Consumer protection laws have a noble purpose — providing a remedy for people who are duped by false advertising or misleading practices in their day-to-day purchases. Sadly, however, these laws have strayed from this objective as they are being used by personal injury lawyers primarily to generate fees rather than protecting consumers.
The latest example is a lawsuit filed against Coca-Cola and the American Beverage Association (ABA) by advocacy group Praxis Project, claiming that Coca-Cola and the ABA falsely advertised their products, deceiving consumers about the causes of obesity and the health risks associated with their beverages.
Unfortunately, the lawsuit against Coca-Cola and the ABA is not unique. There have been hundreds of previous cases that abuse our civil justice system in the same manner, in which plaintiffs’ lawyers are looking to take advantage of these laws to generate “sweet” fees for themselves.
It’s little wonder that this takes place since lawyers suing under these consumer protection statutes often do not need to demonstrate that an individual or group suffered actual injury because of the alleged deceptive marketing. These laws truly serve the interest of the lawyers bringing these cases, not the public.
This is just another regrettable attempt at regulation through litigation involving the food and beverage industry championed by big government liberals and greedy trial lawyers. Since the early 2000s, plaintiffs’ lawyers seeking to reap the benefits of the next “big tobacco” type settlement joined together with so-called consumer advocacy groups to target obesity through lawsuits against large corporations — and this case is a prime example.
The effectiveness of this type of litigation has fueled a new wave of lawsuits, and this certainly won’t be the last, especially as pro-regulation politicians take up personal crusades on big business by supporting and funding efforts targeting soda to the tune of $25 million nationwide.
The Praxis Project lawsuit is certainly no different than the rest, as the organization is funded by left-leaning nonprofits and, ironically, government agencies.
It is outrageous that tax dollars are going to such an organization to fund litigation, but it is the lawyers through the awarding of attorneys’ fees that will benefit. It also should be noted that both Coca-Cola and the ABA have demonstrated that beverages are not driving obesity rates — since data show that soda consumption has decreased while obesity has increased over the same time.
Sadly, real-life consumers ultimately absorb the costs of these verdicts and settlements. This form of lawsuit abuse also reduces consumer choice in products and services as well as higher prices. As a result, all across the country, state policymakers are rethinking and reforming their respective Consumer Protection Acts (CPAs) to ensure that they protect the broader interests of consumers and provide redress against demonstrably fraudulent conduct but not providing windfalls for personal injury lawyers.
We applaud those state policymakers truly concerned with consumers’ welfare who have begun to rethink their respective CPAs in order to stop this growing abuse of our civil justice system. Outlined below are policies that leaders in their respective states should establish so we can restore state consumer protection acts to their original purpose.
—All plaintiffs must show actual injury. This will dissuade lawyers from abusing consumer protection acts by inventing a “theory of misrepresentation” and then searching for clients.
—Require all consumer protection act claims to demonstrate “reasonableness” a factor. Obligating consumers to demonstrate that they acted reasonably in relying on a marketing claim is good policy and will cut down on abusive litigation.
—Only allow attorneys’ fees to be awarded when state laws have been knowingly violated. This will help to ensure that lawyers only pursue cases involving defendants who are consciously trying to deceive consumers.
—Limit the awarding of class-action remedies, such as statutory damages and attorneys’ fees. Limiting statutory damages will discourage many of the unnecessary and socially harmful consumer protection act claims. Additionally, capping attorneys’ fees will prevent lawyers from walking away with enormous amounts of money, while class members receive only a small amount of the overall settlement, which has frequently been the case in the past.
