The dietary supplement industry is trying to tip the scales in its favor with “Ozempic dupes.” While weight loss solutions are not new to the market, they have taken on a new flavor in this Ozempic era. Dietary supplement advertisers have started using the term “GLP-1” on products that do not contain GLP-1, or any hormone that mimics GLP-1. Many dupes are also being marketed as “side-effect free” or even “natural” alternatives to GLP-1 injections. These supplements purport to boost or support natural production of GLP-1 without a drug.

Enter Kourtney Kardashian Barker’s “Lemme GLP-1 Daily.” This supplement is marketed to promote GLP-1 production, reduce hunger and cravings, and support fat reduction. Despite its name, the supplement does not contain a synthetic GLP-1 hormone and does not behave as a GLP-1 receptor agonist (like Ozempic or Wegovy). Lemme instead points to clinical studies on its ingredients—including nutraceutical eriocitrin (Eriomin), plant and fruit extracts—in support of its claims.

Given the magnitude, dietary supplement companies must carefully navigate regulations when making weight loss claims and positioning themselves as alternatives to drugs. As a threshold matter, advertisers cannot tout weight loss without competent and reliable scientific evidence. Advertisers who can adequately substantiate claims for their weight loss supplements may wonder how they can reference popular GLP-1 injections while keeping their claims competitive.

As the market for “nature’s Ozempic” continues to grow, we expect advertisers to push boundaries, and we are watching regulators closely. In the meantime, we have some calorie-free food for thought:

• Avoid unsubstantiated weight loss claims at all costs.
• GLP-1 injections are a fierce competitor, but stay in your lane. Avoid taking your marketing to the extreme to pack a punch. Do not imply that taking your supplement alone, without diet and exercise, will result in significant weight loss.
• Consider the substantiation you have in support of your claims. Weight loss claims require competent and reliable scientific evidence in the form of randomized controlled trials in humans that show statistically significant results that are meaningful to consumers. The results should be reproducible. Don’t stretch the truth—making extreme weight loss claims without adequate support is bound to raise some eyebrows.
• Testing on only one key ingredient alone may not be enough to adequately support your claims. Typically, if you have clinical testing on only individual ingredients in your product and you have not tested the whole formula, your claims must be appropriately limited to avoid conveying the misleading impression that the product as a whole was clinically studied to confer the touted benefit.

The bill, as written, has no shortage of broad and undefined terms. To determine whether advertising directed at children is false or misleading, the bill, among other changes, amends New York’s general false advertising statute, New York General Business Law § 350 (“NY GBL § 350”), to require courts to consider the following factors:

• Whether the advertising “targets a consumer who is reasonably unable to protect their interests because of their age, physical infirmity, ignorance, illiteracy, inability to understand the language of an agreement, or similar factor.” Here, “‘consumer’ is defined as a person who is targeted by an advertisement, or those acting on such a person’s behalf.”
• Whether the advertising constitutes “an unfair act, practice or conduct.”
• “An act, practice, or conduct” is considered “unfair” to a consumer where it: “(a) causes or is likely to cause substantial injury to such consumer; (b) cannot be reasonably avoided by such consumer; and (c) is not outweighed by countervailing benefits to such consumer or to competition.”
• Courts must give special consideration to advertisements “concerning a food or food product” directed at children. In determining “whether any advertising concerning a food or food product is false or misleading,” courts must also consider factors including—but not limited to—the following: “(a) subject matter; (b) visual content; (c) use of animated characters or child-oriented activities and incentives; (d) music or other audio content; (e) age of models; (f) presence of child celebrities or celebrities who appeal to children; (g) language; (h) competent and reliable empirical evidence regarding audience composition and evidence regarding the intended audience; (i) physical location of advertisement, including, but not limited to, proximity to schools or other institutions frequented by children; (j) medium by which the advertisement is communicated, including, but not limited to, social media; or (k) other similar factors.”

The bill fails to define several key terms, including “unhealthy foods,” and “ignorance,” to name just a few. Further, the bill directs that courts consider not only whether advertising is directed to children, but also whether advertisements target persons unable to protect their interests due to “illiteracy” or “ignorance.” The bill would also provide a private right of action for consumers “targeted by an advertisement, or those acting on such a person's behalf.”

Although subject to constitutional challenges similar to those filed relative to NY’s soon-to-be-effective dietary supplement age restrictions, if passed, this amended version of NY GBL §350 would further open the litigation floodgates against food and beverage companies. Impacted stakeholders should consider advocacy strategies individually or via trade associations to ensure that their viewpoints are considered at the legislative level.

Regarding product and facility registration and listing, in question-and-answer format, the draft guidance addresses a range of topics, including:

• Definitions
• Who registers and submits product listings
• What information is submitted to register and list
• Will the information submitted be public
• How and when stakeholders register and list
• Treatment of cosmetic products that are also drugs
• Fees

The draft guidance is open for comment until September 7^th. Previous voluntary facility registrations will not be considered adequate to comply with the mandatory registration and listing requirement. FDA expects to have an electronic portal available in October 2023 along with a paper registration option.

Other December 2023 Deadlines

Stakeholders will recall that several provisions in MoCRA have one-year deadlines, making December 29, 2023 a key date. In addition to establishment registration and product listing (§607), these include:

• Adverse event recordkeeping and reporting (§605) – Every responsible person must maintain records of all adverse events associated with any of its cosmetic products for six years. Serious adverse event reports must be submitted to FDA (along with retail packaging of the product at-issue) within 15 business days after receipt of same.
• Safety substantiation (§608) – Responsible persons must ensure, and maintain documentation of, “adequate substantiation of safety” for each cosmetic product it distributes/manufactures.

Additional information regarding MoCRA’s requirements is available here.

In a recent proposed class action, Brendan Abbott alleged that Golden Grain Co. misled customers into thinking they were getting more of the manufacturer’s rice pilaf mixture than the box actually contained, and that Abbot was “disappointed” when he opened the box and found it was no more than one-third full. The Eastern District of Missouri dismissed Abbott’s claims with prejudice, finding that Abbott got exactly what he bargained for: “Golden Grain’s boxes say that they contain 6.09 ounces of rice pilaf, and Abbott does not allege that they contain, or that he received, anything less than 6.09 ounces of rice pilaf.”

Notably, the Court held that Abbott’s “subjective, package-disclosure-defying expectations” of the box’s contents would not be shared by other reasonable consumers, something that Abbot was required to allege pursuant to recent amendments to the Missouri Merchandising Practice Act. Rather, the Court ruled that reasonable consumers would understand that the box contained 6.09 ounces of rice pilaf simply by “reading the package.” Indeed, not only did the package accurately disclose its weight and specifically advise consumers that the product was sold by weight and not by volume, Golden Grain went so far as to include a “fill line” on the side of the box, demonstrating exactly how much grain was in the package. Under these circumstances, the Court found that “[w]hether his disappointment was feigned for the purpose of propagating litigation or real, Abbott got what he bargained for and fail[ed] to plausibly allege an ascertainable loss.”

Abbott’s reference to FDA nonfunctional slack fill regulations (a common practice in class action complaints these days) was similarly unpersuasive because the complaint did “not explain how FDA regulations can set the standard for what a state legislature deems misleading, and necessary to state a cause of action, under a state consumer-protection law.”

This case serves as a noteworthy example of judges’ growing frustration with class actions premised on irrational and unreasonable interpretations of product labels and packages. In this instance, a single grain of rice pilaf (or rather, 6.09 ounces thereof) was just enough to tip the scales of justice.

enforcement policy regarding major food allergen labeling and cross-contact prevention. The updated guidance reflects the addition of sesame as a major allergen, discusses how allergens must be disclosed when used as an ingredient in packaged food, and details the preventive controls provisions in 21 CFR § 117 applicable to preventing allergen cross contact. The updated guidance also details the circumstances in which failure to properly declare allergens or prevent cross-contact render a food misbranded or adulterated. Stakeholders have until July 17^th to submit comments.

Although not included in the guidance, FDA’s press release also makes clear the agency’s position regarding recent industry trends of adding sesame to products and declaring it as an allergen rather than taking steps to remove it from products and facilities. The press release states:

The FDA is aware that some manufacturers are intentionally adding sesame to products that previously did not contain sesame and are labeling the products to indicate its presence. While the draft CPG does not specifically address the issue of industry adding sesame to products that did not previously contain it, the draft CPG does address the FDA’s enforcement policy for labeling and cross-contact controls for major food allergens, including sesame. The FDA is engaged with various stakeholders on this issue. The FDA recognizes that this practice may make it more difficult for sesame-allergic consumers to find foods that are safe for them to consume-an outcome that the FDA does not support. (emphasis added)

So, what’s the takeaway? Although the draft guidance is intended as direction to FDA staff, it also provides helpful clues for industry. The updated guidance is far more detailed than the prior version, reflecting a heightened concern about food allergens and, likely, increased enforcement focus.

To prepare for their next FDA facility inspection, packaged food manufacturers should review labels to ensure that ingredient lists are up to date and allergens are declared as required. In addition, reviewing and updating cross-contact prevention controls, employee training, and recall policies will help the next facility inspection go as well as possible.

For food retailers such as supermarkets and restaurants, although local health authorities are the primary inspectors, the updated guidance also serves as a helpful guide for preparation, particularly in light of the allergen updates to the Model Food Code, which articulate best practices for retail food safety.

State AGs began a multistate investigation after the Federal Drug Administration (FDA) warned the company about marketing its online vision tests without appropriate approval. The State AGs claim that their investigation revealed that Visibly deceived consumers, including by: (1) marketing and selling a device without the required clearance or approval from the FDA; (2) marketing unsubstantiated safety and effectiveness claims about its online vision test; and (3) falsely claiming to offer a 100% satisfaction or money back guarantee. Note that while the State AGs’ investigation was pending, Visibly began the process of seeking FDA approval, but they did not have this prior to the investigation.

To resolve these allegations, Visibly agreed to pay $500,000 combined to the participating states. Visibly must among other requirements do the following:

• Comply with consumer protection statutes, the Federal Food, Drug, & Cosmetics Act (FDCA), and FDA authority;
• Align all representations that its products can diagnose, cure, mitigate, treat, or prevent any disease or condition with the FDCA and FDA authority;
• Possess competent and reliable scientific evidence substantiating any claims that its products are comparable to the safety and effectiveness of products offered by doctors’ offices or other FDA approved devices;
• Clearly and conspicuously disclose any terms or conditions for eligibility for a satisfaction guarantee, money back guarantee or other offer of refund to consumers;
• Ensure all optometrists and ophthalmologists who contract with the company are in good standing with applicable states;
• Clearly disclose that providers in any “find a doctor” feature do not endorse its products (unless specifically obtained), and agree to remove doctors upon their request; and
• Provide a disclosure that Visibly’s online vision test is not a substitute for an in-person comprehensive eye examination and urge consumers to seek such exams to determine overall eye health.

Takeaway: Claims on telehealth platforms attract enforcers’ attention due to the sensitive nature of the services and the relative novelty of the technology involved. From the FTC, to the FDA, to State AGs, governmental entities are interested not only in protecting the privacy of telehealth consumers (as shown in the BetterHelp settlement), but also the substantiation of advertising claims. Companies should:

• Substantiate telehealth-related claims.
• Clearly describe any relationships with providers, and ensure providers comply with state licensing laws.
• Make appropriate disclosures regarding limitations of products and services where a failure to disclose may materially affect a consumer’s decision.

“Clean at Sephora” Motion to Dismiss A Test for the Reasonable Consumer Standard

Clean claims on foods, supplements, OTC drugs and cosmetics have surged in popularity as have retailers’ efforts to curate product selections and ingredients to eliminate disfavored ingredients, such as synthetic dyes, preservatives, fragrances, parabens, phthalates, etc. “Clean” is not defined in regulations, which means that each brand or retailer must explain to shoppers how it’s defined within that brand. In fact, many popular lifestyle-related terms – vegetarian, vegan, keto, cruelty-free, etc. – also are not defined by regulation.

To the delight of advertising lawyers and the chagrin of marketers, the answer to the question of how to deal with potentially vague terms is through clear and conspicuous disclosures. It is just this scenario that is at issue in a pending false advertising lawsuit, Finster v. Sephora USA Inc.

