One of
the new hot trends in class action litigation is to bring suit against products
for false advertising. Both federal laws, like the Lanham Act, and state
laws protect consumers from deceptive practices in advertising. A recent
target of these suits is the liquor industry, which is surprising because
the the Federal
Alcohol Administration Act gives the Alcohol Tax and Trade Bureau
("TTB") the authority to regulate advertising of liquor products.
Nonetheless, two well-known liquor
products are facing class action suits. First, Templeton Rye Whiskey is
defending a potential class action suit in Cook County, Illinois. The
class Plaintiffs have alleged that Templeton deceives consumers and violates Iowa
and Illinois law by stating that it's made in Iowa, and that it is a
Prohibition Era recipe.
Tito's Vodka is also facing multiple
class action suits in federal court in Florida, and state court in California,
over the fact that it calls itself "hand-made" right on the bottle.
The consumers claim that "hand-made" makes the purchase deceptive,
because consumers believe hand-made is of a higher quality, but in reality it
is manufactured similarly to most other vodkas. In defense, Tito's notes
that the TTB approved the brand’s label and that Tito’s “small-batch
distillation process” differentiates it from other vodka brands.
It will be interesting how these suits
play out on multiple fronts. First, there is a question of whether
individuals can maintain a suit against a company that has passed the
government advertising regulations of the TTB, and received specific
approval. Could a TTB approved label really still be a target for a
deceptive practices suit? Additionally, how are terms like "hand-made"
defined? Are courts going to define such terms for purposes of
determining misrepresentations? And, finally, are terms like
"Prohibition Era recipe" and "hand-made" just “puffery”
such as “premium” or “best” that cannot, as a matter of law, be reasonably
relied upon by consumers.
