It’s been hard to ignore attorney Spencer Sheehan in the last four years. Since 2020, his firm alone has filed more than 400 false ad and product labeling claims in federal court, and not all against big companies like Walmart or Proctor & Gamble. Many times Sheehan’s firm targets small- to medium-sized food companies, perhaps because they don’t have the budget to pay lawyers to fight for months or years and would choose to settle earlier, regardless of whether the case has legs. We don’t know how many other cases may settle before they are even brought to suit, but these would swell beyond 400 the list of companies finding themselves at the pointy end of a Sheehan demand.
The barrier to filing a food labeling class action is low. In most cases, plaintiffs’ counsel like Sheehan duplicate tens or hundreds of cookie-cutter complaints, often with only the target company name changed, and then let fly. Sometimes Attorney Sheehan has to make a case, but not always. A lot of proposed class actions, and not just those involving Attorney Sheehan’s firm, require only cranking out a sheaf of identical complaints, sending them to their targets with equally identical demand letters, filing a few to get the defendant’s attention, perhaps attending a mediation, collecting the money and moving on to the next target. Unless, of course, the case is filed and subsequently dismissed, which for Attorney Sheehan is pretty common, as it turns out.
The returns for these cases can be big, but not for consumers. The individual consumer – the purported harmed party – can get five or ten dollars, but more often they will receive nothing at all. The attorneys, on the other hand, can collect as much as a third of any settlement or judgment. The average settlement in food labeling cases falls somewhere between $50,000 and $100,000, but many cases net more and some cases settle for tens of millions. A 2016 Kellogg’s case (not involving the Sheehan firm) settled for twenty million dollars, netting the plaintiffs’ counsel five point one million dollars. Not bad for throwing pasta at the wall.
Plaintiffs’ counsel like Mr. Sheehan speak with pride of calling food producers to account, but it is clear to food producers and their attorneys that this line of litigation is more Madoff than Robin Hood. And this isn’t a victimless “crime.” Lawsuits, even frivolous ones, cost producers real money, make food more expensive to produce and tie up court time and resources, but rarely do they spark actual change, make food safer or protect consumers from misleading labels. In fact, many food producers would have been ready to change labels if asked . . . but in most cases that’s not what these demands are really about.
For years the food industry has been frustrated by the shake downs, but now it appears the judges are catching on.
In Illinois this week, two federal judges ordered Mr. Sheehan to produce a spreadsheet of his cases, identifying which survived a motion to dismiss – a very low bar that only the thinnest complaints fail. The spreadsheet of cases demanded from Sheehan revealed that 82% of his cases that were up on a motion for dismissal lost – meaning 82% of his cases didn’t even hold enough water to warrant proceeding through the litigation process to be tested further. But even more of them were withdrawn before that decision could be made. According to counsel for Foley Hoag, a firm that has defended as many as fifteen Sheehan suits, Sheehan just as often withdraws his complaints when facing a dismissal, which seems to show what he thinks of the credibility of his own cases.
“Plaintiff’s counsel has peddled this theory time and again, in case after case, without much success in this district,” said the judge in one of the Illinois cases, this one challenging the amount of olive oil found in a Walmart-branded mayonnaise, “The complaint joins a warehouse of complaints filed by plaintiff’s counsel that are not fit for public consumption . . . By all appearances, attorney Sheehan keeps bringing cases about how to read product labels, but he can’t seem to read the tea leaves from the judiciary.”
Ouch.
Lawyers have a duty to refrain from filing frivolous lawsuits and can be sanctioned for filing suits that have no good faith basis. In the words of the judge covering the second of the two Illinois suits, this one complaining that mint-flavored gum doesn’t contain actual mint:
“Spaghetti is best eaten, not thrown at walls.”
Eat + Drink Vermont 