On November 11, 2022, Lindsey Finster and a purported class of consumers filed a lawsuit against Sephora USA Inc. in the U.S. District Court for the Northern District of New York, alleging that Sephora’s “Clean” cosmetics—sold under its “Clean At Sephora” program—are deceptively advertised as “clean,” where the products “contain ingredients inconsistent with how consumers understand” the word “clean.” Finster alleges that consumers were therefore misled into believing that the products being sold were neither synthetic nor “connected to causing physical harm and irritation.” Plaintiffs allegedly purchased “Clean At Sephora” believing that the products were not harmful or synthetic. In support of her allegations, Finster lists several allegedly synthetic and potentially harmful ingredients in the products designated “Clean At Sephora.” As a result, Finster asserts claims for violations of state consumer fraud acts, deceptive acts and unlawful practices pursuant to NY GBL §§ 349, 350, fraud, unjust enrichment, breach of implied and express warranties, and violations of the Magnuson Moss Warranty Act.

On February 2, 2023, Sephora moved to dismiss these claims, claiming that Finster “transform[s] the phrase ‘Clean at Sephora’ into something completely different,” that is to say, “Natural at Sephora,” and ignores the fact that “Sephora prominently explains, in plain terms, exactly what it means by the phrase.” Given Sephora’s transparency as to what “Clean At Sephora” means, Sephora claims that consumers could not plausibly be confused by the phrase. Finster, according to Sephora, makes no allegations that Sephora’s “Clean At Sephora” definition “is not prominently displayed or is not, in any sense, being met.” Sephora goes on to defend that the “Clean At Sephora” seal means “formulated without parabens, sulfates SLS and SLES, phthalates, mineral oils, formaldehyde, and more,” and the label does not say that these “products contain only natural ingredients.”

We have no connection to this case but it’s one we’re watching closely, and here’s why: This case is a litmus test for the “reasonable consumer” standard. Based on the sample above, Sephora took reasonable steps to clearly and conspicuously disclose what “Clean at Sephora” means in close proximity to the claim. Sephora makes clear that “clean” is associated only with a list of excluded ingredients. It is not reasonable for consumers to assume that it means anything else. If the court finds that Sephora’s disclosure was not sufficient, the litigation risks could ripple across “clean” brands everywhere.

Further, given that “clean” is not defined in regulations, is used differently across brands and retailers, and is a term that is not specific to cosmetics or even consumer products, it seems a stretch to believe that any class of consumers could have a common understanding of “clean” sufficient to form a class. Finster may survive a motion to dismiss, but we’re holding out hope that Sephora comes out clean in the end.

NAD + FTC

Whitens…without the harm? NAD also reviewed the use of an undefined term – “harm” – in the context of teeth whitening products. P&G challenged Oral Essentials, Inc., (“OEI”) maker of Lumineux Whitening Strips relative to the following claim: Clinically proven to whiten as well as the leading brand…without the harm.

Setting aside the product efficacy review, NAD was concerned that “harm” conveys a safety-related message that P&G’s product could damage teeth. OEI’s declaration supported that tooth sensitivity and gum irritation are associated with peroxide bleach, as used in P&G’s product. However, because these symptoms are generally mild and self-resolving, and because the American Dental Association has determined that P&G’s Crest whitening strips are safe for consumer use, NAD determined that “without the harm” conveyed a safety message for which OEI did not provide substantiation.

Net Zero by 2040? Tell me how. NAD also doubled-down on parsing environmental claims to discern whether advertisers actually have plans to achieve their lofty environmental goals or whether these are merely lofty ESG-themed aspirations. JBS – the second-largest food company in the world – made several aspirational claims about its commitment “to be net zero by 2040” on its website, social media, newspapers, YouTube, and publicly accessible corporate reports. Those claims were challenged by the Institute for Agriculture & Trade Policy (“IATP”), who argued that the claims convey an unsupported message that “JBS has an operational plan in place to achieve its net zero goals and is implementing such a plan.” NAD acknowledged that JBS had made a “significant preliminary investment” toward reducing emissions, that it had “undertaken steps to begin learning” how to address the operational and scientific challenges it will face, and that these steps “may be helpful towards achieving net-zero by 2040.” Nevertheless, NAD found that these steps were not enough to “support the message conveyed by the claim.” NAD thinks the message is “that JBS has a plan it is implementing today to achieve net zero operational impact by 2040.” Check out our group’s full post here. Relatedly, as part of its Green Guides update, the FTC is conducting a public hearing regarding “recyclable” claims on May 23^rd.

Light Beer Should Taste Like Beer…And finally, NAD considered a Molson Coors ad in which athletes are celebrating the completion of a difficult workout by opening a can labeled “Extremely Light Beer” and pouring the liquid over their heads while an announcer says “Light beer shouldn’t taste like water. It should taste like beer.”

Anheuser-Busch filed a challenge using NAD’s Fast-Track SWIFT process, arguing that the videos falsely disparage Michelob Ultra and other light beers by claiming that consumers find them to taste like water. Molson Coors pointed out that no competitors were named and the tagline was simply “a subjective opinion about what beer should and should not taste like, which cannot be objectively proved or disproved.” In other words, mere puffery “because it is not sufficiently specific and material enough to create expectations in consumers.” But NAD didn’t agree. It deemed Coors’ claim measurable and objective and found it to be unsupported by evidence.

Really? Crack open a beverage of choice and check out our group’s concerns about what this says about the line between puffery and objectively provable claims here.

FDA + USDA

• USDA announced a final rule intended to strengthen enforcement on production, handling, and sale of organic agricultural products, which is effective March 20, 2023. As food producers and retailers know, “organic” production may involve multiple links in a supply chain. The new rule is intended to close gaps in prior regulations by requiring National Organic Program (“NOP”) import certificates for imported products, clarifying NOP’s oversight role, and reduce the types of entities that operate in the organic supply chain without USDA oversight. While the final rule focuses on supply chain and enforcement, labeling is also impacted. The final rule includes provisions intended to clarify calculation of organic content in a multi-ingredient product.
• FDA announced that the agency intends to exercise enforcement discretion for certain qualified health claims involving high flavanol cocoa and reduced risk of cardiovascular disease.
• FDA also released its “Labeling of Plant-Based Milk Alternatives and Voluntary Nutrient Statements” draft guidance. The draft guidance leans heavily on consumer understanding of plant-based products being different from dairy milk and allows for plant-based products to be labeled as “milk” and recommends that those plant-based products that feature “milk” in their names also include a voluntary nutritional comparison statement. The comment period is open until April 24, 2023.
• Related to the plant-based milk draft guidance, FDA also released its list of guidance topics it plans to issue in the upcoming year here.

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Check out all of our advertising, privacy, and consumer protection content here.

The Food Court – Vanilla Cases Melt Away But Other Ingredient Theories Rise

With courts expressing continued skepticism about vanilla bean false advertising theories, plaintiffs are targeting a slew of other ingredient-based false advertising angles. For example, in Patoni et al. v. Spindrift Beverage Co., the plaintiff claims that Spindrift’s “clean” branding and messaging trumpeting that the drinks contain only water and fruit are false and misleading because the products also contain citric acid, which is plainly disclosed on the ingredient declaration. Because many courts do not expect consumers to look beyond a product’s front panel to read ingredient declarations, those three words – yup, that’s it – which are pervasive in Spindrift’s branding, are likely to be highly significant because they expressly tell the consumer that there is nothing else in the products.

Where consumers are basing their lawsuits on assumptions rather than express claims, courts are more likely to view them as… half-baked. An Illinois court dismissed a claim that Bimbo Bakery’s brown bread was falsely advertised because the bread's dark color, visible flecks of grain and "brown bread" name caused consumers to believe it has a higher grain content, when it is actually made with enriched flour and has only 4% of the daily fiber value. The court found that the plaintiff’s assumptions about the bread content were unreasonable. Even if the bread’s color and obvious presence of grain suggested that the product had whole grains, it was no guarantee of the product’s precise grain content. The court stated: No reasonable consumer could conclude what percentage of whole wheat the bread contains merely by these toppings.

What’s the lesson: Lawsuits based on consumer assumptions about what is in a product may lean in favor of a motion to dismiss; however, where the seller has expressly limited consumer understanding with front panel language, courts may be unlikely to find that a reasonable consumer should look any further. Yup, that’s it.

State AG – GrubHub Deceptive Fee Settlement Sets Standards for Price Disclosures

Wait….how much was that takeout? If you, too, questioned how hungry you really were when you saw the final cost of a takeout order on one of the popular delivery apps, you’re not alone. While food prices generally have increased, regulators have also been concerned about whether platforms are adequately disclosing fees tacked on to the orders.

The DC Attorney General announced a $3.5 Million settlement with GrubHub relating to the platform’s alleged use of false and misleading marketing tactics and deceptive fees. In addition to monetary relief, the settlement requires GrubHub to make the following changes:

• Prominently disclose to consumers when it presents search results that additional fees may apply at checkout;
• List the name and amount of each fee as a separate line item at checkout;
• Stop its practice of combining taxes and fees into one line item;
• Stop advertising that Grubhub+ subscribers receive “free delivery” and instead specify that the $0 delivery fee only applies to eligible orders and that other fees may apply;
• Stop charging menu prices higher than those available at the restaurant itself unless it clearly discloses, both on the menu and at checkout, that prices may be higher on Grubhub; and
• Shut down all microsites for restaurants located in the District or transfer ownership to the restaurant.

These injunctive measures are intended to set best practices for pricing disclosures and follows similar suits against DoorDash and Instacart. Check out our related posts on “dark patterns” here and State AG insights here to get up to speed on the latest enforcement priorities.

National Advertising Division – Medical Marketing 101 and More Green Claims

NAD parsed Novartis’s advertising for breast cancer drug, Kisqali. As NAD followers know, it’s unusual to see challenges involving prescription drugs. However, the challenge involved questions that aren’t unusual for those who regularly review medical marketing materials: which claims are appropriate for health care professionals (HCPs) and which claims are appropriate for consumers.

As the decision notes, NAD has long recognized that health care providers and specialists are a sophisticated audience and are better equipped to decipher the advertised results of clinical data than the general consumer, especially when provided with appropriate context and detail. In this instance, NAD concluded that clinical experience and the context provided in the advertiser’s HCP-directed brochures would both inform the physician’s takeaway of the claim and limit it to the recited facts, and that this audience would interpret the challenged comparative claim narrowly.

However, NAD did not think that consumers would have the necessary experience and context to understand similar claims relating to Kisqali’s effectiveness and could reasonably understand messages that were not supported.

So what do we do with this? The lesson here is that advertisers can and should take into account the intended audience when determining the suitability of marketing claims. A more sophisticated audience can be expected to understand more complex claims than the general public.

Green, green, it’s green they say….Also, not to be missed, NAD notched another “green claims” challenge by issuing a decision involving Dyper, a diaper and baby wipes manufacturer. Dyper agreed to discontinue 15 different comparative and environmental claims, which NAD did not review on the merits. However, NAD found that Dyper provided a reasonable basis for claims that certain components of its bamboo viscose diapers are biodegradable but recommended that the claim be qualified to make clear the circumstances in which the diaper components would actually degrade, specifically when disposed of via the REDYPER service or a composting facility. This follows a decision in December 2022 in which NAD took a strict view of recycling claims made by the American Beverage Association. For more on recent green claims lawsuits and FTC updates to the Green Guides check out our coverage here.

FDA Still Doesn’t Think CBD Is A Dietary Supplement + Model Food Code Changes Regarding Allergens

Although the Wall Street Journal stoked momentary optimism that FDA would release a framework for how CBD could be governed, no one who has watched this space for very long was truly surprised when the agency instead said that existing regulatory frameworks are not appropriate for the sale of CBD as a food or a supplement. FDA pledged to work with Congress to find a new path forward. Expect industry to finally address this regulatory uncertainty in the next iteration of the 2023 Farm Bill.

FDA also released an updated version of the Model Food Code, which is a set of food safety best practices for food retailers and restaurants. A detailed summary of the changes versus the 2017 version is here. The changes that stood out most to us were those related to allergen disclosures and training. Specifically, the updated Model Food Code calls for employee training on elements associated with food allergy awareness and what topics food establishments can consider including when developing operational- specific allergen training programs for employees. In addition, the updated Code adds sesame as the ninth major food allergen (consistent with changes to federal law) and calls for express allergen disclosures relative to consumer-dispensed foods and unpackaged foods.

