McGinity v. The Procter & Gamble Co.

Mital Patel*

Why It Made the List

The filing of mass-produced class action suits targeting allegedly misleading product labels continued unabated in 2023. Though the trend shows no hint of slowing down, courts across the country continued to critically assess the allegations of these proposed class actions. California courts have long been a preferred venue for class action litigation, and this year, the Ninth Circuit provided much needed clarity to consumer companies that routinely face false advertising litigation by resolving an issue that had split district courts in the circuit.

In a panel decision, the Ninth Circuit held that when “a front label is ambiguous, the ambiguity can be resolved by reference to the back label.”^[1] The decision also warned that consumer surveys require the “utmost care.”^[2] Prior to this decision, the district courts in the Ninth Circuit were split as to whether and when a reasonable consumer can be expected to rely on the back label to clarify content on the front label. McGinity provided consumer products companies with necessary guidance on labeling practices and consumers with the assurance that an unambiguously deceptive front label of a product cannot be cured by the back label.

Though prolific plaintiffs’ attorneys are continuing to file putative class actions targeting the food and beverage industry at high speeds, the Ninth Circuit is sending clear messages to the plaintiffs’ bar. In 2023, the Ninth Circuit also affirmed the dismissal of Vitort v. Kroger Co., another putative class action targeting a spreadable fruit product, “Just Fruit,” sold by Kroger supermarkets.^[3] In an unpublished decision, a three-judge panel agreed with the lower court that a reasonable consumer is unlikely to be misled especially because spreadable fruit products usually contain added sugars.^[4]

Other circuit and district courts around the country are undoubtedly taking note of the Ninth Circuit’s skepticism of complaints based on front label claims alone. Whether these decisions slow down the plaintiffs’ bar has yet to be determined.

Decision and Background

The McGinity case concerned “Pantene Pro-V Nature Fusion” shampoo and conditioner with “Nature Fusion” labels appearing in bold, capitalized text with an image of an avocado on a green leaf on the front label.^[5] Plaintiffs filed a putative class action complaint in the Northern District of California against Procter & Gamble Co. (P&G) alleging the front labels of these shampoos and conditioners were misleading and violated California consumer protection laws because the labels conveyed the products are natural when they purportedly “contain nonnatural and synthetic ingredients, harsh and potentially harmful ingredients, and are substantially unnatural.”^[6]

In support of his allegations that the labels were misleading, McGinity relied on a survey of over 400 consumers commissioned by his counsel. This consumer survey purported to show that about 75% of consumers thought the products contained more natural than synthetic/artificial ingredients; 52.6% of consumers thought the phrase “Nature Fusion” meant that the product did not contain synthetic ingredients; 49.1% of consumers thought that the phrase “Nature Fusion” meant that the product contained only natural ingredients; and 69.2% thought that the phrase “Nature Fusion” meant that the product contained both natural and synthetic ingredients.^[7]

McGinity’s survey only showed the survey respondents the products’ front labels.^[8] Plaintiff alleged the back labels were irrelevant because according to Plaintiff, information on the back of a product cannot be used to “clarify” a deceptive label on the front.^[9]

After the district court dismissed plaintiff’s second amended complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6), he appealed the decision to the Ninth Circuit.^[10] Plaintiff contended that he purchased the products and paid a premium for them because he wanted “natural” personal care products, but these products contained non-natural and synthetic ingredients and were substantially unnatural. The Ninth Circuit, applying the reasonable consumer standard, affirmed the district court’s dismissal of the complaint for failure to state a claim.^[11]

Pointing to the plaintiff’s own survey, the Ninth Circuit panel found that there was ambiguity as to what “Nature Fusion” meant in the context of the product packaging. As the court noted, “[l]ooking only at the front label, survey respondents were split nearly 50/50 on the question of whether the products contain a mixture of natural and non-natural ingredients, or if they instead contain all or substantially all natural ingredients.”^[12] As in Moore v. Trader Joe’s,^[13] where the court found a manuka honey product label stating “100% New Zealand Manuka Honey” was ambiguous as to whether the Manuka flower was the only source of the honey, this ambiguity regarding “Nature Fusion” meant that the court needed to consider what additional information other than the front label was available to consumers.^[14] Judge Gould, who authored the panel decision, noted that “[g]iven that ambiguity, the survey is not informative as to whether the labeling of the products is misleading as a whole . . . . Had the survey participants had access to the products’ back labels, they would have had an immediate answer to this question—they could see that the products contain avocado oil, a natural ingredient, as well as many synthetic ingredients.”^[15]

Citing Moore v. Mars Petcare U.S., Inc., the court held that when, as here, a front label is ambiguous, the ambiguity can be resolved by reference to the back label.^[16] These products’ back labels contained representations that made clear that “Nature Fusion” referred to the use of natural avocado oil in the products and the ingredient lists dispelled any confusion on the part of a reasonable consumer as to whether each of the ingredients were natural or synthetic. With the entire product in hand, no reasonable consumer would think that the products were either completely or substantially natural. The court therefore affirmed the decision of the district court dismissing plaintiff’s claims for failure to state a claim under F.R.C.P. 12(b)(6).^[17]

Concurring in his own opinion, Judge Gould, joined by Judge Berzon, wrote separately expressing some discomfort and opining that although the labeling at issue was not deceptive as a matter of law, the labeling nonetheless reflected an increasingly common practice known as “greenwashing,” in which the positive environmental impact or attributes of a product are publicly misrepresented or exaggerated.^[18]

