Presenting a live 90-minute webinar with interactive Q&A Food Labeling Class Actions: Navigating Ascertainability, Predominance, Preemption and Standing WEDNES DAY, OCTOBER 1, 2014 1pm East ern | 12pm Cent ral | 11am Mount ain | 10am Pacific Today’s faculty features: S arah L. Brew, Partner, Faegre Baker Daniels , Minneapolis Ronald J. Levine, Partner, Herrick Feinstein , Princeton, N.J. R. Trent Taylor, Partner, McGuireWoods , Richmond, Va. The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10 .
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Food Labeling Class Actions: Navigating Ascertainability, Predominance, Preemption and Standing Presented by: S arah L. Brew, Faegre Baker Daniels, Minneapolis, sarah.brew@ faegrebd.com Ronald J. Levine, Herrick Feinstein, Princeton, N.J., rlevine@ herrick.com R. Trent Taylor, McGuireWoods, Richmond, Va., rtaylor@ mcguirewoods.com
QUIZ UIZ WHY ARE SO MANY NEW CASES BREWING IN THE UNITED STATES? [ MULTIPLE CHOICE TEST ] 6
A. BECAUSE TOBACCO COMPANIES SHELLED OUT BIG BUCKS TO THE PLAINTIFFS’ LAWYERS. 7
B. BECAUSE AL GORE INVENTED THE INTERNET. 8
C. BECAUSE OF THE EVER INCREASING USE OF CONSUMER CLASS ACTIONS IN THE COURTS. 9
D. BECAUSE OF THE GROWING FOCUS ON OBESITY AND HEALTH 10
E. BECAUSE PEPSI DOES NOT TALK TO COKE. 11
ANSWER AND MANY MORE FACTORS HAVE CONTRIBUTED TO THE GROWING NUMBER OF CASES. 12
LITIGATION IS A “FOR- PROFIT” BUSINESS – THE PLAYBOOK • Demonize the industry • Support certain public interest groups • Use the media to maximum advantage • Blame a multi-factorial health problem on a single “ADDICTIVE” or “HARMFUL” ingredient. 13
ADDING FUEL TO THE FIRE – SOCIAL MEDIA • PLAINTIFFS’ LAWYERS SCOUR WEB ADVERTISING • PLAINTIFFS’ LAWYERS TROLL FOR CLAIMANTS • BLOG COMMENTS GET REHASHED IN PLEADINGS • VIRAL STORIES ABOUT LAWSUITS 14
“Nature’s valley is linked with the concept of natural on the brand’s website” “General Mills also links the Nature Valley Brand with the concept of natural on its Flickr photostream” “Nature Valley’s Facebook page also features photographs of nature . . .” Janney v. General Mills (Class Action Complaint), (N.D. Cal.) 15
Silber v. Barbara’s Bakery, Inc. (Class Action Complaint), (E.D.N.Y.) 16
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THE INDUSTRY’S DISADVANTAGES • Regulated, but not completely • Highly competitive – competing claims on “natural,” ingredients, health, etc. Constantly evolving product lines • • Rapidly changing consumer tastes • Diet is a subject of strong public interest 18
“Natural” 19
How Does FDA Define “Natural”? • Holds to the policy it outlined in 1993: “ FDA has not established a formal definition for the term ‘natural’, however the agency has not objected to the use of the term on food labels provided it is used in a manner that is truthful and not misleading and the product does not contain added color, artificial flavors, or synthetic substances. Use of the term ‘natural’ is not permitted in the ingredient list, with the exception of the phrase ‘natural flavorings.’” • “Natural” only defined in terms of Natural Flavors: The essential oil, oleoresin, essence or extractive, protein hydrolysate, distillate, or any product of roasting, heating or enzymolysis, which contains the flavoring constituents derived from a spice, fruit or fruit juice, vegetable or vegetable juice, edible yeast, herb, bark, bud, root, leaf or similar plant material, meat, seafood, poultry, eggs, dairy products, or fermentation products thereof, whose significant function in food is flavoring rather than nutritional. • Has long resisted making any definition for other foods (several petitions have been outstanding for years) 20
How Does USDA Define “Natural”? • 2005 incorporated in Labeling Policy Book its longstanding policy of allowing use of “Natural” where • (1) product does not contain any artificial flavor/color/chemical preservative per 21 CFR 101.22; and • (2) product/ingredients are only minimally processed • 2005 Policy modified to add exceptions for (1) ingredients in the National Organic Policy; and (2) corn-derived sodium lactate • 2006 Hormel petition to codify 1982 memo language with some exceptions • Sept. 2009 Advanced Notice of Proposed Rulemaking issued with comment period ending 11/09; no further actions taken 21
How Does FTC Define “Natural”? • It doesn’t – case by case basis • Rulemaking process started in mid-1970s; abandoned in 1983, confirmed case-by-case basis going forward • 2010: Green Guides released, again refused to define • No cases involving food or beverages • Left with the “reasonable basis” substantiation standard: advertiser/company must have “reasonable basis” for all express/implied claims made in advertising, at time claims are made • Open question whether FTC would defer to FDA’s definition, per its 1994 Enforcement Policy Statement on Food Advertising 22
“Natural” Early Targets • High Fructose Corn Syrup (HFCS) (Snapple, Arizona Beverages, Nature Valley bars, Healthy Choice pasta sauce) • Citric acid (enzymatically-made, solvent washed) in juices • Alkalized Cocoa (Ben & Jerry’s) • Potassium carbonate (Skinny Girl Margaritas) • Other products made through use of enzymes, solvents, acids, bases, etc. • By 2011, almost weekly filing of lawsuits 23
Holk v. Snapple Beverage Corp., 575 F.3d 329 (3d Cir. 2009) • Held no preemption of “All Natural” claim • No express preemption clause – FDA policy statement not enough • No field preemption – NLEA states no preemption unless explicit, and Congress clearly stated intent not to occupy field • No conflict preemption – FDA’s policy statement on “natural” is not a formal definition entitled to preemptive effect • Primary Jurisdiction: • Court stayed case for 6 months and sought FDA guidance on “natural” • FDA responded by letter indicating no action due to lack of agency resources 24
GMO “Natural” Litigation • Briseno, et al. v. ConAgra Foods, Inc. (C.D. Cal. June 28, 2011) • Plaintiffs alleged “100% Natural” labeling is misleading because vegetable oil is derived from plants grown from seeds genetically engineered to allow greater yield and be pesticide-resistant • Key Causes of Action • Violation of California’s false advertising/unfair competition laws • Breach of express warranty • Plaintiffs also sought permanent injunction and order requiring ConAgra to adopt and enforce a policy disclosing GE ingredients or removal of natural claims 25
• In re Wesson Oil Marketing and Sales Practices Litigation • October 13, 2011 MDL assigned cases to C.D. Calif. • ConAgra moved to dismiss, arguing: • FDA’s labeling guidance for bioengineered foods, which says disclosure is not required, preempts these claims • FDA has concluded that bioengineered foods are not meaningfully different and so claims that a food is not “natural” merely because it is bioengineered is preempted 26
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