The Supply Side Briefs: Kellogg sued, Hormel acquisition, ConAgra retirement

• Consumer group sues Kellogg
Consumer group Center for Science in the Public Interest has filed a false and misleading labeling complaint against Kellogg, alleging the Cheez-It whole grain crackers are “virtually indistinct nutritionally” from Cheez-It original crackers.

“They contain only one gram of dietary fiber per serving,” the lawsuit said. “Neither whole grain variety increases whole grains beyond half, as recommended by the Dietary Guidelines. Thus, Cheez-It whole grain crackers are not predominantly whole grain, despite the reasonable expectations that Kellogg has created by distinguishing Cheez-It whole grain crackers from other crackers in the Cheez-It product line by denominating them whole grain.”

Kellogg has called the lawsuit meritless and said it’s Cheez-It whole grain labels are in full compliance with FDA regulations.

Other companies facing similar lawsuits include Mondelez International and Pepperidge Farm. Mondelez offers Nabisco Wheat Thins Whole Grain that are 100% whole grain, as are Nabisco Triscuit crackers. Similarly, Pepperidge Farm Goldfish Baked with Whole Grain are predominantly whole grain flour (whole wheat flour being the first ingredient).

The snack crackers primary ingredient listed on the ingredients panel is enriched flour, followed by soybean and palm oil and then whole wheat flour, according to the suit. The plaintiffs note in the filing that customers would not have purchased the items had they known they contained so little whole grain.

The companies argue all the ingredients are listed on the products for consumers to read before they purchase.

Kellogg is a supplier to Walmart and operates a large sales office in Northwest Arkansas.

• Hormel to acquire Justin’s nut butter brand
Hormel Foods Corp. has agreed to acquire Justin’s, maker of Justin’s brand nut butter spreads, squeeze packs, peanut butter cups and snack packs. Financial terms were not disclosed.

“Justin’s naturally delicious, high-quality nut butters, nut butter snacks and organic peanut butter cups align perfectly with our goal of complementing our existing brands with new offerings that resonate with younger, on-the-go and more health-conscious consumers,” said Jeffrey Ettinger, chairman CEO at Hormel Foods.

He said Justin’s will continue operating out of its office in Boulder, Colo., as a subsidiary of Hormel’s Grocery Products segment. The brand includes maple almond butter, chocolate hazelnut butter and pretzels.

Hormel is a supplier to Walmart and a competitor to Tyson Foods. The company has a sales office in Northwest Arkansas.

• ConAgra chief financial officer to retire
John Gehring, executive vice-president and chief financial officer of ConAgra Foods, plans to retire after 14 years with the company. Gehring will stay on until the company names a successor and will aid in the transition. ConAgra Foods has initiated a search to find his replacement.

“We are grateful for John’s many years of distinguished service to our company,” said Sean Connolly, president and CEO of ConAgra Foods. “He has been an outstanding leader and friend. We wish him the best of luck in his next chapter.”

Prior to ConAgra Foods, Gehring was a partner with Ernst & Young and held auditing positions with PepsiCo, Inc. and KPMG. He joined ConAgra Foods in 2002, assuming his current role in 2009.

“I am honored to have had the opportunity to serve as c.f.o. during such an important period for ConAgra Foods,” Gehring said in the release. “This has been the most professionally rewarding experience of my career, and I am proud of all that we have accomplished together over the past 14 years.”

ConAgra is a supplier to Walmart and operates a large retail sales office in Northwest Arkansas.