer class actions, sports litigation, false advertising, trademark, and other intellectual property disputes.

Jeff defends companies in connection with consumer class actions involving advertising and privacy issues. He has handled dozens of class actions around the country for multinational companies across diverse sectors including consumer product companies, retailers, and sports leagues. Jeff also counsels clients to avoid being targeted in such actions, helps them respond to demand letters from plaintiffs’ counsel, and negotiates resolutions.

Additionally, Jeff represents clients in competitor versus competitor advertising disputes, including in Lanham Act cases and advertising self-regulation disputes before the National Advertising Division and the National Advertising Review Board. He also counsels companies on advertising substantiation issues, with an emphasis on complex scientific testing, such as clinical trials and sensory testing. Jeff regularly advises major sports leagues on complex business disputes.

Jeff maintains a robust pro bono immigration practice, assisting clients with asylum and U-Visa applications and in connection with removal proceedings. In addition to his active practice, Jeff is an editor of and contributor to the Firm’s false advertising blog, Watch This Space: Proskauer on Advertising Law.

Read more about Jeffrey WarshafskyEmail
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Photo of Marc Palmer Marc Palmer

Marc Palmer is an associate in the Litigation Department. He earned his J.D. from Boston College Law School, where he was an articles editor of the Boston College Law Review. While in law school, he interned at an automotive startup working on…

Marc Palmer is an associate in the Litigation Department. He earned his J.D. from Boston College Law School, where he was an articles editor of the Boston College Law Review. While in law school, he interned at an automotive startup working on intellectual property and technology licensing matters. Prior to law school, Marc worked as a mechanical design engineer in the industrial gases industry.

Read more about Marc PalmerEmail
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  • Posted in:
    Business and Commercial
  • Blog:
    Proskauer on Advertising Law
  • Organization:
    Proskauer Rose LLP
  • Article: View Original Source

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