The Supreme Court handed consumers a victory when it unanimously upheld a competitor’s ability to challenge allegedly misleading labeling of another’s product.
POM Wonderful LLC (POM) is a company which produces, markets and sells bottled fruit juice and fruit juice blends, including a Pomegranate-Blueberry juice blend. In 2008, POM sued Coca-Cola alleging false advertising for a juice Coca-Cola labeled as “Pomegranate-Blueberry” which actually contains only 0.3 percent pomegranate juice and 0.2 percent blueberry juice.
The lawsuit invoked state false advertising law as well as the federal Lanham Act, which is actually a trademark law but which gives companies rights of action to sue for anti-competitive business practices that may cause a company harm. Coca-Cola responded that since the federal Food, Drug and Cosmetic Act (FDCA) and the Food and Drug Administration (FDA) regulate labeling of food products, the federal law “occupies the field” and state law claims are invalid. Moreover, Coca-Cola argued, neither the FDCA nor FDA regulations prohibit the labeling of the drink as “Pomegranate-Blueberry” and therefore the labeling is not against the law.
A trial court agreed with Coca-Cola, as did an appeals court. POM brought the dispute to the U.S. Supreme Court.
AARP joined four consumer advocacy organizations in a friend-of-the-court brief asking the Supreme Court to overturn the prior rulings and to find that federal Lanham Act does apply. The brief – filed by attorneys with AARP Foundation Litigation -- noted that while the FDA does oversee labeling of some foods and drugs, it does not police the types of misleading labeling alleged here. The brief pointed out that Congress and state legislatures have long recognized that federal and state agencies cannot alone effectively police all food labeling issues and thus the laws expressly permit private rights of action to enforce consumer rights in addition to any federal or state regulatory oversight.
The Supreme Court agreed, ruling that the Lanham Act absolutely allows companies to sue others for false and misleading practices. This is a significant win for consumers.
What’s at Stake
Older people increasingly are vulnerable to a variety of deceptive labeling and advertising claims. Deception in consumer product marketing may cause harm to an older person’s financial security, and even more seriously, may endanger the person’s health. Vigorous enforcement of laws prohibiting false advertising is particularly important because state and federal enforcement agencies are woefully underfunded, short staffed, and have limited resources to police the marketplace.
POM Wonderful v. Coca-Cola was decided by the U.S. Supreme Court.