How reasonable does a consumer have to be before they’re “unambiguously” deceived? Our Food & Beverage Team reads the tea leaves to discover how courts in the Ninth Circuit are applying the new McGinity standard.

• The McGinity decision is more of an evolution than a revolution from the Ninth Circuit
• Unless the front label is “unambiguously deceptive,” the rest of the labeling must be considered by the court
• Prospective plaintiffs now have a steeper hill to climb when challenging front-label claims

Food companies often counter false labeling litigation by pointing to the wealth of information found on the rest of the product packaging. An ingredients list or even basic information on the rest of the packaging could quickly dispel a plaintiff’s lawyer’s fanciful interpretation of a label or claim that reasonable consumers somehow are deceived.

Whether this additional information should factor into a court’s reasonable consumer analysis can dictate the outcome of a motion to dismiss, not to mention whether food companies will increasingly be forced to litigate semantics. Must a plaintiff consult the rest of a product’s packaging to confirm their alleged interpretation of a product’s label?

According to the Ninth Circuit’s recent decision in McGinity v. P&G, the answer is unambiguously yes when the front label is not unambiguously deceptive.

Reading the Fine Print on the Ninth Circuit’s Reasonable Consumer Standard

Although the McGinity decision may surprise some who view the Ninth Circuit as the prototypical plaintiff-friendly forum, it actually represents a common-sense, natural progression of Ninth Circuit jurisprudence about the reasonable-consumer standard.

For starters, back in 2008, the Ninth Circuit concluded in Williams v. Gerber Products Company that reasonable consumers are not “expected to look beyond misleading representations on the front of the box to discover the truth from the ingredient list in small print on the side of the box.” For the court, an accurate ingredients list on the back label could not reveal the “truth” to reasonable consumers: that the fruit juice snacks did not contain many of the fruits depicted on the front label. Instead, reasonable consumers “expect that the ingredient list contains more detailed information about the product that confirms other representations on the packaging.”

What about front-label representations that are not misleading? The Ninth Circuit responded in Moore v. Trader Joe’s Company that, at least when a claim was ambiguous, a variety of information and context may inform whether reasonable consumers are misled. Specifically, in evaluating the claim “100% New Zealand Manuka Honey,” the Ninth Circuit agreed that “other available information about” the product would “quickly dissuade a reasonable consumer” from the misguided notion that Manuka Honey was derived from 100% Manuka flower nectar. These sources ranged from the product labeling to the price tag to even reasonable consumers’ understanding about “the foraging nature of bees.”

McGinity v. P&G

McGinity builds on the foundation laid in Williams and Moore. In McGinity, the plaintiff challenged “Nature Fusion” shampoo and conditioner, alleging that the phrase “Nature Fusion” and the images of an avocado on a green leaf and a gold vitamin represented that the hair care products were natural. Instead, the plaintiff complained, the products actually contained “non-natural and synthetic” and “harsh and potentially harmful ingredients.” But the plaintiff lost in the district court, which dismissed three versions of the plaintiff’s complaint because the plaintiff did not allege sufficient facts showing that reasonable consumers would be deceived.

On appeal, the plaintiff again argued to the Ninth Circuit that its “precedent” precluded the defendant from relying on back-label information to establish the meaning of “Nature Fusion.” Although the Ninth Circuit applied “precedent,” it wasn’t in the plaintiff’s favor.

To the contrary, McGinity’s directive is clear:

[T]he front label must be unambiguously deceptive for a defendant to be precluded from insisting that the back label be considered together with the front label.

The Ninth Circuit observed that under its precedent, a court should ask first whether a defendant “commit[s] an act of deception on the front of a product.” If not—such as when “a front label is ambiguous”—then any “ambiguity can be resolved by reference to the back label.” It determined that the phrase “Nature Fusion” was simply “ambiguous” because it could “mean any of a number of things.” Turning to the products’ back labels, the court observed that the ingredients list and phrases “Smoothness Inspired by Nature” and “NatureFusion® Smoothing System with Avocado Oil” clarified to consumers that the products contain both natural and synthetic ingredients.

Applying McGinity

In the months since, more than a dozen courts have applied McGinity's holding to dismiss false labeling cases when other information on the product clarified potentially ambiguous (or at least not “unambiguously deceptive”) front-label claims. Some did so with lofty rhetoric suggesting a marked shift in the “wake” of the Ninth Circuit’s decision. Earlier this year in Mier v. CVS Pharmacy Inc., the Central District of California observed that the plaintiff’s “misunderstanding of the label only makes sense if the Court or a consumer were to ignore the statement on the back label,” which, “[u]nder McGinity … the Court cannot do.”

Other courts, however, seem to hold the view (as we do) that McGinity simply “endorsed” and applied the Ninth Circuit’s reasonable consumer jurisprudence.

Still other courts have sought to limit McGinity’s application of Ninth Circuit precedent by distinguishing it as “much further removed” from the circumstances at issue. For example, in January 2024, the Southern District of California in Corpuz v. Bayer Corporation faulted the defendant for failing to “explain how or why” the term “natural” is analogous to McGinity’s analysis of the phrase “Nature Fusion.”

But McGinity’s central holding has taken root—so long as a product’s front label is not unambiguously deceptive, as the Central District of California noted in November 2023 in Scruggs v. Mars Inc., “a reasonable consumer would be expected to review and consider the back label” when making conclusions about the product.

For other examples of Ninth Circuit courts applying McGinity, see:

• Brown v. Madison Reed Inc. (9th Cir. Dec. 13, 2023).
• Lozano v. Walmart Inc. (C.D. Cal. Feb. 1, 2024).
• Dawson v. Better Booch LLC (S.D. Cal. Feb. 9, 2024).
• Prescott v. Ricola USA Inc. (N.D. Cal. Apr. 30, 2024).

Takeaways

Will other circuits follow the Ninth Circuit’s lead? The Second Circuit already agreed late last year in Foster v. Whole Foods Market Group that “context can be crucial” when interpreting front-label claims and that “under certain circumstances, the presence of a disclaimer or similar clarifying language may defeat a claim of deception.” But the Second Circuit has not yet found that the front label must be unambiguously deceptive for a court to preclude a defendant from referencing the back label.

As for other courts, the First Circuit avoided the question by determining that whether a reasonable consumer would be deceived by the phrase “100% Arabica Coffee” would be better addressed at trial—at least with the unique facts of that case. Similarly, the Seventh Circuit has not directly addressed the Ninth Circuit’s “unambiguously deceptive” rule, observing in Bell v. Publix Super Markets Inc. only that “an accurate fine-print list of ingredients does not foreclose as a matter of law a claim that” a product’s front label deceives reasonable consumers.

Regardless of whether other circuits will follow the Ninth Circuit, prospective plaintiffs now have a steeper hill to climb when challenging front-label claims that can be clarified by information present on the rest of the packaging. McGinity is a natural—yet welcome—progression of the principles established in Williams and resolves the uncertainty about what information a plaintiff must consider when alleging that reasonable consumers are deceived.

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