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Legal red lights flash over Simply Orange

April 9, 2012

by David Robertson, New York, The Times of London

It says Simply Orange on the label, but Coca-Cola’s juice drink has become the subject of legal action by an angry shopper for not being orangey enough.

Nor is it alone but is merely one target in a flurry of lawsuits this year by parties demanding compensation from the likes of Coke and PepsiCo after their products allegedly failed to live up to their marketing.

The Simply Orange suit, for example, alleges that the claim that the juice is a pure natural orange juice is false. In truth, Coca-Cola’s Simply Orange is heavily processed and flavoured it is not 100 percent pure or natural.

The lawsuit filed by Randall Davis from Chicago, argues that the juice cannot be pure because it is “extensively manipulated” to extend its shelf life. The action is seeking other plaintiffs so that it can become a class action, which would increase the scale of damages being sought.

Lawyers not connected with the case said that it had become common in America for plaintiffs to use a literal interpretation of a company’s marketing slogan to seek damages in a class-action lawsuit.

A spokesman for Coke said: “This lawsuit has nothing to do with misleading consumers and everything to do with lining class-action lawyers’ pockets. It is a meritless case against which we will vigorously defend ourselves.”

The legal action bears an uncanny resemblance to one filed by Angelena Lewis from California against PepsiCo’s Tropicana brand in January.

Much of the phraseology is identical. Drinks industry insiders said that copycat lawsuits often appeared in different parts of the country.

According to court filings, Simply Orange is also being sued by Kirk Yee from California. Meanwhile, Chris Shake, of Brooklyn, has filed an action against Frito-Lay and its Tostitos and SunChips brands.

Mr. Shake’s lawsuit, which has attracted two other plaintiffs since it was filed in January, alleges that Frito-Lay’s claim that its snacks are “made from all natural ingredients” is false as the crisps are made from genetically modified corn. The reasonable consumer assumes that genetically modified organisms are not all natural. Thus, Tostitos’s and SunChips’s advertising is deceptive to consumers.

The lawsuit goes on to argue that Mr. Shake has been damaged “to an extent to be determined at trial” because he did not get the all-natural snack he had been expecting.

Peter Huang, a law professor at the University of Colorado, said: “Companies have a decision to make in these cases. Do they fight and risk a volatile jury finding against them, which would set a precedent for other claims? Or do they settle? In many cases for big corporations it is easier to settle, even if there is little merit to the case.”

Critics of class-actions lawsuits argue that the law should be changed to be more like the system used in Britain, where the legal costs are picked up by the loser. In the United States, they are shared and for a plaintiff it costs very little to submit a lawsuit.

“Because you pay your own legal costs, there is an incentive in the American system for the plaintiff to file even if they do not have a meritorious case because it costs them so little to do so,” Professor Huang said. “A company may decide it will cost more to defend than to settle, so the plaintiff gains without having to test his case.”

Lawyers for Mr Davis and Ms Lewis were unavailable for comment.

Reprinted with permission.