Landslide Digital Feature

An Eater’s Guide to the Natural Labeling Food Fight

Julia Dayton Klein

©2016. Published in Landslide, Vol. 9, No. 1, September/October 2016, by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association or the copyright holder.

Natural, sustainable, local, organic, farm-to-table, healthy, fresh, pure, clean, homegrown, whole grain, non-GMO, vegan, gluten-free, good-for-you. These and other marketing “buzzwords” permeate the food world and entice us to dig in. But what do they mean? This is a multimillion dollar question that has become the subject of many a litigation battle—and a regulatory quagmire. The Food and Drug Administration (FDA) has recently indicated that it might be ready to come to the table with rules to define the term “natural”—but after decades of use of this term in the marketplace, will the food industry and the public view formal recognition as a welcome dinner guest or just another presence in a crowded buffet line?

Many of us love to consider ourselves conscientious consumers of food, flocking to our local farmers’ markets, co-ops, and neighborhood grocery stores to examine the freshest hydroponically grown heirloom tomatoes, artisan mozzarella cheese pulled right in the store, organically grown basil harvested earlier that day from the local cooperative garden just down the street, and certified olive oil and balsamic vinegar, all combining for that perfect caprese salad. But those hunger-inducing descriptors are not mere adjectives. Rather, they serve as calculated triggers, designed to push our consuming buttons to pay what often amounts to a premium price for our food. Increasingly, many of us value knowing more about where our food comes from and the unique attributes and benefits associated with what goes into our bodies. Not only that, we also can see food as an economic tool, perhaps preferring local farmers or supporting one type of food production practice over another. And so presents the issue: given the value that we consumers place on this information and the feelings we have about our food, there has been an increasing amount of litigation and regulator head-scratching surrounding, exactly, what these words mean. One word in particular—natural—has been as thorny as an untrimmed artichoke.

Let’s peruse the menu . . .

Appetizer: “Natural” as a Selling Point

Calling something “natural” entices consumers—and food producers, manufacturers, and restaurateurs want to convey the qualities of their products in ways that whet consumers’ collective appetites. They want to tout the features of their products that appeal to consumers and meet consumer demand with products that satisfy their cravings. This rings true for food as much as anything else.

“Natural” proves a powerful selling point for consumers. It has been reported that nearly 62 percent of shoppers usually buy foods labeled “natural,” and nearly 87 percent of shoppers who buy “natural”-labeled foods would pay more if the term met their expectations.1 Very unscientific research revealed a host of claims that products are “natural,” whether in the branding, the words on the packaging, the artwork on the labeling, or the ingredient list. “Natural” in this era, much like “low fat” in the 1990s, jumps off the label to consumers. It conveys something—perhaps health, perhaps an aspiration of an appealing lifestyle, perhaps a fulfillment of social responsibility. For me, as a mother of two young children, the term has been a shortcut for “less processed stuff to feed my kids,” which mysteriously translates in my mind to “better parent.”2 Whatever the meaning to the consumer, use of “natural” has been popular and controversial.

Salad Course: Limits on Using “Natural” on Food Labels

Food producers, manufacturers, retailers, and restaurants must take care in how they present their products in the marketplace. For instance, the Food, Drug, and Cosmetic Act (FD&C Act) considers food “misbranded” if its labeling is false or misleading.3 Also, consumer protection and false advertising statutes all over the country prohibit false and misleading statements on products.

Three federal agencies—the Federal Trade Commission (FTC), the FDA, and the United States Department of Agriculture (USDA)—all have considered defining “natural.” The FTC first pondered regulating “natural” in the 1970s but abandoned the effort. The USDA has issued regulations about what constitutes “natural” for meat, poultry, and processed eggs, which are in its regulatory purview. The FDA has yet to issue an authoritative guidance despite its charge to protect public health by, among other things, ensuring the safety and proper labeling of all other food sold in the United States.

