It seems that we spend so much time thinking about the product that goes inside the bottle or box, that we sometimes give very little thought to the package itself. There are several issues concerning product packaging that deserve your attention, including the question of whether the container itself is potentially “misleading.” The possibility of a consumer class action alleging that your company’s products are being sold in misleading containers (food companies of all types have been targeted) is real.
The U.S. Food and Drug Administration (FDA) defines a “misleading container” as one “that does not allow the consumer to fully view its contents … if it contains nonfunctional slack-fill.” 21 CFR 100.100(a). “Slack-fill” is defined as the “empty space in a package that is filled to less than its capacity.” Not all slack-fill, however, is necessarily a problem. There are perfectly legitimate reasons why a container might include some amount of empty space, which is why the law recognizes a number of exemptions for the inclusion of functional packaging slack-fill. Issues arise when the slack-fill is determined to be “non-functional.”
Under the Federal Food, Drug and Cosmetic Act, slack-fill is considered “nonfunctional” if it does not meet one of the listed exemptions, set forth in 21 C.F.R. Section 100.100, these are: 1) protection of the contents of the package; 2) requirements of the machinery used for enclosing the contents; 3) unavoidable product settling during shipping and handling; 4) instances where the package performs a specific function in the preparation or consumption of the product where such function is inherent to the nature of the food and is clearly communicated to consumers; 5) food packaged in a reusable container where the container is part of the presentation of the food and has value which is both significant in proportion to the value of the product and independent of its function to hold the food, (e.g., a gift product with a container intended for further use after the food is consumed, or durable commemorative or promotional packages); and 6) when there is an inability to increase the level of fill or further reduce package size (e.g., where some minimum package size is necessary to accommodate required food labeling excluding any vignettes or other nonmandatory designs or label information), to discourage pilfering, facilitate handling, or to accommodate a tamper-evident system.
Enforcement
Despite the existence of the regulation, it appears that FDA has never actually undertaken enforcement action of any kind against any company or individual involving an allegation of non-functional slack-fill. This apparent lack of FDA enforcement, however, has not stopped potential plaintiffs from filing numerous class action complaints in courts across the country concerning a vast array of food products. In these cases, the FDA regulation is frequently at issue because even while there is no private right of action to enforce FDA regulations, if the defendant can demonstrate compliance with the aforementioned FDA regulation, the lawsuit would almost certainly be preempted.
In addition to the FDA, many states also prohibit the use of misleading containers. For example, under New York state law “[f]ood shall be deemed to be misbranded … [i]f its container is so made, formed, colored or filled as to be misleading.” N.Y. Agric. & Mkts. Law § 201(4). On September 19, 2018, California amended its own slack-fill law (A.B. 2632, Chapter 544)— https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180AB2632—to include the following additional exemptions: when the dimensions of the product or immediate product container are visible through external packaging; when there is a “clear and conspicuous” depiction of the actual size of the product or immediate product container on the exterior package (except on the bottom); when there is a line or a graphic that represents the product or product fill showing the minimum amount of the product (fill line after maximum settling); or when the mode of commerce does not allow the consumer to view or handle the physical container or product. (This last exemption almost certainly refers to “mail order” situations where a consumer would not be able to physically examine the product prior to purchase).
It remains to be seen how the new California exemptions will interact with the FDA regulation, should the agency ever decide to commence a slack-fill enforcement action, or how the new California exemptions might be referenced by companies seeking to defend consumer class actions brought in states other than California.
An example of “functional” slack-fill would seem to be the inclusion of air in a bag of potato chips. The purpose of the air is to keep the bag “fluffed” so it is not crushed during shipping pulverizing the potato chips within. Of course, an action was brought against a potato chip company questioning the amount of air included in the company’s bags: Alce v. Wise Foods, Inc. 1:17-cv-02402-NRB (S.D.N.Y.). The court ultimately granted defendant’s motion to dismiss plaintiffs’ First Amended Class Action Complaint in a decision dated, March 27, 2018, which discussed the difficulty the plaintiffs faced in factually establishing that empty space in a package is truly nonfunctional. The plaintiffs’ arguments primarily relied on a comparison of the amount of empty space contained in packages of various brands of potato chips to demonstrate that Wise Foods had an excess amount of air (nonfunctional slack), when compared to the other brands. The court noted the “Plaintiffs have not demonstrated, with factual assertions, that the slack-fill in the products is unnecessary to protect the chips, or does not reflect the requirements of the machines used for enclosing the packages, or is not the result of unavoidable product settling, or is not the consequence of an inability to increase the level of fill or to further reduce the size of the package.”
Even though many slack-fill cases have been brought, fortunately, most have been dismissed on motion by the defendant companies. The following examples demonstrate some of the issues that the plaintiffs have in trying to state a viable cause of action against a company for nonfunctional slack-fill.
