McCormick & Co. filed to dismiss a lawsuit brought by a
smaller rival that alleged the spice maker deceived shoppers by
putting less pepper in its tins while leaving the price
unchanged.
In a filing in the U.S. District Court in Minnesota, McCormick
said that privately held Watkins Inc. didn't show that it suffered
any harm from McCormick's actions or that any consumers were
deceived.
"Without alleging such injury, plaintiff has no standing to
bring this suit," McCormick said Friday in the filing.
The Watkins lawsuit, filed last month, leaned on regulations
governing how much air manufacturers are allowed to include in
their packaging. So-called slack-fill laws allow empty space for
reasons like protecting the contents from damage and limitations of
the machines that pack them, but too much extra space can run afoul
of the law.
Watkins, which sells spices as well as other household products,
argued that McCormick went too far when it cut the volume of pepper
in its tins without changing the size of the packaging, creating
what is known as nonfunctional slack fill. It said the change put
it at a competitive disadvantage in the spice aisle and confused
consumers too.
McCormick's change essentially amounted to a stealth price
increase. McCormick said last month it did so because of a sharp
increase in pepper costs in recent years, including a 60% rise in
the year before the change was made.
A hearing has been scheduled for late September on the motion to
dismiss. A McCormick spokeswoman said the company wouldn't comment
beyond the filing.
In a statement, Watkins reiterated that it believes McCormick
"acted in an illegal and deceitful manner."
Slack-fill violations have been fertile grounds for litigation
in recent years, with district attorneys and plaintiffs alleging
that consumers have been deceived by the size of the packaging on
everything from snacks to deodorants. McCormick is facing a
separate class-action suit, filed days after Watkins made its
allegations, over the changes to its pepper packages.
Earlier this month, Procter & Gamble Co. paid $850,000 in
civil penalties and costs and agreed to change the packaging of
some Olay skin-care products as part of a settlement with
California prosecutors.
Write to Paul Ziobro at Paul.Ziobro@wsj.com
Access Investor Kit for McCormick & Co., Inc.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US5797802064
Access Investor Kit for Procter & Gamble Co.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US7427181091
Subscribe to WSJ: http://online.wsj.com?mod=djnwires