Tyson Faces Second False Advertising SuitJun 24, 2008 | Parker Waichman LLP
Earlier this month, Tyson Foods Inc. announced it would "voluntarily withdraw" advertising and labels that claim its poultry products do not contain antibiotics; this, following a federal court injunction stopping the practice and to settle a false advertising lawsuit brought by Perdue and Sanderson farms. It seems there is some controversy over antibiotics in Tyson chicken products, despite its claims to the contrary. Meanwhile, on the day Tyson resolved one federal lawsuit, it was hit with another filed in the same court on behalf of customers accusing Tyson of consumer fraud, breach of express warranty, and unjust enrichment.
Perdue’s issues stem from Tyson’s claims that its chickens were “raised without antibiotics” and, later, “raised without antibiotics that impact antibiotic resistance in humans.” In April, a U.S. District Court in Baltimore ruled that Tyson remove the claims from its advertising while the suit was pending and set a May 15 deadline to stop Tyson from running any of the "raised without antibiotics" advertisements. The injunction followed a suit by Perdue Farms Inc. and Sanderson Farms Inc.; both claiming Tyson's advertising was misleading. Although Tyson appealed the ruling, in May, the 4th Circuit Court of Appeals in Richmond, Virginia, denied a motion by Tyson to stay the order.
“Consumers reacted and relied on this campaign in buying chicken,” paying a premium for an antibiotic-free product, the class action claims. Tyson continues to fight the U.S. Department of Agriculture (USDA), which controls what can go on its labels. On June 2, the USDA ordered Tyson to stop using even the qualified claim by June 18. On June 11, Tyson sued the USDA, claiming its definition of “raised” incorrectly includes the period in the shell.
Tyson said it notified the USDA it would stop using the "raised without antibiotics" label and asked the USDA—which previously approved the slogan—to initiate "a public process to bring more clarity and consistency to labeling and advertising rules" on antibiotic claims. Tyson claimed it based its slogan on the absence of any antibiotic believed to affect humans. "We still support the idea of marketing chicken raised without antibiotics because we know it's what most consumers want; however, in order to preserve the integrity of our label and our reputation as a premier company in the food industry, we believe there needs to be more specific labeling and advertising protocols," said Tyson senior vice president Dave Hog berg.
Sanderson Farms argued it lost a $4 million account to Tyson and Perdue claims it lost about $10 million in revenue since last year, both due to Tyson’s “raised without antibiotics” advertising campaign. Charles Hansen of the Truthful Labeling Coalition—members include Perdue, Sanderson, and Foster Farms—requested the USDA rescind its approval for Tyson's labeling.
After approving the "raised without antibiotics" advertising, the USDA later told Tyson that when it approved the no-antibiotics label, it mistakenly overlooked additives called ionophores used in feed for Tyson's chicken. Regulators said the USDA's Food Safety and Inspection Service (FSIS) has a long-standing policy of classifying ionophores as antibiotics. Tyson disagreed, saying the U.S. Food and Drug Administration (FDA) did not consider ionophores antibiotics.