Stay ADvised: 2024, Issue 11

A class action lawsuit accuses the makers of Splenda Naturals Stevia, a sugar alternative, of misleading consumers with the claim that the product is "100% Natural."
United States Media, Telecoms, IT, Entertainment
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In This Issue:

  • Plaintiff Says Splenda 100% Natural Ad Claims Leave a Bitter Taste
  • Makers of Deceptively Advertised N95 "Color-Changing" Mask That Wasn't Actually N95 To Pay More Than a Million To Settle
  • "100% Pure Avocado Oil" Claims Are Ripe for Discontinuance, NAD Concludes
  • NAD Concludes That TPR MCAT Score Guarantee Is a Performance Claim

Plaintiff Says Splenda 100% Natural Ad Claims Leave a Bitter Taste

A class action lawsuit accuses the makers of Splenda Naturals Stevia, a sugar alternative, of misleading consumers with the claim that the product is "100% Natural."

According to the complaint, TC Heartland, manufacturer of the alternative sweetener, falsely marketed the product when it prominently labeled the product "100% Natural" on its packaging. The complaint indicates that the "100% Natural" claim appears on packaging for a variety of sizes and formats of the product. That claim is misleading, says plaintiff, because the sweetener consists solely of the ingredients stevia leaf extract and erythritol, which do not occur naturally in nature but rather are produced in factories using biochemical processes.

The complaint notes that following earlier litigation, Heartland in 2023 began to phase out the "100% Natural" claim, in some instances replacing it with "U.S. Grown" or "Plant Based." Nevertheless, the plaintiffs contend, the products bearing the "100% Natural" claim remain on the market, ready for purchase, and perpetuating deception.

The plaintiff also contends that Heartland, in seeking to justify the "100% Natural" claim, essentially sought to redefine the term "natural." "Aware from the beginning that Splenda Naturals Stevia is not '100% Natural,' but wanting to use that marketing claim, Heartland devised a plan it hoped would help it avoid liability for the misrepresentation." Specifically, the product packaging and website indicate that under Heartland's "natural standard," an ingredient is natural if it's made by "minimal and common processes."

And in characterizing stevia leaf extract and erythritol as "natural" under that standard, the plaintiffs argue, Heartland oversimplified and misrepresented the complex multi-step nature of the production process.

The complaint acknowledges that the Food and Drug Administration has not formally defined the term "natural" but notes that the FDA has indicated that it considers "natural" to mean that nothing synthetic or artificial has been added to or included in the product.

"Natural" remains "one of the most compelling labeling claims to consumers," says plaintiff. And, the complaint asserts, Heartland deliberately labels Splenda with the "100% Natural" claim to capitalize on consumer desire for healthy, wholesome food.

Key Takeaways

A key issue in the case will be whether the court finds that Heartland's use of the term "natural" to refer to ingredients produced with "minimal and common processing" is misleading to a reasonable consumer. (The court also may consider whether the production process used in generating these two ingredients is in fact "minimal and common.") As we saw in a recent New York federal court decision, the court there gave the advertiser's (Sephora's) definition of "clean," another similarly undefined term, significant weight, holding that the advertiser's definition governed when there was no standardized definition. That seems less likely here ... but we shall see.

Makers of Deceptively Advertised N95 "Color-Changing" Mask That Wasn't Actually N95 To Pay More Than a Million To Settle

Gaming company Razer will pay the Federal Trade Commission (FTC) more than $1.1 million to atone for the sale of masks the FTC says were deceptively marketed as N95 during the height of the pandemic.

The complaint alleges that Razer marketed the "wearable air purifier" mask it named the Zephyr as an N95 mask providing protection against COVID, despite the mask never having been approved as an N95 mask and the company's lack of competent and reliable scientific evidence on which to base its protection claims.

This was no ordinary N95 mask, nor your run-of-the-mill cloth mask or fashion fabric mask. The product, which was announced at a consumer electronics show, was a unique-looking mask made of plastic with color-changing lights, which one tech journalist called "a gaming mouse that you strap to your face," made by a manufacturer "best known for neon-tinged gaming" and consumer tech products.

That company promoted the gadget as a "Surgical N95 Respirator" that provided the "highest degree of safety." It was advertised as providing "maximum protection" with "replaceable N95 grade filters." Razer also claimed that it was "lab-tested" for safety, and that it was "FDA-registered and lab-tested for 99% BFE."

