On January 6, 2014, the U.S. Food and Drug Administration (FDA) refused the request of three federal judges to clarify whether food with bioengineered ingredients may be labeled “Natural,” “All Natural” or “100% Natural.”
Over the past few years, numerous consumer class actions have been filed against food and beverage manufacturers and retailers regarding alleged misbranding and false advertising concerning “All Natural” claims. Many of these cases are brought under unfair competition and false advertising laws, alleging that a company engaged in deceptive advertising by labeling is products as “Natural,” “All Natural,” or “100% Natural.”
Courts have reached varying results in adjudicating these claims, based largely on the fact that the FDA—the entity responsible for ensuring that food labels are neither false nor misleading—has not issued a regulation defining the term “Natural.” At present, the FDA has issued nonbinding industry guidance that for a product to be considered natural, “nothing artificial or synthetic (including all color additives regardless of source) has been included in, or has been added to, a food that would not normally be expected to be in the food.” 58 Fed. Reg. 2,302 at 2,407 (Jan. 6, 1993).
Recognizing the lack of clarity on this topic, the courts in Cox v. Gruma Corp., No. 12-06502 (N.D. Cal.); Barnes v. Campbell Soup Co., No. 12-05185 (N.D. Cal.) and In re General Mills, Inc. Kix Cereal Litigation, No. 12-00249 (D.N.J.)—referred the issue of whether foods containing bioengineered ingredients may be labeled as “Natural,” “All Natural” or “100% Natural” to the FDA.
In Cox, plaintiffs alleged that that because Gruma Corp.’s food products contain corn grown from bioengineered seeds, Gruma’s “All Natural” labels are false and misleading. Likewise, in Barnes, plaintiff alleged that Campbell deceptively advertises and labels some of its soups as “100% Natural” even though they contain genetically modified organisms like soy, corn, and derivatives of the same. Finally, in Kix Cereal, plaintiffs alleged that General Mills misleads consumers by labeling its Kix® cereals with bioengineered corn as “made with all natural corn.”
Citing primary jurisdiction grounds, the Cox and Barnes courts stayed these cases for six months to enable the FDA to determine whether food products with ingredients grown from bioengineered seeds can be labeled “All Natural.” Finding that “deference to the FDA’s regulatory authority [was] the appropriate course of action,” the courts referred the issue to the FDA in order to avoid “undermining, through private litigation, the FDA’s considered judgments.” The court in Kix Cereal reached the same conclusion, stating that “the issue of whether products may be labeled ‘Natural’ when they are made with bioengineered forms of corn falls within the expertise of the FDA.” The court administratively terminated the action until the FDA responded to the pending referrals.
In its letter response, the FDA declined “to make a determination at this time regarding whether and under what circumstances food products containing ingredients produced using genetically engineered ingredients may or may not be labeled ‘natural.’” As a preliminary matter, the FDA acknowledged that it has yet to promulgate a “formal definition of the term ‘natural’ with respect to foods.” Nonetheless, the FDA cited a number of concerns that led to their decision to decline defining this term. First, the FDA stated that any act to revoke, amend, or add to the FDA’s current non-binding industry guidance is not an appropriate course of action to take in the “context of litigation between private parties.” Instead, the more “prudent” course of action is to “engage the public on this issue” given the “complexities” of this issue. According to the FDA, such an inquiry would include a consideration of (i) relevant science; (ii) consumer preferences; (iii) perceptions; (iv) beliefs; (v) food production technologies; (vi) food processing methods; and (vii) “any strictures flowing from the First Amendment.” Second, the FDA noted that defining the term “Natural” necessarily implicates the “interests of other Federal agencies other than FDA, including the United States Department of Agriculture” and that both agencies have made efforts to jointly consider the issue. Finally, the FDA cited the “limited resources that FDA has to address food matters” in light of other priorities (e.g., implementation of the FDA Food Safety Modernization Act of 2011, issuing nutrition labeling regulations, other actions with direct public health impact) that the FDA will address first.
The FDA’s failure to define “Natural” leaves food and beverage manufacturers with little to no guidance in terms of what labeling or advertising will or will not subject them to costly consumer class actions.