A California federal court earlier this month dismissed a proposed class action claiming the makers of Jim Beam misrepresented its bourbon as “handcrafted.” See Scott Welk v. Beam Suntory Import Co. et al., No. 3:15-cv-00328 (S.D. Cal. 8/21/15) A victory for common sense.
This putative class action centered on the use of the word "handcrafted" on Jim Beam Bourbon bottle labels. The use of the term "Bourbon" for a type of whiskey has been traced to the 1820's, and the term began to be used consistently in Kentucky in the 1870's. According to the Kentucky Distillers' Association, Kentucky produces 95 percent of the world's bourbon supply.
The complaint asserted causes of action for violation of California's false advertising law, Cal. Bus. & Prof. Code § 17500 et seq. ("FAL"), violation of California's unfair competition law, id. at § 17200 et seq. ("UCL"), intentional misrepresentation, and negligent misrepresentation. Jim Beam filed a motion to dismiss, arguing (1) under California's safe harbor doctrine, its compliance with federal labeling law insulates it from Welk's claims, (2) Welk failed to state a plausible claim because he hasn't alleged facts to show that the label would mislead a reasonable consumer, and (3) the economic loss doctrine barred Welk's negligent misrepresentation claim.
Let's focus on the reasonable consumer issue. According to Welk, a "reasonable consumer" would believe that "Jim Beam Bourbon was crafted by hand" and that consumers have long associated this with higher quality manufacturing and high-end products. But, he alleged, Jim Beam Bourbon was actually manufactured using at least in part a mechanized and/or automated process. California UCL and FAL claims are governed by the "reasonable consumer" test. Williams v. Gerber Prods. Co., 552 F.3d 934, 938 (9th Cir. 2008). Under that standard, Welk must "show that members of the public are likely to be deceived." Id. A reasonable consumer is the ordinary consumer acting reasonably under the circumstances, and is not versed in the art of inspecting and judging a product, in the process of its preparation or manufacture. See Colgan v. Leatherman Tool Grp., Inc., 135 Cal.App.4th 663, 682 (2006). Where a court can conclude as a matter of law that members of the public are not likely to be deceived by the product packaging, dismissal is appropriate. See Werbel ex rel. v. Pepsico, Inc., 2010 WL 2673860, at *3 (N.D. Cal. July 2, 2010).
Generalized, vague, and unspecified assertions constitute mere puffery upon which a reasonable consumer could not rely. McKinney v. Google, Inc., 2011 WL 3862120, at *6 (N.D. Cal. Aug. 30, 2011). Rather, a statement must make a specific and measurable claim, capable of being proved false or of being reasonably interpreted as a statement of objective fact. Vitt v. Apple Computer, Inc., 469 Fed. Appx. 605, 607 (9th Cir. 2012).
The court concluded that Welk's proposed definition of the word "handcrafted" just doesn't fit the process of making bourbon. To make bourbon, grains are ground into "mash" and cooked; then yeast is added, and the mixture ferments; then the mixture is distilled, i.e., heated until the alcohol turns to vapor; then the alcohol is cooled until it returns to liquid form, and transferred to barrels for aging. Indus. & Trade Summary, USITC Pub. No. 3373, 2000 WL 1876666 (Nov. 2000). Fermentation, distillation, and aging are necessary to meet the legal definition of bourbon. See 27 C.F.R. §§ 5.11, 5.22(b)(1)(I). Machines, including stills and other equipment, have always been necessary to make bourbon. See Henry Crowgey, Kentucky Bourbon: The Early Years of Whiskeymaking 34, 59 (2008).
Thus, a reasonable consumer wouldn't interpret the word "handcrafted" on a bourbon bottle to mean that the product is literally and completely "created by a hand process rather than by a machine." Thus, it isn't "reasonably interpreted as a statement of objective fact." Vitt, 469 Fed. Appx. at 607. Instead it's "generalized, vague, and unspecified" and therefore inactionable as "mere puffery." McKinney, 2011 WL 3862120, at *6; see also Salters, 2015 WL 2124939, at *3.
The court thus dismissed the suit with prejudice, saying no amendment would cure Welk's inadequate allegation that Jim Beam's use of the term "handcrafted" is misleading.