Consumer Advocate Legal Update : Class Action Lawyers & Attorneys : Khorrami Pollard & Abir Law Firm : Mass Torts, Products Liability

                 Understandably, many people are upset with this lawsuit, alleging poor parenting, blame shifting, and greedy individuals going after deep pockets, but that is not the entire story. As indicated in the complaint that started this lawsuit, the Center for Science in the Public Interest (CSPI) filed this case on behalf of the Sacramento mother. CSPI has its headquarters in Washington, DC and specializes in impact litigation against large food industry powers in order to improve nutrition and food safety. As a non-profit organization, CSPI works to enact social change. CSPI’s track record includes a settlement with Kellogg to stop marketing sugary cereals to children and a lawsuit against KFC for using frying oil high in trans fat, which was subsequently dropped when KFC switched to trans fat-free oils. Before filing this case against McDonald’s, CSPI offered to meet with McDonald’s to avoid litigation if McDonald’s would stop using toys to market to children, which McDonald’s refused. Based off of this case history, Mr. Baker and CSPI have the primary purpose of changing McDonald’s advertising and not simply seeking a cash settlement.

                Many advertisements are either aimed at children or appealing to them, including everything from cigarettes to toilet paper to candy. Children are not well equipped to make competent consumer decisions, so most of these advertisements are tempered by parents’ explanations to their children. Companies should be allowed to market their products freely, but they should follow certain ethical guidelines and exercise special caution with advertisements that are targeted at or could be appealing to children. For example, cigarette companies for decades knowingly targeted children with advertisements appealing to children, such as Joe Camel, and made products more likely to be appealing to children, such as flavored cigarettes.

California’s strong restrictions against unlawful, unfair, and fraudulent business acts (Cal. Bus. & Prof. Code §§17200 et seq.) and deceptive marketing (Cal. Bus. & Prof. Code §§17500 et seq.) help combat unethical advertising. California’s unfair competition law (UCL) is stronger and broader than many other states’ UCL. While most of McDonald’s food is unhealthy and its Happy Meal advertisements are squarely aimed at children, McDonald’s food is not illegal for children to consume, unlike cigarettes. The Happy Meal advertisements also do not appear to make any claims beyond containing a fun toy and yummy food, unlike PF Flyers, for example, which advertised that they could help you “run faster and jump higher,” which are dubious claims. CSPI alleges in its complaint that “because these children do not understand marketing, they are inherently deceived by the marketing, just as adults are deceived by deliberately misleading advertising.” This allegation, however, would render all advertisements aimed at children with any possible negative effects as violations of California’s UCL and discounts the power of parents to control what products their children purchase.

                To McDonald’s credit, they have taken certain steps to provide healthier options, although they can still improve in some areas. In the past few years, McDonald’s has introduced several healthier options, including apples and milk. Despite these changes, public opinion still seems to be against McDonald’s, with one California law outlawing Happy Meal toys in unhealthy meals. These efforts may simply be window dressing, as a recently study by Yale’s Rudd Center for Food Policy and Obesity found the marketing for these healthy options to be in the background at the best and not up to par for what a healthy meal should be. Out of 12 restaurants studied, only Subway and Burger King offered options that could be considered a healthy meal. The study also found that McDonald’s included toy seems to be the primary reason that children choose McDonald’s. If McDonald’s were to offer healthier options and advertise those options more prominently, the public outcry would quickly die down.

                Parents of young children, as the ones who purchase their children’s food and shape their opinions, can make the largest difference in the future health and purchasing habits of their children. McDonald’s is not the only restaurant that offers to children a bonus with their meals. For example, Chick-Fil-A offers children’s books with their kid’s meals and has much healthier food than McDonald’s. Additionally, many toy companies make licensed toys similar to those included in Happy Meals, so parents can easily find a Shrek toy if their children insist upon having one. Next, parents should educate themselves and their children about the nutritional content of the food that they consume. Finally, parents should be willing to tell their children “no,” no matter how many times their children beg and plead.

