This regular publication by DLA Piper lawyers focuses on helping clients navigate the ever- changing business, legal and regulatory landscape.
- Judge rules that terms “almond milk” and “soy milk” are not misleading. The Northern District of California ruled on December 1 that it is lawful to use terms such as “almond milk” and “soy milk” to describe plant-based beverages and that no reasonable consumer would confuse those products with dairy milk, dismissing claims that retailer Trader Joe’s had misled consumers and violated food labeling laws in using those terms for its beverages. The court ruled that the fact there is a federal standard for milk does not prevent companies from using other terms that contain the word “milk” to identify other products, as long as the products are not being held out to consumers as actually containing milk from cows. The court allowed other unrelated claims in the lawsuit to proceed.
- Picamilon in the news. Picamilon, developed in the Soviet Union in 1969, is prescribed in Russia for certain neurological conditions, but has never been approved in the US for any purpose. In recent months, its use in dietary supplements sold in the US has come under attack on several fronts.
FDA warns dietary supplement marketers. Since picamilon is neither approved as a drug in the US nor as a dietary ingredient, supplements containing the chemical are deemed adulterated under federal law. On November 30, the FDA sent warning letters to five marketers of dietary supplements containing picamilon. Each company was given 15 business days to tell the FDA how it will bring its products into compliance.
Oregon AG seeks to have supplements case heard in state court. Oregon Attorney General Ellen Rosenblum has moved to have the state’s lawsuit against GNC heard in state court, opposing a motion filed by the company to have the case transferred to federal court. The lawsuit alleges that some of GNC’s dietary supplements contain ingredients not approved for sale in the US, most notably picamilon and BMPEA, and that the company is therefore obligated to pay penalties under Oregon’s consumer protection statutes. GNC says federal jurisdiction is appropriate since its products are regulated by the FDA. Seeking oral argument on her motion to have the case heard in state court, Rosenblum replied on December 3 that lawsuits in state court alleging violation of federal requirements are nothing new.
Class action filed. When reports of the Oregon AG’s action reached the market, GNC stock fell about 14 percent. In late November, a putative class action lawsuit was filed against GNC in the District Court for the District of Oregon on behalf of investors who purchased GNC Holdings securities between May 2, 2013 and October 22, 2015. The lawsuit alleges the company misled its investors by failing to disclose material adverse facts.
- Grocery manufacturers continue attempts to stall state GMO labeling laws. On December 9, the Grocery Manufacturers Association said it would continue to push forward with an amendment to the omnibus fiscal 2016 spending bill that would stall state labeling laws for two years. According to observers, this was a plan to buy more time for Congress to pass federal labeling legislation that would have the effect of preventing Vermont’s labeling law from going into effect on July 1, 2016. At least four Democratic senators have vowed to oppose the amendment. Opponents of the Vermont law have tried, but so far failed, to strike it down in the courts on constitutional grounds.
- The National Restaurant Association acts. On November 30, the National Restaurant Association announced it plans to file a lawsuit against New York City's health department concerning its new requirement that chain restaurants post warning labels on foods that contain more than the recommended daily limit for sodium. The rule, which took effect December 1, requires chains with 15 or more locations in New York City to display a warning symbol – a salt shaker inside a triangle – if a menu item has more than 2,300 milligrams of salt. “It is clear that the board is trying to circumvent the legislative process, and set policy by creating its own set of rules regarding sodium without the benefit of a legislative mandate or even guidance,” the association said. The Center for Science in the Public Interest responded, “The need for this information is clear. The African-American and Hispanic communities of New York City suffer disproportionately from the preventable heart diseases and strokes associated with excess sodium in the diet.”
Next, New York state’s Industrial Board of Appeals has rejected the National Restaurant Association’s attempt to overturn the state’s gradually phased in $15-an-hour minimum wage for fast-food workers. AP reports that the Association regards the law as unconstitutional, arbitrary, unsupported by the evidence and focused improperly on fast-food chains with more than 30 locations. On December 11, the Association announced it intends to take its challenge to the state Supreme Court.
- FDA denies petition for mandatory GMO labeling; are QR codes the solution? On November 19, the FDA denied a petition filed on behalf of 22 activist and public interest groups that were seeking mandatory federal labeling of genetically modified organisms in food products. The agency concluded that the petition “does not provide evidence sufficient to show that foods derived from genetically engineered plants, as a class, differ from foods derived from non-GE plant varieties in any meaningful or uniform way, or that as a class, such foods present any different or greater safety concerns than foods developed by traditional plant breeding.” The Grocery Manufacturers Association applauded the ruling, saying the FDA “had made the right decision for the right reasons.” Some food industry observers now say that the best solution to the GMO labeling impasse might be to add QR codes, which can be scanned using a smart phone, to product packaging.
- KIND company asks for redefinition of term “healthy.” On December 1, the KIND snack company filed a citizen petition with the FDA asking the agency to update its regulations concerning the term “healthy” when used as a nutrient content claim in food labeling. At present, the FDA states that this term can be used only to describe foods that contain three grams or less of total fat and one gram or less of saturated fat per serving. The petition came after the granola bar maker received a letter from the FDA in April telling KIND to stop using the term “healthy” on its labels. Kind’s founder and CEO Daniel Lubetzky said that, in the company’s view, the FDA regulations, which have not been changed in nearly 20 years, “are inconsistent with the dietary guidelines and current nutrition science.” Among other things, the company says, nuts are now considered a healthful food, and their importance to diet has only recently been recognized.
- FDA receives comments on definition of “natural.” As of December 1, the FDA has received more than 2,000 comments to its request for suggestions on how to define the term “natural.” The quantity and the variety of the comments, most of which are from individual consumers, make clear how difficult the FDA’s task will be. As NutraIngredients noted, “The FDA will have its work cut out when it comes to coming up with a workable definition of ‘natural,’ if the comments submitted to the FDA thus far are anything to go by.” The comment period began November 10, and most major food companies and organizations have not yet responded. The deadline for comments is February 10. The FDA also asked consumers and industry for comments on whether consumers view the terms “natural” and “healthy” as synonymous and on whether shoppers confuse the terms “natural” and “organic.”
- APHIS green-lights latest Monsanto GMO corn. On December 4, the USDA’s Animal and Plant Health Inspection Service green-lighted Monsanto’s newest GMO corn, MON 87403, which was genetically engineered for increased ear biomass, a marker of higher grain yield at harvest. APHIS granted “nonregulated status” to MON87403. Agri-Pulse reports that farm industry groups were split on the question of approval. The National Grain and Feed Association and North American Export Grain Association jointly recommended that APHIS “create and apply a different category of ‘deregulation’ – namely ‘conditional deregulation’ – expressly for MON 87403” and other new GMOs, which may present a risk to farmers because important export countries have not approved them. The South Dakota Corn Growers Association, in contrast, unconditionally supported MON 87403’s nonregulated status.