FTC – Updated Health Claims Guidance Seeks To Impose Inflexible Substantiation Standards

Misguided: Just as December wound down, the FTC’s Bureau of Consumer Protection released its Health Products Compliance Guidance—a sweeping overhaul of the 1998 Guidance, Dietary Supplements: An Advertising Guide for Industry. Unlike the recently announced effort to review its Green Guides, the FTC did not seek public comment.

According to an FTC blog post that accompanied its release, the new Guidance purports to “correct misunderstandings” and “urban myths” that have circulated about FTC substantiation standards. In actuality, however, the new Guidance represents a recitation of some of the positions the agency has taken in health-related enforcement matters over the last decade, continuing a stark departure from the prior “flexible” approach to substantiation set forth in the 1998 Guidance. Check out our blog post here.

Check out our regular coverage of all things advertising, privacy, and consumer protection on our Ad Law Access blog.

On October 6, 2022, Sean Burke and a purported class of consumers filed a lawsuit against Tribucha, Inc. in the U.S. District Court for the Eastern District of North Carolina, alleging that Tribucha Kombucha (“Tribucha”) was deceptively advertised as non-alcoholic because it contained more than 0.5% alcohol by volume and failed to comply with labeling requirements for alcoholic beverages.

Plaintiffs allegedly purchased Tribucha at local retailers in their respective states, “with the belief and on the basis that” Tribucha was not alcoholic, based on label statements, store placement, and other factors. Based on lab tests allegedly showing that the Tribucha beverages contained more than 0.5% alcohol by volume, plaintiffs assert claims for violations of state consumer fraud acts, breach of implied and express warranties, fraud, unjust enrichment, and violations of federal and state labeling laws.

Why does this matter?

Regardless of whatever merit there may or may not be to the allegations, the Burke case illustrates how tricky the jurisdictional lines and labeling requirements for low and no-alcohol products can be and how important it is that manufacturers understand compliance before bringing a product to market. Here are some guidelines and resources for navigating this space:

• Kombucha that is at or above 0.5% alcohol by volume at any time is subject to TTB regulation. By contrast, kombucha that is never at or above 0.5% alcohol by volume is subject to FDA’s regulations, but not TTB. State and local requirements may also apply.
• TTB regulates wine with 7% or more alcohol by volume, malt beverages, sake, and spirits. State and local requirements may also apply.
• FDA regulates a range of de-alcoholized wine and wine with less than 7% alcohol by volume along with certain beers. This is why many new entrants to the low and no-alcohol category feature nutrition facts panels and other familiar food labeling elements, along with disclosures regarding alcohol content and a surgeon general’s warning. And, of course, state and local rules may also apply.

* * * *

More specifically, the agencies’ goals related to reducing occurrence of foodborne illness are as follows:

• Increase uniformity, consistency, and capacity of state, tribal, local, and territorial (STLT) retail food protection programs;
• Promote industry’s active managerial control (AMC) of foodborne illness risk factors and promote a culture of food safety; and
• Maintain a strong FDA National Retail Food Team (NRFT) and CDC National Center for Environmental Health (NCEH) workforce to assist STLT partners.

• Improve STLT’s effectiveness in conducting risk-based inspections and foodborne illness investigations.
• Promote a culture of food safety and food safety management systems within retail and foodservice establishments (including facilities that serve highly susceptible populations (HSP) such as institutional foodservice, correctional facilities, schools, and healthcare facilities).
• Improve research in support of foodborne illness risk factor reduction.
• Improve the knowledge, skills, and abilities of FDA NRFT and CDC NCEH staff.

What Is Changing?

The proposed rule attempts to harmonize the definition of “healthy” with the current recommendations published in the Dietary Guidelines for Americans 2020-2025. Accordingly, the proposed “healthy” definition uses a food group-based approach in addition to nutrients to limit (based on the understanding that each food group contributes an array of important nutrients to the diet), which has changed since 1994, when the current definition of “healthy” was promulgated. The proposed rule would also require a food to contain a certain amount from at least one of the food groups or subgroups (vegetables, fruits, grains, dairy, and protein foods) recommended by the Dietary Guidelines in order to use the “Healthy” claim, e.g., there must be at least ½ cup of fruits or vegetables, 3/4 cup of dairy, a range of 1-1 and 1/2 ounces of protein depending on the type, or no less than 3/4 ounce whole grain. Additionally, the new rule discards certain nutrient requirement provisions as no longer relevant while prescribing limits on three specific nutrients – sodium, saturated fat, and added sugar. Required amounts and limits are all adjusted for each specific food group, as well as the type of item (a mixed product, a main dish, a meal) in question. Finally, the proposed rule creates a group of foods, including raw and whole fruits and vegetables, and water, that will be automatically considered “healthy” and can use the claim without being subject to requirements for food group equivalent amounts or the nutrients to limit.

How Does The Proposed Rule Compare To The New Rule?

The current definition of “healthy” includes limits for total fat, saturated fat, cholesterol and sodium to qualify; foods must also provide at least 10% of the Daily Value for one or more of the following nutrients: vitamin A, vitamin C, calcium, iron, protein, and fiber. Sugar (added or naturally-occurring) is not addressed.

The proposed definition requires the following: a food must contain a certain amount of food from at least one of the food groups (fruit, vegetables, grains, dairy, and protein foods, oils, mixed products, main dish, and meals); specific limits for added sugars, saturated fat, and sodium is based on a percentage of the Daily Value for these nutrients; raw and whole fruits and vegetables automatically qualify for the “healthy” claim. These requirements and limitations are illustrated in the charts below.

Rule: A food must contain the “food group equivalent” (the minimum amount) of a food group for it to bear the “healthy” implied nutrient content claim.
Food Group	Food Group Equivalent	Examples
Vegetable	1/2 cup equivalent vegetable	1/2 cup cooked green beans; 1/2 cup raw spinach
Fruit	1/2 cup equivalent fruit	1/2 cup strawberries; 1/2 cup 100% orange juice; 1/4 cup raisins
Grains	No less than 3/4 ounce equivalent whole grain	1 slice of bread; 1/2 cup cooked brown rice
Dairy	3/4 cup equivalent dairy	6 ounces fat free yogurt; 1 1/8 ounce nonfat cheese
Protein Foods	1 1/2 ounce equivalent game meat; 1 ounce equivalent seafood; 1 ounce equivalent egg; 1 ounce equivalent beans, peas, or soy products; 1 ounce equivalent nuts and seeds	1 1/2 ounce venison; 1 ounce tuna; 1 large egg; 1/4 cup black beans; 1/2 ounce walnuts

Rule: An individual food may use the term “healthy” as an implied nutrient content claim on the label if it is a raw, whole fruit or vegetable or meets the following conditions per reference amount customarily consumed per eating occasion.
If the food is . . .		It must contain at least . . .	The added sugars content must be no greater than . . .	The sodium content must be no greater than . . .	The saturated fat content must be no greater than . . .
A vegetable product		1/2 cup equivalent vegetable	0% DV	10% DV	5% DV
A fruit product		1/2 cup equivalent fruit	0% DV	10% DV	5% DV
A grain product		No less than 3/4 ounce equivalent whole grain	5% DV	10% DV	5% DV
A dairy product		3/4 cup equivalent dairy	5% DV	10% DV	10% DV
Protein Foods	Game meats	1 1/2 ounce equivalent	0% DV	10% DV	10% DV
	Seafood	1 ounce equivalent	0% DV	10% DV	10% DV
	Egg	1 ounce equivalent	0% DV	10% DV	10% DV
	Beans, peas, and soy products	1 ounce equivalent	0% DV	10% DV	5% DV
	Nuts and seeds	1 ounce equivalent	0% DV	10% DV	5% DV, excluding saturated fat derived from nuts and seeds
Oils	100% Oil		0% DV	0% DV	20% of total fat
	Oil-based spreads whose fats come solely from oil		0% DV	5% DV	20% of total fat
	Oil-based dressing containing at least 30% oil and oils meet the requirements in paragraph (d)(3)(ii)(F)(1) of this section		2% DV	5% DV	20% of total fat

How Will the Proposed Rule Affect Labels?

Although FDA must finalize the notice and comment process, industry now has the agency’s current thinking regarding what will be required. Given the investment required to modify product labels, and the potential for false advertising litigation associated with labeling compliance in recent years, companies will want to consider whether a “healthy” claim remains an option or whether they want to pivot to a claim that is not limited by a strict regulatory definition. Either way, manufacturers will want to be mindful of the “net impression” of the label and consider not just technical label compliance, but how the watchful eye of the plaintiff’s bar may interpret the claims as well.

Opportunity To Comment

Once the proposed rule is published in the Federal Register, the FDA will consider comments submitted within the following 90-days. Specifically, the FDA has requested comment on: Whether “nutrients-to-encourage” should be included in addition to the food groups; Whether the use of food groups would better help consumers identify foods with healthy nutrient content rather than a limited set of individual nutrients; Whether their calculations for required amounts is appropriate; The scope of nutritional context and information the rule should apply to; Whether the rule should include the addition of the automatically healthy category; Whether the various ceilings for limited nutrients are correct; What types of records should be kept; and Whether or not water should be included as automatically “Healthy.”

NAD

Best in Show NAD evaluated whether flea and tick medications were fairly compared via a television advertisement reminiscent of the beloved film Best in Show. The challenged ad featured a comparison of NexGard and Bravecto in a dog show setting. The host announces: “Welcome. It’s time to see which chew is best in show for long-lasting flea and tick protection.” As shown below, a disclosure appears on the bottom the screen stating “BRAVECTO Chews for Dogs kills fleas, prevents flea infestations, and kills ticks (black-legged tick, American dog tick, and brown dog tick) for 12 weeks. BRAVECTO Chews also kills lone star ticks for 8 weeks. NexGard is approved for 30 days.” By week 12, the host declares Bravecto the “clear winner”.

NAD determined that, viewing the commercial in its entirety, the commercial blends duration of action claims with a comparative superiority message and that one reasonable interpretation of the commercial is that Bravecto is superior to NexGard in protecting dogs from flea infestations. Further, NAD determined that the presentation and plain language of the disclosure were inadequate to explain that dosing intervals were the basis for the product comparison, not overall efficacy. NAD recommended discontinuing the advertisement. Merck is appealing to the NARB. For more on this “apples to oranges” comparison and, better yet, a picture of cute dogs, check out Gonzalo Mon’s blog post and podcast episode here.

Not #1 NAD reviewed baby wipes testing to determine whether Water Wipes could substantiate claims that its wipes were the “#1 wipe against the causes of diaper rash” and a similar “clinically proven” claim. As support for its claims, the advertiser relied on the results of its “Baby Skin Integrity Comparison Survey” (BaSICS Study), involving home use tests of three baby wipe brands on infants from birth to eight weeks old. NAD identified several concerns about the design of the BaSICS Study, including:

• The study universe was too narrow to support the broad #1 claims;
• The study’s failure to attempt to control for the use of skin creams and lotions to treat infants with diaper rash, which could significantly impact the role of the wipes in preventing diaper rash; and
• The study did not attempt to blind the branding and marketing on the packaging itself, which could have biased the survey participants’ responses.

Delivering Social Justice? NAD initiated a challenge against app-based delivery service DoorDash relating to the following claim: “We are donating $1 million, with $500,000 going to Black Lives Matter and $500,000 to create a fund to be directed by the Black@DoorDash ERG (Employee Resource Group) towards state and local organizations.” In response to the inquiry, DoorDash provided documentation that substantiated donations exceeding $1 Million to various state and local organizations pursuant to its Black@DoorDash ERG. NAD determined that the documentation adequately substantiated the claim.

These kinds of campaigns, frequently called commercial co-ventures, are subject to various state registration and bonding requirements in addition to advertising laws. For more resources on these campaigns, check out our commercial co-ventures resources.

Sign of the Times And finally, if your tastes tend more toward preparing for the end of days, check out NAD’s decision regarding advertising for survival food kits. In a challenge that explores a range of advertising issues, one among them is whether the name of the meal kit – “3-Month Survival Food Kit” or “1-Year Survival Food Kit” conveys any messages about serving size, caloric content, or adverse effects of consuming the food for the stated period. NAD determined that no implied claims were conveyed by the names alone but suggested that the advertiser modify disclosures regarding the number of calories offered in each kit to ensure that they are clear and conspicuous.

This decision stands in contrast to FTC’s Dietary Supplements: An Advertising Guide for Industry, which explains that product names can convey claims. See the Identifying Express and Implied Claims section here.

