Waiting for the FDA is the Hardest Part, California Federal Judge Rules

shredded cheddar cheeseWhat it means for food to be “natural” has become a topic of contentious debate, and the Food and Drug Administration (“FDA”) entered the fray earlier this year, requesting comments on use of the term on food labeling. Some courts, including the U.S. Court of Appeals for the Ninth Circuit, have stayed lawsuits centering on use of “natural” on food labels. These stays have been granted on primary jurisdiction grounds, with the courts waiting for the FDA to speak on the issue before moving forward with the cases before them.

One court recently broke from this mold, however, denying a motion to stay a case filed against Kraft Foods Group, Inc. (which is now Kraft Heinz) centering on the use of the term “natural cheese” on Kraft’s shredded fat free cheddar packaging.

In a consumer class action brought by Claudia Morales and Mocha Gunaratna against Kraft Foods Group, Judge John A. Kronstadt of the U.S. District Court for the Central District of California recently held that the primary jurisdiction doctrine did not call for a stay of proceedings. See Morales v. Kraft Foods Group, Inc., (12/06/16). Noting that the doctrine is a prudential one giving courts the option to “refer an issue ‘within the special competence of an administrative agency’ to the agency, and stay or dismiss without prejudice the underlying action pending agency review,” Judge Kronstadt determined that the court was bound by neither precedent nor reasoning to put the case on ice. In short and in a break from other courts, Judge Kronstadt ruled that there was no need to wait for the FDA’s definition of “natural” and denied Kraft’s motion for a stay pending the FDA’s statement.

Underlying the plaintiffs’ objection to Kraft’s use of the term “natural” is the fact that the product includes artificial color. That fact, Judge Kronstadt reasoned, distinguishes Morales from another case involving use of “natural” on food labeling, Kane v. Chobani, which the U.S. Court of Appeals for the Ninth Circuit remanded earlier this year to the district court with instructions to stay pending the FDA’s inquiry. In contrast to the question presented in Kane (which centered on the description of an added sugar ingredient as “evaporated cane juice”), the FDA already has taken a clear stance on the labeling of products containing artificial color.

“The question here is not whether Kraft has violated FDA regulations,” Judge Kronstadt wrote in his Order denying the defendant’s Renewed Motion to Stay Case Pending the FDA Action on “Natural” Guidance. “Rather, in this case the question is whether the ‘natural cheese’ label is deceptive to the reasonable customer.”  Because the answer to this question does not depend upon whether the defendant violated FDA regulations, there is no reason to defer to the agency’s determination as to what it means for a product to be “natural,” the court concluded. Furthermore, Judge Kronstadt continued, there is no guarantee that the FDA will ultimately define “natural” or determine how the term should be used in the context of cheese products. (Indeed, in its request for public comments, the FDA asked (inter alia) “[w]hether it is appropriate to define the term ‘natural’.”).

This decision raises some interesting issues. Other judges across the country hearing these types of alleged false labeling cases may very well follow the lead of Judge Kronstadt. Also, decisions such as this that deny motions for stay are not appealable under 28 U.S.C. § 1292(a)(1), and so many food law observers will be keenly interested in what kind of expert proof is adduced during the litigation.

Whether Judge Kronstadt has started a trend is something we will have to wait to see, just like we continue to await the FDA’s definition of “natural.”

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Cozen O’Connor has a national team of attorneys experienced in handling food contamination and product recall coverage matters related to first-party, third-party and specialty policies. The firm also developed a Food, Beverage & Nutritional Products Industry Team to provide advice and counsel to a wide range of companies connected directly and indirectly to the food and beverage industry.
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