SAN FRANCISCO (CN) - A federal judge approved a $5.25 million class action settlement that claims Ghirardelli's white chocolate chips do not contain any white chocolate.
Lead plaintiff Scott Miller bought a package of Ghirardelli white chocolate chips in June 2012, and thought they did not taste like white chocolate.
"He reviewed the ingredients list on the packaging and noticed that the white chips contained no white chocolate, cocoa, or cocoa butter," according to U.S. Magistrate Judge Laurel Beeler's summary of the complaint.
The class accused Ghirardelli of misrepresenting the white chocolate content in its chocolate chips, wafers, white chocolate flavor, mocha mix and frappes. It alleged violations of U.S. Food and Drug Administration regulations, and state law infractions including false advertising, unfair competition and fraud.
Miller, of Auburndale, Fla., sued in San Francisco, where Ghirardelli is based. The confectioner removed the case to Federal Court and sought dismissal, arguing that Miller lacks standing to sue over white chocolate products he did not buy.
In April 2013, Beeler tossed all the allegations that did not pertain to white chocolate chips.
The parties entered into mediation, and last year told the court they had settled the case.
Beeler granted preliminary approval of the settlement in October, and after conducting a final fairness hearing, issued a final order approving the settlement on Friday.
Ghirardelli will pay $5.25 million into a common fund to be distributed among the class and the plaintiffs' attorneys.
Class members who make a claim will receive $1.50 for each purchase of the disputed white chocolate chips and 75 cents for each purchase of Ghirardelli products labeled "all natural."
If there is money left over in the common fund, it will be donated equally to four organizations: Consumers Union, The National Consumer Law Center, and the food science departments at University of California-Davis, and Florida State University.
Ghirardelli also agreed to not use the phrase "all natural" on its packages of white chocolate chips.
The lead plaintiffs also will receive a $5,000 incentive award.
Plaintiffs' attorneys were awarded more than $1.5 million in fees, and $87,000 in litigation costs.
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