• Will the Supreme Court Weigh in on the Interplay Between the Lanham Act and the FDC Act? The SG’s Office Says it Should Not, But the Justices Will Decide in January of 2014, So Stay Tuned
  • December 30, 2013 | Author: James P. Ellison
  • Law Firm: Hyman, Phelps & McNamara, P.C. - Washington Office
  • In early 2014, the Supreme Court will meet in conference to decide whether to hear a case concerning whether, and to what extent, a private party can pursue a Lanham Act claim based on labeling regulated under the FDC Act.

    The Court will consider whether to address that issue in connection with the POM Wonderful LLC v. Coca-Cola Co. case. We have previously blogged on POM’s legal wrangling with the FTC in which POM’s marketing of its pomegranate juice products is being challenged.

    POM has been fighting its juice battles on multiple fronts, defending its products’ marketing before the FTC while at the same time challenging competitors that it claims are unlawfully marketing competing products. In the POM v. Coca Cola case, it is POM that is challenging Coca-Cola’s marketing of its Minute Maid brand pomegranate blueberry juice product. POM brought suit in September of 2008. Coca-Cola argued that POM was challenging, under the Lanham Act, labeling that was regulated and authorized by the FDC Act and implementing regulations. The district court ruled that POM could not base its Lanham Act claims on Coca-Cola’s name or labeling, but could pursue claims based on other advertising or marketing.

    By way of background, the Lanham Act is an often-considered and sometimes employed option for FDC Act regulated companies that believe that their competitors are falsely or misleadingly marketing their products. In those cases that are litigated, a central issue is often whether the plaintiff is attempting to use the Lanham Act to privately enforce the FDC Act. While parties routinely disagree about how that question should be answered in any given case, there is agreement that the Lanham Act may not be used to circumvent the FDC Act’s prohibition against private enforcement.

    In the POM case, following the district court’s ruling, POM appealed to the United States Court of Appeals for the 9th Circuit. The 9th Circuit ruled that POM could challenge neither the name of the Coca-Cola product, nor its labeling. The 9th Circuit reached this conclusion after consideration of FDA’s regulations regarding naming and labeling of juices. The crux of the 9th Circuit’s holding seems to be the following analysis: “In concluding that POM’s claim is barred, we do not hold that Coca-Cola’s label is non-deceptive. . . . We are primarily guided in our decision not by Coca-Cola’s apparent compliance with FDA regulations, but by Congress’s decision to entrust maters of juice beverage labeling to the FDA and FDA’s comprehensive regulation of that labeling.” 679 F.3d 1170 (9th Cir. 2012). In the 9th Circuit’s view, that conclusion was consistent with its earlier decision in Photomedex, Inc. v. Irwin, 601 F.3d 919 (9th Cir. 2010), in which it held that claims regarding the “cleared” status of a medical device were similarly barred.

    POM disagreed with the 9th Circuit’s analysis and filed a cert. petition in the Supreme Court. The Court sought the views of the Solicitor General, which is a good sign for those seeking cert., because the Court grants cert far more frequently in cases in which is seeks input from the SG’s office. In November of 2013, the SG’s office weighed in.

    The SG’s amicus brief is a notable foray by the government into Lanham Act jurisprudence. The federal government does not litigate Lanham Act cases and in most instances, private parties and courts are left to characterize the government’s view of the interplay between federal regulatory schemes and Lanham Act claims. Indeed, we cannot recall any other case where the federal government has expressed views regarding whether the FDC Act bars a Lanham Act case. In its brief, the SG’s office opines that the 9th Circuit was wrong about the preclusive effect of the FDC Act on Lanham Act claims relating to food but that the Supreme Court should not take up the case.

    On the interplay between the FDC Act and the Lanham Act, the SG’s Office asserted that “although Section 43(a) of the Lanham Act and the FDCA overlap in that each applies to the label of respondent’s juice, each can be given effect, except where the Lanham Act would undo what Congress or FDA specifically required or permitted under the FDCA.” Id. at 9. In the SG’s view, the 9th Circuit was wrong in concluding that the FDA’s authority to regulate juice labeling further precluded private enforcement based on that same juice labeling.

    On the question of whether the Court should take up the case, the SG’s office opined that cert. should be denied because, among other reasons, there was not a developed circuit split that warranted Court review. Id. at 19-21. That view is not good news for POM, as the Court follows the SG’s advice on cert. denials in the overwhelming majority of cases.

    Since November, both POM and Coca-Cola have filed supplemental briefs characterizing the import of the SG’s brief. POM’s December 10 supplemental brief focused on the SG’s opinion that the 9th Circuit decision was wrong. Coca-Cola’s December 17 supplemental brief focused on the SG’s view that cert. should be denied.

    If the Supreme Court grants cert and takes up the case, the Court would provide its own guidance on the interplay between the FDC Act and the Lanham Act. If the Court denies cert., we expect that we’ll see parties in Lanham Act cases citing the SG’s position and arguing about whether an act or omission allegedly actionable under the Lanham Act was specifically required or permitted by Congress or the under the FDC Act. The SG’s brief suggests that such analysis may very well be different based on the particular facts and circumstances of the regulatory scheme. In minimizing any alleged split in the circuit courts, the SG’s brief noted that cases concerning animal drugs, OTC drugs, and brand name prescription drugs, “each of which is distinguishable because (among other things) each concerned the preclusive effect of provisions of the FDCA that apply to a product other than food.” Id. at 9.

    In any case we’ll be watching to see what the Supreme Court does and how the SG’s brief influences future Lanham Act cases.