Main Course: A Smorgasbord of “Natural” Litigation

Without any metes and bounds around the terms, the uncertainty, coupled with consumer interest, creates a climate ripe for litigation. In the past year alone, there have been over 155 class action lawsuits related to food, one-third of which concern this issue.4

The typical “natural” claim seems to follow a pattern: a producer puts on a label that a product’s ingredients are “natural,” “all natural,” or something that evokes nature; a class action plaintiff claims that consumers who buy the product are misled because the product might contain something artificial, such as a coloring, flavoring, or preservative; might have genetically modified organisms (GMOs); might have been processed using certain chemicals; or simply might not comport with their world view of what “natural” means. The majority of the alleged violations coalesce around state-based claims for unfair trade practices, consumer protection, fraud, and breach of warranty.5 The most popular venues for these suits are places with robust consumer protection statutes, with California and New York topping the list, and the Northern District of California earning the label “Food Court.”6

None of these lawsuits has seen a trial, but they do deserve attention. This kind of litigation can be expensive and can change the course of branding. In 2013, PepsiCo agreed to pay $9 million to class action plaintiffs and to stop using “all natural” to describe its Naked Juice product. Naked Juice now boasts “no sugar added,” “100% Juice,” and a list of “the goodness inside.” After winning dismissal of a class action suit brought in Minnesota against its Nature Valley brand of granola bars, General Mills agreed to discontinue using “100% natural” on its label to settle four other, similar suits. Now, Nature Valley granola bars focus on other features of the label—the amount of whole grains, calories, sugars, sodium, and saturated fat. Cargill recently settled a class action suit around its Truvia brand of sweetener, agreeing to pay $6.1 million and retaining the right to use “natural” in its labeling and branding. However, it appears that Cargill relabeled the product to take out references to “natural” and is focusing instead on pointing out that the sweetener is calorie-free and comes “from the stevia leaf.”

Should the FDA weigh in on the meaning of “natural,” it might be useful in defending against these class action suits on primary jurisdiction grounds, that is, allowing the FDA—and not the courts—to be the decision maker regarding what this term means. Indeed, recently, the Ninth Circuit stayed a consumer class action involving Chobani Greek Yogurt’s claims that it has “only natural ingredients” until the FDA issued its final guidance on the meaning of the term “evaporated cane juice” and noted the FDA’s inclination to define the term “natural.”7 This turn of events shows a willingness to push the plate away until the FDA can properly set the table.

Palate Cleanser: The FDA Sorbet

The FDA has for years grappled with whether to define “natural.” Until now, the best guidance the FDA could provide was that “natural” (1) could not be used for products with added color, synthetic substances, and flavors;8 and (2) meant that “nothing artificial or synthetic (including colors regardless of source) is included in, or has been added to, the product that would not normally be expected to be there.”9 Both of these attempts at guidance are advisory; neither establishes a legal requirement that would give assurances to food producers and manufacturers and to consumers in the marketplace about what the term means. From time to time, the FDA has issued warning letters, telling food manufacturers and producers to remove the “natural” label, but none of these has a broader enforcement scope.

More than 15 years ago, the FDA toyed with the idea of defining “natural,” mentioning in a preamble that “natural” is often used to convey that a food is comprised only of substances that are not human made and are therefore more wholesome.10 The FDA declined then to engage in rulemaking around the term “natural,” claiming that “[n]one of the comments provided FDA with a specific direction to follow for developing a definition” of the term.11

Now, and in response to four “citizen petitions”—from the Grocery Manufacturers Association, the Consumers Union, the Sara Lee Corporation, and the Sugar Association—as well as requests for an administrative determination from several federal judges who were presiding over “natural” cases,12 the FDA opened a rulemaking docket.13 It first invited public comment on whether to define “natural” and what shape that definition should take. More than 7,600 commenters RSVPed to that dinner party, submitting comments ranging from “ban the use of the term” to “don’t bother” to more specific directives, such as “minimal processing,” “containing no synthetic additives,” and all things in between. One very popular thread encouraged the FDA to define “natural” as excluding GMOs, though, like interesting dinner party guests, the commenters could not agree on what that term meant, either.14

As the FDA sifts through these comments, it will be interesting to see what comes next. The FDA will likely propose rules in the coming months, though, unlikely as it may be, the FDA might again decline to take a stand. In fairness to the FDA’s caution on this issue, the variants on the comments seem to show that “natural” is in the eye of the beholder. One commenter considered sugar to be an unnatural ingredient, but opined that honey and maple syrup made the cut.15 Other commenters insisted that only food produced using sustainable farming practices could be considered natural.16 Still another encouraged the FDA to consider the carbon footprint of the shipping methods for food.17

Even if the FDA sends its regrets to this dinner party, Congress may force the issue. The U.S. House passed the Safe and Accurate Food Labeling Act, which would amend the FD&C Act to, among other things, require the FDA to issue regulations setting standards for what could be called “natural” on food labels. Though the measure failed to pass in the Senate, it shows that Congress has an appetite for reform.

