When is yogurt not yogurt? That's for the FDA

Hood v. Wholesoy & Co., 2013 WL 3553979 (N.D. Cal.)

Hood alleged the usual California claims based on failure to label certain foods in compliance with the FDCA as adopted by California law.  Wholesoy allegedly failed to list “sugar” or “dried cane syrup” as an ingredient, but instead listed “organic evaporated cane juice,” in violation of FDA labeling rules; and its products failed to comply with the FDA standard of identity for “yogurt” because they didn’t contain any form of milk.

On “evaporated cane juice,” Hood alleged that the FDA issued guidance in October 2009 and has sent warning letters to companies advising them that the term was unlawful. But the guidance states that it’s a draft, “Contains Nonbinding Recommendations,” and is “Not for Implementation.”  It’s not legally enforceable, but describes the FDA’s current thinking and recommendations, not legal requirements.  The draft guidance here advised that “evaporated cane juice” isn’t the common or usual name of any sweetener; cane syrup has a defined standard of identity under the regulations and is known as “dried cane syrup.”  Juice is liquid from fruits and vegetables; sugar cane isn’t one of those in the FDA’s view; and thus sweeteners from sugar cane syrup shouldn’t be called juice. The guidance says: “FDA considers such representations to be false and misleading … because they fail to reveal the basic nature of the food and its characterizing properties (i.e., that the ingredients are sugars or syrups) as required by [federal regulations].”  The FDA has issued warning letters to companies using “evaporated cane juice” as an ingredient, telling them that they’re violating the law and that the draft guidance states the proper way to name this ingredient.

Similarly, Hood alleged that Wholesoy’s products were misbranded because they didn’t contain the ingredients required by the FDA’s standard of identity (any form of dairy milk). The packages do feature prominent labels stating “DAIRY FREE,” “made from single source U.S. grown organic soybeans,” and “VEGAN.”  But Hood alleged that the regs require dairy, and that the FDA has sent warning letters to companies using “milk” to describe soy-based products, such as “Soymilk” (“[W]e do not consider ‘soy milk’ to be an appropriate common or usual name because it does not contain ‘milk.’   We do consider ‘soy drink’ or ‘soy beverage,’ however, as acceptable common or usual names for such products.”); “French Yogurt Cheese”; “Muscle Milk”; and “Vegetable Yogurt Cheese.”

The court granted Wholesoy’s motion to dismiss under the primary jurisdiction doctrine, per Pom Wonderful. The four relevant factors are: “(1) the need to resolve an issue that (2) has been placed by Congress within the jurisdiction of an administrative body having regulatory authority (3) pursuant to a statute that subjects an industry or activity subjects an industry or activity to a comprehensive regulatory authority that (4) requires expertise or uniformity in administration.”  So, “where determination of a plaintiff's claim would require a court to decide an issue committed to the FDA's expertise without a clear indication of how FDA would view the issue, courts of this district have repeatedly found that dismissal or stay under the primary jurisdiction doctrine is appropriate.”

Here, the “evaporated cane juice” guidance wasn’t legally enforceable, but only a suggestion; the court found it “unclear” why the FDA would then issue warning letters (which are reserved for violations of law) on the topic. At a minimum, the FDA’s position was unsettled and there was no uniform enforcement standard, so the court wouldn’t decide the issue.

With “yogurt,” the FDA didn’t appear to have ruled at all as to whether “soy yogurt” would be subject to the same standards as dairy yogurt, or whether this was a situation like “butter” (which has a standard of identity) and “peanut butter” (which has a completely different standard of identity).  “Many products contain soy and the need for the FDA to administer a comprehensive approach is compelling.”  The warning letters weren’t sufficient to provide clear guidance, and the court wouldn’t act in the first instance.

Hood argued that abstention wasn’t required because the issues presented didn’t require any scientific or nutritional expertise to resolve: all that the court needed to decide was that “soy yogurt” has no milk, and “evaporated cane juice” is really just sugar. But the FDA hadn’t come to any clear conclusion on either issue.   (Hood’s position was also inconsistent, in the court’s view, with Hood’s allegations that the use of “yogurt” was misleading because of nutritional differences.) If the case continued, the court would either lack a clear standard to apply or have to announce one, overstepping its proper role.