Federal Judge Dimisses Part of Pepsi, Lipton Tea Class Action Lawsuit

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Part of a class action lawsuit filed against Pepsico, Inc, Pepsi Lipton Tea Partnership and Unilever United States, Inc. alleging that several of its beverage products are misbranded was dismissed by a California federal judge on Thursday.

Plaintiff Amy Maxwell says in the second amended class action lawsuit filed in April 2013 that several Pepsi and Lipton products include claims on the food labels that are considered “illegal statements.” The original lawsuit was filed in 2012.

Maxwell claims to have purchased eight Lipton Tea products but she includes 83 other products in the lawsuit that she didn’t purchase, alleging that they are substantially similar to the ones she did purchase.

Among those 83 products, she also includes several Pepsi soda beverages in the class action lawsuit because they contain phosphoric acid, which she says is a synthetic ingredient, while “the label suggests that the product is free of such artificial preservatives and/or artificial flavors.”

However, U.S. District Judge Edward J. DaVila dismissed all allegations in the Lipton Tea class action lawsuit against the nonpurchased products.

“Plainitff alleged that all of the 91 products are ‘physically substantially similar’ and share identical labeling claims, yet Defendants showed in their motion numerous examples where the products had considerable differences among the labels,” Judge DaVila wrote.

The judge said that the problem with including the nonpurchased items in the class action lawsuit is that it “leaves the Court analyzing which of the 83 nonpurchased products resemble the eight purchased products, an arduous task the Court is not inclined [to] undertake.”

Specifically, Maxwell takes issue with claims having to do with the “purported health benefits of Lipton Tea” that it makes on its website and on the packaging of some of its products.

“Indeed, the sale, purchase or possession of misbranded food is a criminal act in California and the FDA even threatens food companies with seizure of misbranded products,” Maxwell states in her class action lawsuit.

In August 2010, the FDA sent a warning letter to Unilever, owner of the Lipton Tea brand, stating that it was making “unauthorized nutrient content claims” about its use of the terms “antioxidant” and “flavonoid.”

Maxwell’s charges against Pepsi and Unilever includes engaging n Unlawful Business Acts and Practices, Unfair Business Acts and Practices, Fraudulent Business Acts and Practices, Misleading and Deceptive Advertising, Untrue Advertising, violating the Consumer Legal Remedies Act and the Sherman Antitrust Act.

The California woman asked that the class action lawsuit be certified, that damages be awarded to the class, which she believes exceeds $5 million, and that Pepsi and Unilver be required to “cease and desist from selling their products . . . in violation of law.”

Judge DaVila did keep the allegations against the beverage company concerning the nutrient content, antioxidant content, nutritional value as well as the “all natural” claims, saying that these could be deceiving to a reasonable consumer.

The California federal judge has given Maxwell 15 days to file another amended complaint.

The plaintiff is represented by Ben F. Pierce Gore of Pratt & Associates and J. Price Coleman of Coleman Law Firm.

PepsiCo is represented by Daniel W. Nelson and Timothy W. Loose of Gibson Dunn.

Unilever and Pepsi-Lipton Tea are represented by William L. Stern, Claudia M. Vetesi and Lisa A. Wongchenko of Morrison & Foerster LLP.

The Lipton Tea/Pepsi Class Action Lawsuit is Amy Maxwell v. Unilever United States Inc. et al., Case No. 5:12-cv-01736, in the U.S. District Court for the Northern District of California, San Jose Division.