Cheese or Dessert? What “Natural” Litigation Shows about Coming Claims

Given the regulatory uncertainty and the class action feeding frenzy, it might be tempting to just declare a fast and give up on “natural” altogether. Indeed, some food producers and manufacturers have done just that, abandoning the term. The president of Annie’s Homegrown commented at a conference that “natural” has no meaning and that they have stopped using the term altogether. For some, such a natural moratorium is possible; for others, abandonment is not so simple. They might, for instance, have “natural” embedded into their brand, and a rebranding effort would severely damage the good name the product has built over the years. They might, for strategic reasons, want to fight on about what “natural” means.

Also, the litigation and uncertainty around what “natural” means represents a much larger uncertainty in the marketplace. After all, “natural” presents one way to convey a benefit to consumers. So many more words and phrases remain subjects of litigation, even, in some instances, where the FDA has issued regulations that give them meaning: healthy, nothing artificial, whole grain.18 The list goes on.

Digestif: Food for Thought

The cornucopia of issues surrounding food labeling seems to beg for some certainty that regulation might provide. But regulations can only do so much, and both producers of food and consumers have an evolving menu of options to address these issues.

Increasingly, and particularly in the digital age, consumers and food producers and manufacturers are having a dialogue about what goes into food. There are a wealth of resources about how food is produced and an increasing call for further transparency. Food producers, manufacturers, and restaurateurs seem eager to answer that call. Walking into one of my favorite local haunts, I learned from a chalkboard all of the farmers, ranchers, and cheese makers who had labored to produce the food I would soon enjoy. The menu used these producers in the description of the food, presumably as a selling point, and for some consumers, that sells. From a risk-mitigation standpoint, it certainly has appeal—it’s independently verifiable (either it’s from that farm or it’s not) and can connote certain positive attributes by association (perhaps social responsibility or supporting the local economy). While this is an example on the micro-level, there are some macro lessons to learn.

One trend that does seem to be emerging with larger scale food production is a shift to factual, independently verifiable claims, which can either be certified through independent third parties or through testing. As I write, I am munching a snack that is labeled Non-GMO Verified, Certified Kosher by the Orthodox Union, Certified Organic by Quality Assurance International and the USDA, Certified Gluten-Free, Whole Grain, Vegan, and uses fair trade ingredients.19 The prominence of these independently verifiable claims does not serve as a complete shield from litigation, but they do represent a trend that seems to be emerging in the marketplace.

So, while the FDA ruminates over whether to define “natural,” food producers, manufacturers, and consumers should all take note of the landscape.

Endnotes

1. Consumer Reports Nat’l Research Ctr., Natural Food Labels Survey: 2015 Nationally-Representative Phone Survey 7 (2016), http://www.consumerreports.org/content/dam/cro/magazine-articles/2016/March/Consumer_Reports_Natural_Food_Labels_Survey_2015.pdf.

2. The debate over that topic is better left for another day, perhaps another year.

3. Food, Drug, and Cosmetic Act § 403, 21 U.S.C. § 343(a)(1).

4. Perkins Coie Food Litigation: 2015 Year in Review, Food Litig. Newsl., 2016, https://www.foodlitigationnews.com/wp-content/uploads/sites/12/2016/05/2015-Year-in-Review-Food-Litigation-Newsletter1.pdf.

5. See, e.g., Nicole E. Negowetti, Defining Natural Foods: The Search for a Natural Law, 26 Regent U. L. Rev. 329, 333 (2013).

6. See Vanessa Blum, Welcome to Food Court, Recorder (Mar. 1, 2013), http://www.linerlaw.com/NewsMedia/.../portalresource/lookup/wosid/cp-base-4-3324/media.name=/130301.ACA%20Recorder%20article.pdf.

