The Food and Drug Administration (FDA) established a docket to receive information and comments on the use of the term ‘‘natural’’ in the labeling of human food products and dietary supplements, including genetically-engineered foods and products that contain genetically-engineered ingredients. For a review of the regulatory implications of FDA’s announcement, see here. FDA’s latest action also could impact pending and future litigation challenging “natural” claims on food products in at least three significant ways: 1) reconsideration of prior and pending motions to stay, 2) triggering new preemption arguments and 3) altering the litigation mitigation landscape.
First, FDA’s latest inquiry provides an opportunity for companies to seek stays or dismissal on primary jurisdiction grounds of ongoing “natural” food and dietary supplement litigation while the agency’s new policy is being developed. Over the years, the absence of rules governing the use of “natural” in product labeling spawned dozens of private class action lawsuits across the country, particularly in California. See our discussion here. Many companies moved to stay those class actions on primary jurisdiction grounds, pending resolution by FDA on the definition of the term “natural.” Those motions were not resolved uniformly by the courts. Some cases were stayed and others were not, depending on each court’s perspective on whether and when FDA was going to define the term. In January 2014, FDA issued a public letter acknowledging the litigation and the stays, but also noting that private litigation would not dictate FDA’s allocation of resources and that it was not allocating resources at that time to defining the term “natural.” In other words, FDA’s letter made clear that it was not exercising its jurisdiction at that time to decide which foods and food ingredients were “natural.” FDA’s letter resulted in most of the stays being lifted and litigation continued. FDA’s new notice reflects FDA’s exercise of jurisdiction on the issue and affords companies named in lawsuits challenging “natural” claims with a renewed basis to bring a motion to stay on primary jurisdiction grounds.
Second, the ultimate impact on consumer litigation of any further FDA action may depend, inter alia, on the type of action FDA chooses to take. Additional guidance from FDA on this issue may not reduce the number of consumer class action lawsuits given that in the past, plaintiffs and their counsel have used FDA’s limited guidance on this issue to frame their claims. FDA “has not objected” to the use of the term “natural” if a food does not contain added color (even when from a natural source, like beet juice), synthetic substances or artificial flavors. On the other hand, if FDA makes findings and issues regulations on the proper use of the term “natural” in food labeling, then state law (including common law) inconsistent with such regulations would be preempted, potentially reducing or resolving consumer lawsuits that challenge the use of the term in a manner of which FDA has approved.
Third, best practices demand that companies continually reassess their “natural” product claims and labeling through the lens of a plaintiff’s eye in order to be aware of their potential litigation exposure. This exposure often can be reduced in ways fully consistent with business and marketing goals. False advertising claims need not be predicated on lack of regulatory compliance; many such claims are brought even when labels and marketing are fully compliant with federal law and FDA regulations. Small changes to a label, claim or webpage can mitigate legal risk; if advertising has changed over time, the exposure period is potentially circumscribed. Moreover, if FDA provides further clarification on use of the term “natural,” companies will be able to even better assess the legal and business risks of advertising their “natural” products. Keeping abreast of developments in this changing legal landscape and making adjustments as appropriate will be key to successful marketing products without undue exposure.
The comment period on FDA’s new notice runs until February 10, 2016. FDA is seeking input specifically on:
- Whether it is appropriate to define the term “natural”;
- If so, how the agency should define “natural”; and
- How the agency should determine appropriate use of the term on food labels.
FDA recently indicated that it intends to “collect and analyze all of the public comments and information it receives before determining how to proceed on this issue.” In other words, formal rulemaking may or may not result from this process. But the information and comments provided to FDA may provide important clues about the issues consumers and their lawyers are most concerned about vis-à-vis the use of the term “natural” and may also reveal consumer expectations and understanding of the term. Such information could prove useful in defending and even defeating proposed class actions, particularly if the comments reveal that consumers do not have a common understanding or expectation of what it means when the word “natural” appears on a product label. As for whether or not FDA ultimately decides to formally address “natural” labeling of dietary supplements and other food products, FDA’s inquiry alone provides an opportunity for companies and the courts to press pause on the ongoing “natural” food and supplement litigation while possible answers are being developed.
If you have any questions regarding this Sidley Update, please contact the Sidley lawyer with whom you usually work, or
Elizabeth M. Chiarello
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