November 22, 2017
A recent Law 360 story by Joyce Hanson, “Frito-Lay to Pay $2M in Fees in ‘All Natural’ Suit Deal,” reports that a New York federal judge approved the settlement of a class suit accusing Frito-Lay of deceptively labeling food products as being “made with all natural ingredients” when they are actually made with ingredients containing genetically modified organisms, awarding about $2 million in attorneys’ fees and expenses to class counsel.
U.S. District Judge Roslynn R. Mauskopf finally signed off on the proposed settlement agreed to in November 2015 by lead plaintiff Julie Gengo and Frito-Lay North America Inc., which offers no award of damages to the class but does provide the primary relief sought in the litigation — namely, an assurance that products such as Tostitos and SunChips will not be labeled or advertised as “natural” unless those claims on any products containing GMOs are expressly authorized by the U.S. Food and Drug Administration or state or federal legislation.
“The complexity, expense and likely duration of the litigation favor settlement, which provides substantial benefits on a much shorter time frame than otherwise possible on behalf of the class,” Judge Mauskopf said. “The support of class counsel, who are highly skilled in class action litigation such as this, and the plaintiffs, who have participated in this litigation and evaluated the settlement, also favor final approval.”
Under the terms of the final order and settlement agreement, Frito-Lay does not admit the validity of the claims or any wrongdoing or liability, the judge said. Frito-Lay also continues to deny that its labeling of the challenged products is false, deceptive or misleading to consumers or violates any legal requirement. However, Frito-Lay has already removed the “made with all natural ingredients” claim from its products, and the company has agreed not to label the products as “natural” as long as they continue to include GMO ingredients, according to a Nov. 10, 2015, class counsel memo. The settlement was achieved with the assistance of retired U.S. District Judge Richard J. Holwell after mediation sessions over a period of 10 months, the memo said.
The judge approved class counsel’s motion for attorneys' fees in the amount of $1.9 million and for reimbursement of expenses of up to $200,000. She also approved $5,000 awards to class representatives Gengo, Chris Shake and Valarie Zuro, and a $2,500 award to class representative Deborah Lawson.
“Class counsel achieved a favorable result for the class and created a benefit with a substantial value to the class by obtaining Frito-Lay's agreement to modify the labeling policies and practices challenged in this lawsuit,” Judge Mauskopf said in making the award of attorneys’ fees and expenses.
The case is Julie Gengo v. Frito Lay North America Inc., case number 1:12-cv-00854, in the U.S. District Court for the Eastern District of New York. The multidistrict case is In re: Frito-Lay North America Inc. All Natural Litigation, case number 1:12-md-02413, in the U.S. District Court for the Eastern District of New York.