HONOLULU (CN) - Cargill agreed to pay $6.1 million to settle a class action accusing it of falsely advertising its synthetic Truvia sweetener as natural.
U.S. District Judge Leslie Kobayashi approved the settlement Monday, which includes $1.83 million in attorneys' fees.
Four lawsuits were brought against Cargill in 2013, claiming the agribusiness behemoth intentionally misled consumers by advertising Truvia as a natural sweetener primarily manufactured from the stevia plant.
Truvia, however, is "largely a synthetic and chemically produced" product, according to the May 2014 consolidated complaint.
"As part of a scheme to make Truvia more attractive to consumers, boost its sales and ultimately increase its profits, Cargill uses terms such as 'Nature's Calorie-Free Sweetener' and 'Truvia sweetener comes from nature,' and natural imagery such as the leaves of stevia plants in labeling, advertising and marketing," according to the 52-page complaint.
Cargill teamed up with Coca-Cola to develop the sweetener, unveiling Truvia in 2008 and revealing that it was made with an extract of the stevia plant, Rebaudioside A, according to lead plaintiff Denise Howerton.
"Reb A is not the natural crude preparation of stevia, but rather is a highly chemically processed and purified form of stevia leaf extract," the complaint states. "Cargill describes the process of obtaining stevia leaf extract as 'similar to making tea,' but does not tell the consumer that Cargill adds ethanol, methanol, or rubbing alcohol to this so called 'tea' in a patented multi-step process to purify it."
Howerton sued Cargill for fraud, unjust enrichment and breach of implied and express warranty under Hawaii, California and Florida state laws. The class sought preliminary and permanent injunctions, corrective advertising and information campaigns, restitution, disgorgement and damages.
The parties agreed on a preliminary settlement in June this year, and were granted final approval Dec. 8.
Aside from the $6.1 million settlement fund, Cargill has 90 days from the date of Kobayashi's order to change its Truvia labeling and provide more information to consumers about the product's ingredients.
"The court has reviewed the memoranda, the objections and the applicable law and finds the settlement agreement fair, reasonable and adequate," Kobayashi wrote.
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