Food Fraud – An Emerging Litigation Risk
Food Fraud presents an emerging litigation risk in California and nationwide.
What is Food Fraud?
Food fraud occurs when someone sells a product that is not what it purports to be. A few examples include short weighting (e.g., including the weight of excessive ice glazing) of frozen seafood, species substitution, dilution of premium olive oil with inferior oil, and misrepresenting a product’s country of origin.
How do Fraudsters Get Away with It?
Many times, only minor distinctions differentiate competing products, so it can be difficult even for trained professionals to detect fraud. Almost two hundred years ago, British writer Cyrus Redding stated that consumers could avoid food fraud by becoming “perfect[ly] acquaint[ed] with that which is good.” But how can one become “perfectly acquainted” with the differences between conventionally-produced and “free range” eggs, other than by the price paid?
Why is this an Emerging Litigation Risk?
Food fraud is economic fraud, because labels matter, and customers want to get what they pay for. Some states have already seen food fraud class actions filed that allege honey laundering. Food fraud also presents a risk of food allergy personal injury litigation for companies that substitute cheaper finfish products like surimi for shellfish like crab. Food fraud also may result in criminal indictment and imprisonment. There are also the indirect costs of negative publicity arising from conviction in the court of public opinion.
What can be Done to Manage Food Fraud Risks?