Organix Branding In Question Under Proposed Class-Action Settlement
This article was originally published in The Rose Sheet
Executive Summary
If approved, a class-action settlement between consumers and Vogue International will require the firm to elevate the organic content in its Organix brand or rename the line and stop characterizing it as organic in marketing. Qualifying purchasers of Organix products will be eligible for compensation under the proposed deal, according to a memorandum filed in California district court.
Tampa Bay, Fla.-based Vogue International will either have to rename its Organix brand of hair- and skin-care products and drop the word “organic” from promotional materials or boost the line’s organic content under a proposed settlement to a false-advertising suit filed by consumers in California.
In addition, the company will compensate qualifying purchasers of Organix products via payments from a $6.5 million claim fund, according to court documents.
A memorandum filed Aug. 22 in the U.S. District Court in the Northern District of California seeks preliminary approval of a class-action settlement agreement between Vogue and a group of consumers who claim they paid a premium for Organix products based on the line’s misleading organic positioning.
In fact, the plaintiffs say, Organix offerings do not contain more than 10% organic ingredients.
Plaintiff Andrea Golloher, et al., filed an initial complaint in October 2012, seeking relief on behalf of the proposed class of consumers for alleged violations of consumer-protection and false-advertising laws across a number of states, including California’s Unfair Competition Law.
Terms of the agreement are in line with those Vogue reached in a September 2012 settlement with the Oakland, Calif.-based Center for Environmental Health, which imposed restrictions on Organix branding, labeling and marketing in California where products represented as organic or made with organic ingredients must contain at least 70% organic content, per the California Organic Products Act of 2003.
Vogue was a holdout in CEH’s suit, which targeted a slew of companies, many of which settled with the NGO in late 2011. Firms that opted to settle at that time included Kiss My Face Corporation, Stearns Products, Inc. and Cosway Company, Inc., marketers of the Kiss My Face, derma e and Head Organics brands, respectively (Also see "Brands Settle With CEH, Will Make “Organic” Products COPA-Compliant" - HBW Insight, 12 Dec, 2011.).
Vogue’s proposed agreement with Golloher et al. “will prevent future alleged violations of state consumer-protection and false-advertising laws” by holding the firm to California’s organic standards.
Furthermore, consumers who submit valid claims will be eligible to recover $4 for each Organix product purchased, up to $28 per class member, according to the memorandum. It notes that items in the Organix line typically retail for $7.99 apiece.
If the settlement is approved by the court, notices will publish in People, Us Weekly and Life And Style magazines, as well as the San Francisco Chronicle, to alert consumers. In addition, a press release targeting all 50 states will issue in both English and Spanish languages, and digital advertisements will launch via Facebook, Yahoo! and other online platforms, directing class members to a settlement website and toll-free telephone support system, the court document says.
Any monies left in the claim fund following payments for claims, claims administration expenses, notice and attorneys’ fees and other costs will be distributed to the Center for Food Safety and Consumers Union – “two non-profit entities that serve the interest and needs of the class.”
The plaintiffs are seeking preliminary approval of the settlement, provisional certification of the settlement class and a formal fairness hearing on final settlement approval.
Organic veteran and purist Dr. Bronner’s Magic Soaps All-One! has waged its own legal battle against companies in the personal-care sector whose marketing and business practices constitute organic fraud, according to the Escondido, Calif.-based firm.
Months after filing suit against a number of companies in May 2008 for allegedly misleading consumers and creating an uneven competitive field, Dr. Bronner’s settled with Ikove and Juice Beauty, which agreed to reformulate their products to higher organic standards (Also see "OASIS’ Anti-SLAPP Fails; Dr. Bronner’s “Organic Cheaters” Case Goes Forward" - HBW Insight, 20 Oct, 2008.).
However, The Hain Celestial Group and other defendants continued to fight the allegations, and a California court eventually dismissed the case in August 2012, holding that the responsibility for policing claims in the organic products marketplace belongs to the U.S. Department of Agriculture, which administers the National Organic Program (Also see "Dr. Bronner's Reappeals To USDA Following Dismissal Of Organic Claims Suit" - HBW Insight, 20 Aug, 2012.).
While Dr. Bronner’s agrees that organic personal care should fall within USDA’s jurisdiction, it maintains that the agency should enforce standards for cosmetic products as stringently as it does for foods. The firm has made repeated appeals to USDA and threatened to file suit against the agency – which would not be the first time – as USDA continues to grant leeway to cosmetic brands that make organic claims without complying with NOP criteria (Also see "Dr. Bronner’s V. USDA? Firm Meets With Agency On “Organic” To Avoid Suit" - HBW Insight, 22 Oct, 2012.).