Honest Co. Defends 'Natural' Claims On Both Coasts
This article was originally published in The Tan Sheet
Executive Summary
Embroiled in litigation in California, Honest also faces a class action complaint in New York citing a list of chemicals and at least 40 of its personal care and household products as evidence of false "natural" advertising. The legal woes could complicate a valuation of the company, reportedly exploring an IPO.
The Honest Co. faces legal battles on the US west and east coast to defend its labeling and marketing practices against claims of false advertising and unfair business practices, following a suit filed Feb. 12 in New York federal court.
The proposed class action alleges deceptive use of "natural" and related claims by the Santa Monica, Calif.-based personal care and household products company, and closely resembles suits filed in September 2015 in California federal courts, which have been consolidated (Also see "Alba's Honest Beauty Launch Travels Light With 'Natural' Baggage" - Pink Sheet, 28 Sep, 2015.).
Honest entered a motion to dismiss the consolidated class action complaint in California on Feb. 15, arguing that the plaintiffs' claims "are premised on an improper legal conclusion regarding the definition of 'natural,'" among other failings.
In the newly filed litigation in US District Court of the New York Southern District, plaintiffs Brad and Manon Buonasera cite "a spectacular array of synthetic and toxic ingredients" in at least 40 Honest offerings ranging from children's toothpaste, moisturizing lotion, bath products and deodorant to laundry and household cleaning products.
According to the complaint, such ingredients belie Honest's natural-oriented and "plant-based" claims, as well as its promise of "no harsh chemicals (ever!)."
Plaintiffs state: "Ironically, Honest's products are not so honest, after all. Instead, Honest's products are a chemical soup."
They claim pervasive use of non-natural ingredients throughout the company's portfolio, "some of which Honest even admits are synthetic, and many of which are federally classified as toxic substances."
The complaint lists phenoxyethanol, present in the company's "'kid-friendly' and seemingly mom-worthy 'plant-based' Laundry Detergent," as an example of synthetic ingredient use contrary to Honest messaging.
Similar to the complaint in California, the Buonaseras say the company has admitted on its "Honestly" blog that phenoxyethanol is synthetically produced, and they assert that "even short exposure [to the ingredient] could cause serious temporary or residual injury."
On its CosmeticsInfo.org website, the Personal Care Products Council notes that the Cosmetic Ingredient Review Expert Panel reaffirmed in 2007 that phenoxyethanol can be safely used for preservative purposes in cosmetic products under current conditions of use, which are concentrations not exceeding 1%.
Reportedly, Honest is working with banks on an IPO following a 2015 funding round that valued the company at $1.7bn.
The plaintiffs also point to Honest's use of methylisothiazolinone, another preservative, as a departure from its natural positioning. They underscore the ingredient's sensitizing potential, which has European regulators considering tighter restrictions on MI's use in cosmetic products (Also see "European Scientific Committee Not Budging On Recommended MI Restrictions" - HBW Insight, 15 Jul, 2015.).
The plaintiffs acknowledge that Honest's formulation choices do not violate US law. "Honest, however, did and does not claim that its products are simply 'legal,'" they note.
Acetic acid, glyceryl stearate, lauryl glucoside, panthenol, propylene glycol, sodium benzoate, sodium citrate, tocopherols, titanium dioxide and zinc oxide are among other ingredients flagged in the complaint as non-natural and potentially hazardous chemicals featured in Honest products.
All have been deemed safe for cosmetic use within recommended limits by the CIR Expert Panel.
Claiming that Honest has profited unjustly by misleading consumers into paying more for products misrepresented as natural, the plaintiffs seek injunctive relief, consumer refunds and damages.
In a statement, the company co-founded by actress Jessica Alba said it "takes its responsibility to our consumers seriously and strongly stands behind our products. These allegations are without merit and we will vigorously defend this baseless lawsuit. Our formulations are made with integrity and we remain steadfast in our commitment to transparency."
Bloomberg reported Feb. 5 that Honest is working with Goldman Sachs Group and Morgan Stanley on an IPO following a 2015 funding round that valued the company at $1.7bn.
Honest, which has grown from 17 products at launch in 2011 to a comprehensive lifestyle brand, sells its products through a combination of online subscription services and traditional retailer partnerships.