FDA + USDA

Updated Voluntary Recalls Guidance FDA published Initiation of Voluntary Recalls under 21 CFR Part 7, Subpart C, which is an update to draft guidance issued in April 2019. The guidance describes steps that all FDA-regulated firms should take to prepare for recalls, including identifying appropriate personnel and training them on their responsibilities, identifying reporting requirements, use of adequate coding, and maintaining records. In addition, the guidance discusses procedures relating to initiating and executing a recall and how FDA works with recalling firms. Comments may be submitted here.

PFAS FDA issued new test results regarding PFAS levels in a range of foods and shared an update on the voluntary market phase-out of certain short-chain PFAS used in food packaging. From the agency’s summary: Results from the FDA’s most recent survey of the general food supply show that 89 of 92 food samples had no detectable levels of PFAS. Three seafood samples—tilapia, cod, and shrimp—had detectable levels of PFAS. The food samples analyzed were collected for the FY2021 regional collection of the Total Diet Study (TDS) and are the fifth set of general food supply testing done by the FDA. To date, there have been 10 samples with detectable PFAS out of 532 TDS samples the FDA has tested since 2019. Based on the best available current science, the FDA has no scientific evidence that the levels of PFAS found in the TDS samples tested to date indicate a need to avoid any particular food.

• Alleged presence of PFAS in non-food products is being used as the basis for false advertising lawsuits involving a range of cosmetics and even underwear. Check out this link for a few recent examples. Companies seeking to evaluate risk around PFAS should look carefully at ingredients and warning language to determine whether disclosures are adequate.
• On a related note, our friends at Kelley Green Law Blog wrote about EPA’s recent release of PFAS data and plans to eliminate a de minimis exemption for PFAS here.
• In addition, Washington state is considering legislation to ban PFAS and other chemicals from cosmetics and personal care products. SB 5703, the Toxic-Free Cosmetics Act, would ban PFAS, phthalates, and formaldehyde, among other chemicals. If enacted, the new law would become effective in 2025.

Climate Smarts USDA announced details of the Partnerships for Climate-Smart Commodities opportunity on February 7, 2022. Through this new program, USDA will finance partnerships to support the production and marketing of climate-smart commodities via a set of pilot projects lasting one to five years. Pilots will provide technical and financial assistance to producers who implement climate-smart practices on a voluntary basis on working lands; pilot innovative and cost-effective methods for quantification, monitoring, reporting and verification of greenhouse gas benefits; and market the resulting climate-smart commodities.

• As we wrote about last month, climate-beneficial claims are getting an are likely to continue to get a significant amount of attention from consumers, regulators, and the plaintiffs’ bar.

Looking to Make Money? Whether it’s food or package delivery, sale of cosmetics or dietary supplements, or another interest-earning venture, the FTC is concerned about potentially deceptive earnings claims. To that end, the FTC released an Advanced Notice of Proposed Rulemaking (ANPR) on earnings claims as it embarked on a mission to adopt a rule that would give the FTC, in its own words, “an important new tool to return money to consumers injured by deceptive income claims, and to hold bad actors accountable with civil penalties.” Importantly, the ANPR also suggests that the rule could do more than just change the FTC’s enforcement tools and also seek to substantively change the standard that has long been applied in analyzing earnings and lifestyle claims. Interested parties will have 60 days from publication in the Federal Register to submit comments and respond to the FTC’s questions and requests for evidence. Check out the full blog post and podcast from Donnelly McDowell and John Villafranco to learn more about past enforcement and where the agency is headed.

But Are You Who You Say You Are? The State AG’s joined the FTC in expressing concern about impersonation scams such as deceptive mail solicitations and phone calls that appear to come from government agencies. Our State AG team analyzes the multi-state efforts and what’s likely to happen here.

Class Action Update

The courts served up a bit of a mixed bag in February, deciding a number of dispositive motions in the voluminous “ingredient” class action docket.

Starting with the dismissals: A New York federal court dismissed a lawsuit alleging that Mars falsely advertised its vanilla ice cream bars as having “milk chocolate” coating when, in fact, the coating contained vegetable oils. The court ruled it was “nothing more than a conclusory leap” to allege that reasonable consumers read statements about milk chocolate “to implicitly mean that the product necessary contains no vegetable oils.” Additionally, two different judges in the Northern District of California dismissed cases filed against Kind, LLC and Kashi Co., alleging that various food products were miscalculating the products’ protein content in the Nutrition Facts panel. Applicable FDA regulations only require identification of the raw of number of grams of protein in a food product, and allow that calculation to be made using what is known as the “nitrogen” method. If a label makes a protein nutrient claim on the front of the package, however, the Nutrition Facts panel must also include a “% Daily Value” calculated using a different method, the Protein Digestibility Corrected Amino Acid Score (“PDCAAS”). The plaintiffs in both of these cases argued that if a protein nutrient claim is on the label, then both the raw protein content and the % Daily Value must be calculated using the PDCAAS method. The court disagreed, finding that such claims are preempted by the FDCA because they would impose labeling requirements that go beyond what the FDA regulations require.

Some courts took a different approach, denying motions to dismiss in several “ingredient” cases and sending them into discovery. For example, an Illinois court sustained a complaint alleging that a product labeled “smoked almonds” suggested that the nuts were actually roasted over an open fire, particularly because the product’s red packaging was “evocative of fire.” And in California, a judge allowed a “vanilla” yogurt class action to proceed despite three prior dismissals. The court previously ruled that dismissal of the California Unfair Competition Law (“UCL”) claim was appropriate because no reasonable consumer would conclude that the yogurt’s vanilla flavor was derived only from natural sources and therefore the plaintiff had failed to plausibly allege reliance as required by the UCL. The amended complaint, however, contained allegations that the yogurt violated various FDA regulations, which are incorporated into California state law through the state Sherman Food, Drug, and Cosmetic Law. Since the Sherman Act does not require reliance as measured by a reasonable consumer, nor should the plaintiffs’ UCL claim.

And some new filings: We saw a number of new food class action filings following the same trends we have been seeing in recent months including: (1) challenges to the use of “natural flavoring” in Poland’s sparkling water (N.D. Illinois); (2) alleged misrepresentation of cacao content in various Mondelez’s dark chocolate products; and (3) allegations relating to the amount of whole grains used in The Cheesecake’s Factory’s “brown bread” (N.D. Illinois). Infant formula and baby food products were also a target in February, with new actions filed against Abbott Laboratories alleging that various Similac infant formulas are causing infants to develop bacterial infections and gastrointestinal illness (N.D. Illinois and S.D. Florida), against CVS for allegedly misleading label similarities between its infant and toddler formula products (N.D. Illinois), and against Sprout Foods for suggesting its baby food products are healthier than its competitors’ products (N.D. California).

In the personal care, supplement, and drug space, new filings included: (1) multiple actions challenging “non-drowsy” claims for over-the-counter cough and flu medicine (C.D. California, S.D.N.Y., M.D. Florida, N.D. Illinois, and E.D. Michigan); and (2) a number of efficacy challenges including to claims that E.T. Browne Drug Co.’s “Tummy Butter” drastically reduces the appearance of stretch marks (Illinois state court) and Mommy’s Bliss’s gripe water reduces symptoms of colic in newborns (N.D. California).

Finally, the Tenth Circuit affirmed the dismissal of various challenges to pet food marketing claims in Renfro v. Champion Petfoods USA, Inc. Specifically, the court ruled that “Fresh” and “Regional” claims were subjective, and that the plaintiffs’ suggested meaning—that all ingredients were “fresh”—were belied by the rest of the products’ packaging. The court also found that Champion’s “Trusted Everywhere” claims were inactionable puffery. Finally, the court disagreed with the plaintiffs’ allegations relating to Champion’s “Biologically Appropriate” claims, finding that no reasonable consumer would interpret the claim to mean that the dog food mirrored the “richness, freshness, and variety” of a dog’s natural prey, and was “protein rich and carbohydrate limited.”

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Prop 65

Our friends at Kelley Green Law Blog get the starting position for this issue by highlighting a precipitous uptick in the number of Prop 65 filings over the prior year. While the Covid-19 pandemic caused all sorts of disruptions to society and the economy, at least one area of business has thrived over the last two years: private plaintiff enforcement of California Proposition 65. In 2020-2021, over 40% more Prop 65 actions were brought by private plaintiff “bounty hunters” than in the two years prior to the pandemic (2018-2019). Compared to a decade ago, private plaintiff groups now initiate three times more Prop 65 actions each year, and five times more than in 2008. Learn more here about the most frequently cited chemicals and those that are emerging, including PFAS.

Notable Dishes From the Food Court

The close of 2021 included two notable class action decisions for the food industry. In the first, Bolden v. Barilla America, Inc., the Northern District of Illinois denied a motion to dismiss various state law consumer fraud and express warranty claims alleging that Barilla deceptively labeled its pasta sauces as containing no preservatives, even though the products contain the known preservative citric acid. However, the court granted Barilla’s motion to dismiss the implied warranty claim for lack of privity, and as also dismissed the negligent misrepresentation claim because it was barred by the economic loss doctrine. The court also denied the plaintiffs’ request for injunctive relief, ruling that they could avoid Barilla’s allegedly deceptive products by purchasing other branded sauces.

In the second, Warren v. Whole Foods Market Group, Inc., the Eastern District of New York dismissed claims that Whole Foods Markets tricked consumers into believe its instant oatmeal product was sugar-free or low in sugar by using allegedly misleading phrases such as “dehydrated cane juice solids” and displaying picture of fresh raspberries on the label. The court found that, in the absence of any express claim that the product was sugar-free or low in sugar, consumers are “trained to look” to the ingredient list, which disclosed the use of dehydrated cane juice solids, and found it “improbable” that reasonable consumers would gloss over the words “Sugar 11 g,” which were prominently displayed in the nutrition panel immediately next to the ingredient list and, in the court’s view, “hard to miss.”

In January, the Southern District of New York followed the overwhelming number of courts that dismissed “vanilla” claims throughout 2021. In this most recent case, Santiful v. Wegmans Food Markets, Inc., the plaintiffs had alleged that the use of the words “vanilla” and “naturally flavored” on the label of Wegmans’ Gluten Free Vanilla Cake Mix misled consumers into believing that the product was flavored mainly from vanilla beans when it allegedly contained artificial flavors. The court disagreed, finding that the vanilla representations conveyed to consumers the flavor of the product rather than the specific ingredients used to impart that flavor. As to the artificial flavoring aspect of the complaint, the court held that that because the ingredients that contributed to the vanilla flavoring (ethyl vanillin, vanillin, maltol and piperol) can be artificial or natural depending on how they are derived, the plaintiffs were required to allege exactly how these ingredients were derived for this product. Because they had not done so, the court dismissed the complaint but permitted the plaintiffs to file an amended complaint.

Food Filings Trends

Furthering one of the growing trends of the last year, 2021 ended and 2022 started with a number of new “ingredient” class actions, including three suits challenging the use of non-dairy ingredients in “fudge”-based products, as well as others challenging the use (or rather, lack of use) of real cinnamon in cinnamon-flavored cereal, the lack of butter in “butter snaps pretzels,” and the minimal use of whole grains in various cracker products. We also saw a number of new “natural” and “preservative-free” lawsuits, and multiple new lawsuits challenging “healthy” marketing claims and protein content claims.

Hot Tip: For those reviewing or refreshing food labels, here are a couple of practical watch-outs:

• Terms that are subject to a “standard of identity,” i.e., a regulatory definition for what must be in a product to bear a particular name. Using defined names without meeting the regulatory definitions is increasingly drawing scrutiny.
• Multi-function ingredients such as malic acid, citric acid or fumeric acid, which can perform multiple functions in a product in conjunction with claims such as “preservative free”. Even if not acting as a preservative, courts have been reticent to dismiss claims of false advertising where the product include a multi-function ingredient and a claim that directly relates to one of those functions.

What’s in a name? NAD determined that Goli Nutrition had a reasonable basis for use of the name Apple Cider Vinegar (ACV) Gummies but also found that the advertiser could not substantiate that the gummies provided the health benefits typically associated with ACV and thus recommended that the advertiser qualify the use of ACV – including in the product name – to avoid conveying unsupported health benefit claims.