Two months prior to the McGinity decision, the Ninth Circuit also affirmed the District Court of Oregon’s dismissal inTop of Form Vitort.^[19] In Vitort, the plaintiff claimed that Kroger marketed its spreadable fruit product as “Just Fruit” in order to capitalize on consumer demand for minimally processed foods that avoid unhealthy added sugars despite including “significant added sugar, well beyond the sugar occurring naturally in the fruit,” including additives such as pectin, calcium citrate, apple juice concentrate, and citrus acid.^[20]

In an unpublished opinion, the Ninth Circuit panel agreed with the lower court’s conclusion that the product’s label “Just Fruit” was not objectively false in the context of spreadable fruit products.^[21] Plaintiff’s allegation that the pectin, fruit syrup, calcium citrate, apple juice concentrate, and citric acid are not fruit because they don’t appear in a form that exists in nature was unpersuasive to the court.^[22] The court noted that “spreadable fruit” is also not found in nature and, unlike many other spreadable fruit products that do contain non-fruit ingredients such as flavor extracts, non-fruit sugar, food coloring, or animal gelatin, each ingredient in Kroger’s “Just Fruit” product is actually derived from fruit.^[23] The court concluded that because each of the ingredients on the label was derived from fruit, the label was not objectively false.

The Ninth Circuit further agreed with the lower court’s determination that a reasonable consumer would not be misled by the “Just Fruit” label.^[24] The court found that the label does not imply or expressly state anything about the sugar content of the product, and a reasonable consumer would not interpret it as doing so because spreadable fruit products also tend to contain added sugars.^[25]

Implications and Impact

This recent pair of decisions suggests a growing skepticism by courts of challenges to front label claims. The decisions reinforce a growing trend of cases holding that while a back-label disclosure cannot correct a plainly false or deceptive representation, the back label, including the ingredient list, would set reasonable consumers straight when the challenged statements on the front pack are merely ambiguous. This is a welcomed decision for false advertising defendants that have had difficulty convincing district courts to review the entirety of a package with allegedly misleading front-of-pack representations. Going forward, it will be more difficult for plaintiffs to argue that a reasonable consumer should solely rely on a product’s front label. To do so, plaintiffs will face the burden of plausibly alleging that the front label is plainly false or deceptive, rather than merely ambiguous. If relying on a survey to show whether a front label is deceptive or merely just ambiguous, it must be designed with the utmost care.

Notably, the McGinity decision has already had a positive impact on defendants facing false labeling consumer class action suits. For instance, after the McGinity decision, the U.S. District Court for the Central District of California granted defendant’s motion for reconsideration and dismissed with prejudice the Consumer Legal Remedies Act and express warranty claims in Scruggs v. Mars Inc.^[26] In its prior motion to dismiss, the court—citing Williams v. Gerber Prods. Co.^[27]—found that “the placement, color and font size of ‘Artificially Flavored’ compared to the word ‘CINNAMON’ [on an Altoids container] and the depiction of cinnamon sticks, could cause a reasonable consumer to find the meaning [of the front label] ambiguous.”^[28] In light of McGinity, on reconsideration the court determined that the front label of the product was ambiguous and therefore, “a reasonable consumer would be expected to review and consider the back label in determining the actual ingredients of the Product.”^[29] The Scruggs decision highlights the welcomed impact McGinity will continue to have on false labeling consumer class actions.

*   Mital Patel is a senior associate in the Intellectual Property Department at Foley Hoag LLP in New York. She focuses her practice on consumer class action suits and advertising and unfair competition matters.

[1]   McGinity v. Procter & Gamble Co., 63 F.4d 1093, 1099 (9th Cir. June 9, 2023).

[2]   Id. at 1100.

[3]   No. 22-35185, 2023 U.S. App. LEXIS 10410 (9th Cir. Apr. 28, 2023).

[4]   Id.

[5]   63 F.4d 1093.

[6]   McGinity v. Procter & Gamble Co., No. 4:20-cv-08164, 2021 U.S. Dist. LEXIS 165001 (N.D. Cal. Aug. 31, 2021).

[7]   McGinity, 2021 U.S. Dist. LEXIS 165001, at *6; see also Top of Form

McGinity, 69 F.4th at 1096.

[8]   McGinity, 69 F.4th at 1099.

[9]   Id.

[10]  McGinity, 69 F.4th.

[11]  Id.

[12]  Id. at 1099.

[13]  4 F.4th 874, 876–77 (9th Cir. 2021).

[14]  McGinity, 69 F.4th at 1097.

[15]  Id. at 1099.

[16]  McGinity, 69 F.4th at 1093.

[17]  69 F.4th 1093, 1099–1100.

[18]  McGinity, 69 F.4th at 1100 (Gould, J., concurring).

[19]  2023 U.S. App. LEXIS 10410.

[20] Id.

[21]  Id. at *2.

[22]  Id. at *3.

[23]  Id.

[24]  Id. at *4.

[25]  Id.

[26]  No. 22-cv-05617 JAK, 2023 U.S. Dist. LEXIS 212597, at *2 (C.D. Cal. Nov. 9, 2023).

[27]  552 F.3d 934, 939 (9th Cir. 2008).

[28]  Scruggs v. Mars, Inc., 2023 U.S. Dist. LEXIS 96022, *19–*20 (C.D. Cal. May 22, 2023).

[29]  Scruggs, 2023 U.S. Dist. LEXIS 212597 at *19.