Utz agrees to pay $1.25M in dispute over 'all natural' labeling
Utz Quality Foods has agreed to pay $1.25 million to settle a lawsuit alleging it used words like "all natural" in a way that misled consumers.
Utz also agreed as a term of the settlement to stop using the terms "natural" and "all natural" on its packaging for certain snacks.
The settlement, filed Dec. 6, is still pending approval from a federal judge. Utz does not admit any wrongdoing in the agreement.
Company spokespeople did not return a request for comment Monday.
The payout stems from a complaint two consumers filed in Massachusetts federal court nearly three years ago. Those consumers argue that Utz's potato chips, tortilla chips, pretzels and other snacks are not "all natural," as much of their packaging proclaimed, in part because they are made with genetically modified cottonseed oil, corn and other products.
The complaint-filers argue that the labeling is deceptive and violates Massachusetts law. They sought class-action status for the complaint.
Consumer advocates have waged dozens of court battles over the years concerning food manufacturers' use of the word "natural." The U.S. Food and Drug Administration has generally shied away from developing a formal definition of the term as people debate whether genetically modified ingredients, pesticides and processing methods should influence what does and does not meet the "natural" standard.
If the Utz settlement gains court approval, most people who purchased eligible Utz snacks over the past several years could submit a claim form requesting $2 per item purchased, for total payment of up to $20 per household.
Other slices of the $1.25 million settlement would go to the original plaintiffs and their attorneys, with any remaining funds going to Consumers Union, a nonprofit consumer advocacy group.
The agreement comes less than a year after Utz paid $2.5 million to settle a separate suit filed by several former route salespeople.