On September 19, 2017, Governor Jerry Brown signed into law AB 2632, which amends California’s slack fill law, and provides manufacturers, retailers, and consumers with greater clarity regarding the requirements for packaging.
Slack fill is the empty space between the actual container capacity and the volume of the product in the container (i.e., the air in a bag of potato chips). Manufacturers and retailers may include slack fill in their products, but the question of whether slack fill is permissible turns on whether the empty space is deemed “non-functional.” “Non-functional” slack fill is impermissible because it can mislead consumers into believing they are getting more product than the package actually contains.
California’s slack fill law, the Fair Packaging and Labeling Act (FPLA) (which is subject to the Federal Food, Drug, and Cosmetic Act) provides specific safe harbor provisions for certain circumstances in which “non-functional” slack fill is nonetheless permissible. Cal. Bus. & Prof. Code §§ 12606-12606.2.
Leading up to AB 2632
Despite these safe harbors, California and federal slack fill regulations have become a weapon of choice for plaintiffs’ lawyers in consumer class actions aimed at large companies like Mars, Inc., Starbucks Corp., and Unilever. Undeterred by traditional labeling of net weight on most packaging, plaintiffs’ lawyers have brought hundreds of slack fill cases in the last decade, at least 14 of which were class actions brought in 2017 alone. The targets for these lawsuits are almost always large, well-known manufacturers of both food and non-food products alike.
Although these “shake the box” lawsuits see varying levels of success, the complaints keep coming. As an example of variable success, the Ninth Circuit upheld a $12 million settlement against Starkist in Hendricks v. Ference for underfilled tuna cans, but at least some of the settlement was in vouchers, which can only be used to purchase–you guessed it, canned tuna.
The impact of these lawsuits should not be trivialized. In its February 2017 report on trends in food and beverage class action litigation, the U.S. Chamber Institute for Legal Reform found that, of the class actions identified in this area between 2015 and 2016, 12% were slack fill cases. This makes slack fill the third most popular allegation in these lawsuits, following “other representation is misleading,” and “not natural” lawsuits. Furthermore, violations of a slack fill regulation may be alleged as a predicate offense for a UCL (or false/misleading advertising) claim. See Cal. Bus. & Prof. Code §§ 17200 et seq.
Before the recent amendment, only the following exemptions were available to defendants: slack fill used to protect the contents of the package, to accommodate machinery, to allow the product to settle during shipping and handling, or when necessary to provide legible presentation of required information. Unfortunately, these narrow exemptions did not cover all common uses of slack fill and left the door open to plaintiffs’ lawyers to target companies with costly lawsuits.
AB 2632 amends California’s slack fill laws in three major ways
First, and arguably most importantly, the amendment adds a new exemption where the product’s mode of commerce does not allow the consumer to view or handle the physical container or product prior to purchase. This likely would apply to online sales, under the rationale that a consumer is not misled because he or she cannot physically handle the product.
Second, the amendment clarifies that a product with a line or a graphic that represents the product or product fill and a statement communicating what the line or graphic represents (e.g., a “Fill Line,”) is exempt. The exemption applies so long as both (the line or graphic and the statement) are clearly and conspicuously depicted on the exterior packaging or immediate product container at the point of sale. If the product is subject to settling (such as a powder), the line must represent the minimum amount of product after settling.
Third, the amendment clarifies that if there are multiple units of the same product in a package, only one “actual size” depiction is necessary for units of the same size. A statement that the “actual size” depiction applies to multiple units in same package must be provided with the depiction.
In the wake of AB 2632, we may see a reduction in slack fill litigation. AB 2632 dispenses with at least some of the uncertainty that paved the way for previous consumer class actions and other enforcement actions. However, manufacturers and retailers should take the opportunity to review their packaging in light of the new exemptions.