Consumer Fraud

According to recent reports, a plaintiff yesterday filed a putative class action against General Mills for allegedly misleading consumers about the nutritional qualities of Fruit Roll-Ups and other similar products.  Although this case is not as facially implausible as the Crunchberries and Froot Loops lawsuits, it is nevertheless a bit suspect.  The complaint alleges that General Mills marketed the food products as "nutritious" and "healthy to consumers" but that General Mills failed to disclose that Fruit Roll-Ups contain partially hydrogenated oil.  The plaintiff seeks to certify a class of purchasers of the products and an award of compensatory and punitive damages.

Very recently, in Allen v. V & A Bros., Inc., the appellate division of the New Jersey Superior Court took a step to expand the reach of its Consumer Fraud Act by holding that principals of a company--and even the company's employees--can be held personally liable for treble damages if the company does not comply with regulations promulgated under the Consumer Fraud Statute.  New Jersey courts have, for decades, interpreted the Consumer Fraud Act liberally in favor of consumers, and the consumer plaintiff's bar has historically viewed this as a license to develop ever more creative theories of recovery against businesses operating in that state.  However, this new ruling extends the reach of this strict liability statute in a way that seems patently unfair.