Popular baby product brand, Babyganics settled for $2.215 million, an amount set aside by the maker, KAS Direct LLC in a suit alleging misleading advertisement and marketing of their products.
Babyganics, run by two dads, is a line of household and bath products for babies and toddlers.
According to Business Wire, a class action complaint was filed in a federal district court in New York in September of 2016.
The complaint alleged that while Babyganics advertised their products as “organic” and “mineral-based,” some products contain chemical ingredients.
The complaint further alleges that Babyganics charged premium prices for a less than premium product.
While the suit sought at least $5 million in damages, Babyganics settled for $2.215 million.
From Business Wire:
Despite its name, the suit alleges that most Babyganics products are not manufactured using organic ingredients. Yet the company’s marketing has made them appear as the organic and therefore safer and healthier – if costlier – alternative to thousands of American parents concerned about reducing their babies’ physical exposure at home to potentially harmful synthetic chemicals the complaint alleges. Most Babyganics infant care products are applied directly to the skin, such as sunscreens, diaper rash rubs, insect repellents, and hand and face wipes. The suit alleges that consumers have become increasingly concerned about the effects of synthetic and chemical ingredients in their products and that Babyganics is capitalizing on consumers’ concerns and their desire for “organic products.”
The lawsuit alleges that the Babyganics name violates various consumer protection statutes in California and New York, and by extension throughout the United States, since Babyganics products are marketed through various retail channels on a national basis. The lawsuit asks the court to award class damages from KAS/Babyganics in excess of $5 million and to require the company to cease using marketing practices that falsely portray it as an organic company making organically based products.
According to the complaint, the Babyganics deception begins with the brand name itself, which implies to consumers that the company is all about organic products, despite the inclusion of laboratory-derived chemicals in several products such as baby sunscreens and cleaning agents. The Babyganics business is built on the idea that consumers will pay more for organically-based products, because they perceive them to be more healthful and life-enhancing, the complaint states. The Babyganics name, itself an artificially contrived admixture of baby and organics, was deliberately selected to suggest to consumers that Babyganics differentiates itself – falsely – by making products free of synthetic chemical intrusion or composition, says the complaint.
“Consumers deserve truth in labeling and should have confidence that they can rely on product labels when making purchasing decisions. We are talking about calling products ‘organic’ that contain potentially harmful chemicals—we will fight hard to right what we believe is a wrong,” says Melissa Wolchansky, attorney with Minneapolis-based Halunen Law, one of three law firms filing the class action lawsuit on behalf of plaintiffs Tanya Mayhew in New York and Tanveer Alibhai in California.
The deception allows Babyganics to charge premium prices for its products, a practice that has unjustly enriched the company to the tune of millions of dollars, the complaint alleges. So successful was Babyganics strategy that it appeared on the Inc. 5000 list of fastest growing private companies in America in 2014, after reporting a 277 percent annual growth rate for the previous three years.
Under the terms of the settlement, Babyganics admits no wrongdoing and has agreed to update product packaging and advertising.
From Top Class Actions:
Under the terms of the Babyganics organic class action settlement, Class Members will be entitled to either a full refund with proof of purchase or partial reimbursement without proof of purchase for up to eight Babyganics items.
KAS Direct will also be required to update Babyganics products packaging and advertising to help consumers understand whether the ingredients in the product are organic.
KAS Direct admits no wrongdoing under the terms of the Babyganics organic class action settlement agreement.
Class Members can object or exclude themselves from the Babyganics organic class action settlement by Oct. 10, 2018.
For more information, see babyganicssettlement.com.