According to the complaint, Razer knew that its mask was not an N95 mask and would not be certified as such. It had been warned by a consultant that the N95 designation was not relevant to the product and that "the claim will cause confusion." The company was also aware that the mask failed to perform to the N95 standard.

Yet, according to the complaint, Razer went ahead with advertising the mask as N95 protective, primarily on social media and elsewhere online. Even as the company's CEO claimed that the Zephyr was a "more comfortable, reusable N95, internal communications reveal that" Razer allegedly knew that the mask could not provide an N95 level of protection.

The FTC's complaint alleges that the product was not certified or approved by any U.S. government agency, including the Food and Drug Administration (FDA), and that Razer's indication that the company was "FDA-registered" was misleading because a company's registration "does not mean that the establishment or the device has been approved by the FDA, that the establishment or device is in compliance with all FDA regulations, or even that the establishment has sought approval from the FDA for the device."

Nor was the Zephyr approved as an N95 by the National Institute for Occupational Safety and Health ("NIOSH"), the agency that certifies N95 masks in the United States. Razer did not even seek NIOSH certification, according to the complaint. Having never acquired the NIOSH N95 designation and the permission to market and sell the Zephyr as an N95 mask, the company's marketing of the mask as N95 and of its N95 safety features amounted to false marketing, avers the complaint.

Further, testing on the Zephyr showed that the company knew that the Zephyr repeatedly failed to reach the N95 standard. Despite knowing this, the company allegedly decided to remove disclaimers stating that the mask was not an N95 mask, which employees had proposed including on the product packaging.

Only after journalistic reports, a public outcry, and requests from the FTC and FDA did Razer agree to remove the deceptive N95 representation.

Under the proposed settlement, Razer would, in addition to paying the monetary penalty, be banned from making any claims that the mask prevents or reduced the likelihood of a COVID infection or the severity of the virus without prior FDA approval. It also prohibits the company from representing any health benefits or performance benefits without competent and reliable scientific evidence.

Key Takeaways

Though the fevered height of the pandemic and the false advertising that came along with it are now past, the FTC continues to prosecute cases against companies that falsely advertised COVID-19 products.

"100% Pure Avocado Oil" Claims Are Ripe for Discontinuance, NAD Concludes

What do you say to an advertiser who hasn't substantiated their "100% Pure Avocado Oil" claims? Holy guacamole! Conversely, what do you say to the challenger who prevailed in the National Advertising Division (NAD) matter challenging those same avocado oil claims? Bravocado, of course.

Avocado puns (and reader groans) notwithstanding, NAD sided with the challenger in a matter that might leave the competition green with envy. Challenger and competitor Chosen Foods LLC took issue with a number of express and implied claims made by Lily of the Desert Nutraceuticals Inc., which produces and sells avocado oil under the Tropical Plantation brand.

Chosen Foods argued that the term "100% Pure Avocado Oil" conveyed a misleading and unsupported message that the product was made solely of avocado oil and contained no other types of oils. The claim appeared prominently on the front of the bottle above an image of three avocados (one of which was cut in half displaying the pit) along with additional text on the back of the bottle stating that the product is "100% Pure Avocado Oil" and the oil is "made from Hass Avocados."

NAD first determined that the "100%" language, with its mathematical connotations, imbued the claim with "the authority of dispassionate and objective certainty of authenticity, purity and origin." The juxtaposition of the claim alongside the avocado artwork also reasonably conveyed the messages that the product is made exclusively from avocados, doesn't contain any non-avocado oils, and has the same properties as other non-adulterated avocado oils. In addition, NAD found that the "made from Hass Avocados" claim on the back of the bottle also conveys to the consumer that the product is comprised of a single ingredient.

Chosen argued that the "100% Pure Avocado Oil" claim is not supported, based on the findings of a third-party purity test by SGS North America, which uses the standards published by the Mexican government (because there is no established U.S. or international purity standard for avocado oil). Indeed, it was determined through the use of this approach to testing that Lily's product is not 100% pure as it includes more acid (i.e., palmitoleic, stearic, and stigmasterol acids) than permitted by the official Mexican standards.

