Nearly 600 Kona coffee farmers will receive millions of dollars over a 2019 class-action lawsuit.
A proposed settlement involving a 2019 class-action lawsuit might result in an estimated 600 Kona coffee farmers receiving millions of dollars. The suit was filed by Kona coffee growers Bruce Corker, Colehour and Melanie Bondera and Robert and Cecelia Smith against retailers who “falsely labeled commodity coffee beans as premium ‘Kona’ coffee.”
The defendants include Walmart, Costco, Amazon, Safeway, Kroger, Cost Plus/World Market, Bed Bath &Beyond, and other distributors, wholesalers, and retailers for “falsely advertising coffee as ‘Kona’ that did not originate in the Kona region in violation of the Lanham Act, which addresses false advertising.”
According to the suit, the plaintiffs believed the “the defendants’ deceptive practices have flooded the market with counterfeit ‘Kona’ coffee products, injuring honest Kona farmers by driving prices down and misleading consumers into believing that Kona coffee is nothing special, making it less likely they would pay a premium price for the product in the future.” When commenting on the matter, Suzanne Shriner, the owner of one of the farms represented in the suit, said:
“Everyone wants a piece of the Kona market because our brand value and reputation are high…But the fakes undercut our integrity. When people have a bad cup of fake Kona, they may not be willing to buy the real beans. Over time, we lose our customer base.”
Fortunately for farmers like Shriner, many of the retailers and others listed as defendants are beginning to agree to settlements. Earlier this month, Costco, Marshalls, and Gold Coffee Roasters reached an agreement for an undisclosed amount. Additionally, the settlement, which has reached preliminary approval by the U.S. District Court for the Western District of Washington will require the “defendant coffee sellers to follow new labeling guidelines and vendors to go through a certification process when labeling coffee as originating in the Kona region.”
Gold Coffee Roasters is set to pay $6.1 million and must also “create detailed labeling obligations that will increase information available to consumers about Kona content and subject Gold to Hawaii’s more stringent labeling laws on a nationwide basis,” according to the agreement. Additionally, the company will ensure that “any of its current or future products labeled as ‘Kona’ will accurately and unambiguously state on the front label of the product the minimum percentage of authentic Kona coffee beans contained in the product. Only Kona coffee certified and graded by the Hawaii Department of Agriculture as 100% Kona shall be considered authentic Kona coffee.”
Earlier this year, the court also approved preliminary settlements with other defendants, including BCC Assets, Cameron’s Coffee and Distribution Company, Copper Moon Coffee, Cost Plus Inc., and Pacific Coffee.
According to the recent settlement agreements, farmers included in the suit will receive a portion of the settlements on a “pro-rata basis, less court-awarded attorneys’ fees and expenses, as calculated by reported sales volumes, less any voluntary contributions for the benefit of the Kona region.”