An ‘ambiguity’ defense in ‘clean beauty’ litigation?

"Clean beauty" has grown into a multi-billion dollar industry. Once considered niche products aimed only at the most discerning and eco-conscious consumers, "clean beauty" products are now available on the shelves of major retailers across the country. But the growing demand for "clean beauty" products has attracted the attention of the plaintiffs' class action bar. For example, one plaintiff has challenged Sephora's use of the "Clean at Sephora" certification because many of its "clean" products contain glycerol, cetyl alcohol, and other substances that consumers allegedly do not regard as "clean." See Finster v. Sephora USA, Inc., Case No. 6:22-cv-1187 (N.D.N.Y.). Another pending class action alleges that the "Target Clean" product line includes products that contain many "unwanted or harmful ingredients" and, therefore, are not "clean." See Boyd v. Target Corp., Case No. 0:23-cv-2668 (D. Minn.).

In many cases, manufacturers argue that the term "clean" is non-actionable puffery. In other cases, manufacturers argue that their "clean" certifications - such as Sephora's "Clean at Sephora" certification or Target's "Target Clean" certification - clarify the meaning of the term "clean" by disclosing which ingredients a "clean" product can (and cannot) contain. But some courts appear reluctant to dismiss these lawsuits, reasoning that the question of "whether a business practice is deceptive will usually be a question of fact" that a court should not resolve at the pleading stage. Williams v. Gerber Prods. Co., 552 F.3d 934 (9th Cir. 2008).

A recent Ninth Circuit decision, McGinity v. Procter & Gamble Co., 69 F.4th 1093 (9th Cir. 2023), may provide additional ammunition to manufacturers faced with "clean beauty" lawsuits. McGinity holds that when a product's "front label is ambiguous" and the "ambiguity can be resolved by reference to the back label," the labeling is not misleading as a matter of law. Id. at 1099. But while McGinity is a valuable arrow in the cosmetics industry's quiver, it may not always offer a bulletproof defense to manufacturers faced with "clean beauty" lawsuits.

The Ninth Circuit's ruling in McGinity

In McGinity, the plaintiff challenged the labeling of Procter & Gamble's "Pantene Pro-V Nature Fusion" shampoo and conditioner. 69 F.4th at 1096. He alleged that the phrase "Nature Fusion," along with an image of an avocado on a green leaf, falsely suggested that "the Products are natural when, in fact, they contain non-natural and synthetic ingredients." Id. Based on these allegations, the plaintiff asserted false advertising claims on behalf of a putative class of consumers. McGinity, 69 F.4th at 1096. The district court dismissed the plaintiff's lawsuit, and the Ninth Circuit affirmed.

In reaching that conclusion, the court agreed that "there is some ambiguity as to what 'Nature Fusion' means in the context of its packaging." Id. at 1097. "Unlike a label declaring that a product is '100% natural' or 'all natural,'" the court explained, "the front 'Nature Fusion' label does not promise that the product is wholly natural." Id. at 1098. "Instead," the court reasoned, "'Nature Fusion' could mean any of a number of things: that the products are made with a mixture of natural and synthetic ingredients, that the products are made with a mixture of different natural ingredients, or something else entirely." Id.

The court then held that "when, as here, a front label is ambiguous, the ambiguity can be resolved by reference to the back label." Id. at 1099. Applying that principle, the court found that the labeling was not deceptive because the ingredient list on the back label "includes many ingredients that are synthetic and that a reasonable consumer would not think are natural." Id. Because the packaging "clarifies that the rest of the ingredients are artificial and that the products thus contain both natural and synthetic ingredients," the court found that the phrase "Nature Fusion" was not likely to mislead reasonable consumers into believing the products were free of synthetic ingredients. Id.

McGinity's utility - and limits - in "clean beauty" cases

Although McGinity involved products labeled with the term "nature" as opposed to the term "clean," its reasoning applies neatly to lawsuits challenging "clean beauty" products. In contrast to a product labeled as "all natural" or one that claims to have "no artificial ingredients," there is no uniform, agreed-upon definition of "clean." A manufacturer faced with a lawsuit challenging "clean beauty" claims can therefore argue that other material--such as the ingredients list or the manufacturer's "clean beauty" standard--clarifies the meaning of the term "clean" and defeats any claim of deception. Nonetheless, this defense has at least three potential limitations:

First, courts may decline to apply McGinity where the "clarifying" information is not easily accessible to consumers. For example, one court refused to apply McGinity to dismiss a lawsuit challenging the labeling of the defendant's "24HR Foundation," even though the label included a statement directing consumers that they needed to "reapply at least every 2 hours," because that instruction was "printed underneath a peel-back sticker" that was "not immediately visible to consumers at the time of purchase. Zimmerman v. L'Oreal USA, Inc., 2023 WL 8587620, at *3 (N.D. Cal. Dec. 8, 2023). Here too, an ingredient list or other on-pack information clarifying the meaning of the term "clean" is far more effective than a website, a brochure, or other extra-label information that a consumer may not see at the point of sale.

Second, courts may decline to apply McGinity where the labeling discloses all ingredients in the product but fails to clarify whether those ingredients are "synthetic" or otherwise inconsistent with the term "clean." For example, in Gonzalez v. Chattem, Inc., the plaintiff alleged that it the defendant falsely promised that its melatonin supplement would help consumers "get a good night's sleep, naturally," even though it contained allegedly artificial ingredients like citric acid and sodium citrate. 2023 WL 8101923, at *1 (N.D. Cal. Nov. 21, 2023). In contrast to McGinity, where the labeling disclosed that the products contained "ingredients like Yellow 5 and guar hydroxypropyltrimonium chloride," the court found that the disclosure of citric acid and sodium citrate in the ingredient list was not sufficient to "dispel the impression formed by the label that they are 'natural.'" Id. at *6. If a plaintiff's challenge to a "clean beauty" product hinged on the presence of ingredients that are not self-evidently "unnatural" or "unclean," a court may find that the mere disclosure of those ingredients is not sufficient to defeat a claim of deception.

Third, some cases involving "clean beauty" products allege that the products contain contaminants - such as heavy metals, phthalates, and per- and polyfluoroalkyl substances (PFAS) - that the FDA does not regard as "ingredients" and does not require manufacturers to disclose in the ingredient list. Because the ingredient list would not disclose the presence of those substances, it is unlikely that a manufacturer could use the ingredient list to defend itself against these lawsuits.

Despite these limitations, McGinity provides a powerful defense to manufacturers faced with lawsuits challenging "clean beauty" claims. But it is not a silver bullet, and manufacturers would be well-advised to keep its limitations in mind - both when defending against these lawsuits and when reviewing their labels to avoid similar lawsuits in the future.