CBD Industry Beware: The False Labeling Class Action Has Arrived
Last week, in what may be the first of its kind, a putative class of Massachusetts consumers filed a false labeling class action complaint against Global Widget LLC, d/b/a Hemp Bombs (“Hemp Bombs”) (Ahumada v. Global Widget LLC, D. Mass. Case No. 1:19-cv-12005), challenging the labeling of numerous Hemp Bombs products, including gummies, lollipops, capsules, syrup, vape and pet products.
The lawsuit is primarily based on the allegations that Hemp Bombs makes numerous false and misleading claims on the product labels and on its website “to illustrate and convey to consumers, the level of potency associated with benefits that consumers can expect to receive through their consumption. Specifically, Defendant misrepresents that the CBD Products have specific amounts of CBD when, in fact, the Products do not contain the amount of CBD as advertised and are instead grossly under-dosed.”
The complaint also alleges that Hemp Bombs markets certain of its products as “pure” and “certified pure”, allegedly because Hemp Bombs “knew that consumers would pay more for” products labeled as such.
All of the claims alleged sound in warranty for delivering lesser doses of CBD than promised on the labels and/or marketing materials. The complaint seeks refunds, disgorgement of all of Hemp Bombs’ profits for the sale of the products along with treble or punitive damages.
Class action litigation regarding label claims has been an on-going trend in the food industry and has spread into the health, beauty and cosmetics spaces. Given that CBD products tend to overlap with these, companies in this space and their marketing personnel should be aware that this litigation could have some real staying power and engage with their supply chains accordingly.