Do Additives Mean You Lose Some Protections Under the Alcoholic Beverages Labeling Act? – Consumer Suits Over Caffeinated Alcoholic Beverages

Caffeine – UnadulteratedThis is likely going to play out on a state-by-state basis.  Consumers filing class action suits over money they spent on caffeinated alcohol.  Brands like Four Loko, and in this case from California’s federal district courts, a caffeinated malt beverage called Joose.  

The decision from the Southern District of California in Ceuvas v. United Brands Company, Inc. allows a consumer suit to proceed based on claims that the buyers of the Joose products weren’t informed through labeling that there were additional effects that mixing caffeine and alcohol produce that would have changed their decision to purchase Joose, had they known.

The Court distilled the claim very well:

According to Plaintiff, “Nothing in UBC’s packaging, labeling, advertising, marketing, promotion, or sale of  the Products disclosed, or adequately disclosed, the amount of caffeine in the Products or the risks associated with caffeine as used in the Products . . . .” Plaintiff claims that the amount of caffeine in the Products and the risks associated with caffeine as used in the Products were material facts that would have affected her decisions to purchase the Products. Plaintiff alleges that she was deceived by Defendant into purchasing the Products. Plaintiff claims that she suffered an economic injury because the Products had significantly less value than was reflected in the price Plaintiff paid for them. “In fact, had Plaintiff known the true facts about the Products as set forth above, she would not have purchased them at all.”

The lawsuit allows consumer protection claims against the manufacturer of Joose as well as warranty claims to proceed.  The Plaintiffs are seeking damages for money they wouldn’t have spend on the products if they’d known about the effects of alcohol and caffeine when taken together in the same product.

Now, you may think that the Federal Alcoholic Beverages Labeling Act of 1988 (27 USCS §§ 213 et seq.) should have some part to play in this debate.  And you’re right, it does… to the extent the beverage is a alcoholic beverage under ABLA and is basically wine, beer or liquor, you’d be right, but the argument that comes out of the plaintiffs’ side of this case is that ABLA would allow this suit to be dismissed if we were just talking about regular products, without additives, but when you add another chemical, like caffeine, then you’ve changed the nature of your product and if it has an side-effect – you may end up needing to disclose that as well.

The court considered this argument and ultimately found it was enough to let the suit proceed:

Here, the warnings Plaintiff claims Defendant should have given relate to the interaction of caffeine and alcohol, not the health risks of alcohol per se. The warning would be something to the effect that caffeine may desensitize the person drinking the alcoholic beverage to any effects of the alcohol. The warning would not even have to reiterate or discuss what adverse health effects alcoholic beverages have. In other words, Plaintiff’s claims do not seek to impose requirements regarding statements relating to the health hazards of consuming or abusing alcohol and are not expressly preempted by ABLA.

This isn’t the beginning of this debate – it’s been around for some time.  Consider this quote from the Restatement Second of Torts on the subject:

Good whiskey is not unreasonably dangerous merely because it will make some people drunk, and is especially dangerous to alcoholics; but bad whiskey, containing a dangerous amount of fuel oil, is unreasonably dangerous.

And this isn’t the end of the debate.  Just because a suit goes forward, it doesn’t mean producers have got to start changing the way they label if they’re making a caffeinated fermented malt beverage, but it does mean they’ve got a lot more to think about.  

From their present warnings and labels to the potential for state and federal legislative help in classifying exactly what, if anything, ABLA , or some other statute should be amended to address, the time is now ripe to start considering how to address the balance between regulatory concerns about effective and proper warnings and the economic interests of being able to produce and deliver innovative drinks that people crave.