District Court Allows Olive Oil Labeling Class Action to Proceed
A federal judge on Jan. 6 denied a motion to dismiss a class action lawsuit in Northern California U.S. District Court against a major olive oil multinational alleging fraud, false advertising, and unfair trade practices. The class action alleges Deoleo falsely labels its Bertolli and Carapelli brand olive oils are extra virgin when they are instead bottled and shipped in way that ensures the oil is degraded before it reaches the consumer. The labels also say the olive oil is “imported from Italy” when it is actually made from olives grown and pressed in several countries, it said. Deoleo filed an early motion to dismiss the case for failing to raise valid arguments, but District Judge Richard Seeborg found enough in the lawsuit to support moving the case forward.
Sign up for a free preview to unlock the rest of this article
If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.
Scott Koller filed the class action in May, seeking damages and an injunction against any further false labeling by Deoleo. Koller says Deoleo’s Bertolli and Carapelli brand olive oils are shipped at temperatures well above 59 degrees, which allows heat to quickly degrade the olive oil. The olive oil is also mixed with refined oil and packed in clear bottles, which allows light to degrade the oil. The resulting products can no longer be expected to meet U.S. Department of Agriculture, California, and International Olive Council standards for extra virgin olive oil by the time they reach the consumer, said Koller. But despite multiple studies confirming that Deoleo’s packing and shipping methods ensure the oil is not extra virgin, the company still labels its Bertolli and Carapelli olive oils as such, said the complaint.
In addition, Bertolli and Carapelli olive oil is prominently labeled as “imported from Italy” on its bottles, but the contents of the bottles are actually a mix of oils from countries throughout the Mediterranean and South America, Koller alleged. At best, the oil is shipped to Italy, bottled, and then exported, said the complaint. But CBP has ruled that simply mixing ingredients from multiple countries does not substantially transform a product and confer origin, said Koller. Although the back of the bottle contains fine print that says the olives used to make the oil are from countries other than Italy, no statement to that effect is made in close proximity to the prominent claim that the oil is “imported from Italy,” as required by the Tariff Act, said the complaint. And the Ninth Circuit has ruled that consumers can’t be expected to “look beyond misleading representations on the front of the box to discover the truth” from small print on the side or back, said Koller.
In its motion to dismiss, Deoleo said the complaint failed to plausibly allege that any fraud or illegal actions were committed. The District Court, however, found enough to make a case for wrongdoing by Deoleo, and declined to dismiss the lawsuit. Koller told a plausible story of fraud, and while “whether he can prove it remains to be seen,” dismissal at such an early stage is unwarranted, said the court.
Email ITTNews@warren-news.com for a copy of the complaint or the denial of Deoleo’s motion to dismiss.
(Scott Koller v. Deoleo USA and Med Foods; N.D. Cal. #14-02400; dated 01/06/14; Judge Seeborg)