The maker of Canada Dry Ginger Ale couldn’t shake a lawsuit brought on behalf of California consumers who claim they were misled by labeling and advertising that said the drink was “made from real ginger.”
U.S. Magistrate Judge Nathanael Cousins of the Northern District of California on Nov. 2 partially turned back a summary judgment motion from Plano, Texas-based Dr. Pepper Snapple Group Inc. finding that consumers could plausibly claim that they were misled to believe that Canada Dry contains ginger root when it actually contains a ginger derivative, ginger oleoresin.
Although Cousins found that the beverage was “literally made in part ‘from’ real ginger” since ginger oleoresin is derived from ginger root, he noted that the defendant’s own expert survey suggested that between 11.54 to 40.59 percent of consumers believe that “real ginger” tagline might imply that Canada Dry is made using ginger root itself.
“In short, plaintiffs have shown there is a genuine issue of material fact as to whether the ‘Made from Real Ginger’ label misleadingly implies that Canada Dry is made with ginger root,” Cousins wrote.
The judge, likewise, sided with plaintiffs by allowing their claims that the Canada Dry’s “real ginger” branding misleads consumers about the health benefits of the beverage, of which there are none. In waiving on those claims, Cousins cited internal documents from the company that found that 30 percent of consumers who increased their Canada Dry consumption did so because of the perceived health benefits.
“Simply put, it would be odd for the court to conclude that Dr. Pepper’s advertisements do not affect consumer expectations regarding Canada Dry, when Dr. Pepper itself believes that it had,” Cousins wrote.
Cousins’ ruling is the second recent win in the case for lead plaintiffs counsel at Gutride Safier and the Margarian Law Firm. In June Cousins certified a class of all California consumers who had purchased a Canada Dry product dating back to Dec. 28, 2012.
Gutride Safier’s Adam Gutride didn’t immediately respond to a request for comment.
Cousins, however, on Nov. 2 did grant Dr Pepper’s motion for summary judgment on claims that the company misled consumers about the amount of ginger in Canada Dry. Cousins noted that the plaintiffs hadn’t pointed to any evidence showing how much ginger consumers expected to be in the beverage and defense survey data that showed consumers exposed to the “real ginger” advertising were skeptical about the amount of ginger in Canada Dry.
Dr. Pepper Snapple Group is represented by counsel at Baker Botts. Van Beckwith, the Dallas-based chair of the firm’s litigation department, said in an email that his client was pleased that the court had entered summary judgment on its behalf on some claims. He also said they were pleased that the court “struck one of plaintiffs’ experts entirely and limited the scope of the opinions that may be offered by two other experts” in a related order Nov. 2.