In Search of Mislabeled Olive Oil to Make a Buck

Opinion & Commentary

By Virginia Brown Keyder, on November 19, 2013

A recent seemingly minor decision by Judge Brian F. Holeman of the Washington DC Superior Court, Civil Division, on a motion (request) by defendant grocery Mohtamar, Inc. for summary judgment is at first glance enough to scare off any interested party untrained in the twists and turns of the Common Law. It is however of considerable importance.

The defendant grocer (among others) was sued by one Dean Mostofi in 2011, for violating the DC Consumer Protection Procedures Act (CPPA) by selling Pompeian brand olive oil mislabeled as ‘extra-virgin.’ Having become aware of the mislabeled oil after reading about the famous 2010 UC Davis Report that named Pompeian as one of the culprits in the extra-virgin mislabeling scandal, the plaintiff promptly bought a bottle and brought an action for ‘injuries suffered.’

Much of the decision is taken up with the question of whether the D.C. statute allows a consumer to sue where he/she reads about a mislabeled product and buys it solely for the purpose of bringing legal action (i.e. whether he/she has ‘standing’) for injuries suffered. This is an important question, as allowing such an action could open the doors to masses of litigious consumers’ actions for any reportedly mislabeled product – an event that could conceivably put any medium size enterprise out of business in record time.

Relying on earlier case law to the effect that a plaintiff has a right “to be free from improper trade practices” and may sue even though he “suffered no judicially cognizable injury,” the Court rejected the defense that the plaintiff “knowingly purchased products that he believed were defective and did so for the purpose of filing a lawsuit,” and was therefore the victim of a “self inflicted injury.” Judge Holeman stated:

“No precedent establishes that the Court must apply a “good faith” standard to the actions of a plaintiff in order to find that the standing requirement has been met. Further, Plaintiff does not need to demonstrate that he suffered any physical, emotional, or monetary injury (emphasis added); an actual or immediate statutory violation is sufficient to establish an injury-in-fact,” (p. 5) and held that: “The dispositive consideration is that Plaintiff is a consumer who engaged in a consumer transaction. This transaction is protected by the CPPA.” (p. 6)

Rejecting (in part) the motion for summary judgment, Judge Holeman left the questions of whether the consumer’s ‘reasonable expectation’ has been violated, and whether he/she can prove by “clear and convincing evidence” a claim of intentional misrepresentation under the CPPA, to be decided at trial.

It might be noted, that Pompeian, an importer and bottler of olive oil based in Baltimore, was the only to attain the USDA Quality Monitoring Program logo for its extra virgin and organic oils, after olive oil was added to the USDA’s list of eligible products. This should logically render this particular lawsuit moot, but the encouragement this decision provides to further vexatious litigants represents a real danger to all producers who choose to do business in Washington, D.C.

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This article was last updated November 23, 2014 - 2:56 PM (GMT-5)

  • chris

    Not the only scam happening in Washington.

    • virginia brown

      You don’t say. :)

  • Rebecca Wheeler

    The last sentence in the article I view as a threat to consumers everywhere and, sadly, indicates that the OOT is more interested in supporting the sellers profit regardless of practices. This approach hurts the long term benefits of olive oil for ‘producers, consumers, and its health benefit perceptions. Is the Olive Oil Times a corporate rag??

    • virginia brown keyder

      Nothing to do with OOT – I, the author, take full responsibility and no one has ever called me a corporate rag before… Be that as it may, the idea of finding a product that has already been subject to the rigors of consumer protection and all the bad publicity that rightly comes along with it, and using it, and the legal system, for personal gain when there has been no personal harm is an abuse of the legal process of the highest (well, maybe not the highest, but…) order. Don’t you think? Pompeian has suffered and has cleaned up its act. Why call out the dogs?

      • Athan Gadanidis

        “whether he/she can prove by “clear and convincing evidence” a claim of intentional misrepresentation under the CPPA, to be decided at trial.”
        Since the US government has not yet determined whether the mislabeling was intentional, it is up to individual consumers or groups to pick up the slack… I agree with Rebecca Wheeler on this point.

        Mislabeled is a serious charge and should not be taken lightly. The question that remains is was it intentional. It seems to me this has not been determined. Perhaps this lone litigant is doing the work the US government should. It comes down to whether the mislabeling was intentional. If this law suit settles this question then it is in no way frivolous. Pompeian’s sparkling reputation in the past has no bearing on this case.

        The ones that mislabel their food products should feel the danger of individual litigants. It is apparent he government is unable to make full determinations without consumers intervention… determining intent should be the first thing the government does in these cases of “mislabeling”

  • virginia brown keyder

    Rebecca and Athan, I do fully support consumer protection, and individual lawsuits when a consumer has been affected, but the act of reading about a product and suing the retailer (not the mislabeler, mind you, but the retailer) when you only bought the product for that purpose still appears to me to be an abuse of process. Add to that that neither good faith nor injury on the part of the plaintiff need be shown only adds to the potential for abuse. This will only encourage personal animosity against grocers to be played out in courtrooms across DC (will we have a new category of lawyers called ‘olive oil chasers’?) I just can’t see this as a fruitful consumer protection action, especially when there is absolutely no way the retailer can open the cans and test the oil. Mislabeling is a problem that appears to have been solved, certainly in the EU, where, according to some, all the mislabelers hang out. For Pompeian, the government has certified its purity.

