US: Major beverage retailer wins dismissal of “greenwashing” false advertising lawsuit

On November 10, 2022, the Superior Court for the District of Columbia dismissed a greenwashing claim alleging that a major beverage retailer’s public statements regarding its sustainability initiatives constituted false and deceptive marketing (Earth Island Institute v. The Coca-Cola Company, Civil Action No. 2021 CA 001846 B).

The Plaintiff, a non-profit environment group, filed the complaint asserting that the retailer’s statements constituted a violation of the District of Columbia’s Consumer Protection Procedures Act (a)(d)(e)(f)(h), D.C. Code §§ 28-3901 (CPPA), which forbids “unfair or deceptive trade practices[,]” and, in part, provides that a violation can occur even in the absence of actual damages if a reasonable customer could be misled by the statement in question.

The Court divided its dismissal of the Plaintiff's claims into 3 parts, each of which analyzed a commonly-asserted "greenwashing" argument:

Defendant’s statements were “aspirational in nature”

In the complaint, the Plaintiff cited various statements made by the retailer including on their website and social media platforms. The Court determined the majority of these statements to be “aspirational sentiments” and divided them into two subcategories for analysis; “General Aspirational Statements and Vague Corporate Ethos” and “More Specific, Future Statements.”

“General Aspirational Statements and Vague Corporate Ethos”

The Court explained that statements such as “a more sustainable and better shaped future,” “a focus of ours,” “a more sustainable future for our communities and our planet,” “help develop more effective recycling systems,” and “committed to creating” were merely “general, aspirational corporate ethos.” This is because these statements contain no measurable datapoints that would render them true or false, such that it would be impossible to determine whether or not Defendant had met them.

“More Specific, Future Statements”

The Court also identified a separate subsection of “aspirational sentiments” which included specific data points that could potentially be construed as a promise to the consumer. However, the Court found these non-actionable given that these statements all pertained to goals set significantly in the future, e.g., “Part of our sustainability plan is to help collect and recycle a bottle or can for every one we sell globally by 2030.” The Court ruled that such statements could not create a valid CPPA claim until the stated point in the future arrived and it could be determined whether these promises were accurate or misleading. Further, the Court noted the above example included the word “help” which “muddles the promise” making the chance of enforceability, even in 2030, “somewhat uncertain.”

Therefore, the Court determined that the Plaintiff failed to allege any statement that was “provably false and misleading” under the CPPA.

Defendant’s statements were not tied to goods or services as required by the CPPA

As a further ground for dismissal, the Court explained that subsections (a), (d), and (h) of the CPPA all required a deception tied to specific “goods or services.” The good at issue in this case was the beverage sold by the retailer, potentially including the bottle it was sold in; however, none of the statements cited by plaintiffs were actually placed on the bottle, instead being made across various digital platforms. Since none of the cited statements were part of the good, they could not be evaluated under the above listed three subsections of the CPPA.

Defendant’s statements were “not sufficient to create a misleading ‘general impression’ or a ‘mosaic of representations’ to a reasonable D.C. consumer as a matter of law.”

The Court further analyzed the challenged statements under Sections (e) and (f) of the CPPA, which do not require a connection between the alleged misrepresentation and a specific good or service to establish a violation. The Plaintiff asserted that the retailer’s statements, taken together, form a “general impression” and a “mosaic of representations” which are sufficient for a reasonable consumer to be misled as a matter of law. However, the Court rejected this notion, stating that “[t]he statute provides a cause of action for a misleading ‘material fact,’ not a bungle of different statements taken from various documents at different times.” The Court expressed concern that the “trial (not to mention discovery)” about how a global entity “represented” itself over several decades would be “rudderless as each side cherry-picked events, documents, and actions all over the world over several decades to state or negate how the defendant entity ‘represented’ itself”  The Court therefore concluded that the allegations were too vague, subjective and undefinable, and did not state a claim under the CCPA.

This dismissal demonstrates that the outcome of “greenwashing” litigation can be fact and venue-specific. The Plaintiffs have already filed a  notice of appeal, and within the same month another “greenwashing” suit was brought against the same manufacturer in California by a different environmental organization and dismissed. We have previously written about similar cases here and here. Organizations making statements regarding their sustainability and environmental initiatives should monitor these trends in order to ensure compliance with evolving best practices.