Nationwide Nutella Deceptive Marketing Class Action Settlement Upheld

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The 3rd U.S. Circuit Court of Appeals has upheld a $3 million class action settlement over claims Ferrero USA Inc. misleadingly marketed its Nutella spread.

The Nutella class action settlement was opposed by several consumers who were dissatisfied with the deal. One objector urged the appellate court to reject the Nutella settlement because “the notice plan was insufficient, the cy pres provision was improper, the injunctive relief was of no value, and the attorneys’ fee request was excessive.” In July 2012, the district court overruled their objections and granted final approval to the Nutella class action settlement. Subsequently, the consumers filed an appeal.

The Nutella class action settlement will resolve two class action lawsuits that were consolidated into multidistrict litigation titled In re: Nutella Marketing and Sales Practices Litigation in New Jersey federal court. The plaintiffs alleged Ferrero deceptively marketed, advertised and sold its Nutella chocolate-hazelnut spread as a nutritious food without indicating that the nutritional value was based on other food items served with the spread, including bread, milk or fruit.

The parties began mediating the Nutella class action lawsuit in 2011. Two separate Nutella class action settlements have been reached: A nationwide settlement covering 49 states and a settlement that includes only California Class Members.

The California Nutella settlement was also appealed, but the 9th U.S. Circuit Court of Appeals upheld the class action settlement this summer.

Under the terms of the nationwide Nutella class action settlement, Ferrero agreed to pay $2.5 million to eligible Class Members who submit a valid Claim Form. Class Members would be able to submit a claim for $4 per jar, up to a maximum of $20, though the actual amount each Class Member will receive depends on how many valid claims have been filed.

In addition to providing cash benefits to Class Members, Ferrero also agreed to change its labeling, website content and advertisements for its Nutella spread.

In Monday’s decision, a unanimous panel found that the district court did not abuse its discretion when it approved attorneys’ fees that were partially taken from the Class fund. The appellate panel noted the distinction between attorneys’ fees that are considered a statutory fee and those that are considered a common fund fee. The panel found the disputed fees fell under the common fund doctrine and therefore it was permissible for a portion of the attorneys’ fees to come from the common fund.

The appeals court also rejected the appellants’ arguments that the injunctive relief provided little value to Class Members. “The District Court acknowledged that Ferrero agreed to change its label, to stop airing potentially misleading advertisements, and to provide more information on the product’s sugar and fat content,” the appeals court wrote. “The District Court’s conclusion that the marketing changes, as sought in the plaintiffs’ complaint, were of some limited value to the Class is not clearly erroneous.”

The deadline to file a claim for the Nutella class action settlement has passed. According to the Nutella settlement website, the awards will be distributed after all pending appeals are resolved.

The Nutella Deceptive Marketing Class Action Lawsuit is In re: Nutella Marketing and Sales Practices Litigation, Case No. 12-3456, in the 3rd U.S. Circuit Court of Appeals.

UPDATE: Viewers of TopClassActions.com are reporting they have received checks in the mail from the Nutella class action settlement. Congratulations to everyone who got paid!

UPDATE 2: Viewers are reporting that they began receiving checks from the nationwide Nutella class action settlement on March 16, 2015. Did YOU get paid? Let us know in the comments section below!