FDA takes Kind Approach to “Healthy” Corporate Philosophies

This month, FDA showed a willingness to catch up with the recent trends, advancements, and developments in the food and beverage industry by reconsidering years-old regulations regarding products labeled as “healthy.”

Kind, a snack food company, was publicly condemned last spring for mislabeling its popular snack bars as “healthy” in violation of dated regulations.  Earlier this month, FDA announced it will permit Kind to return the “healthy and tasty” label to its products.

Kind received national attention in April 2015 after receiving a warning letter from the FDA.  The Agency cited four Kind snack bar products that were improperly labeled “healthy.”  Kind felt a significant backlash of negative publicity and waves of litigation as a result of the warning letter which struck right at the heart of the company’s values and mission to provide healthy food products.

Current FDA regulations pertaining to the term “healthy” are complex, but, in part, a food labeled as “healthy” cannot contain more than 3 grams of fat per serving.

Kind is a company dedicated to providing nutritious food products to its health conscious consumers and it fought back hard.  It contended that the regulation was outdated.  Kind responded to FDA and its customers explaining that its products contained healthy fats—nuts.  It is universally accepted today that many foods with high nutrient values contain fats which are beneficial, such as avocados, nuts, salmon, and olive oil.

The regulation Kind violated can be considered remnants of the trends of the 90s when low-fat and fat-free highly processed foods dominated grocery store shelves and Americans’ pantries.  Today, a shift in thinking has caused the marketplace for health foods to be dominated by whole foods and minimally processed foods, including fruits, vegetables, meats, nuts, and seeds.  Consumers’ mindsets have largely accepted this shift.  Other agencies have as well, including the USDA which abandoned the traditional food pyramid in favor of “My Plate” in 2011.  Meanwhile, FDA regulations have grown stale.  Food products like raw nuts cannot be labeled healthy, but highly processed foods can be.

An FDA spokesperson said that now is “an opportune time to re-evaluate  the regulations concerning nutrient content claims, generally, including the term ‘healthy,’” given the research now available.  The Agency stated that it will solicit public comments on these issues in the “near future.”

FDA is permitting Kind to reincorporate the phrase “healthy and tasty” in its labeling because the text is “clearly presented as its corporate philosophy.”  It is not represented as a “nutrient content claim,” does not appear on the same display panel as other nutrient content claims, and does not appear alongside nutritional information.  FDA’s position, which is at best reasonable given the regulations in place, recognizes the difference between using “healthy” as part of a corporate philosophy versus as part of a “nutrient content claim.”

Because changes to regulations often take years, for now the regulation remains unchanged.  While food and beverage industry members certainly hope FDA acts promptly in revising and improving its regulations, until then industry members are bound by what is on the books.

For companies already entrenched in consumer class action litigation, however, FDA’s announcement and forthcoming efforts to reevaluate and potentially revise the regulation do present litigation strategies to class action defendants.  Food and beverage industry members defending themselves against mislabeling claims should consider moving for a stay pending the outcome of FDA’s actions, as Kind as done in an action pending in the Southern District of New York, In re Kind LLC “Healthy and All Natural Litigation,” No. 1:15-md-02645.

Kind’s victory on its “corporate philosophy” argument, however, is already a victory for the industry.  Many companies are recognizing trends and consumers’ values and interests and are providing wholesome, less processed, food and drink products.  These companies’ philosophies may be permitted to be marketed as “healthy” despite the numbers printed on the nutritional values.

Please feel free to contact a member of Cozen O’Connor’s Food and Beverage Industry Team for more information about the subject of this blog post or how Cozen O’Connor can be of help to you and your organization.

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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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