Two class action lawsuits against companies Nestle and Hershey in the United States were dismissed after a federal court ruled there is no duty to disclose the use of child labour in the cocoa supply chain. The suits were brought by consumers who stated they would not have bought the chocolate produced by the defendants had they been made aware of the forced child labour used in cocoa harvesting. The suit cites a study which found that in Ivory Coast alone as many as 4,000 children are victims of slave labour, many of whom are kidnapped and fall victim to traffickers. Nonetheless, the judge decided that it was not for the courts to say which of the “countless issues that may be legitimately important to many customers” should take precedence in occupying the “limited surface area of a chocolate wrapper”.
Hershey & Nestle Duck Suits Over Slave Labor
SAN FRANCISCO (CN) – A federal judge ruled that the nation’s largest chocolate companies have no duty to disclose that their cocoa suppliers use child slave labor.
“There are countless issues that may be legitimately important to many customers, and the courts are not suited to determine which should occupy the limited surface area of a chocolate wrapper,” U.S. District Judge Joseph Spero wrote in a pair of identical rulings related to two class actions against Nestle and Hershey.
Elaine McCoy sued Nestle and Laura Dana sued Hershey in Sept. 2015, claiming Nestle and Hershey violated California’s Consumer Legal Remedies Act and the state’s unfair competition and false advertising laws by failing to disclose labor abuses in its supply chain on chocolate wrappers.
A third class action was filed by Robert Hodsdon against Mars. His appeal of U.S. District Judge Richard Seeborg’s dismissal is pending in the Ninth Circuit Court of Appeals.
More than 4,000 children work at forced-labor plantations in Ivory Coast to produce cocoa, according to a Tulane University study cited in the complaints.
Some children are sold by their parents to traffickers, while others are kidnapped. Some migrate willingly but fall victim to traffickers who sell them to recruiters or farmers, the complaints state.
The children are held against their will on isolated farms, locked away at night, threatened with beatings and forced to work long hours even when they are sick, according to the complaints.
Spero found it wasn’t enough that Dana and McCoy would not have purchased Hershey or Nestle chocolate had they known about these practices.
He referenced Seeborg’s Hodsdon ruling in dismissing the actions, writing, “The court agrees with Judge Seeborg’s conclusion that the weight of authority limits a duty to disclose under the Consumer Legal Remedies Act to issues of product safety, unless disclosure is necessary to counter an affirmative misrepresentation,” he wrote. “Further, the court agrees with Judge Seeborg and Hershey that some bright-line limitation on a manufacturer’s duty to disclose is sound policy, given the difficulty of anticipating exactly what information some customers might find material to their purchasing decisions and wish to see on product labels.”
Citing Hodsdon, Spero added, “A duty to disclose under California law does not extend to all ‘information [that] may persuade a consumer to make different purchasing decisions.'”
Spero axed Dana’s and McCoy’s unfair competition claims, finding neither identified any legislative policy requiring Nestle and Hershey to disclose their supplier’s slave-labor practices on their product labels, and that those disclosures are not required under the law.
Spero also dismissed the false advertising claim, as they were based on “pure omissions,” not actual misleading statements.