Coffee Co. To Pay $7.8M In Latest ‘Kona’ Coffee Settlement
As seen in Law360 (August 1, 2023, 4:57 PM EDT) —
A Washington federal judge has given the go-ahead to a $7.78 million settlement to end claims that the now-bankrupt Mulvadi Corp. wrongly sold coffee using the name “Kona,” the latest deal in litigation from Hawaiian farmers alleging the company’s coffee contained no coffee grown or harvested from the state’s Big Island.
In an order filed Monday, U.S. District Judge Robert S. Lasnik granted the farmers’ bid for preliminary approval of the deal, finding that the settlement is likely fair, reasonable and entered into in good faith without collusion, and gave the OK to begin sending notice out to class members.
The deal is the latest settlement in the litigation, and as with the 11 previous deals, it includes a provision requiring that Mulvadi “accurately and unambiguously” label the “minimum percentage of authentic Kona coffee beans” contained in its products.
The farmers previously inked a $12 million deal with MNS Ltd.; a $6.15 million deal with L&K Coffee Co. LLC, which operates as Magnum Coffee Roastery; and a deal with Costco in March 2021 that did not require Costco to pay the farmers any money.
According to the farmers’ motion for preliminary approval, this latest deal will bring the total relief to the class up to $40 million, and after it is approved, the only remaining issue in the litigation will be a fee application related to sanctions against Mulvadi’s attorneys at Buchalter PC.
Earlier in July, Judge Lasnik sanctioned the Buchalter attorneys, saying they had made unsupported arguments and false or misleading assertions, causing delays in discovery.
The farmers first sued about two dozen coffee retailers and wholesalers in 2019, claiming that only coffee harvested from Hawaii’s Big Island is actually Kona coffee. Though filed under the federal trademark statute, the Hawaiian farmers don’t claim trademark rights to the name, but rather argued that their suit was like efforts by groups of European food exporters to enforce “appellations of origin” over geographic names like “Champagne.”
The farmers’ complaint included results from scientific testing that confirmed the coffee marketed and sold by defendants as “Kona” coffee contained little or no coffee grown by the Kona farmers, according to court documents.
“Plaintiffs are very pleased with the Mulvadi settlement as it provides very valuable injunctive relief and substantial financial relief to the class of Kona farmers,” Nathan T. Paine of Karr Tuttle Campbell, representing the farmers, told Law360 on Tuesday.
Representatives for Mulvadi could not immediately be reached for comment Tuesday.
The farmers are represented by Nathan T. Paine, Daniel T. Hagen and Joshua M. Howard of Karr Tuttle Campbell and Jason L. Lichtman, Daniel E. Seltz and Andrew Kaufman of Lieff Cabraser Heimann & Bernstein LLP.
Mulvadi Corp. is represented by Bradley P. Thoreson, John B. Crosetto and Jennifer Oswald of Buchalter PC.
The case is Bruce Corker et al. v. Costco Wholesale Corp. et al., case number 2:19-cv-00290, in the U.S. District Court for the Western District of Washington.