The Supreme Court has given Pom Wonderful the go-ahead to sue Coca-Cola in a case expected to have significant ramifications for the food and beverage industry, in terms of how foods are named and labeled.
At the heart of the case is one central question: Can a company like Pom sue another company (Coca-Cola) on a claim of using a misleading label, if that label that has been interpreted as permissible by the Food and Drug Administration?
Pom sued Coke six years ago, accusing the beverage giant of misleading consumers about its Minute Maid Pomegranate Blueberry Flavored Blend of Five Juices, which actually consists of 99 percent apple and grape juice. The suit pointed to a number of label characteristics—images, typeface and wording—that Pom said misled consumers about the juice composition.
Today, eight Supreme Court judges (Justice Stephen Breyer recused himself from the case) unanimously overturned two lower courts' rulings that the FDA’s approval of the drink should stand, according to Time.
But the court was faced with a challenge: how to harmonize two federal laws, one allowing private lawsuits over misleading advertising and the other authorizing federal regulation of food labels, The New York Times reported. Justice Anthony Kennedy wrote for the court, saying the two federal laws had different purposes.
The false advertising law, the Lanham Act, "is for competitors, not consumers," he said, according to the Times, and is enforced largely through private lawsuits. The second law, the Food, Drug and Cosmetic Act, is intended to protect public health and safety, and is enforced by federal regulators and prosecutors. According to the Times, he called these statutes complementary and said one should not preclude the other. The two acts have co-existed since 1946, according to The Washington Post.
A lawyer told Adweek earlier this year that if Pom wins, anything on a food label—approved by the FDA or not—could become fodder for litigation, including class-action suits.
Ironically, Pom is still in litigation with the Federal Trade Commission over its own deceptive advertising. That case is on appeal with the D.C. Circuit Court of Appeals.