A Food Court Follies Analysis
No doubt, many a diet soda will be consumed this weekend. Will any of those consumers, though, purchase that soda—in reliance on the manufacturers’ devious use of “diet”—because they think it will assist in weight loss?
That impression is the basis of a number of copycat consumer class-action lawsuits filed in New York and California by the same lawyers on behalf of soda purchasers against Coca-Cola, PepsiCo, and Dr. Pepper Snapple Group. Four such suits have been dismissed, the most recent being Manuel v. Pepsi-Cola Co. in an pointedly written opinion by U.S. District Court for the Southern District of New York Judge Paul A. Engelmayer.
Two named plaintiffs who are “long-time purchasers and consumers of Diet Pepsi” and have “struggled with obesity for many years” accuse PepsiCo of unfair and deceptive business practices in their use of “diet.” Diet, to the plaintiffs, means weight management, which cannot occur if one consumes Diet Pepsi because, their complaint asserts, the nonnutritive sweeteners used in place of sugar interfere with the body’s ability to metabolize calories.
PepsiCo argued that no reasonable consumer believes “diet” + “soda” = weight-loss product. Thankfully in the Second Circuit, which encompasses Judge Engelmayer’s court, clear precedent indicates that judges can make the reasonable-consumer determination “as a matter of law.” That’s a far clearer and more powerful standard than what courts in the Ninth Circuit (including the Northern District of California/the Food Court) have at their disposal. As we’ve written previously, Ninth Circuit precedent dictates that only in “rare situations” should judges, not juries, assess a claim’s reasonableness on a motion to dismiss. As a result, some California-based judges have allowed truly absurd consumer-protection claims to advance.
Confident in his authority, Judge Engelmayer explained why the plaintiffs’ impression of Diet Pepsi was unreasonable. Words, images, and other items appearing on consumer-product labels, he reasoned, must be considered not in isolation, but in context. To illuminate that point, the judge summoned a memorable phrase from a Judge Learned Hand opinion:
Words are not pebbles in alien juxtaposition; they have only communal existence.
“Diet” appears just in front of and modifies “Pepsi.” That juxtaposition “connotes a relative health claim—that Diet Pepsi assists in weight management relative to regular Pepsi.” In support of that conclusion, Judge Engelmayer referenced an FDA food-labeling regulation that explained when a term like “low calorie” appears before any food, the statement means the “food has been altered to lower its calories with respect to other foods of the same type.”
Judge Engelmayer could have dismissed the claims based solely on his lack-of-context analysis, but he went on to dismantle the second part of plaintiffs’ deception theory—that sugar substitutes are “likely to cause weight gain.” That wording conveys something less than the required cause-and-effect relationship because, as the opinion spells out in two pages of detail, the scientific studies plaintiffs cite in fact disclaim any causal connection between sweeteners and weight gain. Judge Engelmayer quoted study after study using words such as “unclear,” “caution should be taken,” and “may be no causal relationship.”
“In law, as in science,” Judge Engelmayer summarized with reference to a Justice Anthony Kennedy opinion, “‘[c]orrelation is not causation.'”
Regrettably, Manuel will likely join one other copycat class action on appeal to the Second Circuit, Excevarria v. Dr. Pepper Snapple Group, No. 18-1492. Another appeal is pending in the Ninth Circuit, Becerra v. Coca-Cola Co., No. 18-15365, and a suit by that same plaintiff against PepsiCo is pending in the Food Court, Becerra v. PepsiCo., No. 2017-cv-05918. The district judge presiding over that suit has indicated he will decide PepsiCo’s motion to dismiss without hearing oral arguments, an encouraging sign.
What is discouraging, however, is that these enterprises must continue diverting millions of dollars for attorneys’ fees and costs to fight lawsuits that courts have unanimously labeled unreasonable. At a minimum, the soda companies’ undefeated record will hopefully deter future copycat claims. The circuit courts can solidify that deterrent by decisively affirming each dismissal.
So go ahead and enjoy your diet soda this Memorial Day weekend. Just do so with Judge Engelmayer’s deft application of context and reason in Manuel in mind: moderation, not overconsumption, will allow the “diet” in diet soda help minimize the calories.
Also published by Forbes.com on WLF’s contributor page.