In a challenge brought by Bragg Live Food Products, maker of a competing apple cider vinegar shot, Bragg took issue with Goli’s use of “apple cider vinegar” in the product name, alleging that they do not contain enough acetic acid to qualify as apple cider vinegar or an ACV supplement. As such, Bragg also alleged that Goli's use of the term "vinegar" in the product name and labeling runs afoul of FDA labeling requirements and Goli’s gummies have little chemical similarity to apple cider vinegar or a true ACV supplement.

More specifically, Bragg alleged that Goli’s gummies did not have sufficient acetic acid to be labeled “vinegar” per FDA’s regulations and also fell short of the 5% naturally occurring acetic acid concentration found in traditional ACV. Goli countered that its ingredient is made from dehydrated apple cider vinegar. In support of its argument, Goli submitted Specification and Cook Sheets indicating that the apple cider vinegar powder component contained 5.88% acetic acid along with multiple laboratory tests demonstrating acetic acid at 25-33 mg. Based on this, NAD determined that Goli had established a reasonable basis for its product name.

NAD then examined Goli’s advertising for its ACV product, which “created a powerful connection between the product and the expected health benefits of ACV” based on the combination of visual imagery and product scenes featured in ads. In evaluating the substantiation for those claims, NAD noted that the accepted threshold dose of liquid apple cider vinegar is one tablespoon, which delivers 750 mg of acetic acid. When consumed as directed or even at a modified dose, NAD found that the Goli gummies provided far less than 750 mg of acetic acid and that the advertiser did not provide support for a health benefit below that level. As such, NAD recommended that Goli discontinue or modify its advertising to avoid conveying the unsupported message that the amount of ACV contained in its gummies are associated with the health benefits of traditional liquid ACV. NAD noted that this includes modifying or qualifying the use of “Apple Cider Vinegar,” “ACV,” or “Vinegar” including in its product name when in the context of the challenged advertising so as to avoid conveying an unsupported implied health message.

Unsurprisingly, Goli is appealing the decision to the NARB. Given the popularity of ACV and gummies generally, this is one to watch.

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FDA

The big news at FDA is that the agency finally has a confirmed commissioner after over a year without one. Dr. Robert Califf was narrowly confirmed by the Senate earlier this week.

In a sign of things getting back to “normal,” FDA also announced that it will be resuming in-person inspections for domestic facilities.

FDA released a list of guidance topics that the FDA Foods Programs expects to publish by the end of December 2022, which includes the following:

• Labeling of plant-based milk alternatives
• Labeling of plant-based alternatives to animal-derived food
• Multiple guidance documents relating to hazard analysis for various food types
• Three guidance documents relating to heavy metal levels in foods
• Two guidance documents relating to the new dietary ingredient process
• Guidance relating to testing methods for asbestos in cosmetic products that contain talc

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The FTC and state attorneys general are also hard at work. Companies that offer a subscription service or autoship options will want to pay attention to guidance and enforcement regarding allegedly deceptive practices, now branded as “dark patterns”. See here and here for our expert analysis on these topics.

And finally, in-house counsel should check on whether their marketers may be cherry-picking reviews in a way that could be deceptive. The FTC’s settlement with Fashion Nova regarding failure to post negative reviews is a helpful lesson for any company that curates reviews, whether manually or by algorithm.

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Need Help Talking To Dad About Milk?

The UK’s Advertising Standards Authority (ASA) recently investigated advertising by Oatly for advertisements that allegedly overstated the environmental benefits of the popular oat-based beverage. Here’s an example:

The first TV ad, seen on January 16 2021, featured a man sneaking into his home and putting a bottle of milk in the fridge. He was interrupted by his son who said, “What have we here? Cow’s milk? Really?” Large, on-screen text stated “NEED HELP TALKING TO DAD ABOUT MILK?”. Smaller text at the bottom of the screen stated “Oatly generates 73% less CO2e vs. milk, calculated from grower to grocer. To verify see www.oatly.com/helpdad”.

The ASA found the “Need Help Talking to Dad About Milk” ad to be misleading not because the life cycle assessment conducted to support the claims was not sufficiently robust to support a benefit. Rather, the substantiation was limited to Oatly’s Barista Edition but the ad and the disclosure could reasonably be understood to apply to all Oatly products. Because of this gap, the ASA found the ads misleading.

What’s the takeaway? The ASA’s decision, which also covers four other ads, is worth a read by any food company considering how to substantiate environmental claims. There are valuable insights from a technical perspective, including detailed discussion of life cycle analyses for Oatly’s product as well as the dairy, meat, and transportation industries.

There is also a focus on less complex but equally important features for food marketers – such as the consumer understanding of what is included in references to the “meat industry” or the “dairy industry”. Because consumers could interpret “dairy and meat” more narrowly than how Oatly did, the ASA found the claim "Today, more than 25% of the world's greenhouse gases are generated by the food industry, and meat and dairy account for more than half of that" to be misleading.

Stepping back, the biggest issue with Oatly’s advertising wasn’t that the company didn’t have robust substantiation for some claims. It appears that they did. The claims reasonably conveyed didn’t match the limitations and definitions in their substantiation, though, and this wasn’t made clear to consumers.

October Food Filings…More of the Same

As we have seen throughout the year, October brought a number of new class actions, mostly filed in various federal courts in Illinois, challenging representations that plaintiffs believe suggest the use of a specific ingredient in the product, as opposed to describing the product’s flavor. These suits include challenges to:

• Bud Light’s Platinum Hard Seltzer use of agave syrup, as opposed to the more desirable agave spirit (N.D. Illinois);
• Ore Ida pizza bagels’ use of a “cheese blend” despite the label’s suggestion that the product contained mozzarella, cheddar and Monterey Jack cheese (N.D. Illinois);
• The Kroger Company’s use of artificial smoke flavor in its smoked gouda cheese rather than subjecting the cheese to a smoking process (E.D. Wisconsin);
• Kellogg’s inclusion of fruits other than strawberries in its strawberry Pop Tarts product (S.D. New York);
• Trader Joe’s use of combined strawberry and apple filling in its strawberry flavored “Frosted Toaster Pastries” (N.D. Illinois);
• Lorna Doone’s use of oils and baking soda instead of butter in its shortbread cookies (S. D. Illinois); and
• Whole Foods’ use of chocolate substitutes and vegetable oil as opposed to cacao ingredients in its vanilla ice cream bars marketed as being “dipped in organic chocolate” (N.D. Illinois).

We also observed a number of new “natural” filings against the food industry, including multiple suits challenging the use of artificial preservatives and flavorings such as citric acid, ascorbic acid, and malic acid in products marketed as “natural.”

There were also a number of health related claims filed in October. Two such suits were filed challenging various kombucha drinks marketed in a way that suggests they can aid health when, in fact, they contain high amounts of sugar (N.D. California) or the benefits will only be observed by a small portion of the population with certain vitamin deficiencies (N.D. Illinois). Another alleges that Stop & Shop’s “High Potency Fish Oil” fails to provide promised health benefits because it has been deprived of its omega-3 fatty acids through a chemical process called transesterification (S.D. New York). And a fourth suit alleges that Bowmar Nutrition LLC’s whey protein-fortified nut spreads, powders, bars and frostings sold as dietary supplements and food replacements contain substantially less protein than represented on the products’ labels and website (S.D. Iowa).

And Some Victories In The Courts

Despite the number of filings, the courts issued a handful of victories for the food industry in October. In Amin v. Subway Restaurants, the Northern District of California dismissed a putative class action alleging that Subway misrepresented that its products were manufactured with 100% sustainably caught skipjack and yellowfin tuna. More specifically, the plaintiffs alleged that the tuna was not sourced from sustainably farmed fisheries, and did not even consist of 100% tuna. The Court dismissed the complaint, finding that it failed to identify the specific representations being challenged, but granted plaintiffs leave to amend.

In Chong v. Nestlé Water North America Inc., the Ninth Circuit affirmed the dismissal of claims that Nestlé’s Arrowhead Water was sourced exclusively from Arrowhead Mountain. The Court found that this was one of the “rare” cases where it could conclude that no reasonable consumer would be misled based on the pleadings and product labels alone. The product label specifically noted that the water was collected from various mountain springs, and not from one specific mountain, and the Court ruled that the mountain and lake images on the label would not cause reasonable consumers to think otherwise.

In Vizcarra v. Unilever United States, Inc., the Northern District of California denied class certification in a suit alleging that Breyers’ Natural Vanilla Ice Cream contained only natural vanilla. In so ruling, the Court found flaws in the plaintiff’s consumer perception survey, namely that the survey did not test the effect of the vanilla representations and instead tested the entire package which contains other statements and elements that were not being challenged in the suit. With no other evidence suggesting class-wide deception, the Court found that the central question in the case could not be resolved with common proof and therefore class treatment was inappropriate.

Finally, in Iglesia v. Tootsie Roll Industries, LLC, the District of New Jersey dismissed a slack fill case filed against Tootsie Roll Industries, alleging that the company dramatically underfilled boxes of Junior Mints and Sugar Babies. First, the court ruled that the plaintiff did not have standing to assert his claims regarding Sugar Babies, as he only alleges to have purchased Junior Mints, and the two products have different sizes and volumes, and contain different net weights. As to the products that Plaintiff did purchase, the Court ruled that the product’s disclosure that it was sold by weight, and not volume, would not confuse a reasonable consumer and that the product’s statement of net weight was obviously displayed on the front panel of the product’s packaging. Finally, the Court ruled that the plaintiff’s conclusory allegation that he was “shortchanged” was insufficient to establish damages, and that he should have specifically alleged how much he paid for the product and/or facts relating to the price of the product more generally.

NAD

The “Nauseated Face Emoji”

(and others) Can Convey Claims

In a SWIFT challenge between sports drink titans Stokely Van-Camp, maker of Gatorade, and BA Sports Nutrition, maker of BodyArmor sports drink, NAD determined that emojis can convey claims. The case involved social media posts by Cleveland Browns quarterback Baker Mayfield, who is also a BodyArmor endorse. As described in the decision, “The short video at issue begins with the caption “BLIND BODYARMOR TASTE TEST WITH BAKER MAYFIELD [eyes emoji].” Standing on a practice football field dressed in workout attire, Mr. Mayfield engages in a blind “taste test”, attempting to identify which of BodyArmor’s various flavors he has been handed by an individual who is off-screen. As Mr. Mayfield correctly verbally identifies the first three BodyArmor SuperDrink and BodyArmor Lyte flavors he samples, a green checkmark appears on the screen after each correct answer. He is then handed what is clearly a bottle of Gatorade’s Orange Thirst Quencher drink. After taking a sip, a green emoji depicting a face holding back vomit is displayed on the screen (the “Nauseated Face Emoji”), alongside the popular yellow laughing “Face with Tears of Joy Emoji.” Mr. Mayfield spits the Gatorade out on to the ground, and says to the camera, “Yo, that is not cool. That’s awful,” while removing his blindfold and shaking his head. Mr. Mayfield’s accounts caption the video with, “I’m not sure I’ll ever forgive you for this.” As shared by BodyArmor, the video is captioned “C’mon @BakerMayfield, please return our calls! We’re very sorry!!! [3 Face with Tears of Joy emojis] #TeamBODYARMOR.”

In addition to contending that the video disparaged Gatorade, the challenger requested NAD’s review of four express claims: (1) Gatorade is “awful”; (2) having to drink Gatorade is “not cool”; (3) Gatorade is nauseating (as depicted via nauseated emoji); and (4) people spit Gatorade out after drinking it. The advertiser asserted that the video was a “social media joke” and that the emojis were subjective expressions open to different interpretations. The advertiser also claimed that the video was puffery and did not convey objectively provable claims.

NAD focused on the “unmistakable negative” references to Gatorade in Mayfield’s express statements, e.g., Gatorade is “not cool”. Further, Mayfield spit out the Gatorade, an action timed with use of the “Nauseated Face Emoji” showing on-screen. In finding the video disparaging, NAD characterized it as a “harshly negative” statement about a specific BodyArmor competitor. The disparaging nature of the message also negated BodyArmor’s argument that the video constituted puffery. The decision highlights several recent NAD cases on point but ultimately concludes that “[e]xaggerated images and humor can be used to emphasize a message provided, however, that the underlying message is truthful. Here the advertising makes an expressly disparaging statement that Gatorade is “awful,” nauseating, or undrinkable. Because the Advertiser did not have any support for the messages about Gatorade, NAD recommended that the Advertiser discontinue the express claims made in the video.”