                Taken by itself, this litigation would likely not be very successful. Some of CSPI’s arguments have far-reaching implications that would hurt many companies that sell products for children or could conceivably have a product that appeals to children. CSPI, however, aims to improve public health, which is a commendable goal. Based off of the results of CSPI’s prior efforts, McDonald’s would do well to offer healthier choices more prominently if it wishes to continue to be a leading fast-food restaurant.

In reaching its decision, the Court of Appeal noted that with respect to the remedy of restitutionary disgorgement, Tobacco II holds:

"[T]he language of section 17203 with respect to those entitled to restitution--'to restore to any person in interest any money or property, real or personal, which may have been acquired' (italics added) by means of the unfair practice--is patently less stringent than the standing requirement for the class representative--'a person who has suffered injury in fact and has lost money or property as a result of the unfair competition.' (§ 17204, italics added.) This language, construed in light of the 'concern that wrongdoers not retain the benefits of their misconduct' [citation] has led courts repeatedly and consistently to hold that relief under the UCL is available without individualized proof of deception, reliance and injury. [***16] [Citations.]" (Tobacco II, supra, 46 Cal.4th at p. 320.)”

Nevertheless, the Court of Appeal found the class definition too broad because it included persons who were not entitled to restitution because they were never exposed to the “effective as floss’ representation. The appellate court wrote:

“Be that as it may, one who was not exposed to the alleged misrepresentations and therefore could not possibly have lost money or property as a result of the unfair competition is not entitled to restitution. Here, the class certified by the trial court, i.e., all purchasers of Listerine in California during a six-month period, is grossly overbroad because many class members, if not most, clearly are not entitled to restitutionary disgorgement. The record reflects that of 34 different Listerine mouthwash bottles, 19 never included any label that made any statement [*632] comparing Listerine mouthwash to floss. Further, even as to those flavors and sizes of Listerine mouthwash bottles to which Pfizer did affix the labels which are at issue herein, not every bottle shipped between June 2004 and January 2005 bore such a label. Also, although Pfizer ran four different television commercials with the "as effective as floss" campaign, the commercials did not run continuously and there is no evidence that a majority of Listerine consumers viewed any of those commercials. Thus, perhaps the majority of class members who purchased Listerine during [***17] the pertinent six-month period did so not because of any exposure to Pfizer's allegedly deceptive conduct, but rather, because they were brand-loyal customers or for other reasons.”

The Court contrasted the limited six-month Listerine marketing scheme with the extensive and lengthy campaign used by the tobacco industry to sell cigarettes.

“The circumstances herein stand in stark contrast to those in Tobacco II, where the tobacco industry defendants allegedly violated the UCL "by conducting a decades-long campaign of deceptive advertising and misleading statements about the addictive nature of nicotine and the relationship between tobacco use and disease." (Tobacco II, supra, 46 Cal.4th at p. 306.) Tobacco II allows a class representative who actually relied on the defendants' misleading advertising campaign to represent other class members who may have lost money by means of the unfair practice. Tobacco II does not stand for the proposition that a consumer who was never exposed to an alleged false or misleading advertising or promotional campaign is entitled to restitution.”

“As Pfizer argues, it is one thing to say that restitution can be awarded to purchasers of cigarettes where the cigarettes were marketed as part of a massive, sustained, decades-long fraudulent advertising campaign on the grounds the tobacco industry defendants "may have ... acquired" [***18] (§ 17203) the purchase price as a [**804] result of such a pervasive fraudulent campaign. It is entirely another to say that restitution can be awarded to all purchasers of Listerine in California over a six-month period where the undisputed evidence shows many, if not most, class members were not exposed to the "as effective as floss" campaign and therefore did not purchase Listerine because of it.”

In other words, large numbers of persons in the class defined by the trial court were never exposed to the “effective as floss” representations and, accordingly, there is zero likelihood they were deceived by the claimed misrepresentation or that Pfizer obtained money from them by the alleged UCL violation. Had the class definition been limited to persons exposed to the “effective as floss” representation (as opposed to all purchasers) the definition might have withstood appellate scrutiny