Rust-Oleum sells a line of Krud Kutter cleaning products, which the company promotes as "non-toxic" and "earth friendly." A consumer sued the company, alleging that these claims are false and misleading, since they actually do cause harm to humans, animals, and the environment. Would a reasonable consumer be misled by those claims?
Under California law, advertising claims are judged by the "reasonable consumer" standard. In other words, is it likely that a significant portion of the general public, acting reasonably under the circumstances, would be misled? Rust-Oleum moved to dismiss, but a federal court in California allowed the claims to proceed. Here's why.
First, Rust-Oleum argued that the plaintiff couldn't demonstrate how reasonable consumers would interpret a "non-toxic" claim and that, even accepting a broad definition of the claim, consumers would not believe that Krud Kutter products are totally free of risk. (Apparently, the company argued that, "even water can be toxic in excess amounts.") The court held, however, that, at least at the pleading stage, the plaintiff's definition of "non-toxic" – which was that it doesn't "pose any risk to humans, animals, or the environment" – was sufficient to support a false advertising claim.
The plaintiff's position on how consumers interpret a "non-toxic" claim is consistent with the Federal Trade Commission's view. In the FTC's Guides for the Use of Environmental Claims (the "Green Guides"), the FTC says that, "A non-toxic claim likely conveys that a product, package, or service is non-toxic both for humans and for the environment generally." And, then, in the examples, the FTC explains that this covers animals as well. Rust-Oleum argued, however, that the Green Guides "are not valid metrics of how a reasonable consumer interprets the terms at issue." While the court agreed that the FTC's view is not dispositive here, the court held that Rust-Oleum had failed to show that the plaintiff hadn't plausibly asserted a claim.
Second, Rust-Oleum argued that consumers would not be misled by Rust-Oleum's "non-toxic" and "earth friendly" claims because of other information included on the Krud Kutter packaging.
Rust-Oleum argued that consumers would not be misled by the "non-toxic" claim because there's a warning on the front of the package that explains, "Caution: Eye and Skin Irritant." The court didn't think that was dispositive, however, since the plaintiff had alleged other potential harms from the product as well.
Regarding the "earth friendly" claim, Rust-Oleum argued that consumers would not be misled by the terminology because the pack of the packaging defines the claim. On the back, there's a graphic that explains that "earth friendly" means that the product "contains no inorganic phosphates, hazardous solvents or environmentally harmful surfactants." The court held that, at least at this stage of the proceeding, it couldn't determine whether the "earth friendly" claim appearing on the front of the label was adequately disclaimed by the language on the back. Perhaps signaling where the court may ultimately come out on this issue, the court did note, however, that "the definition is in small type and the defendant's own surveys provide evidence that most consumers do not read it."
Finally, Rust-Oleum argued that "earth friendly" is non-actionable because it is mere puffery. Puffery is generally considered to be a hyperbolic statement of opinion that is not provable or disprovable and that isn't material to a consumer's purchasing decision. Here, the court similarly defined puffery as a statement that "is extremely unlikely to induce consumer reliance." The court held that, "The term 'Earth friendly' is not so general or nonspecific as to make it 'extremely unlikely' that a consumer would rely on it." The court also noted that a finding that "Earth friendly" is puffery would be contrary to established principles expressed under California law.
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