FDA

FDA hosted a three-day virtual summit to explore the safety of foods sold in e-commerce. Key themes included the following:

• The Last Mile – Even pre-pandemic, FDA was concerned about food delivery and, specifically, how to ensure food safety in the final stages before it reaches the end consumer. As food delivery and takeout options proliferated during the pandemic, the safety concerns did as well. Specifically, traceability poses a particular obstacle as delivery drivers may pick up food at multiple restaurants or stores for delivery to multiple different consumers. These drivers may use varying measures to ensure food safety, such as insulated bags or coolers, or take no safety measures whatsoever. This variability in practices, training, and even awareness of the potential problem, along with willingness on the part of industry to address the issue, emerged as key issues.
• Cross-Contamination and Traceability – With the rise of subscription and e-commerce-only food options such as regional offerings for nationwide delivery, gift baskets, and meal kits, participants noted that labeling compliance – particularly use of lot codes and other traceability indicators – may not be sufficient to adequately identify adulterated or mislabeled products if needed. Further, given the single serving and convenience-sized packaging commonly used in meal kits, there is potential for cross-contamination particularly if an unpackaged but contaminated item is included in the kit. This very concern may have manifested in the form of the ongoing onion recalls due to presence of salmonella, which impacted meal kit services including HelloFresh and Everyplate.
• New Models – As food delivery evolved and customers trended toward at-home dining, the restaurant industry has evolved as well to incorporate “ghost kitchens”. “Ghost kitchens” are restaurant kitchens used only for preparation without any in-person dining areas. For example, these kitchens may prepare orders only for delivery such that the ultimate customer never knows if their food was prepared in a traditional sit-down restaurant or a “ghost kitchen” functioning either out of standalone or, potentially, central kitchen-type location shared with similar services. On the food retail side, a similar concept called “dark stores” have cropped up, in which the stores function only as fulfillment operations without any in-person shopping available. Given the limited visibility into these operations, the concern is that it may be difficult for consumers – much less regulators – to identify food safety concerns.

FDA accepted comments through November 20, 2021 at docket no. FDA-2021-N-0929. While the comment period has ended, stakeholders should view this as an ongoing conversation with the agency and continue to maintain the dialogue to the extent they have useful perspectives to share.

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The Courts Were Kind to the Food Industry This Summer

This summer brought a series of class action victories to the food industry, including a trio of decisions from the Second and Ninth Circuits, both long-time hot beds for false advertising class actions, as well as four dismissals from the Southern District of New York.

At the appellate level, the Second Circuit affirmed the dismissal of a putative class action challenging Starbucks’ claim that its drinks are the “best coffee for you” and that its coffee is “watched over … from the farm to you,” despite the use of pesticides to kill roaches at certain retail locations. The Court ruled that the challenged claims were not specific enough to misrepresent a quality or characteristic of Starbucks’ coffee, and that no reasonable consumer would interpret them to suggest anything about the use of pesticides in Starbucks’ stores.

The Ninth Circuit decertified a class of consumers claiming that Coca-Cola falsely labels its drinks as having no artificial flavors when they contain phosphoric acid, ruling that consumers lacked standing to pursue injunctive relief. According to the Court, the plaintiffs’ claims that they “would consider purchasing” Coke in the future if certain disclosures were included or if the product’s labels were truthful were insufficient to show an actual or imminent threat of future harm.

Finally, the Ninth Circuit affirmed the dismissal of claims involving Trader Joe’s “100% New Zealand Manuka Honey.” The Court relied on the FDA’s Honey Guidelines, which permit honey to be labeled with the name of a plant or blossom if the producer has reason to believe the designated plant or blossom is the “chief floral source” of the honey. Thus, because plaintiffs’ own testing revealed that the product consists of between 57.3% and 62.6% honey derived from Manuka flower, the product’s “chief floral source” is the Manuka flower and reasonable consumers would not be deceived by the label. The Court further held that consumers would not interpret the label in the manner suggested by the plaintiff because of: (1) the impossibility of making a honey that is 100% derived from one floral source; (2) the lower cost of Trader Joe’s Manuka honey ($13.99) as compared to more concentrated blends (which sell for more than $266); and (3) the “rating” system displayed on the back label of the product, which should have informed a reasonable consumer’s interpretation of the challenged claim.

The Southern District of New York, another popular jurisdiction for food claims and class actions more generally, dismissed four food class actions over the summer. Two S.D.N.Y. judges dismissed similar allegations that the vanilla flavoring in certain products (Mars Dove’s vanilla ice cream bars and Aldi, Inc.’s vanilla almond milk) was not derived exclusively or even predominantly from vanilla beans or vanilla extract. See Garadi v. Mars Wrigley Confectionery US, LLC; Parham v. Aldi, Inc. These Courts joined dozens of others that have dismissed similar claims, finding that no reasonable consumer would construe the challenged labels to make any claims about the source of the vanilla flavor, and that the labels simply alert consumers that the products taste like vanilla.

The S.D.N.Y. also dismissed a putative class action filed against The Coca-Cola Company, alleging that its Gold Peak® “Slightly Sweet” tea leads consumers to believe the beverage was low in sugar and calories when, in fact, sugar is the second most predominant ingredient. The Court analogized “Slightly Sweet” to “Just a Tad Sweet,” which the Eastern District of California previously found to be a “blatant form of puffery.” The Court also found that the sugar content was accurately reflected in the Nutrition Facts Panel and therefore could not mislead a reasonable consumer.

A fourth judge in the S.D.N.Y. dismissed claims that Wise’s “Cheddar & Sour Cream Flavored” chips should have been labeled as “artificially flavored” due to the presence of diacetyl, which bolsters the product’s aroma. The Court found that the label does not imply that the chips’ flavor is derived entirely from cheddar and sour cream, nor does the label indicate that the chips are flavored with only natural ingredients. The Court also found that any confusion on the label is dispelled by the back of the package which explains that the chips contain cheddar, sour cream, and artificial flavoring. Finally, the Court rejected the plaintiff’s claim to the extent it was based on an alleged failure to comply with FDA regulations, ruling that it was “well established that ‘acts cannot be re-characterized as ‘deceptive’ simply on the grounds that they violate another statute or regulation (like the identified FDA regulations) which does not allow for private enforcement. This last ruling is significant, as the plaintiffs’ bar routinely alleges technical violations of FDA regulations in an attempt to establish deception or falsity.

It’s not all good news, though, and the courts declined to dismiss a number of other food complaints, including claims that (1) Celsius Holdings’ sparkling water were deceptively marketed as containing “real” juice when, in fact, they were allegedly flavored with “natural flavor;” and (2) Cooper Cane’s wines were made in Oregon when, in fact, the wine was allegedly bottled in California.

New Food Filing Trends: Is Chocolate the New Vanilla?

This summer brought the filing of at least six new class actions challenging various label representations involving chocolate and fudge: Karlinski v. Costco Wholesale Corp. (“chocolate almond dipped” ice cream bars); Rice v. Dreyer’s Grand Ice Cream Inc. (ice cream bars “dipped in rich milk chocolate); Cashman v. Ferrara Candy Company (Keebler Fudge Stripe cookies); Bartosiake v. Bimbo Bakeries USA Inc. (Entenmann’s chocolate fudge iced cake); Lederman v. The Hershey Company (hot fudge topping); Huston v. Conagra Brands, Inc. (Duncan Hines Chewy Fudge Brownie Mix). These cases all allege that the products’ ingredients are comprised partially or primarily of vegetable oils instead of the dairy ingredients that consumers expect in real chocolate or fudge.

In addition to new “natural” and “place of origin” filings, a significant trend is also beginning to form with respect to health and nutrient claims, including sugar content (Cleveland v. Campbell Soup Co., Alabama state court, and Andrade-Heymsfield v. NextFoods Inc., Southern District of California), Vitamin C (Wagner v. Molson Coors Beverage Co., Northern District of California; Marek v. Molsen Coors Beverage Co., Northern District of California), and protein content (Brown v. Natures Path Foods, Inc., Northern District of California, and Brown v. The J.M. Smucker Co., Northern District of California; Paschoal v. Campbell Soup Co., Northern District of California; Nacarino v. Kashi Co., Northern District of California).

Links from Law360 (subsc. req’d.)

National Advertising Division

Sustainability and humane animal treatment claims were front and center before NAD in two cases.

Safe Catch, Inc. (Pouched and Canned Tuna) Case No. 6911. NAD determined that certain mercury testing claims made by Safe Catch, Inc., a manufacturer of pouched and canned tuna, were substantiated, including claims that every tuna used to make Safe Catch tuna is tested for mercury, claims that its tuna has the “lowest mercury” and “lowest mercury limit” of any brand and use of the name “Safe Catch”. NAD also considered the claim “100% Sustainably Caught Wild Tuna”.

In support of its claim, the advertiser explained that 100% of the tuna it purchases are caught using sustainable methods based on factors considered relevant to the standards set by the Monterey Bay Aquarium Seafood Watch (“Seafood Watch”), the Marine Stewardship Council, the National Oceanic & Atmospheric Administration Fisheries Office of Sustainable Fishing, and Greenpeace. In addition, Safe Catch albacore tuna are purchased from a Marine Stewardship Counsel-certified sustainable seafood fishery, which catches the fish using the pole and line method. Further, Safe Catch Elite Tuna and Wild Ahi Yellowfin Tuna are caught in a manner consistent with the sustainable fishing standards set by Seafood Watch. Safe Catch also noted that it makes its sustainability policy available on its website.

However, NAD recommended that Safe Catch discontinue claims that implied that Safe Catch is healthier than other tuna brands, such as “only tuna endorsed by the American Pregnancy Association,” and certain claims that implied that other tuna brands are less safe.

Butterball, LLC (Butterball Turkey Products) NAD Case No. 6930. In a challenge brought by Animal Outlook, a not-for-profit animal rights organization, NAD determined that Butterball Turkey LLC provided a reasonable basis to substantiate its humane treatment claims where they were used in close proximity to claims about or an explanation of its American Humane Association Certification (“AH Certification”). These included claims such as the following:

• “Commitment to animal care and well-being.”
• “It is our responsibility to produce health, high-quality turkeys in a responsible way.”
• “Animal Care and Well-Being is central to who we are as a company, and we are committed to maintaining the health and well-being of our turkeys.”
• “From our family farms to our processing facilities, we commit significant resources to strengthen our already rigorous standards for animal care and well-being.”

FDA/USDA

FDA’s virtual Summit on E-Commerce: Ensuring the Safety of Foods Ordered Online and Delivered Directly To Consumers is coming up on October 19-21. Originally announced in July, the event is part of FDA’s New Era of Smarter Food Safety blueprint. Given the rise in online food sales, particularly during the pandemic, the goal of the summit is to identify courses of action to address potential food safety vulnerabilities, including those that may arise in the “last mile” of delivery.

Topics for discussion during the summit include:

• Types of B2C e-commerce models (e.g., produce and meal kit subscription services, ghost kitchens, dark stores)
• Safety risks associated with foods sold through B2C e-commerce
• Standards of care used by industry to control these safety risks
• Types of delivery models (e.g., third-party delivery, autonomous delivery models)
• Regulatory approaches to food sold through B2C e-commerce, including challenges and gaps that need to be addressed
• Labeling of foods sold through B2C e-commerce

• Adding headquarters-level contacts for each agency to improve awareness of findings or emerging issues that may warrant more than local or regional coordination.
• Updating the types of findings to be shared to reflect advances in understanding microbiological food hazards, including microbiological or other sampling findings in DJEs or products, which may provide information about sanitary conditions in those establishments or indicate serious adverse health consequence of products under either agency’s jurisdiction. These results will include microbe characteristics (e.g., serotype, whole genome sequence, antimicrobial resistance profile, etc.) where applicable, and other information related to categorizing and tracking pathogens.

USDA Seeking Comments on Labeling of Meat or Poultry Products Made From Cultured Animal Cells. USDA’s FSIS released an Advanced Notice of Proposed Rulemaking on September 3 requesting comments pertaining to the labeling of meat and poultry products comprised or containing cultured cells derived from animals subject to the Federal Meat Inspection Act or the Poultry Products Inspection Act. Some of the issues for comment include the following:

1. Should the product name of a meat or poultry product comprised of or containing cultured animal cells differentiate the product from slaughtered meat or poultry by informing consumers the product was made using animal cell culture technology? If yes, what criteria should the agency consider or use to differentiate the products? If no, why not?
2. What term(s), if any, should be in the product name of a food comprised of or containing cultured animal cells to convey the nature or source of the food to consumers? (e.g., ‘‘cell cultured’’ or ‘‘cell cultivated.’’) …
3. If a meat or poultry product were comprised of both slaughtered meat or poultry and cultured animal cells, what unique labeling requirements, if any, should be required for such products?
4. What term(s), if used in the product name of a food comprised of or containing cultured animal cells, would be potentially false or misleading to consumers?
5. What term(s), if used in the product name of a food comprised of or containing cultured animal cells, would potentially have a negative impact on industry or consumers.

