Kombucha lawsuits highlight risk for new products
The recent FoodNavigator article “Health-Ade lawsuit highlights continuing area of legal vulnerability for kombucha makers: sugar and alcohol levels…” highlights the risks for kombucha makers. Their article does a good job of covering the issues from the Bayol v. Health-Ade LLC et al case filed March 6th in Northern California against Health-Ade LLC and Whole Foods Market California, Inc.
The lawsuit simply says (1) the alcohol level of the fermented beverage routinely exceeds 0.5% alcohol, and thus should be classified as an alcoholic beverage.
However we have seen a similar class action lawsuit – Millennium and Whole Foods agreed to pay $8.5Million in a class action lawsuit for mislabeling the GT Kombucha as a non-alcholic drink.
This two cases highlight, the inherent risks when entering new product categories. Companies should look at their entire portfolio of products and evaluate their risk. Products in new product category have greater risks. New product categories have the greatest potential “known unknowns” – i.e. we would expect that because their new categories, we don’t know everything about them.