Lily didn't dispute the results of the testing but argued that reliance on this standard was inappropriate because it isn't widely used in the industry and is still under development. Lily instead relied on internationally developed testing and assurance about the purity of its avocado oil provided by its manufacturer, Ciuti International, and third-party authentication testing of the purity of avocado oil performed by Eurofins. Noting that the "100%" purity claim requires reliable testing because of its strong impact on consumers and the message of certainty, NAD found that Lily's evidence did not provide the requisite level of substantiation.

First, Lily's internal testing protocol, "while rigorous," did not support the "100% Pure" claim. Second, while Eurofins chose reliable samples of avocado oil as a reference for its tests, there was no evidence as to what markers it used to identify the oil as avocado oil. Without knowing this, NAD could not analyze whether Eurofin's testing sufficiently demonstrated that no other oils were present. Additionally, Lily hadn't provided enough information to explain how Eurofin's testing compared to its own reference sample. Finally, Lily acknowledged the difficulty of detecting adulterated avocado oil without having information on the types of deviations from the avocado oil reference samples Eurofin found acceptable and how Lily's oil compared to the reference samples.

Since an oil is considered "100% pure" to consumers if no other oils are present, the missing information in the testing led NAD to conclude that the advertiser did not provide sufficient support for its claim. Accordingly, NAD recommended that Lily discontinue the express claim "100% Pure Avocado Oil" and refrain from conveying the unsupported message that the product is "100% pure."

Key Takeaways

As this matter demonstrates, advertisers should remember that when it comes to substantiating claims, generally the more absolute and authoritative the claim, the stronger and clearer the evidence in support should be.

NAD Concludes That TPR MCAT Score Guarantee Is a Performance Claim

NAD recently analyzed a challenge to claims by a test preparation center in a Fast-Track SWIFT matter tackling a single, well-defined issue.

Blueprint Test Preparation challenged claims made by TPR Education LLC d/b/a The Princeton Review (TPR) that its students will "Score a 515+ on the MCAT or add 15 points depending on your starting score. Guaranteed or your money back."

The challenger argued that these were performance claims that require substantiation, while the advertiser countered that they are clearly and conspicuously tied to a money-back guarantee so they aren't performance claims.

TPR relied on a NAD case in which NAD found that a claim clearly and conspicuously disclosed a guarantee: "Get pregnant within a year with Ava, or get money back." This, said NAD, was a money-back guarantee rather than a performance guarantee. In contrast, the claim "one year guarantee of pregnancy" elsewhere on the site did not clearly and conspicuously disclose a money-back guarantee and so reasonably conveyed a performance claim, given that the money-back assurance was only visible through a mouse-over hyperlink.

Performance claims clearly and conspicuously tied to a money-back guarantee may still require support, said NAD as an initial matter. And whether the money-back guarantee is clearly and conspicuously disclosed is "crucial" in determining whether a claim is performance-based, but it is not the only factor.

NAD emphasized that "[a]s with all claims, a performance message tied to a money-back guarantee should be viewed from the perspective of the reasonable consumer, taking into account the entire context in which it appears."

Here, although the money-back guarantee was clearly and conspicuously disclosed in every context in which the claim appeared, NAD determined that TPR also conveyed an affirmative performance message that a substantial portion of its test takers could earn a certain score on the MCAT. NAD found that unlike the decisions cited by TPR, crucial here was the fact that TPR advertised very specific quantified claims. The company claimed not only that its product would be effective, but that it would be effective in creating particular, quantified results.

Reasonable consumers may expect variance in test scores, wrote NAD, but a claim that makes such a specific promise should be supported by evidence that a substantial portion of consumers who take TPR's MCAT course will be able to achieve the results specified in the claim. The context where the claim appeared—boldly displayed on the company webpage—also mattered, as did the fact that the TPR course names include the performance claim "515+." With this context in mind, NAD determined that TPR's advertising conveyed a performance message (requiring TPR to substantiate the message).

TPR had not included any evidence in the record to substantiate the challenged claim, so NAD recommended that the company discontinue the claim.

Key Takeaways

The crucial factor between whether a "guarantee" or your money-back claim states a performance claim or simply a money-back guarantee is, as always, context. If, in context, the advertiser makes specific performance claims, including, of course, a quantified one, NAD at least is likely to view the promise as a performance claim and not simply a satisfaction guarantee.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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