Top court upholds limits on punitive damages in food safety lawsuits

The Supreme People's Court, China's highest court, said on Thursday that Chinese courts will support consumers in protecting their food safety rights, but the support should be given with limits.

The top court's comments come in response to a controversial phenomenon in China, where some consumers knowingly purchase food that does not meet safety standards, and subsequently sue the food producers or sellers to courts, demanding compensation.

According to the Food Safety Law, consumers are allowed to initiate lawsuits to demand compensation from food producers or sellers, along with punitive damages, if the food is found not to meet the safety standards. The punitive damages can be up to 10 times the purchase price of the food.

Xie Yong, a judge from the top court's No 1 Civil Adjudication Tribunal, said that the root of such lawsuits lies in the production and sale of food that does not meet safety standards, so it is justifiable for courts to crack down on the behavior.

However, Xie said that the courts have also discovered that some consumers are exploiting the provision in the law to buy goods that were far beyond their actual consumption needs, so that they could ask for larger amounts of punitive damages by litigation.

"Their demand in such a situation should not be supported by courts," Xie added.

In a case disclosed by the top court on Thursday, a consumer surnamed Sha bought 30 boxes of cookies from an online shop and found that the food did not meet the safety standard after receiving them. Instead of turning to court directly, Sha bought an additional 200 boxes in the following two months and then initiated a lawsuit against the food seller.

In addition to asking the seller to return the payment of 4,176 yuan ($585), Sha also demanded punitive damages of 41,760 yuan.

After a trial, the court supported the compensation and the punitive damage for Sha's first 30 boxes of the cookie because the purchase met the need of the consumer's living consumption.

As for Sha's claim for the refund and punitive damages for the additional 200 boxes, the court did not support it, explaining that such buying was clearly beyond the normal needs of daily life consumption.

Xie said, "The ruling not only protected food safety but also maintained the market order for food production and operation."

Taking punitive damages as a measure to solve food problems, Xie added that Chinese judges will also continue to work with prosecutors and government officials to guarantee food safety through public-interest litigation as well as administrative and criminal punishments.

Data released by the top court on Thursday showed that Chinese judicial authorities dealt with over 45,000 criminal cases related to the production and sale of food that did not meet safety standards or were even toxic or harmful from 2013 to 2022, making more than 62,000 people face criminal liability.