On Monday, October, 19, 2020, Northern District of Illinois Judge Virginia M. Kendall denied three motions to dismiss a putative class action alleging that the nation’s leading turkey suppliers—including Butterball, Cargill, House of Raeford, Tyson, and Perdue—engaged in a conspiracy to fix the prices of turkey sold in the United States over a seven year period. 
As the Bilzin Sumberg team previously reported in June 2020, the Department of Justice (DOJ) indicted four executives from Pilgrim’s Pride and Claxton Poultry for their participation in a conspiracy to fix prices and rig bids of broiler chicken products.
That indictment alleged that from at least 2012 through at least 2017, Pilgrim’s, Claxton, and at least five other unnamed chicken suppliers participated in a conspiracy to exchange confidential pricing information and rig bids to some of their largest customers, including quick-service restaurants and grocery chains.
On October 6, 2020, the DOJ issued a superseding indictment, which expanded both the number of companies involved and the scope of conduct.
Earlier this month, the Attorney General’s Office of the State of New York filed a lawsuit in New York Supreme Court against Hillandale Farms alleging that the company gouged egg prices during the COVID-19 pandemic.
The State’s Petition, based on alleged violations of New York’s General Business and Executive Laws, contends that Hillandale, one of the nation’s largest producers and wholesale suppliers of eggs, “increased its prices for eggs to levels double, triple, and even quadruple the prices it charged for the same products in January 2020.”  For example, according to the Petition, purchaser Western Beef saw Hillandale’s wholesale price for a dozen large eggs jump from $0.59 in January to $2.93 by the end of March.
On June 8, 2020, Judge Katherine Polk Failla in the Southern District of New York dismissed a putative class action against TGI Friday’s (“Friday’s”) for alleged deceptive advertising.
The Plaintiff claimed the labeling of Friday’s “Sour Cream & Onion Potato Skins” chips is misleading because it led her to believe the snack contained real potato skins and was thus a healthier option than most chips. According to the Plaintiff, she—and the members of the putative class she sought to represent—would not have purchased the purportedly falsely labeled chips if she had known they did not contain real potato skins.
On June 3, 2020, the Department of Justice (DOJ) indicted executives from Pilgrim’s Pride Corporation and Claxton Poultry Farms—two of the country’s largest chicken producers. The criminal action was filed in the District of Colorado, where Pilgrim’s Pride is headquartered. The individuals criminally charged are Pilgrim’s President and CEO, Jayson Penn and former Vice President, Roger Austin, as well as Claxton’s President, Mikell Fries, and Vice President, Scott Brady.
On May 20, 2020, the Eleventh Circuit affirmed the dismissal of a proposed class action against General Mills for its alleged failure to disclose the presence of a harmful chemical in its Cheerios cereal. The Eleventh Circuit agreed with District Judge Robert N. Scola Jr.’s finding that the Plaintiff failed to allege an actual injury sufficient to confer Article III standing.
The Plaintiff alleged General Mills failed to disclose that its Cheerios and Honey Nut Cheerios contain trace amounts of glyphosate, the herbicide that was the subject of the well-publicized class actions involving Monsanto Roundup.  The putative class representative sought to establish both a nationwide class and a Florida class of purchasers of Cheerios or Honey Nut Cheerios during the applicable class period. In addition to claims of breach of warranty, unjust enrichment, violations of Florida’s deceptive practices act (FDUPTA), and restitution for revenues General Mills earned by purportedly misleading consumers, the Complaint also sought an injunction requiring General Mills to change the company’s allegedly deceptive practices.
In the latest of a series of antitrust lawsuits involving the food industry, a Virginia federal court last week denied a motion to dismiss a class action lawsuit alleging a price-fixing conspiracy in the peanut market.
The class is comprised of peanut farmers and harvesters that sell the raw peanuts to the Defendants, who then process, shell, and sell the final product to food companies or other manufacturers.
Work in the restaurant industry is a grind on a good day. Long hours, revolving staff, never-ending customer expectations, seasonality, supply chain issues, and intense competition are just a few of the daily headaches. As adept as restaurants have become at bracing for frequent storms, COVID-19 represents nothing short of their Hurricane Katrina. State and local orders issued in response to the global pandemic forced business closures nationwide—a paralyzing event from which some companies will never recover.
Many resilient restaurants have adapted quickly to new legal constraints by partnering with food delivery services to ramp up take-out and delivery options. Indeed, on-demand food delivery services like Uber Eats, Postmates, Grubhub, and DoorDash are about the only food-related business to benefit from the pandemic. In fact, with stay-at-home lifestyles becoming the potential new normal, financial forecasters are predicting a nearly $45 billion growth in that market between now and the end of 2024.  Restaurants that can continue to pivot to off-premise services like take-out and delivery options likely will see quicker returns to profitability.
Continue Reading Setting the Table in a Post-COVID-19 World: The Restaurant Industry Rises Up to Tackle Its Greatest Challenge Yet (and Maybe Ever)
Last week U.S. District Judge Phyllis J. Hamilton granted Ghirardelli’s Motion to Dismiss a proposed class action involving the chocolatier’s packaging of its white baking chips.
Filing their case in September of last year in California state court, the class plaintiffs alleged that the products were deceptively labeled because the use of the term “white” insinuated that the chips contained white chocolate when it, in fact, did not. Ghirardelli removed the case to federal court and moved to dismiss, arguing that the mere use of the word ‘white’ says nothing about whether the product is chocolate,” but rather simply describes the color of the chips.
Pursuant to standard FDA regulations, retail restaurants with 20 or more locations doing business under the same name (and offering the substantially same menu) are required to provide nutritional information for standard menu items, including calorie information. But with state and local governments’ recent orders in response to the COVID-19 pandemic forcing restaurants to close their dining rooms and switch to take-out or delivery only, many restaurants are also being forced to make impromptu changes to their menu offerings. While these seemingly innocuous menu changes are relatively easy to implement under ordinary circumstances, labeling changes are far more difficult in the midst of a pandemic that has caused restaurants to struggle substantially on multiple levels.
Recognizing this reality, the FDA has acted quickly to temporarily reduce nutritional and menu labeling restrictions. Specifically, the FDA recently announced that it will not object to restaurants that do not meet the normal menu labeling requirements during the pandemic. These changes are meant to avoid food shortages, keep restaurants open, and avoid wasting food.