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The FTC warned that the claims do not appear to be supported by competent and reliable scientific evidence, in violation of the FTC Act. The FDA warned that the products are being marketed as drugs that could cure, treat, mitigate, or prevent disease, but are not generally recognized as safe and effective for the marketed uses and not approved by the FDA. As such, the products are misbranded and illegal under the Food Drug and Cosmetic Act (FD&C Act). The letters demanded that the companies cease and desist from making unsubstantiated claims within 15 days.

Deceptive Claims under the FTC Act

To be sure, these letters are noteworthy for companies making diabetes-related claims, but their importance is not necessarily limited to that. Advertisers should pay attention more broadly to the FTC section of the letters, as it may signal the FTC testing its authority to seek penalties under Section 5(m)(1)(B).

In particular, in describing how and why the claims violate the FTC Act, the letters cite to cases holding that unsubstantiated disease claims of various types are unlawful, and appear to be styled as so-called Section (5)(m)(1)(b) letters laying the groundwork for civil penalties – similar to letters the FTC has sent companies making allegedly unsubstantiated claims that their products are made from bamboo. In general, the FTC has limited authority to obtain civil penalties. However, Section (5)(m)(1)(b) of the FTC Act authorizes the agency to seek penalties when the FTC has (1) previously determined in a litigated administrative proceeding that a practice is unfair or deceptive (2) issued a final cease and desist order with respect to such practice, and (3) put a company on notice of this fact (such that it has “actual knowledge) via warning letter.

It’s not clear yet whether the FTC will actually seek civil penalties based on these letters. But if it does, it would be testing the limit of its authority under Section 5(m)(1)(b). That’s because the law arguably contemplates that the “final cease and desist order” cited in a Section 5(m)(1)(b) letter be more specific to the practice being warned about than the potpourri of health cases cited in these current letters. Put another way, to confer “actual knowledge” on the companies, the cited cases should address unsubstantiated diabetes claims, not wholly different health claims about heart disease, cancer, erectile dysfunction, etc. Indeed, the language of Section (5)(m)(1)(m) and precedent from the bamboo cases support this narrower reading. Top FTC officials have called for more frequent and aggressive use of the FTC’s Section 5(m)(1)(b) authority, and this appears to be a move in that direction.

Misbranding Under the FD&C Act

The FDA section of the letters doesn’t break new ground, but it does provide a helpful gauge for risk and a reminder about the importance of context.

Companies marketing supplements and foods to people with diabetes or pre-diabetes should review the claims cited in the letters to help assess risk of their current marketing. For example, some letters cite to claims that clearly exceed the bounds of structure function claims, e.g., claiming that the ingredients or products produced quantifiable improvements in fasting blood sugar, A1C levels, and reduced blood pressure as well as risk of heart attacks. However, other letters cite to claims that many marketers may think fall more squarely on the structure-function side of the line, e.g., “promote healthy glycemic response” and “supports healthy glucose tolerance.” In addition to product labels and websites, the letters also cite to claims on social media – including testimonials dating as far back as 2018 – and to Amazon store fronts.

As is standard, the letters cite to specific claims, but it’s important to also consider the broader context. When marketing diabetes-related products, it’s risky to position any product as the fix for a condition that likely requires medication along with constant dietary discipline and monitoring. Even if the product claims are substantiated and within structure-function limitations, the context of positioning the product as one part of an overall diabetes management plan is key to managing risk.

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We will closely monitor developments in these matters, as well as the agencies’ future use of warning letters and sources of legal authority, and post updates as they occur.

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LITIGATION

Two More Vanilla Cases Get Thrown Out of the Food Court

In Robie v. Trader Joe’s Co., the Northern District of California dismissed claims that Trader Joe’s Almond Clusters cereal should have been labeled as “artificially flavored.” The court held that, because the vanilla flavor can from both the vanilla plant and vanillin derived from tree bark, it was properly labeled as “Vanilla Flavored With Other Natural Flavors” under applicable FDA regulations and the plaintiff’s claims suggesting otherwise were preempted. The court also found that the plaintiff had failed to allege facts suggesting that reasonable consumers would interpret “vanilla” on the product label to mean that the product’s flavor is derived exclusively from the vanilla plant, especially given that the challenged label did not contain any other words or pictures suggesting that the flavor was derived exclusively from the vanilla bean.

A different judge in the Northern District of California dismissed a substantially similar vanilla class action alleging that Whole Foods’ 365 Organic Almond Vanilla Almondmilk Beverage was falsely labeled as being flavored exclusively or predominately from vanilla beans. See Fahey v. Whole Foods Market. The court adopted similar reasoning as Robie relating to the mere use of the word “vanilla” on the product label. However, the court departed from Robie (and many other false advertising decisions) and rule that the complaint failed to sufficiently allege a price premium theory of damages because it did not compare the price of Whole Foods’ almond milk to that of other similar products. Finally, the court rejected a consumer survey commissioned by counsel suggesting that over 71% of consumers expected the product’s vanilla taste to come from vanilla beans because the complaint did not provide any information about how the survey was conducted, what questions were asked, or how many consumers participated.

Despite the onslaught of vanilla-related dismissals over the last year or two, the vanilla plaintiffs’ bar has yet to be discouraged. June brought the filing of at least four new vanilla filed in New York and California against Whole Foods, Ciobani, Simply Orange Juice and Fairlife.

Another Preemption Win for Trader Joes

In a second victory for Trader Joe’s this month, the Ninth Circuit affirmed the dismissal of claims alleging that the retailer mislabeled its chicken packaging. See Webb v. Trader Joe’s. The court ruled that Trader Joe’s followed federal testing and retention protocols imposed by the federal Poultry Products Inspection Act before declaring that its chicken contains up to 5% retained water. Thus, the plaintiff’s claims that the products were mislabeled because her own independent testing, using different testing protocols, showed an average of 9% retained water, was preempted.

Food Settlements

There was also a fair amount of class action settlement activity in California this month:

• Briseño v. ConAgra Foods, Inc.: The Ninth Circuit overturned an approved settlement of claims alleging that Wesson Oil was misleadingly labeled as “100% Natural”. The court identified “a squadron of red flags” in the deal warranting further review for potential collusion, including: (1) while the parties contended the deal could be worth more than $100 million, ConAgra ultimately paid out less than $8 million; (2) class counsel was receiving $6.85 million, which was seven times higher than what class members received; and (3) the proposed injunctive relief was arguably meaningless because ConAgra had sold the brand to another party.
• Hisley v. General Mills, Inc. (S.D. Cal.): The Southern District of California denied preliminary approval to a proposed pre-certification settlement of claims alleging that General Mills’ fruit snacks were deceptively labeled as having “no artificial flavors.” The settlement provided for injunctive relief, $725,000 in attorney’s fees and $5,000 incentive awards. The court ruled that the settlement “provides no meaningful benefit to the class” because it “abandons the monetary relief requested” in the complaint, and had all three hallmarks of a potentially collusive settlement: (1) counsel’s receipt of a disproportionate distribution of the settlement, (2) a “clear sailing” arrangement by which the defendant agreed not to oppose the request for attorney’s fees, and (3) a provisions that fees not awarded by the court would revert to defendants.
• Krommenhock v. Post Foods, LLC (N.D. Cal.): Final approval was granted in $15 million settlement of claims that various Post cereals were healthier than they really were. The court approved attorney’s fees in the amount of just under $1 million and $5,000 service awards to the class representatives.

But is it sustainable?

Finally, two new food-related sustainability claims were filed, which is line with a general uptick in sustainability cases more generally. The first, a consumer class action filed in the Central District of California, alleges that Red Lobster uses inhumane methods and environmentally damaging farming practices despite claiming on its menu that its seafood is “sourced to the highest standards.” The second was filed by Earth Island Institute, an environmental advocacy group, in the District of Columbia Superior Court alleging that Coca-Cola markets itself as environmentally “sustainable” despite being the largest generator of plastic waste in the world.

Links from Law360, subsc. req’d.

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FDA

PFAS in Food?

Early in the month, as published in Kelley Green Law, a coalition of environmental, food safety, and consumer health advocacy groups petitioned the U.S. Food and Drug Administration (FDA) yesterday to ban per- and poly-fluoroalkyl substances (PFAS) from food contact uses, and to “take aggressive action to protect consumers from all PFCs [per- and poly-fluorinated compounds].”

The petition contends that the scientific evidence shows “widespread harm” to health from PFAS exposure, and that the substances’ “widespread use and their ability to remain intact in the environment means that over time PFAS levels from past and current uses can result in increasing levels of environmental contamination” and accumulation in humans and animals.

“The cumulative effect of PFAS from all these sources on our health, including our risk of cancer, harm to our immune system and impaired development of our children, has resulted in a national outcry for comprehensive action; states have been compelled to take action because the federal government’s piecemeal approach has left residents at risk.” – June 3rd Petition to FDA

Meanwhile, numerous food service and other companies are moving to adopt policies that prohibit PFAS in food packaging, including McDonald’s Corp., Wendy’s Co., Whole Foods Market, Inc., Chipotle Mexican Grill, Inc.; Office Depot, LLC; and Koninklijke Ahold Delhaize NV, which owns Food Lion, the Giant Co., and Fresh Direct.

For decades, the FDA has authorized several broad classes of PFAS for use in food contact substances due to their non-stick and grease, oil, and water-resistant properties. The authorization of the use of a food contact substance (FCS) requires that available data and information demonstrate that there is a “reasonable certainty of no harm” for that use. To make this finding, the FDA conducts an extensive review of scientific data, including data on migration of the substance into food, expected consumer exposure to the substance, and potential health impact from this exposure.

Currently, according to the FDA, PFAS are authorized for the following general categories of food contact uses:

• Non-stick cookware: PFAS may be used as a coating to make cookware non-stick. Gaskets, O-Rings, and other parts used in food processing equipment: PFAS may be used as a resin in forming certain parts used in food processing equipment that require chemical and physical durability.
• Processing aids: PFAS may be used as processing aids for manufacturing other food contact polymers to reduce build-up on manufacturing equipment.
• Paper/paperboard food packaging: PFAS may be used as grease-proofing agents in fast-food wrappers, microwave popcorn bags, take-out paperboard containers, and pet food bags to prevent oil and grease from foods from leaking through the packaging.

The petitioners specifically request that FDA:

• Revoke existing food contact authorizations that have been granted for PFAS;
• Evaluate other FDA regulations to identify and remove other food contact approvals for PFAS;
• Ban PFAS use in food packaging and food handling equipment; and
• Require companies to demonstrate that all PFCs, including PFAS, “do not biopersist or [] cause cancer by non-genomic means in order for their continued use in food contact materials to remain authorized.”

Later in June, FDA released a constituent update on PFAS in foods. The most recent update included release of testing results on a survey of food products. Of the 94 food samples surveyed, only one had detectable levels of PFAS. That one sample – cod - had detectable levels of perfluorooctane sulfonate (PFOS) and perfluorononanoic acid (PFNA), two types of PFAS. Based on the best available current science, the FDA “has no indication that the PFAS levels in the cod sample present a human health concern.” More information regarding the sampling and testing is included in the constituent update.

Clearly, more is to come on the developing science. Meanwhile, many in industry are rapidly moving away from PFAS-containing products.

Sneak Peak into Food Priorities

FDA also released a list of guidance topics the agency is considering for publication as draft or final by the end of June 2022. Food safety figures prominently, which is unsurprising given FDA’s emphasis on the “New Era of Smarter Food Safety”. Stakeholders can submit comments on the guidance topics at www.regulations.gov at Docket FDA-2021-N-0553. Relatedly, FDA’s 2022 budget requests also place food safety front and center.

Last But Not Least, Yogurt.

