By Jonathan Stempel
July 28 (Reuters) - A federal appeals court revived a proposed class-action lawsuit accusing Chobani of deceiving consumers by falsely advertising some of its Greek-style yogurt as sugar free.
• The 7th U.S. Circuit Court of Appeals in Chicago ruled on Monday that consumers can try to show Chobani violated state consumer protection laws because its Chobani Zero Sugar yogurt contained four grams per serving of allulose, a naturally occurring sweetener.
• The U.S. Food and Drug Administration
regulates the contents of nutrition facts panels on product packaging, and says companies may not label food as "zero sugar" or "sugar free" unless it contains less than 0.5 grams of sugar per serving.
• Writing for a three-judge panel, Circuit Judge Thomas Kirsch found persuasive an FDA brief that said total sugars included all monosaccharides, including allulose.
• Kirsch rejected Chobani's argument that allulose didn't qualify because the FDA regulation listed only glucose, fructose, lactose and sucrose as examples.
• "The agency’s brief is thorough, its reasoning is valid, and its position is consistent with earlier FDA statements about allulose and (its regulation)," Kirsch wrote.
• New York-based Chobani and its lawyers did not immediately respond to requests for comment on Tuesday.
• The named plaintiffs James Franco and Abigail Franco said they bought Chobani Zero Sugar yogurt at a Costco near Chicago in 2023, and would not have done so or would have paid less had they known its sugar content.
• Kirsch said it didn't matter whether reasonable consumers would care about allulose. "The Francos have alleged that consumers were fooled by Chobani’s labels, and given the absolute promise on Chobani’s products (sugar free), we do not find that allegation implausible," he wrote.
• The appeals court returned the case to a federal judge in Chicago.
• A lawyer for the Francos declined to comment.
• The decision came one day after a Manhattan federal judge rejected Chobani's bid to dismiss a lawsuit by Danone, which makes Dannon yogurt, claiming it copied packaging and a slogan for a line of ready-to-drink cold-brew coffee.
(Reporting by Jonathan Stempel in New York; Editing by Mark Porter)