    • DC Consumer

      Ms. Brown Keyder,

      Please point to the passage in the Opinion where the Court finds that “[h]aving become aware of the mislabeled oil after reading
      about the famous 2010 UC Davis Report … the plaintiff promptly bought a bottle and brought an
      action for injuries suffered.” You have conveniently left out the fact that the
      plaintiff had purchased the oil for testing to see if it was truly extra virgin. See Opinion at p. 5.
      Obviously, no lawsuit would have been filed if the oil in question had proved to be extra virgin. Apparently it wasn’t, notwithstanding the USDA’s purported seal of approval.

      The intent of the DC Consumer Protection Act is to encourage and incentivize consumers to police the marketplace as “private attorneys general,” and to bring actions on behalf of the general public against merchants who engage in deceptive trade practices, because the DC government does not have the financial resources to enforce its own consumer protection laws.

      Honest merchants have nothing to worry about, and a truly innocent retailer, who is named as a defendant for selling mislabeled goods, can, and certainly should, seek indemnity from its dishonest suppliers.

      • virginia brown keyder

        “Plaintiff admits that he bought “EVOO” (extra virgin olive oil) from Defendant after becoming aware of studies from the University of California – Davis,
        reported in June 2010 and April 2011 (“2010 Study” and “2011 Study,” respectively), that concluded that certain brands of EVOO failed to satisfy international and United States Department of Agriculture (“USDA”) standards for EVOO.” p. 5.

        Why should a grocery store be compelled to incur the expense of turning around and suing Pompeian? If several people chose this route, the small grocer would be out of business in a heartbeat, and buried in legal fees.
        It seems to me, especially after seeing the number of similar lawsuits the plaintiff was involved in (search him in google) that he is really on a roll. Law should not incentivize vigilante lawsuits – it should operate between the government and the culprit, who in this case has done more than necessary to clean up his act.

        • DC Consumer

          “Why should a grocery store be compelled to incur the expense of turning around and suing Pompeian? If several people chose this route, the small grocer would be out of business in a heartbeat, and buried in legal fees.”

          You are missing the point. Consumers, in every state, can sue a business, regardless of its size, for selling mislabeled goods. That is a risk every store operator must take when it opts to sell goods to consumers.

          You are also overlooking the fact that the plaintiff in this case did not force the grocery store to sell him mislabeled extra virgin olive oil. In every state retail stores can be held accountable for what they sell to their customers. But, unfortunately, they mostly get away with breaking the law because it is difficult to prove the elements of intent, reliance, causation, and damages, for a common law fraud claim. The DC statute makes it easier to hold merchants accountable for deceptive trade practices. What is wrong with that? The focus should be on the deceptive practice, not on the plaintiff’s motives.

          • Athan Gadanidis

            DC Consumer, I agree with you. The whole issue is whether the grocer knowingly kept selling the Pompeian olive oil after they found out its authenticity was brought into question. This the whole issue. What did they know, when did they know it and what if anything did they do about it. Thanks to activists who are taking it upon themselves to bring court action against grocers who may knowingly be selling mislabeled evoo, Perhaps grocers will become more pro-active in protecting their customers in the future. This is good for us the producers and the consumers. Lets not forget how deeply mislabeled evoo hurts the honest olive oil producers. This apparently is not a concern for the author of this article Virginia Brown Keyder.

        • DC Consumer

          I still can’t see where in the Opinion it says “the plaintiff promptly bought a bottle and brought an action for injuries suffered.” Clearly, you have taken the liberty to make up your own facts in order to make your argument sound more persuasive.

          • virginia brown keyder

            It’s quoted above. I don’t know what the problem is. Anyway, I hear you. I don’t agree. I am resolutely anti (unregulated) corporations, but I think this is a feud between two individuals using the legal system as a means of revenge. I don’t think grocers should have to answer these suits when they have no control over the contents of products they sell, especially when they have heard there is a problem, and heard a solution has been reached. Thanks for your comments.

          • DC Consumer

            It seems you disagree with the law of warranties, which is applicable in a majority of states, not only DC. For instance, the Alabama Supreme Court has concluded that the sealed container defense is not applicable to a retail seller of food products in claims asserting a breach of implied warranty under the UCC. See Sparks v. Total Body Essential Nutrition, Inc., et al. (Ala. 2009).

    • Athan Gadanidis

      Rebecca, I see you are very biased against the person bringing this action. The fact is Pompeian has suffered no loss to reputation because a reputation gained based on fraudulent practices is not in fact a loss when it is exposed. In your own words: “Pompeian has suffered and has cleaned up its act. Why call out the dogs?”
      We do not know if the retailer was aware of the U.C. Davies. If he was, we do not know how the retailer responded to the U.C. Davies study; did they ask Pompeian about it? What did Pompeian say in response? If the retailer allowed the olive oil to be sold in their stores, after being made aware of the problem then it could be said there was intent. They should have pulled it from the shelves and sent it back. This will be determined in the court of law. Why defend and excuse Pompeian so vehemently? This makes it curious.

      • DC Consumer

        You make a good point Athan. It is implausible that retailers of olive oil are unaware of the US Davis Report; yet they continue selling the brands that were shown to be mislabeled.

        Further, contrary to what the author suggests, there is no conclusive proof that mislabeling has stopped altogether. A seal of approval from the USDA is meaningless if the oils in question continue failing reliable taste tests.

        Even if the problem has been solved, which is debatable, why should the merchants get away with having sold mislabeled goods before getting caught? Why should they keep their illegally gained profits?

        It is, indeed, curious that the author is so focused on the plaintiff in this case and avoids addressing the underlying wrongful acts that gave rise to the lawsuit. After all, the court found there was sufficient evidence of fraud for the case to proceed to trial.