Following more than three years of litigation, Quaker Oats has settled the class action lawsuit bought against it over the trans fat content and labeling of products.
Quaker has agreed to remove partially hydrogenated oils (PHOs) from its Oatmeal to Go and Instant Quaker Oatmeal products by December 31, 2015 and has pledged to not reintroduce them into these products or develop Chewy Bars or new Oatmeal products with PHOs for a period of ten years.
In addition, Quaker has agreed to remove labels reading ‘contains a dietarily insignificant amount of trans fat’, if by December 31, 2014 products still contain 0.2 grams or more of artificial trans fat per serving.
US district judge Richard Seeborg approved the settlement on July 29, 2014.
The settlement came in the wake of months of negotiations and more than a year of meet-and-confer sessions which resulted in the filing of a settlement document on December 20, 2013.
The total estimated cost of reformulating the PHO-containing products would be $1.4m, Quaker said. The settlement would also cost the cereal firm up to $760,000 in attorney fees.
Quaker still vigorously denies allegations
The class action had been bought against Quaker for alleged ‘misleading’ and ‘false’ labels suggesting its products were “healthy” and “wholesome”, despite their trans fat content from PHOs.
Consumers said it was a breach of California’s consumer protection laws, in particular the Consumers Legal Remedies Act, the False Advertising Law, and the Unfair Competition Law.
In February 2012, Quaker Oats filed a motion to dismiss the lawsuit, but a judge rejected it.
Despite the fact it had now settled, Quaker Oats continued to “vigorously” deny the allegations and legal claims in the lawsuit and said it “stands by its products and marketing”.
Jody Menaker, senior manager of communications at Quaker Foods North America told BakeryandSnacks.com: "Although we dispute the merits of the lawsuit, we’re pleased to have this litigation behind us and look forward to focusing on what we do best: making great tasting products that consumers have come to love and trust for more than 135 years."
She also said that many of the products challenged in the litigation do not contain PHOs. "The remaining products contain PHVOs at levels so low that FDA regulations require us to label them as containing 0 grams of trans-fat."
For the plaintiffs [consumers], although there was a desire to take the lawsuit to trial stage, they acknowledged that it would have proven too challenging.
“The settlement provides relief to the Class without the risks, costs, and delays inherent in the continued litigation, all of which are important factors in considering the reasonableness of the settlement,” the court document read.