Lake-Success based company Hain Celestial Inc. has agreed to settle for almost $10 million a class-action lawsuit in California claiming the company falsely labeled two of its products as organic.
Hain Celestial will pay $7.5 million in cash payments to consumers who submit a claim form stating they purchased either of the two products.
The other $1.85 million Hain Celestial agreed to settle will be disbursed in coupons for Avalon Organics or Jason brand products, according to Top Class Actions LLC, a class-action lawsuit news website.
Rosminah Brown and Eric Lohela filed suit in May 2011 at Superior Court alleging that Hain Celestial’s Avalon Organics and Jason brand products did not meet California state requirements for labeling a product “organic,” according to court documents.
Jason products are labeled as “Pure, Natural & Organic.” Avalon Organics products are marketed and labeled as “Organics.”
“Defendant’s conduct of advertising, marketing, selling and labeling the Product’s as organic, when in fact such products contain less than 70 percent organic ingredients, constitutes unlawful, unfair and deceptive conduct, is likely to deceive members of the public, is unethical, oppressive, unscrupulous and/or substantially injurious to consumers, and violates California’s legislatively declared policy against misrepresenting the characteristics of goods and services,” the lawsuit stated.
California’s Organic Products Act requires that products labeled as organic must contain at least 70 percent organic ingredients. Efforts to reach Hain Celestial officials for comment were unavailing.
The lawsuit states that the Jason Ester-C Super-C Cleanser Gentle Facial Wash contains only one organic ingredient out of the nineteen used in the product. The suit also states five other Avalon Organics and Jason products that were mislabeled as organic.
Once approved, the settlement will compensate consumers who purchased Avalon Organics products between May 11, 2007 to May 11, 2011 and Jason products from May 11, 2007 to Jan. 30, 2011.
Hain Celestial purchased cosmetic company Jason Natural Products Inc. for $23.9 million in June 2004. They purchased Avalon Organics for $120 million from private equity firm North Castle Partners LLC in January 2007.
Headquartered at 1111 Marcus Ave., Hain Celestial is the provider of popular brands such as Almond Dream, Terra, and Celestial Seasonings.
