BROOKLYN, N.Y. (Legal Newsline) - A federal judge has warned that class action lawyers who target every little thing in the grocery store with lawsuits could be hampering innovation.
Judge Brian Cogan's 18-page ruling on Aug. 6 tossed claims that Molson Coors violated New York consumer protection laws by flavoring Vizzys like the popular champagne-and-orange-juice drink but not using champagne to do so.
The decision is another loss for New York lawyer Spencer Sheehan, who has angered judges and defendants with his hundreds of class actions alleging novel theories of consumer deception. One Illinois federal judge has called him "a wrecking ball."
His cases are often tossed at the motion-to-dismiss phase, when he must prove that a "reasonable consumer" would be misled by a company's marketing of a product.
"Plaintiffs do not allege that hard seltzers ordinarily, or even occasionally, contain champagne," Cogan wrote. "Indeed, they do not claim to have ever come across a hard seltzer made with champagne.
"Because a champagne-based hard seltzer is not the norm, a reasonable consumer would expect that if a hard seltzer had champagne in it, the packaging would make that fact abundantly clear."
The ingredients list simply states "alcohol," among other things. Cogan noted a previous Sheehan loss in New York on margarita hard seltzers he said should have contained tequila.
An Illinois judge has also tossed claims against Molson Coors over "Ranch Water"-flavored seltzers that do not contain tequila.
"Lest we stifle development and distribution of innovative forms of consumer products in the name of avoiding consumer 'deception,' we have to give manufacturers reasonable leeway in marketing their products without handcuffing them with lawsuits," Cogan wrote.
"There is a high transactional cost associated with litigation that ultimately has to be passed on to consumers and may push the price of new products beyond affordability."
Now, Cogan says, a company should be punished for misleading consumers.
"But when a manufacturer's marketing effort merely suggests that the product 'tastes like' something, e.g., a mimosa, that claim is what the consumer is interested in," he added.
"If the manufacturer's advertising is wrong, and it does not taste like what the label says it tastes like, then the consumer is not going to buy it again and the product will fail.
"The market is a much more efficient check on that kind of representation than lawsuits."
He called claims Molson Coors tricked customers with brunch-related advertising "strained."
Molson Coors faced at least one other similar suit in a different jurisdiction, brought in Florida by William Wright - a sort-of teammate of Sheehan's. That case was voluntarily dismissed on July 12.
Sheehan advertises on Facebook to find new plaintiffs, like a woman who used Ricola cough drops for more than 20 years before deciding to sue.
Sheehan first gained notoriety as the "vanilla vigilante," filing a host of lawsuits that claimed vanilla flavoring in products did not contain traditional vanilla.
Sheehan has sued because the strawberry flavoring in Pop-Tarts comes from pears and apples and is dyed red. He complained Bagel Bites have cheese that is a blend made with skim milk and feature tomato sauce that contains ingredients consumers wouldn't expect (the judge hearing that case called his claims "unreasonable and unactionable").
Last year, he lost a lawsuit that said the fudge in fudge-covered Oreos should adhere to traditional definitions of "fudge" by containing more milk fat and not palm oil and nonfat milk.
He faces civil contempt proceedings in New York, plus a lawsuit filed against him by Ashley Furniture for naming it as a defendant in a lawsuit that had nothing to do with the company.
And he's on the hook for $180,000 in attorney fees incurred by Big Lots to defeat a Florida class action that made the same claims as an earlier loser in New York had made.