Cook County Record

Tuesday, January 21, 2020

Appeals panel bags class action vs Fannie May over 'slack fill' candy packaging

Federal Court

By Jonathan Bilyk | Dec 10, 2019

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Corey Coyle [CC BY 3.0 (https://creativecommons.org/licenses/by/3.0)]

Saying the customers got the chocolate candy they paid for, a federal appeals court has boxed up a class action lawsuit against Fannie May, which had accused the candymaker of under filling its candy packages.

On Dec. 9, a three-judge panel of the U.S. Seventh Circuit Court of Appeals rejected the attempt by lawyers James X. Bormes and Kasif Khowaja to revive the class action lawsuit on behalf of named plaintiffs Clarisha Benson and Lorenzo Smith against the Chicago-based chocolatier.

The court’s opinion was written by Seventh Circuit Chief Judge Diane P. Wood. Judges William Bauer and David Hamilton concurred in the decision.


James X. Bormes | Law Office of James X. Bormes P.C.

“In our case, Benson and Smith never said that the chocolates they received were worth less than the $9.99 they paid for them, or that they could have obtained a better price elsewhere,” Judge Wood wrote. “That is fatal to their effort to show pecuniary loss.”

The lawsuit dates back to May 2017, when attorneys Bormes and Khowaja first filed suit against the candy company, saying Fannie May’s candy boxes were deceptively large, compared to the amount of candy contained within them. They argued this violated the federal Food Drug and Cosmetic Act and Illinois’ consumer fraud law.

The lawsuit marked the first time Benson and Bormes had partnered to sue Fannie May, but it is not the first time the client and attorney have worked together on class action litigation.

According to federal court records, Benson and Bormes teamed together twice in 2008. Under the first of the class action lawsuits, they sued the operators of Huck Finn Restaurants in Chicago and Oak Lawn, under the federal Fair and Accurate Credit Transactions Act. That case was voluntarily dismissed in 2009.

They then sued American Mattress under the same law, accusing the mattress chain, as they did the restaurants, of printing too much credit card information on sales receipts. That case settled in 2010, giving as many as 15,000 American Mattress customers merchandise credit vouchers worth $75 or 25% off any purchase of $600 or more. Benson received $4,000, while Bormes received attorney fees worth $165,000.

The lawsuit against Fannie May focused on the candy seller's use of “slack fill,” or “the difference between the actual capacity of a container and the volume of product within it.” Manufacturers assert slack fill is needed for a number of reasons, most commonly to reduce damage to the product when it is shipped and displayed.

In this case, however, Bormes and Khowaja argued the amount of slack fill employed by Fannie May was excessive and was intended to fool customers into believing they were getting more candy for their money than the package actually contained.

The lawsuit said Benson bought a package of Mint Meltaways, which contained 33% slack, while Smith purchased a package of Pixies candy, which contained 38% slack.

U.S. District Judge Sara Ellis dismissed the lawsuit in December 2018, ruling the labeling claims filed under the Illinois consumer fraud law don’t match up closely enough with the labeling requirements under the federal FDCA. This, the judge said, means the state law claims can’t move forward, because the federal law does not allow for a so-called “private right of action,” meaning individuals can’t use the FDCA, on its own, to sue companies for mislabeling products.

Benson and Smith appealed the decision.

However, they found no better reception from the appeals court.

To begin, Wood said the appeals court found Ellis was too hasty in dismissing the case, as the appeals judges did not believe the state law claims were preempted by the FDCA’s requirements.

But while Wood said Ellis did not correctly rule in her dismissal, the appeals judge said the candy lawsuit would still melt under review, because the plaintiffs can’t prove they were actually harmed by the alleged lack of candy in their 7-ounce packages.

The judges also brushed aside the plaintiffs’ claims the slack-filled containers served as “unjust enrichment” for Fannie May, or that Fannie May broke an “implied contract” by selling packages containing less candy than the customers believed the package appeared to hold.

“Here, the parties entered into a ‘straightforward, everyday sales contract’ in which the buyers ‘selected the [chocolate] and offered to purchase it at the advertised price, at which point [Fannie May] accepted by taking the plaintiffs’ money in exchange for possession of the [chocolate],’” Wood wrote.

“The ‘contract terms were memorialized in the sales receipt[s] that [Benson and Smith] received at the cash register.’

“The receipts show the specific products (Mint Meltaways and Pixies), the quantity (seven ounces), and the price ($9.99). The receipts embody the contract between the parties, and it concerns the identical subject-matter of the alleged implied contract. State law does not recognize an implied contract in this situation, and so that part of the case was also properly dismissed.”

Fannie May has been represented in the case by attorney David J. Chizewer, of the firm of Goldberg Kohn Ltd., of Chicago.

 

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Organizations in this Story

U.S. District Court for the Northern District of IllinoisLaw Offices of James X. BormesGoldberg KohnThe Khowaja Law Firm, LLCFannie May Candy Shops

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