A federal judge sliced off portions of a class action lawsuit accusing Kraft Heinz of violating multiple consumer fraud laws by allegedly improperly labeling its flagship Kraft Mac & Cheese product.
The lawsuit dates to April 2021, and by the time Kraft moved for dismissal on Sept. 23, 2022, a consolidated complaint covering more than 100 class members from 11 states seeking more than $5 million was being processed in U.S. District Court in Chicago.
U.S. District Judge Rebecca Pallmeyer issued an opinion Jan. 12 dismissing claims of false or misleading statements, breach of implied warranty (for all plaintiffs outside Massachusetts) and breach of express warranty, while allowing allegations of material omission and unjust enrichment to continue.
Rebecca R. Pallmeyer
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According to Pallmeyer, plaintiffs’ challenge relies on the signature blue box, specifically the portion designed to resemble a piece of notebook paper. That part of the label promises customers “The taste you love” and indicates the food contains no artificial flavors, preservatives or dyes. Kraft sells more than 1 million boxes per day, Pallmeyer said, but the plaintiffs said the company “violated its duty to disclose to consumers that the product contains, or is at risk of containing, ‘ortho-phthalates,’ also known as ‘phthalates,’ ” synthetic chemicals that make plastics flexible, which the complaint alleges enter cheese powder during processing and packaging.
The complaint said phthalates disrupt endocrine in the human body and cited scientific studies linking excessive consumption to conditions like allergies, bronchial obstruction, endometriosis and decreased semen quality. Other findings suggest prenatal exposure can result in birth defects and neurodevelopmental delays.
Pallmeyer said the Coalition for Safer Food Processing and Packaging contacted Kraft about the issue in 2017 and addresses the issue on its website. The U.S. Food and Drug Administration hasn’t set a specific allowable threshold specifically for phthalates in food, though it does permit the use of such chemicals in “food contact applications, such as processing tools and packaging materials,” Pallmeyer wrote.
Kraft argued imposing liability per plaintiffs’ complaint would negate FDA’s regulatory authority. But Pallmeyer said FDA regulations don’t negate compliance with a state’s food labeling laws, nor has the FDA asserted the safety of phthalates in consumable food. She also wouldn’t grant dismissal on Kraft’s arguments regarding phthalate quantity in its products. Kraft noted the dry pasta accounts for much of the weight of the box, but the chemicals are only alleged to be embedded in cheese powder. But the judge found the factual dispute would be properly heard at a later stage of litigation.
She likewise said it’s too early to determine whether the claims are negated under the FDA’s exemption from disclosing incidental additives on food labels, because there is disagreement on whether the alleged phthalate concentration is actually incidental. However, she did acknowledge Kraft might win on that point at the summary judgment stage.
Kraft also disputed the plaintiffs' assertion that its alleged failure to disclose about phthalates would actually matter to reasonable consumers. Again, Pallmeyer said, that defense relies on Kraft’s version of the facts, which is insufficient for dismissal. Furthermore, she said “it is not obvious from the pleadings that safety risks associated with even small amounts of phthalates are ‘non-existent and hypothetical,’ such that Kraft had no duty to disclose the presence of phthalates in its macaroni and cheese to consumers.” This is underscored by Kraft’s website acknowledging consumer concern about phthalates.
However, Pallmeyer said the plaintiffs fell short of adequate claims Kraft misrepresented its product. References to an absence of dyes, artificial flavors and preservatives, as well as the phrase “gooey, cheese goodness,” are not at direct issue in the complaint, she said, because the plaintiffs used those claims to allege reasonable consumers believe the mac and cheese is safe, healthy and wholesome.
“The alleged presence of a negative substance does not prohibit a manufacturer from advertising a product’s positive qualities,” Pallmeyer wrote. She added that statements about subjective taste aren’t legally actionable — whether consumers love eating Kraft Mac & Cheese, or whether it is indeed “gooey, cheese goodness,” can’t be fodder for a breach of express warranty claim.
Because she didn’t dismiss the failure to disclose claim, Pallmeyer said, she also must let the unjust enrichment claim survive. But the only sustainable breach of implied warranty claim affects Massachusetts residents because that commonwealth’s laws don’t impose a requirement that consumer lawsuits establish privity between buyer and seller.
Kraft must respond by Feb. 17.
Plaintiffs are represented in the lawsuit by attorneys Katrina Carroll, of Lynch Carpenter, of Chicago; Janine L. Pollack and Michael Liskow, of Calcaterra Pollack, of New York; David J. George, Brittany Brown and Lori G. Feldman, of George Gesten McDonald, of Lake Worth, Florida; Rebecca A. Peterson, of Lockridge Grindal Nauen, of Minneapolis; Joshua D. Arisohn and Alec M. Leslie, of Bursor & Fisher, of New York; Jason P. Sultzer and Mindy Dolgoff, of The Sultzer Law Group, of New York; Charles E. Schaffer and David C. Magagna Jr., of Levin Sedran & Berman, of Philadelphia; and Edward L. Manchur, of Peabody, Massachusetts.
Kraft Heinz is represented by attorneys Dean N. Panos, Thomas E. Quinn, Kate T. Spelman and Alexander M. Smith, of the firm of Jenner & Block, of Chicago and Los Angeles.