Celestial Seasonings Tea Class Action Lawsuit Survives Dismissal

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Hain Celestial Group Inc. will have to face a consumer class action lawsuit accusing the company of falsely labeling its Celestial Seasonings tea products as “all natural” even though they allegedly contain trace amounts of pesticides, according to a ruling issued Tuesday by U.S. District Court Judge Andrew J. Guilford.

The Celestial Seasonings tea products named in the class action lawsuit are Sleepytime Herbal Tea, Sleepytime Kids Goodnight Grape, Green Tea Peach Blossom, Green Tea Raspberry Gardens, Authentic Green Tea, Antioxidant Max Dragon Fruit, Green Tea Honey Lemon Ginseng, Antioxidant Max Blackberry Pomegranate, Antioxidant Max Blood Orange, and English Breakfast Black KCup.

The Hain Celestial tea class action lawsuit takes issue with the use of the term “100% Natural” used on the product packaging and near the logo for these tea products. The class action lawsuit alleges that each of the teas “has been found to contain significant levels of one or more” chemical insecticides, fungicides, and herbicides. The plaintiffs claim that they were “willing to pay for the Products because of the representations that they were ‘100% Natural’ and would not have purchased the Products, would not have paid for the Products, or would have purchased alternative products in the absence of the representations, or with the knowledge that the Products contained Contaminants.”

The Hain Celestial tea class action lawsuit alleges that the labeling of the teas constitute false advertising, breaches of express and implied warranties, and violates the California Consumer Legal Remedies Act, California Unfair Competition Law, and California Unfair Competition Law.

Hain filed a motion to dismiss the class action lawsuit, arguing that the plaintiffs had not supported their allegations.

On June 10, Judge Guilford rejected Hains’ motion to dismiss. “Plaintiffs’ key factual allegation is that the teas contain unnatural pesticides” the judge wrote in his order, “[d]efendant argues that Plaintiffs have not sufficiently alleged this fact” and “[t]he Court disagrees.”

“Defendant essentially asks the Court to disbelieve Plaintiffs’ allegation that the teas contain pesticide residues, arguing that deficiencies in the evidence underlying that allegation make the allegation implausible,” Judge Guilford said. “The strength of this evidence is an issue for the factfinder.”

Judge Guilford also addresses Hains’ argument that “the Complaint alleges only that pesticide residues were found on dry tea leaves, not in the brewed tea that consumers actually drink,” writing in his Order that “taking the Complaint’s allegation that dry leaves contain residues as true, it is reasonable to infer that the brewed tea contains traces of pesticides as well.”

Judge Guilford also explains that he rejected Hains’ argument that the legal “claims should be dismissed because Plaintiffs haven’t plausibly alleged that a reasonable consumer would likely be deceived by the ‘100% Natural’ label” because “[t]he question under the reasonable consumer test is whether an advertisement is ‘likely to deceive’ a reasonable consumer. The Complaint adequately alleges that the product label is likely to deceive a reasonable consumer.”

Judge Guilford also rejected Hains’ argument that the 100% Natural label constitutes “mere puffery” and is not actionable. The judge pointed out in his Order that “'[g]eneralized, vague and unspecific assertions’ are ‘mere ‘puffery’ upon which a reasonable consumer could not rely,'” however, “misdescriptions of specific or absolute characteristics of a product are actionable.”

“Based on the allegations in the Complaint,” continued the judge “the Court cannot conclude that ‘100% Natural’ is puffery.”

Hains’ argument that the court should dismiss the Hain Celestial tea class action lawsuit because the Food and Drug Administration should determine whether “all-natural” claims can be made on products with trace amounts of pesticides was also rejected by the judge, who wrote: “[g]iven the FDA’s lack of interest in providing further guidance on the use of the word ‘natural’ in food labeling, staying or dismissing the case to permit the FDA to do so would likely be futile.”

The plaintiffs are represented by Tina Wolfson, Robert Ahdoot and Theodore W. Maya of Ahdoot & Wolfson PC and Christopher P. Ridout and Caleb Marker of Ridout Lyon & Ottoson LLP.

The Celestial Seasonings Tea Class Action Lawsuit is In Re: Hain Celestial Seasonings Products Consumer Litigation, Case No 8:13-cv-01757, in the U.S. District Court for the Central District of California.