Do consumers who buy kosher products for non-religious reasons have a legitimate “beef” with the manufacturer if the product turns out not to be kosher?

In Wallace v. ConAgra Foods, Inc., 747 F.3d 1025 (8th Cir. 2014) the plaintiffs brought a putative nationwide class action alleging that food-industry conglomerate ConAgra violated various consumer protection laws by labeling their Hebrew National franks (hot dogs) as “Made with Premium Cuts of 100% Kosher Beef.” The plaintiffs alleged that the kosher inspection process was “defective and unreliable” because of the company’s manufacturing quotas.  The district court granted ConAgra’s motion to dismiss based on a lack of subject matter jurisdiction, agreeing that the plaintiff’s claims were “barred”  because “the determination of whether a product is in fact ‘kosher’ [is] intrinsically religious in nature.” Id. at 1028.

The 8th Circuit, however, disagreed and vacated the district court’s dismissal because it held that the plaintiffs actually lacked Article III standing, under the foundational principle that the court “must make every effort to avoid deciding novel constitutional questions.”

In its Article III analysis, the court focused on the requirement that the alleged injury must be a “particularized, actual injury-in-fact” and stated that “[i]n the context of defective products, it is not enough for a plaintiff allege that a product line contains a defect or that a product is at risk for manifesting this defect; rather, the plaintiffs must allege that their product actually exhibited the alleged defect.” Id. at *4 (internal quotations and citations omitted) (emphasis in original). The plaintiffs however, admitted in their Complaint that they “could not possibly tell” if the packages that they had purchased were not kosher beef. Id. at 1033.  Accordingly, “[w]ithout any particularized reason to think the consumers’ own packages of Hebrew National beef actually exhibited the alleged non-kosher defect, the consumers lack Article III standing to sue ConAgra.” Id. at *4.

After concluding that the court did not have subject matter jurisdiction, the court ended up remanding the case back to state court instead of dismissing the case without prejudice, as is the court’s typical practice.  Id. at 1033.  Our colleagues Frank Cruz-Alvarez and Talia Zucker recently commented that the Eighth Circuit improperly applied 28 U.S.C § 1447(c) into the Class Action Fairness Act, which grants federal courts original jurisdiction of class actions.  Given how often Article III standing arises in Eighth Circuit opinions, this may not be the last we hear on the issue.