U.S. District Judge David Dugan dismissed another deceptive labeling lawsuit filed by New York attorney Spencer Sheehan against AriZona Beverages, finding the consumer knew of the tea’s nutritional facts despite its “Lite” labeling but still chose to continue purchasing the beverage.
In his March 30 order, Dugan granted summary judgment for AriZona Beverages USA LLC and dismissed the case with prejudice.
The lawsuit was filed by Sheehan on behalf of plaintiff Kenneth Crawford, alleging multi-state claims under the consumer fraud acts of Alabama, Arkansas, Georgia, Indiana, Iowa, Louisiana, Michigan, Montana, Nebraska, Ohio, Oklahoma, Texas, Virginia, and West Virginia. The plaintiff sought to waive his multi-state claims when he moved for class certification.
According to the complaint, AriZona Beverages manufactured the 20oz Lite Arnold Palmer beverage at issue. Crawford claimed he purchased the beverage from a third-party on one or more occasions in Caseyville.
Crawford alleged the beverage includes deceptive and misleading labeling. He argued that AriZona Beverages’ use of the word “Lite” is misleading “because the reasonable consumer would understand the term to mean that the product is low in both sugar and calories, or lower in sugar and calories than other products.”
However, Crawford alleged the beverage is neither low in sugar nor calories, containing a similar number of calories to that of a can of soda.
Crawford also argued that the label fails to identify a “reference food” so consumers can compare the “lite” claim to another product with higher nutrient values in accordance with regulations by the Food and Drug Administration.
He further argued that the use of a “dual column” nutrition facts panel to show the serving size of a smaller serving size is misleading because the entire beverage is considered a single-serve container.
Lastly, Crawford argued that the beverage misleads consumers to believe it is made in the United States because the label depicts a map of the U.S. covered in the image of the American flag with the words “An American Company - Family Owned and Operated.” However, the label states “Product of Canada” just below the barcode.
Crawford sought monetary damages and injunctive relief for alleged unfair business practices and deceptive advertising in violation of the Illinois Consumer Fraud and Deceptive Business Practices Act and unjust enrichment.
He alleged he paid a premium for the product due to the alleged misleading label.
AriZona Beverages moved for summary judgment, arguing that the plaintiff cannot prove causation, deception or damage under the Consumer Fraud Act.
The defendant argued that Crawford could not confirm he purchased the product with the label at issue, adding that he preferred to purchase the 23oz cans rather than the 20oz cans at issue in the lawsuit. He also allegedly continued to purchase the product even after believing he had been deceived.
Further, the defendant argued that Crawford testified that the beverage was the best product with the best value.
Dugan wrote that Crawford disputed the testimony, “suggesting that defendant took selective portions of the testimony to support its motion for summary judgment.”
Dugan found that Crawford based his claim on one specific label for the 20 oz cans but provided “no real indication that he ever saw the very label by which he now claims to have been misled.”
“Given the absence of evidence to support plaintiff’s [Illinois Consumer Fraud Act] claim, the inquiry could stop at this point,” Dugan wrote. “However, there is additional evidence to suggest that his claim cannot survive even the low hurdle of avoiding summary judgment.”
Dugan noted that Crawford became aware of the sugar and caloric content in the beverage in 2018 or 2019, but he continued to purchase the product because it was a great value, quenched his third, and tasted good.
“Assuming for the moment the ‘Lite’ representation was and is deceptive, and actually deceived plaintiff before 2018 or 2019, it was not a material misrepresentation to him because he did not act differently once he learned the truth,” Dugan wrote.
Dugan also addressed Crawford’s withdrawal of claims, finding the action “left defendant no alternative but to expend time and effort, unnecessarily as it turns out, and fairness requires that any withdrawal of related claims be with prejudice.”
Crawford sought to withdraw the multi-state class claims based on various state fraud statutes when he filed his motion for class certification, which was filed before the defendant moved for summary judgment.
He also sought to withdraw “all claims in regards to any label statement other than ‘Lite.’” The second attempt at withdrawal was made in opposition to AriZona Beverages’ motion for summary judgment.
“Unlike plaintiff’s withdrawal of multi-state class claims, his desire to withdraw all claims based upon any representation other than “Lite” came after a looming adjudication became apparent. Here, defendant mounted a defense against each of the misleading statements and addressed them in the course of discovery, during plaintiff’s deposition, and in its Motion for Summary Judgment,” Dugan wrote.
U.S. District Court for the Southern District of Illinois case number 3:22-cv-220