In an effort to update the standard of identity for yogurt to be consistent with technological changes in the market, FDA released a final rule to amend and modernize the standard of identity for yogurt as part of the agency’s Nutrition Innovation Strategy. The final rule makes several notable changes including the following:

• Expands the allowable ingredients in yogurt, including sweeteners such as agave, and reconstituted forms of basic dairy ingredients.
• Establishes a minimum amount of live and active cultures yogurt must contain to bear the optional labeling statement “contains live and active cultures” or similar statement. For yogurt treated to inactivate viable microorganisms, the statement “does not contain live and active cultures” is required on the label.
• Supports the many innovations that have already been made in the yogurt marketplace, including continuing to allow manufacturers to fortify yogurts, such as adding vitamins A and D, as long as they meet fortification requirements.
• The rule also allows various styles or textures of yogurt as long as they meet requirements in the standard of identity.

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The FTC did not directly address marketing of food products but has had a raucous start to the summer. We encourage you to read this post from our AdLaw Access blog, which chronicles recent events including the change in leadership, formalization of the “Made in USA” rule, and potential enforcement priorities going forward.

And with that, we’ll see you in August!

New Filings

Cheesy Goodness? General Mills was hit with five putative class actions challenging its Annie’s mac and cheese marketing representations that the product is “Made with Goodness” when, in fact, it contains potentially harmful chemicals known as ortho-phthalates which are linked to asthma, breast cancer and diabetes. The cases are pending in the Southern and Eastern Districts of New York and the Northern District of California. The Kraft Heinz Company was named in similar suits filed in the Northern District of California and the Northern District of Illinois.

Sparkling Water/Seltzer: A number of companies were named in putative class actions alleging that various sparkling water products misrepresented the nature of the flavoring agents used. For example, a complaint against Whole Foods (filed in the Southern District of New York) alleges that the Lemon Raspberry Italian Sparkling Mineral Water does not contain an appreciable amount real lemons or real raspberries. Similarly, a complaint against Kroger (filed in the Northern District of California) challenges the non-disclosure of artificial flavoring chemicals. Finally, Molson Coors Beverage Company was named in a class action alleging that its “Vizzy” brand hard seltzers are marketed as containing a significant amount of healthful qualities and nutrients such as vitamin C which, according to the complaint, falsely implies that alcoholic beverages could provide health benefits.

More Vanilla: April and May saw two new vanilla filings, including a case against Prairie Farms Dairy, Inc., alleging that the defendant’s “Premium Vanilla” ice cream was falsely labeled as containing “natural colors and flavors” (Northern District of Illinois) and a case against Hostess alleging that its vanilla wafer products were falsely advertised as containing real vanilla (Missouri state court).

More Natural: The past two months have seen a slew of new “natural” filings in the food industry. Such filings challenge of synthetic preservatives and other ingredients including citric acid (3 cases), ascorbic acid (1 case), artificial coloring (1 case), and monk fruit extract, which is alleged to be natural but processed with artificial solvents and additives (1 case). The filings were made across the country, including in Missouri state court (4 cases), the Central District of California (1 case), and the Southern District of Illinois (1 case). In addition to the natural allegations relating to monk fruit extract, a case against Chobani also challenges claims relating to “complete nutrition,” “advanced nutrition” and the use of a “+” symbol in connection with prebiotics and probiotics which, according to the complaint, falsely suggests that the product has more pre- and probiotics than other comparable foods.

Coffee, Please: We have also seen an uptick in coffee-related class actions, with two actions alleging that ground coffee products artificially inflate the number of cups that can be made from their contents given the directions for use.

Delivery Fees: April and May saw a continued trend of challenges relating to food delivery charges during the pandemic, with cases filed against GrubHub, alleged to have charged an undisclosed $2.50/delivery fee on top of its $9.99/month “Unlimited Free Delivery” for GrubHub+ users, and against Panera, alleged to have falsely promised a flat delivery charge on food deliveries ordered through Panera’s app and website. Both cases are pending in California state court.

Food Settlements

Open or Closed? GrubHub asked a federal judge to approve settlement in the CO Craft, LLC dba Freshcraft v. Grubhub Inc., matter alleging that it steered customers to its partner restaurants by telling consumers that other establishments were closed or not accepting online orders. Per the settlement, GrubHub agreed to amend platform language and pay up to $450k in attorney’s fees.

Even More Vanilla. On May 17, the Southern District of New York granted preliminary approval to a $2.6 million settlement of a putative nationwide class action alleging that Blue Diamond almond milk yogurt was falsely labeled as containing vanilla “with other natural flavors” when it should have been labeled as “artificially flavored” because it uses vanillin to boost the taste of real vanilla. The settlement provides that class members can claim a cash payment of $1 per product with proof of purchase or 50 cents per product without proof of purchase, for a maximum of 10 products.

Even More Natural. On May 7, 2021, the parties in a putative nationwide class action challenging McCormick & Co.’s labeling of various spices and seasoning products as “natural” reached a $3 million settlement. Class members with proof of purchase can claim $1 per purchase without limitation, whereas consumers without proof of purchase are limited to a total recovery of $15. McCormick also agreed to modify the labeling and website representations of the challenged products, but is permitted to sell its existing inventory with the disputed labels. The case is pending in the Western District of New York.

After all of that, let’s turn to some potentially good news for industry from the world of Prop 65 litigation and our friends at Kelley Green Law blog.

Prop 65

Acrylamide. In the latest of a string of potentially ground-altering developments under California’s Proposition 65, a federal judge has temporarily enjoined plaintiffs from initiating new cases alleging failure to warn for foods and beverages that expose consumers to acrylamide, a Prop 65-listed carcinogen that has been the subject of hundreds of actions in the past several years. See more detail here at Kelley Green Law blog.

FDA

Sesame is the newest allergen. Per the Food Allergy Safety, Treatment, Education and Research (FASTER) Act, sesame is now the ninth major food allergen. The FASTER Act requires foods containing sesame to be clearly labeled on products entering interstate commerce as of January 1, 2023, and directs the Department of Health and Human Services to prioritize regular reviews of potential food allergy treatments and research.

Remote facility inspections are here to stay. FDA released its “Resiliency Roadmap for FDA Inspectional Oversight” in May, which details the massive impact that the pandemic had on the agency’s inspections. Going forward, FDA will continue to prioritize critical inspections of priority products and for-cause scenarios. More broadly, industry should expect remote inspection techniques to continue as the agency seeks to clear its backlog and keep up going forward.

A healthy symbol? FDA is seeking public comment on a potential voluntary symbol that could be used on labels to convey a “healthy” nutrient content claim. In furtherance of its Nutrition Innovation Strategy, FDA proposes to conduct three consecutive quantitative research studies—an experimental study and two surveys—to explore consumer responses to the draft FOP symbols that manufacturers could voluntarily use on a food product as a graphic representation of the nutrient content claim “healthy.” The comment period is open until July 6, 2021.

PFAS in bottled water. A group of 11 senators is urging FDA to promulgate Standards of Quality (SOQ) for per- and polyfluoroalkyl substances (PFAS) in bottled water to provide the public, federal and state governments, and emergency responders assurance that bottled water products are safe for everyday use and in times of need when tap water is compromised. The letter points out that EPA has set a PFAS limit for public drinking water, i.e., tap water. However, bottled water is regulated by FDA as a food. In the absence of a federal limit for bottled water, states are establishing their own standards, leading to a patchwork of regulation. The letter cites the International Bottled Water Association standard, which “requires its members to test for PFAS and set a limit of 5 ppt for one PFAS compound and 10 ppt for any combination of PFAS compounds in their products” as an “achievable and affordable” standard.

NAD and FTC

Neither the NAD nor the FTC directly addressed the advertising of a conventional food product in any decisions or settlements during April or May. Check out our April coverage of the dietary supplement and personal care product space here, though, and stay tuned for our May wrap up on supplements and personal care products coming up soon!

Links from Law360 - subscription required.

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Litigation Developments

Hidden Delivery Fees

A number of suits were filed in March regarding undisclosed delivery fees. These suits are framed in a couple of different ways. One such suit filed against Chipotle (Dundon v. Chipotle Mexican Grill, Inc., N.D.N.Y.) alleges that Chipotle has offered “free” or “$1” delivery, but charges more for delivery orders than for in-person purchases or pick-up orders of the same items. According to the complaint, Chipotle adds a 10% “service charge” to delivery orders that is not charged to pick-up orders or in-person purchases. The complaint also alleges that Chipotle charged more for individual food items when ordered for delivery as compared to the prices charged for the same items purchased in person or ordered for pick-up. Similar class action suits were filed against Chipotle in Florida federal court (Hopkins v. Chipotle Mexican Grill, Inc.) and against Chick-Fil-A in California state court (Ortega v. Chick-Fil-A Inc.).

Natural Flavoring and Ingredient Claims

Four new natural flavoring and ingredient class actions were filed in March. One action (Kinman v. The Kroger Co., N.D. Illinois) alleges that Kroger’s smoked gouda products get their smoke flavor from artificial flavoring as opposed to the natural smoking process. Another (Romaine v. Globus Food Products LLC, Missouri state court) alleges that Globus Food Products’ “all natural” pizza products actually contained a synthetic ingredient called powdered cellulose. The third (Vanlaningham v. Sara Lee Bakery LLC, Illinois state court) alleges that Sara Lee’s waffle products are all natural when they contain citric acid, an artificial preservative. And finally, adding to the dozens of vanilla-related cases that have been filed of late, the fourth action (Annmarie St. John v. The Price Chopper Inc., New York state court) alleges that The Price Chopper’s PICS almond milk was represented as containing natural vanilla when it, in fact, contained artificial flavors.

Health Claims

In McMorrow v. Mondelez International, Inc., the Southern District of California certified a nationwide and New York class in an action alleging that Mondelez’s belVita breakfast products are deceptively advertised as providing “nutritious steady energy all morning” and are “part of a balanced breakfast,” when, in fact, they contain high levels of added sugar. The court blessed the plaintiffs’ damages model (at least for purposes of class certification), which proposed to conduct a survey isolating any price premium associated with the term “nutritious” as used in Mondelez’s marketing of its belVita breakfast products. Mondelez filed a petition with the Ninth Circuit for interlocutory review of the certification order, which is currently pending. For more discussion, see our blog post here.

In Hadley et al. v. Kellogg Sales Co., the parties submitted a third motion for preliminary settlement approval of a class action alleging that Kellogg falsely advertised various cereal products as “heart healthy” and/or “lightly sweetened” despite what the plaintiffs characterized as high percentages of added sugar. This version of the settlement (1) eliminated a voucher component that was in prior versions of the settlement; (2) increased the amount of the cash payment to $13 million; (3) expanded the previously-agreed to injunctive relief; and (4) narrowed the scope of the release to claims based on the identical factual predicate as alleged in the complaint, including the specific products that were part of the previous class certification order.

Finally, in Rand v. Kilwins Quality Confections, Inc. (N.D. Ill.), the plaintiff alleges that various caramel and chocolate product labels materially misstated both the number of servings and the number of calories per serving. The plaintiff is asserting thirty causes of action, including claims for violation of a variety of state consumer protection statutes, as well as for breach of contract and unjust enrichment, and seeks to represent both a nationwide class as well as a number of state-specific classes.

Origin Claims

In Corker et al. v. Costco Wholesale Corp. et al., coffee farmers in the Kona region of Hawaii alleged that defendants (a number of suppliers and retailers) misleadingly labeled and sold coffee not from the Kona region as “Kona” coffee. The parties sought approval of a settlement with three suppliers/retailers that included substantial injunctive relief in the form of labeling changes and, in the case of one settlement, a payment of $6.1 million to the class.

(links from Law360, subsc. req’d.)

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National Advertising Division

Grocer Aldi agreed to permanently discontinue several price advertising claims, including the following:

• “The Lowest Prices Everyday”
• “Lowest Possible Prices on Groceries”
• “It’s Official. We Have the Lowest Prices on Long Island”
• “ALDI has the Lowest Prices on Long Island”

Chobani LLC also permanently discontinued challenged express claims that its Chobani Complete 5.3-ounce yogurt cup contains 25 grams of protein.

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FDA

FDA released its Foods Safety and Nutrition Survey. Key findings include:

• Most consumers are familiar with the Nutrition Facts label
• Most consumers have seen menu labeling at restaurants
• Consumers are familiar with front of package claims
• Hand washing practices vary depending on the occasion
• The majority of consumers own a food thermometer, but usage varies depending on what is being cooked

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Thanks for joining us again this month. See you in May!