Kellogg Deceptive Advertising Case Settles

The legal team at SFMS follows up on the settlement of the Kellogg deceptive advertising case.On October 21, 2019, the representative for a class of California consumers filed a motion for preliminary approval of a nationwide class action settlement against Kellogg Sales Company (“Kellogg”) for Kellogg’s alleged violations of California’s False Advertising Law, Consumers Legal Remedies Act, and Unfair Competition Law.

This case commenced on August 29, 2016, when Plaintiff, Stephen Hadley (“Hadley”), filed a class action complaint against Kellogg in the United States District Court for the Northern District of California, alleging that Kellogg deceptively markets its cereals and cereal bars with labels that state the products are “Healthy,” “Nutritious,” and “Wholesome,” when, in fact, the identified products contain copious amounts of sugar that render the products decidedly unhealthy.  Hadley alleged that, on average, the deceptively-labeled products in question contain 9 to 16 grams of sugar per serving and are 18% to 40% added sugar by calorie. The complaint detailed dozens of Kellogg products which were allegedly deceptively labeled, either on the product labels themselves or through product advertising.

On April 30, 2018, Hadley filed a motion for class certification seeking to certify the following class:

[A]ll persons in California who, on or after August 29, 2012, purchased for household use and not for resale or distribution:

Raisin Bran Subclass: Kellogg’s Raisin Bran (including Omega-3) or Kellogg’s Raisin Bran Crunch Cereals in a 13.7 oz., 14.3 oz., 18.2 oz., 18.7 oz., 23.5 oz., 24.8 oz., 29 oz., 30.3 oz., 43.3 oz., 56.6 oz., or 76.5 oz. package stating “heart healthy.” Smart Start Subclass: Kellogg’s Smart Start Original Antioxidants cereal in a 17.3 oz. package.

Frosted Mini-Wheats Subclass: Kellogg’s Frosted Mini-Wheats Bite Size (Original, Maple Brown Sugar, Strawberry, or Blueberry varieties), Big Bites (Original variety), Little Bites (Chocolate or Cinnamon Roll varieties), or Touch of Fruit in the Middle (Mixed Berry and Raspberry varieties) cereals in a 15.2 oz., 15.5 oz., 15.8 oz., 16.5 oz., 18 oz., 21 oz., or 24 oz. package.

Nutri-Grain Soft-Baked Breakfast Bar Subclass: Kellogg’s Nutri-Grain SoftBaked Breakfast Bars (Blueberry, Strawberry, Cherry, Raspberry, and Variety Pack varieties), in 8-bar, 9-bar, 16-bar, or 24-bar counts with packaging stating, “the wholesome goodness you need to shine your brightest!”

On August 17, 2018, Judge Lucy Koh, issued an order granting in part and denying in part Hadley’s motion for class certification.  In her order, Judge Koh granted class certification for each subclass except the proposed Nutri-Grain Soft-Baked Breakfast Bar Subclass, finding that the allegedly deceptive phrase displayed on that packaging did not satisfy Federal Rule of Civil Procedure 23(b)(3)’s predominance requirement.  (Dkt. No. 208.)

In the proposed settlement, Kellogg has agreed to pay over $20 million to class members in cash and vouchers, and has agreed to implement a number of marketing changes in its products, including:

  • Removing or modifying “Heart Healthy” claims for Smart Start and Raisin Bran cereals so long as ten percent (10%) or more of the products’ calories come from added sugar.
  • Removing from packaging for a period of no less than three years claims that Frosted Mini-Wheats and Smart Start cereals are “Lightly Sweetened,” so long as more than ten percent (10%) of the products’ calories per serving come from added sugar.
  • Removing “No High Fructose Corn Syrup” claims and similar statements from the packaging of each identified cereal for a period of no fewer than three years, so long as more than ten percent (10%) of the product’s calories per serving comes from added sugar.
  • Using, for a period of no less than three years, the words “wholesome,” “nutritious,” or “benefits” only in connection with a specific ingredient or nutrient.

This settlement sends an important signal to manufacturers that they will be held accountable for misleading branding and advertising.

The legal team at SFMS has significant experience litigating consumer class actions, including false advertising matters.  If you have any questions regarding this subject or this posting, please contact John Roberts (jroberts@sfmslaw.com) or Alec Berin (aberin@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, and Pennsylvania. SFMS is an active member of Integrated Advisory Group (iag.global), 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.

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