Los Angeles Business Journal

Trader Joe's to Settle 'All-Natural' Lawsuit

By Deborah Crowe Thursday, March 6, 2014

A federal judge in San Francisco on Thursday gave preliminarily approval of a $3.4 million settlement that Trader Joe's Co. will pay to settle a class action lawsuit accusing the Monrovia grocery chain of falsely advertising its cookies, apple juice and other products as being "all-natural" even though they contained synthetic ingredients.

The lawsuit, Tamar Davis Larsen et al. v. Trader Joe's Co., said products that contained cocoa processed with alkali; ascorbic acid; sodium acid pyrophosphate; sodium citrate; xanthan gum; and vegetable monoglycerides or diglycerides — which the plaintiffs consider synthetic — were packaged with labels that said "All Natural" or "100% Natural."

The original complaint cites U.S. Food and Drug Administration guidelines that say a product is not considered natural if it contains color additives, artificial flavors or synthetic substances. The products cited in the lawsuit include Joe-Joe's chocolate vanilla creme cookies and sandwich creme cookies; Trader Joe's jumbo cinnamon rolls, buttermilk biscuits, crescent rolls, fresh jellies and fresh pressed apple juice; and Trader Giotto's "100 percent natural" fat-free ricotta cheese.

In settlement documents, the company denied it had done anything wrong, but agreed to settle "solely to avoid the further expense, inconvenience, and distraction of any burdensome and protracted litigation and to be completely free of any further controversy with respect to this lawsuit."

Under the settlement, the company will establish a fund of $3.38 million. Each class member, or customer, who has proof of purchase will be eligible to receive a payment of the average price of the purchased goods. Each member without proof of purchase will be eligible for reimbursement of between $2.70 and $39.99.