Lawsuit Against Chobani Over Claim Its Yogurt Has Zero Sugar Will Proceed, Court Rules

‘The federal requirements at issue are plain—food products cannot be labeled sugar free unless they have less than half a gram of sugar,’ the ruling stated.

Chobani products labeled zero sugar in a grocery store in New York City on Aug. 12, 2021. Eugene Gologursky/Getty Images for Chobani

A federal appeals court on July 27 revived a case challenging Chobani’s marketing of its yogurt as free of sugar, even though it had allulose, a sweetener.

“The federal requirements at issue are plain—food products cannot be labeled sugar free unless they have less than half a gram of sugar, and sugars include every monosaccharide, including allulose,” Circuit Judge Thomas Kirsch wrote for the unanimous panel of judges on the U.S. Court of Appeals for the Seventh Circuit.

Residents of Arizona, Illinois, and Kansas in 2023 sued Chobani over its labeling, which includes statements that products have “zero sugar” or “no sugar.” That was deceptive because each serving contained four grams of allulose, a naturally occurring sugar found in products such as figs and maple syrup, the class-action complaint alleged.

Federal regulation says that no food may be labeled with terms such as “sugar free” or “zero sugar” unless it contains less than 0.5 grams of sugar.

A federal district court judge threw out the case, ruling that the claims were preempted by federal law.

The appeals court reversed that decision.

“Allulose is a sugar under the relevant federal regulation and the Francos plausibly alleged consumer deception, which means their suit may proceed in the district court,” Kirsch said.

The Food and Drug Administration in 2020 guidance said it would not take enforcement action against manufacturers that excluded allulose from the amount of total sugars, pending further rulemaking. But the agency told the court in a brief that the regulation definition is unambiguous and that the definition of sugar includes all monosaccharides, including allulose.

“Chobani contends that it relied on the Allulose Guidance in deciding how to label its products. And Chobani says that it even secured a marketing permit from the FDA, after the agency approved Chobani’s zero sugar labeling,” the new ruling said. “But the Allulose Guidance was a statement about enforcement discretion, and the agency hasn’t engaged in further rulemaking, which means its original definition of sugar remains in force.”

Lawyers for Chobani have also argued that the case should be dismissed because it does not plausibly allege deception of consumers. The panel disagreed, finding that the plaintiffs have plausibly alleged consumer deception, because there was an absolute promise on Chobani’s labels, and the plaintiffs say they were fooled by it.

Chobani did not respond to a request for comment by the time of publication. A lawyer representing the plaintiffs declined to comment.