Starbucks and others want to be exempt from California law
requiring warnings
By Sara Randazzo and Annie Gasparro
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (April 17, 2018).
The coffee industry is fighting the suggestion its products
could cause cancer.
A Los Angeles judge's recent ruling in a lawsuit over cancer
labels has galvanized coffee brands and retailers, including
Starbucks Corp., to push harder to avoid carrying the labels.
The companies say that trace amounts of the chemical acrylamide
in their brew doesn't justify a warning to consumers in California
-- an important market for food and beverage brands.
As the companies gird for potentially years more of legal
wrangling, industry analysts have collectively shrugged, saying
consumers are unlikely to abstain even if labels warn of hidden
dangers.
"Consumers often do not change their behavior" because of health
warnings because there is so much conflicting information, said Joe
Pawlak, a foodservice-industry consultant at Technomic.
Cancer warnings have proliferated in California since 1986, when
voters approved the Safe Drinking Water and Toxic Enforcement Act.
The measure, known as Proposition 65, passed with 63% of the
vote.
Acrylamide is one of more than 900 chemicals on a list of those
known to the state to cause cancer, birth defects or other
reproductive harm.
A chemical can make the list in various ways, including whether
it has been identified as causing cancer in people or lab animals
by the World Health Organization, as the result of deliberations by
two independent state panels of scientific and heath experts or if
it is cited by an agency such as the U.S. Food and Drug
Administration or the Environmental Protection Agency.
Under the law, businesses must warn about the presence of the
chemicals, or risk getting sued.
A group of the coffee companies, including JAB Holding Co.'s
Caribou, J.M. Smucker Co.'s Folgers, Keurig Green Mountain and
Coca-Cola Co., which sells Gold Peak Tea & Coffee, argued in a
court filing earlier this month that they adequately proved at a
trial last fall that the amount of acrylamide in coffee isn't at
dangerous levels. They said they should be exempt from the law
because the chemical is a byproduct of the necessary roasting
process.
The companies wrote that many studies show "coffee consumption
does not increase the risk of any chronic disease and is
independently associated with a decreased risk of several major
chronic diseases."
The filing comes in response to a tentative ruling issued by Los
Angeles Superior Court Judge Elihu Berle in late March against the
coffee brands. The judge is expected to finalize his decision in
the coming weeks.
From there, the coffee companies will go back to court for a
trial over monetary penalties and the specifics of the warning
labels. No trial date is scheduled.
An organization called the Council for Education and Research on
Toxics, backed by attorney Raphael Metzger, first sued the coffee
sellers in 2010.
The companies named in the lawsuit directed comments to the
National Coffee Association, which said it is up to each defendant
whether they appeal. It said in a newsletter to members that "this
legal case is likely to have a long road to travel."
The NCA member alert blasts Proposition 65 as relying on a
"guilty until proven innocent" concept. "Prop. 65 and coffee is a
confusing, frustrating -- and for some consumers, potentially
frightening -- issue, " the organization wrote to members.
Last year, 688 settlements over Proposition 65 claims totaling
$25.8 million were reported to the California state attorney
general's office. Of that, 76% went toward attorneys' fees and
cost, according to the office.
While most cases settle, some industries choose to fight. In
2015, an appellate court upheld a ruling that baby-food
manufacturers didn't need to warn about lead in products including
juice and packaged fruit because it didn't occur at dangerous
levels.
The fast-food industry and potato-chip makers faced litigation
in the early 2000s, also brought by Mr. Metzger, over acrylamide
generated during the frying process. Frito-Lay and other brands
agreed to reduce the acrylamide levels by 20% to 50% and make
payments of up to $1.5 million. McDonald's Corp., Wendy's Co. and
other restaurants also agreed to post warnings and pay
penalties.
Some companies have backed down from the coffee case. Defendant
7-Eleven settled last year, agreeing to post warnings and pay over
$1 million in penalties and costs.
The companies are unlikely to pass the costs of the litigation
and relabeling to consumers, analysts say.
Kent Schmidt, a California attorney at Dorsey & Whitney LLP,
said companies may appeal if they lose because designating
different labels for California than for markets elsewhere in the
U.S. "creates a logistical nightmare."
Many California residents have become immune to Proposition 65
warnings, which adorn everything from parking garages to
restaurants to packaged foods.
"They're so ridiculous," said Dale Leshaw, a 63-year-old Los
Angeles resident who doesn't plan to change his morning habit of a
few espresso shots. "How many warnings can they put on stuff?"
Write to Sara Randazzo at sara.randazzo@wsj.com and Annie
Gasparro at annie.gasparro@wsj.com
(END) Dow Jones Newswires
April 17, 2018 02:47 ET (06:47 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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