• Food Labeling at SCOTUS: Can FDA Compliant Labels Still be Deceptive?
  • April 30, 2014 | Author: Gene Summerlin
  • Law Firm: Husch Blackwell LLP - Lincoln Office
  • On April 21, 2014, the Supreme Court of the United States heard oral arguments in POM Wonderful LLC v. The Coca-Cola Company. This is perhaps the most interesting food labeling case to come along in, well . . . forever. What is at issue here? The central question is whether a food product label which arguably complies with the Food and Drug Administration’s regulatory labeling requirements can, nonetheless, be misleading under another federal statute, the Lanham Act, which prohibits false or misleading advertisements. This is our second post in what is sure to be a mega-multiple post analysis of food labeling law.

    POM Wonderful sells several varieties of juices that are either 100% or primarily composed of pomegranate juice. Coca-Cola’s Minute Maid brand sold a product (pictured above) labeled as “Pomegranate Blueberry Flavored Blend of 5 Juices,” that contained 0.3% pomegranate juice, 0.2% blueberry juice and 99% apple and grape juice. POM claims that the “total amount of blueberry and pomegranate juice in [Coca-Cola's] product can be dispensed with a single eyedropper. It amounts to a teaspoon in a half gallon.” Oral Argument Transcript at 14. POM also argues that Coca-Cola added artificial color to its product so that it resembled the color of pomegranate juice along with a label which visually depicted pomegranates, blueberries, grapes and cherries. POM contends that ”Coca-Cola has designed its ‘Pomegranate Blueberry’ juice product to mislead consumers. . . [Although] the amounts of pomegranate and blueberry juice . . . are so trivial that no consumer could perceive them . . . every aspect of the product’s appearance is tailored to convince consumers that it contains significant amounts of pomegranate and blueberry juice.” Brief for Petitioner at 2.

    POM brought suit against Coca-Cola claiming that the Minute Maid juice label is false and misleading under the Lanham Act. This federal statute creates a private right of action against anyone who uses a “false or misleading” description or representation “in connection with any goods or services” or who, “in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person’s goods, services, or commercial activities.” 15 U.S.C. § 1125(a). So essentially, the Lanham Act allows either consumers or competitors to bring a claim against any entity that falsely advertises its products or services. In the words of The Eagles, are you with me so far? Good.

    Coca-Cola’s defense to POM’s lawsuit is that because its label is allowed under FDA regulations, it can not, as a matter of law, be false or misleading. (POM also argues that Coca-Cola’s label is not in compliance with FDA regulations, but the Supreme Court appears willing to address the more straightforward question of whether FDA labeling requirements preempt false advertising claims under the Lanham Act).

    The FDA regulates food and beverage labels to ensure that these products are not misbranded. 21 U.S.C. § 343. The FDA’s regulations address various aspects of food labeling, including the labeling of blended juice products. 21 C.F.R. § 102.33(c)-(d). With regard to blended juice products, the FDA specifically requires that “the names of those juices . . . must be in descending order of predominance by volume unless the name specifically shows that the juice with the represented flavor is used as a flavor.” 21 C.F.R. § 102.33(b). In addition, the FDA regulations provide a catchall provision that a “food shall be deemed to be misbranded” if “its labeling is false or misleading” or its “advertising is false or misleading.” 21 U.S.C. § 343(a). Unlike the Lanham Act, though, the FDA’s regulations can only be enforced by the federal government. 21 U.S.C. § 337(a). So, one federal statute (the Lanham Act) prohibits false or misleading advertisements and allows claims to be brought by pretty much anyone, and another set of federal regulations prohibit false or misleading statements with regard to food and beverage labels, but can only be enforced by the FDA.

    Both the district court and Ninth Circuit Court of Appeals accepted Coca-Cola’s claim that compliance with the applicable FDA regulations precluded POM’s Lanham Act claims. The Supreme Court appears reluctant to follow the Ninth Circuit’s lead. At oral argument, Coca-Cola asserted that one of the the primary purposes of the FDA labeling regulations was to ensure national uniformity in labeling requirements. Justice Kennedy’s response to this assertion was to ask, “Is it part of Coke’s narrow position that national uniformity [with respect to food product labels] consists in labels that cheat the consumers like this one did?” Oral Argument Transcript at 28. Although Coca-Cola’s counsel tried valiantly to dodge the question, Justice Kennedy refused to allow a non-answer:

    " I think it’s important for us to know how the statutes work. And if the statute works in the way you say it does and that Coca-Cola stands behind this label as being fair to consumers, then I think you have a very difficult case to make. I think it’s relevant for us to ask whether people are cheated in buying the product. Because Coca-Cola’s position is to say even if they are, there’s nothing we can do about it.

    Id.

    Justice Sotomayor seemed equally skeptical of the claim that FDA compliance necessarily meant that the label was not false or misleading.

    " [T]hat’s where I’m having a little bit of difficulty, because it’s not that you have to use this name, you’re permitted to use this name under their regulations. But why are you permitted to use it in a misleading way? . . . . [I]f you’re using the name in combination with other factors in a misleading way that’s not subject to the regulation . . . then it’s actionable under the Lanham Act.

    Oral Argument Transcript at 30.

    Justice Ginsburg asked whether any “statute or regulation of the FDA says that compliance with the permissive regulation of the FDA necessarily renders the label non-misleading?” Oral Argument Transcript at 33. Coca-Cola’s counsel tried to answer this question by pointing the Court to the regulations which preempt state law labeling claims. In response, Justice Kagan asked, “[S]uppose we thought that the preemption provision here was utterly irrelevant, that it applies to state law and not Federal law . . . . So suppose I just put that aside. Do you still have any kind of argument?” Oral Argument Transcript at 34. Chief Justice Roberts appeared to sum up the prevailing view of the justices (at least at oral argument) when he pondered, “I don’t know why its impossible to have a label that fully complies with the FDA regulations and also happens to be misleading on the entirely different question of commercial competition, consumer confusion that has nothing to do with [the FDA's role in regulating] health.” Oral Argument Transcript at 36-37.

    Recognizing that views expressed through questions at oral argument are oftentimes a poor prognosticator for determining how individual justices will vote, if I were a betting man, I’d put my money on POM and the Lanham Act.