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"Natural" Labeling Cost $4.5M for Seventh Generation

The connotation of the word "natural" may be followed by images of flowers growing in a large field or a glacial waterfall rushing down a forest mountainside. So, naturally, consumers may be surprised to see synthetic ingredients such as Methylisothiazolinone or Benzisothiazolinone on their natural-labeled products. In fact, a class action lawsuit against Seventh Generation Inc. ("Seventh Generation" or the "Company") accused the Company of illegally misleading consumers by labeling its cleaning products as "natural," despite its use of synthetic preservatives.

In response to the complaint, Seventh Generation argued that it adopted the United States Department of Agriculture's ("USDA") bio-based guidelines for its products. The guidelines show customers how much of the product is bio-based and how much is petroleum-based. For example, Seventh Generation's dish liquid soap disclosed that the product was 95 percent bio-based and was certified by the USDA.

Although the Company stands by its product labels, it agreed to end the lawsuit with a $4.5 million settlement fund. Named plaintiffs will get $5,000, and consumers who have proof of purchase can get a full refund, while those consumers without proof of purchase can get a 50 percent refund.

Furthermore, Seventh Generation agreed to remove claims of "100% natural" and "all natural" from its labels. The products in question were all available for sale at Walgreens, Walmart, Target, Amazon.com, Bed Bath & Beyond and Whole Foods, and included its natural laundry detergent, natural four-times concentrated laundry detergent, ultra power plus natural laundry detergent, natural dish liquid, and ultra power plus natural dish liquid.

The legal team at SFMS has significant experience litigating class action matters. If you have any questions regarding this subject or this posting, please contact Nick Lussier (nlussier@sfmslaw.com) or Chiharu Sekino (csekino@sfmslaw.com). We can also be reached toll-free at (866) 540-5505.

Shepherd, Finkelman, Miller & Shah, LLP is a law firm with offices in California, Connecticut, Florida, New Jersey, New York, Pennsylvania and Wisconsin. SFMS is an active member of Integrated Advisory Group (www.iaginternational.org), which provides us with the ability to provide our clients with access to excellent legal and accounting resources throughout the globe. For more information about our firm, please visit us at www.sfmslaw.com.

SOURCES

Amaral, Brian. "Seventh Generation Settles 'Natural' Claims For $4.5M." Law360. Last modified on July 1, 2016.

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