Class Action Lawsuit Claims Charging More for Oat Milk Is Discriminatory

I have not had Dunkin’ in well over a decade. But I used to love the chain’s blueberry coffee. The scent of the artificial fruity steam lingers beside youthful memories, and I can still feel the weightless heft of their enduring styrofoam cups. These days, though, I more often find myself at Portland, Oregon’s third- and fourth-wave coffee shops, which tend to place greater focus on the people behind the beans and the environmental and social impacts of their businesses. (And when I crave blueberry flavor, I can get it from naturally processed beans.)

But even in a city that accommodates allergens and veganism, an extra $0.50 to $1 is almost always tacked on to my coffee for nondairy milk. ​This additional fee, according to a recent class action lawsuit against Dunkin’, is discriminatory. The lawsuit — filed in late December in Northern California’s federal district court on behalf of all U.S. consumers who have paid more at Dunkin’ for nondairy milk alternatives within the last four years — seeks no less than $5 million for class members.

The named ​plaintiffs “all suffer from lactose intolerance and milk allergies,” making it “medically necessary” for them to avoid dairy. The complaint alleges that imposing a surcharge for alternative milk violates the Americans with Disabilities Act, since, under the 1990 law, food allergies that substantially limit a major life activity can be considered a disability.

In early March 2024, Dunkin’ filed a motion to dismiss, and the hearing is set for April 19 in San Francisco. In its motion to dismiss, Dunkin’ argued in part that the ADA does not require the business to sell accessible goods at the same price as non-accessible goods. The chain’s lawyers warned that the “consequences of adopting Plaintiffs’ radical theory are far-reaching and cannot be ignored.” The plaintiffs’ “radical theory” of comparable pricing, could, the Dunkin’ lawyers caution, include a supposedly nightmarish future wherein gluten-free items are priced like their gluten-containing counterparts.

Why alternative milks historically cost more

Dunkin’ charges an extra $0.50 to $2.15 for nondairy milks even though the retail price of the cow’s milks it offers without surcharge is, according to the complaint, “the same, if not more than their Non-Dairy Alternatives​.​” But this is not true for smaller shops; I spoke to local coffee shop owners who say that around half of their customers choose nondairy milk, but the $0.50 to $1 surcharge is necessary due to the higher price of alternatives. Portland’s vegan cafes incorporate the higher costs into their beverage programs, and local nondairy milk producers have to work around slim margins. Making milk is, no pun intended, labor intensive.

Andrew Le​, a shift supervisor at Heart Coffee Roasters and the founder of alt-milk company Utter, charges $10 for his milk teas. Le is determined to make his plant milks work with coffee and says his milks are a “labor of love, time, and care,” not even comparable to “mass produced, factory-farmed cow milk.” Ota Tofu’s rich, creamy soy milk is sold at a reasonable $3.50 per half gallon. But in Oregon, the average price of a gallon of conventional cow’s milk is $3 (the national average hovers under $4 per gallon). Milk from other mammals can be sold at this rate because the United States government sends the dairy industry billions of dollars each year.

Rajesh K. Reddy, director of the Animal Law Program at the Center for Animal Law Studies at Lewis & Clark Law School, highlights how subsidies harm competition. “Some may recall that in 2006 Dunkin’ Donuts adopted the slogan ‘America runs on Dunkin’ to emphasize its coffee​,” Reddy says​. “​But with every cup of morning Joe, it’s the dairy industry Americans are bailing out. Just how much the federal government — and taxpayers by extension — subsidize the industry is a little-known fact, and its implications are mind-boggling.” ​By keeping dairy prices artificially low, demand for dairy increases while smaller producers deal with higher production costs and lower demand. “You couldn’t come up with an inherently more unlevel playing field if you tried.”

These subsidies also incentivize overproduction. So much so that there is currently over 1 billion pounds of cheese and millions of pounds of butter stored underground in Missouri. But the excess doesn’t stop there: Each year, millions of gallons of milk are dumped on fields or sent down drains. And at least 29 percent of school children throw away government-purchased milk cartons — unopened. In one study from Tufts University’s Friedman School of Nutrition Science and Policy, an elementary school teacher estimated that her 21 students threw away around 15 milks a day.

Are there really that many people drinking alternative milks?

Despite the government’s continual championing of Big Dairy, there has been a “long-run downward trend in milk drinking.” Gen Z has been dubbed the “Not Milk” generation. And as Gregory Gourdet (whose newish bar Sousòl serves a nondairy riff on a milk punch) put it recently while commenting on a New York Times Instagram post: “The people have spoken. Milk is gross.”

In spite of this, Congresswoman Virginia Foxx of North Carolina implored Congress​ in December​ to “end the war on milk.” From the House floor, she wondered aloud what people could possibly have against Santa’s fuel.

But members of Congress ​themselves ​have pointed out that “rates of lactose intolerance in BIPOC communities are startlingly high, with 65 percent of Latino students, 75 percent of Black students, and 90 percent of Asian students unable to digest dairy milk without detrimental effects.” ​​Dairy is also worse than alternative milks for the environment, and pollutes the air and water of historically marginalized communities. ​Moreover, most milk comes from a cow who was artificially inseminated and whose calf was taken away from her within hours. This cycle is repeated around four times, without interruption, before she is slaughtered.

​What the lawsuit could mean for the future of alternative milks at coffee shops

The lawsuit against Dunkin’ underscores that people who do not drink cow’s milk for any or all of the above reasons should not have to pay for dairy subsidies and surcharges on the nondairy milk option, especially at multibillion-dollar chains.

On March 12, a similar class action lawsuit was filed against Starbucks, and as the two complaints note, because of their size, Dunkin’ and Starbucks have “the power to control the manufacturing costs for Non-Dairy Alternatives.” There is already no real price difference between milk alternatives and dairy for these businesses. If they were to offer nondairy alternatives without financially penalizing their customers, it is likely that sales would increase, making plant milks more affordable for smaller coffee shops and home consumers too.

Some shops have already successfully eliminated the additional fee. Panera Bread and Pret a Manger abandoned the alt-milk surcharge back in 2020. Citing carbon neutrality goals, Blue Bottle and Stumptown followed suit and made oat milk their shops’ default milk (meaning customers have to specifically ask for cow’s milk cappuccinos). Guilder, with just two locations in Portland, including one in Powell’s City of Books, made these changes years ago.

No matter what the outcomes are of the Starbucks and Dunkin’ class actions, people are asking these companies to change. In 2022, the actor James Cromwell summarized this nicely while his hands were superglued to a Midtown Manhattan Starbucks counter in protest: “When will you stop raking in huge profits while customers, animals and the environment suffer?”

Anastasia Sloan is a Brooks Institute Animal Law LLM Fellow at Lewis & Clark. She received her JD from the University of Michigan Law School, interned with Whetstone Magazine, Farmworker Justice, and the Animal Legal Defense Fund, and has managed restaurants in Chicago and New York City.