Facts

Defendant Kellogg Sales Company manufactures cereals. Plaintiffs, purchasers of certain Kellogg cereals that were labeled "heart healthy" or "lightly sweetened," filed a class action suit generally alleging that defendants violated certain laws by labeling some of its cereals--such as Raisin Bran, Smart Start, Frosted Mini-Wheats--with certain nutritious statements even though the products contained excessive amounts of sugar. Plaintiffs' complaint detailed the history and physiological effects of sugar consumption. They then provided scientific evidence linking excess sugar consumption to several diseases including obesity, Type 2 diabetes, liver and cardiovascular diseases.

PLAINTIFFS' CONTENTIONS: Plaintiffs contended that defendant actively maintains a policy and practice of labeling high-sugar cereals (those significantly contributing more than 5% of calories from added sugar and thus more likely to contribute to increased risk of illness when regularly consumed) with various health and wellness claims that suggest the cereals are healthy. This practice is furthered through repeating certain words and phrases consistent with its health and wellness claims not only on its products but also its website.

DEFENDANT'S CONTENTIONS: Defendant denied all contentions. Defendant contended that plaintiffs' claims regarding added sugar are not accepted by the majority of the medical and scientific community and plaintiffs' experts represent the minority view.

Result

The case was settled for $13 million. Additionally, defendant agreed to stop using certain phrases, such as "heart healthy" and "nutritious," in cereal products with 10% or more calories from added sugar. Kellogg may continue to use the "heart healthy" claim on Raisin Bran. Kellogg may use the "heart healthy" claim on Smart Start after a one-year period.