SAN FRANCISCO (CN) - A federal judge dismissed a fraud class action against Whole Foods led by the People for the Ethical Treatment of Animals, over ads touting the supermarket chain's high animal-welfare standards.
U.S. Magistrate Judge Nathanael Cousins said the complaint brought by the animal rights group was short on details about which ads were misleading, but said they could file a third amended complaint and try again.
PETA and Whole Foods shopper Lori Grass sued Whole Foods in September 2015, targeting the high-end grocer's five-step animal welfare rating system for meat suppliers as a "sham."
Whole Foods rolled out its five-step rating system developed by the Global Animal Partnership in 2009, and expanded it nationwide in 2011. All its suppliers must meet Step 1 standards to sell products in Whole Foods stores, which say its suppliers use "no crates, cages or crowding."
But PETA says suppliers fail to live up to even the lowest standard, and Whole Foods only requires that they submit to one scheduled audit every 15 months.
Neither Whole Foods nor PETA attorneys returned requests for comment.
In dismissing PETA and Grass' false advertising claims with leave to amend, Cousins said they must be more specific as to which ads Grass relied on when buying meat at Whole Foods.
"For example, plaintiffs attach multiple exemplar photographs to the complaint, but it is not clear in the photographs which placards and signs they allege are illegal, are not preempted, and were relied on by Grass," Cousins wrote.
Relying on a ruling by the California Supreme Court in In re Tobacco II Cases, PETA's lawyers had argued that the group is not required to prove individualized reliance on specific false statements as long as they can show those ads were part of a long-running ad campaign and that Grass relied on the campaign's "cumulative message."
The argument did not convince Cousins, who wrote on Friday that while PETA claims Whole Foods inundated its customers with signs, placards and napkins for four years, "it is not clear from the second amended complaint which signs and placards were deceptive advertising, over what time period they were placed in the store and Grass was exposed to them, and therefore whether the alleged advertising campaign rises to the level required under Tobacco II."
PETA has until Feb. 16 to file an amended complaint.
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