On December 12, 2016, a federal judge granted the company’s motion to dismiss in Bautista v. Cytosport, Inc. (15-CV-9081 (S.D.N.Y.), a “slack-fill” case concerning containers of Muscle Milk protein powder. According to the court’s decision, the plaintiff had expected the opaque container to be full and was “surprised and disappointed” when he opened it to discover that it contained roughly 30 percent of empty space.
The court ultimately dismissed the case because, despite the opportunity to file an amended complaint, all the plaintiff alleged, as the court noted, “in the same conclusory fashion” was that the 30 percent empty space was not used “to protect product, necessary for enclosing the product, or because of settling.” But he provides no facts rendering that conclusion plausible.” So, an obvious hurtle for any plaintiff in attempting to bring a slack-fill case is how he or she will be able to establish, in the first instance, that any slack-fill in a product container is non-functional. One must remember, that it is an obligation of a plaintiff to establish a prima facie cause of action before it is the obligation of the defendant to defend the allegations.
Typically, accurate statements of net contents have not served as a defense to a slack-fill case, but this may be in the process of changing. Although it involved a drug product, a very instructive decision about slack-fill and bottles of pills, tablets or capsules is Fermin v. Pfizer, 1:15-cv-02133-SJ-ST (S.D.N.Y. October 18, 2016). This lawsuit involved allegations of slack-fill concerning various size bottles of Advil.
In its decision, the court noted that while each package clearly displayed the total pill-count on the label, “Plaintiffs and the members of the Class did not rely on the labeling specifying the number of ibuprofen pills in the products, but rather relied on the sizes of the packaging and dispensing bottles, which led them to have an expectation that the entire volume of the packaging would be filled to capacity with pills.” The court continued, “Plaintiffs provide no basis for disregarding the clearly stated pill-counts on the labels, nor do they dispute the fact that the tablet-count is clearly and prominently displayed on each of the labels. Plaintiffs’ own exhibits show that the labels plainly negate any supposed “reliance” on the size of the packaging as it is impossible to view the products without also reading the total number of pills contained in each package.” (Internal citations omitted).
The court concluded: “It defies logic to accept that the reasonable consumer would not rely upon the stated pill count. Plaintiffs cannot show that they did not receive the total number of pills listed in each package, and admit as much. This court finds, as a matter of law, that it is not probable or even possible that Pfizer’s packaging could have misled a reasonable consumer. Plaintiffs seek to be protected under packaging laws but to dispense with reading the package. The suggestion that such laws should cover their failure to read an unambiguous tablet-count does not pass the proverbial laugh test. In sum, plaintiffs’ claims amount to “non-actionable puffery,” and are unreasonable as a matter of law.” (Internal citations omitted).
Finally, in a very recent decision, Daniel v. Tootsie Roll Industries, LLC, 1:17-cv-07541-NRB (S.D.N.Y. August 1, 2018), involving boxes of Junior Mints candies, alleged to have significant slack-fill, a federal district court judge, dismissed the case because the plaintiffs did not allege “reasonable reliance” on the size of the packaging alone. In other words, according to the Court, “a person of ‘ordinary intelligence’ could easily ascertain the amount of candy contained in the product boxes by 1) inspecting the net weight printed on the front, and 2) multiplying the serving size by the number of servings in the box, as provided on the back. Moreover … reliance is even less justified given that “consumers may have come to expect significant slack-fill in [Junior Mints] and other snack products.” (internal citation omitted). An appeal of this decision is pending before the Second Circuit Court of Appeals, so this will be something interesting to re-visit.
Avoid a Problem
So, what is the bottom line concern for your company? Even if many of these “slack-fill” cases are being dismissed, the cost of defending a federal court litigation can be substantial and best avoided if possible. Attempt to take an unbiased look at your packaging. Will a consumer in opening the package find something, or a lack of something, that may make them feel “cheated?” Those are the people that are most likely to seek compensation. If you are using external and immediate containers, such as a bottle or tube in a box, does the interior container reasonably relate in size to the outer package? Is the external packaging even necessary? If there is a significant amount of empty space in the package, is there a valid and obvious reason? If a consumer understands the reason, perhaps they will be less motivated to have a justification to complain. Can the package be made “see through” in some fashion to allow a consumer to see the contents at the point of purchase? The expanse associated with applying each of these questions to your products’ packaging will be well worth the investment if it keeps you out of court and away from the debate over whether the consumer acted reasonably when relying solely on size of your product packaging in making a decision to purchase. NIE
Steven Shapiro is of counsel to Rivkin Radler LLP (rivkin.com) and a partner of Ullman, Shapiro & Ullman, LLP (usulaw.com). His practice focuses on the dietary supplement/natural products industries with a particular emphasis on FDA and FTC compliance issues including labels, labeling and advertising claims.