7. Kane v. Chobani, LLC, 645 F. App’x 593 (9th Cir. 2016).

8. Food Labeling: Nutrient Content Claims, General Principles, Petitions, Definition of Terms, 56 Fed. Reg. 60,421, 60,466 (proposed Nov. 27, 1991).

9. Id.; see also 21 C.F.R. § 101.22.

10. See Use of the Term “Natural” in the Labeling of Human Food Products; Request for Information and Comments, 80 Fed. Reg. 69,905, 69,906 (Nov. 12, 2015).

11. Food Labeling: Nutrient Content Claims, General Principles, Petitions, Definition of Terms; Definitions of Nutrient Content Claims for the Fat, Fatty Acid, and Cholesterol Content of Food, 58 Fed. Reg. 2302, 2407 (Jan. 6, 1993).

12. Judge Jeffrey White from the Northern District of California and Judge Kevin McNulty from the District of New Jersey wrote to the FDA, requesting an administrative determination under 21 C.F.R. § 10.25(c) of whether food products containing ingredients produced using bioengineering may be labeled as “natural,” “all natural,” and/or “100% natural.” Judge Jerome Simandle from the District of New Jersey asked the FDA for an administrative determination of whether high fructose corn syrup qualified as a “natural” ingredient.

13. Use of the Term “Natural” in the Labeling of Human Food Products, Docket No. FDA-2014-N-1207 (Nov. 12, 2015), https://www.regulations.gov/docket?D=FDA-2014-N-1207.

14. There has also been a food fight, in the form of litigation and proposed legislation, surrounding the use of GMOs. In 2014, Vermont passed a law (Act 120) requiring GMO labeling. Vt. Stat. Ann. tit. 9, §§ 3041–3048 (effective July 1, 2016). The following year, the U.S. House passed the Safe and Accurate Food Labeling Act, which would federally mandate GMO labeling. Though that measure failed to pass in the Senate, just weeks after the Vermont law came into effect Congress passed and President Obama signed into law S. 764, which calls for the USDA to establish a “national bioengineered food disclosure standard,” thereby preempting state laws such as Vermont’s. Opponents refer to the federal law as the Denying Americans the Right to Know Act (DARK Act), because it allows companies to use a QR code or 1-800 number as a form of GMO labeling, forcing consumers to scan the code or make a call to get more information. In August 2016, Vermont’s attorney general announced that in light of the federal law, the state will no longer enforce Act 120.

15. Comment from Kristi Brister, Docket No. FDA-2014-N-1207-1804 (Dec. 24, 2015), https://www.regulations.gov/#!documentDetail;D=FDA-2014-N-1207-1804.

16. Comment from George Wilkins, Docket No. FDA-2014-N-1207-0538 (Nov. 25, 2015), https://www.regulations.gov/#!documentDetail;D=FDA-2014-N-1207-0538; Comment from James Sullivan, Docket No. FDA-2014-N-1207-0639 (Nov. 27, 2015), https://www.regulations.gov/#!documentDetail;D=FDA-2014-N-1207-0639; Comment from Stephanie Jacobson, Docket No. FDA-2014-N-1207-0757 (Nov. 30, 2015), https://www.regulations.gov/#!documentDetail;D=FDA-2014-N-1207-0757.

17. Comment from Anonymous, Docket No. FDA-2014-N-1207-1056 (Dec. 3, 2015), https://www.regulations.gov/#!documentDetail;D=FDA-2014-N-1207-1056.

18. For example, in a suit filed in New York, which Kellogg calls “meritless,” the class action plaintiffs claim that Cheez-It Whole Grain crackers are not predominantly whole grain.

19. Before you get the wrong idea, it’s a peanut butter and chocolate cereal.

Julia Dayton Klein

Julia Dayton Klein is a principal with Gray Plant Mooty—specializing in regulatory issues, government investigations, and litigation—and an avid “foodie.” The author thanks Gray Plant Mooty summer associates Cade Cross and Robin Gimm for their help with the legal research and all of the local food emporiums and neighborhood restaurants that contributed to the other research associated with this article.”