Kachuck Enterprises v. Mission Produce, Inc.

The federal district court for the Central District of California dismissed claims by California avocado farms that distributors and suppliers of Mexican-grown avocados misrepresented the sustainability of their avocados. The plaintiffs alleged that the defendants source their avocados from deforested land in Mexico, which contributes to climate change and other environmental impacts. The court found that the plaintiffs failed to allege statutory standing for its claims of fraudulent business practices under California’s Unfair Competition Law (UCL) and of violation of California’s False Advertising Law because they did not allege actual reliance on the alleged misrepresentations, even by a consumer. The court reserved ruling on the question of whether the plaintiffs could rely on third-party consumers’ reliance on the alleged misrepresentations to establish standing. The court also found that the plaintiffs failed to state “unfair” or “unlawful” business practice claims under the UCL. In addition, the court dismissed the plaintiffs’ unjust enrichment claim, finding that their complaint did not allege a basis for the allegation that the plaintiffs conveyed a market share benefit on the defendants. The court granted the plaintiffs leave to amend all of their claims.

Four owners and operators of avocado farms in southern California filed a greenwashing action in the federal district court for the Central District of California against companies that import Mexican avocados. The plaintiffs alleged that the defendants represented to consumers that their imported avocados were sustainably and responsibly sourced when in fact they are sourced from Mexican orchards “where the local environment is being decimated by uncontrolled deforestation, severe water shortages, soil degradation, and biodiversity and habitat loss driven by U.S. demand for sustainably sourced avocados.” The complaint contained allegations that the defendants’ sourcing of avocados from orchards on deforested land contributes to climate change by “disruptive the natural carbon cycle of native forests.” The plaintiffs alleged that defendants’ sustainability representations were misleading to consumers, with consumer confusion “often compounded at the point of sale, as many retailers do not distinguish or separate California-grown avocados from Mexican-grown avocados.” The plaintiffs asserted that the defendants violated California’s False Advertising Law and Unfair Competition Law and also asserted an unjust enrichment claim. The relief sought by the plaintiffs included orders requiring the defendants to remove references to “sustainable” and/or “responsible” source practices and to inform consumers that their sourcing practices are not environmentally sustainable or responsible. The plaintiffs also sought restitution and disgorgement of monies received as a result of unlawful, unfair, or fraudulent practices; monetary and statutory damages; and reasonable costs and expenses of suit, including attorney fees.