In a recent court decision, a Manhattan federal judge has ordered coffee shop giant Starbucks (SBUX.O) to address a class action lawsuit alleging that several of its "Refresher" fruit drinks lack a key ingredient: fruit.
U.S. District Judge John Cronan has denied Starbucks' motion to dismiss nine of the eleven claims in the proposed class action, noting that "a significant portion of reasonable consumers" would expect Starbucks beverages to contain the fruits mentioned in their names.
The products in question
Consumers have expressed their dissatisfaction with drinks such as Mango Dragonfruit, Mango Dragonfruit Lemonade, Pineapple Passionfruit, Pineapple Passionfruit Lemonade, Strawberry Açai and Strawberry Açai Lemonade from Starbucks, arguing that these drinks did not contain mango, passion fruit or açai at all, as advertised in their names.
The plaintiffs in this case have alleged that the main ingredients of these beverages were water, grape juice concentrate and sugar. They believe that the misleading names used by Starbucks resulted in overcharging by the company, which, in their view, violated the consumer protection laws of their respective states.
The impact on Starbucks' reputation
This lawsuit has had a strong impact on Starbucks' reputation. The company, known for its focus on customer experience and product quality, is now under public scrutiny. A lack of transparency in describing the ingredients of its beverages has led to a loss of consumer confidence.
In response to these allegations, Seattle-based Starbucks has claimed that its product names describe the flavors of the beverages and not their ingredients. It further claims that its menu labels accurately advertise these flavors. Starbucks has also argued that no reasonable consumer would have been confused when ordering these drinks and that its baristas could have clarified any possible confusion if consumers had questions.
However, the judge has stated that, unlike the term "vanilla," which has been the subject of numerous similar claims, there is no evidence to indicate that terms such as "mango," "passion fruit" and "açaí" are typically understood to represent a flavor without the corresponding ingredient also being present.
In addition, Cronan has pointed out that the confusion may be understandable, as other Starbucks products do contain ingredients in their names; for example, the Ice Matcha Tea Latte contains matcha, and the Honey Citrus Mint Tea contains honey and mint.
The case is now in the hands of the courts, and is expected to be resolved in the coming months. Depending on the outcome, it could have significant legal and commercial implications for Starbucks and other companies that promote food products.