J&J makes Benecol and Benecol Light Spread. Benecol is “a margarine-like,
vegetable-oil-based spread sold in eight-ounce tubs with the following labels: ‘Proven
to Reduce Cholesterol’; ‘No Trans Fat’; ‘No Trans Fatty Acids’; and ‘Each
serving contains .85g of Plant Stanol Esters.’”
Reid alleged that, despite Benecol’s premium price, he bought it in
reliance on its representations that (1) plant stanol esters may reduce the risk
for coronary heart disease; (2) Benecol is proven to reduce cholesterol; and
(3) Benecol contains no trans fat or trans fatty acids. He alleged falsity and misbranding because:
(1) Benecol does not contain sufficient plant stanol esters per serving; (2)
Benecol does not contain the minimum amount of vitamin A required prior to any
nutrient addition; and (3) Benecol's label contains an inaccurate level of
recommended consumption of plant stanol esters pursuant to federal law. Separately,
he alleged that “Proven to Reduce Cholesterol” was false and misleading because
no studies support the claim that Benecol—as formulated—effectively reduces
blood cholesterol, though studies have shown that plant stanol esters, in
certain forms, may reduce LDL/bad cholesterol. Reid also alleged that the “Proven” claim made
Benecol into a misbranded drug because it made a structure/function claim of
reducing bad cholesterol. Finally, he
alleged that Benecol was misbranded because of its “no trans fat” and “no trans
fatty acids” labels, since the FDA has not yet defined “no trans fat” and “no
trans fatty acids” and since Benecol actually contains small amounts of
artificial trans fatty acids. He brought the usual California claims.
The court found that the complaint satisfied Rule 9(b), but
failed anyway. J&J argued that Reid
didn’t adequately plead reliance. He
didn’t allege physical harm (failure to receive the health benefits), but that’s
not required by consumer protection law.
Reliance plus financial harm was sufficient. But no reasonable consumer could be deceived
by “No Trans Fat” and “No Trans Fatty Acids”:
Benecol's ingredient list, although
in smaller print than the larger font on the lid of Benecol's container and
immediately above the nutrition facts panel, shows that it contains a small
amount of partially hydrogenated oils and trans fats. A reasonable consumer
would be unlikely to incorrectly interpret “No Trans Fat” to mean that Benecol
products do not contain any trans fat.
Okay, (1) this presumes, without evidence, that consumers
understand what “partially hydrogenated” means, and (2) isn’t this inconsistent
with the
9th Circuit’s rule that consumers aren’t required to read an
ingredient list to find information that contradicts the explicit claims on the
front of the package? (See below for the better preemption argument.)
Anyway, because he didn’t allege that Benecol’s statements
could deceive a reasonable consumer, he didn’t have standing. (Hunh, what?
Why is that a standing question now as opposed to alleging the elements
of the claim? Or are we just going to
use “standing” to mean “you lose” from now on?)
Separately, the court evaluated J&J’s express and
implied preemption argument. The NLEA
expressly preempts non-identical state labeling requirements, but Congress
specifically indicated its intent not to occupy the field, and there’s a
presumption against other kinds of preemption.
According to the FDA’s 2000 regulations, “[s]cientific
evidence demonstrates that diets that include plant sterol/stanol esters may
reduce the risk of [coronary heart disease]” and also “helps to lower blood
total and LDL cholesterol levels” if a person consumes “3.4g or more per day of
plant stanol esters” in “two servings eaten at different times of the day with
other foods.” Food products can bear
these health claims if they contain “[a]t least 1.7g of plant stanol esters”
per serving and meet a minimum nutrient contribution requirement, which bars
health claims unless “the food contains 10 percent or more of the Reference
Daily Intake ... for vitamin A, vitamin C, iron, calcium, protein, or fiber per
reference amount customarily consumed prior to any nutrient addition.” In 2003, the FDA issued a letter lowering the
amount of phytosterols required to make claims as long as the food contained at
least 400 mg and the claim specified that the daily dietary intake of
phytosterol that may reduce the risk of chronic heart disease was 800 mg or
more per day. Benecol contained 850 mg
per serving, which was consistent with the 2003 letter, which governs until a
final rule is issued. The FDA issued
such a proposed final rule in 2010, but announced that it wouldn’t be enforced
until Feb. 2012, and would exercise enforcement discretion in the intermediate
period. Public comments closed in April
2012.
The court held that Reid was asking the court to rule on
non-final FDA issues and impose an outdated interim rule. Although the letter wasn’t formal notice and
comment rulemaking, that wasn’t required for preemption. Given Benecol’s compliance with the letter,
the claim that Benecol didn’t contain enough plant stanol esters per serving was
preempted. (The parties didn’t address
the separate argument that Benecol couldn’t make these claims because J&J
only achieved 10% of Vitamin A by adding it, contrary to the regulation.)
Separately, Reid alleged that Benecol's “Proven to Reduce
Cholesterol” label was false and misleading, because despite the existence of
general studies on the potential for plant stanol esters to reduce cholesterol,
there was no study supporting the conclusion that Benecol, “as formulated,”
effectively reduces blood cholesterol. In any event, the claim was “highly
misleading” because “the trans fat would negate much of the claimed impact of
Benecol on cholesterol” and may even “expose [the consumer] to increased risk
of many other diseases.” Also, Reid
alleged that the claim made Benecol a misbranded drug by suggesting it could
treat the condition of high cholesterol.
The FDA has found that the evidence supports the link
between plant stanol esters and lower cholesterol levels. Under the FDCA, a food product can make certain
approved health claims without being regulated as a drug. The regulations require a minimum amount of
plant stanol esters before a food can make the cholesterol claim, but don’t
require specific evidence that each food works “as formulated.” Because the regulations allowed Benecol to
make the health claim at issue, Reid’s cholesterol claims were preempted.
Reid argued that, since the FDA hadn’t defined “No Trans
Fat” and “No Trans Fatty Acids,” Benecol was misbranded because it bore unauthorized
nutrient content claims. The FDA
requires the disclosure of trans fat content where it is meaningfully present
in a food. But the regulations say that
if a serving contains less than 0.5 gram, the content in the nutrition
information section shall be labeled zero.
Statements of this sort on the label (except the nutrition information
section) are nutrient content claims, and nutrient content claims can’t be made
except in accordance with regulation.
The regulations give requirements for some nutrient content claims (“high,”
“no fat,” etc.), but have no definition for “No Trans Fat.”
Benecol contains less than 0.5 gram of trans fat per
serving, and, following the law, says “Trans Fat 0g” in its nutrition facts. Since it was required to say this in the
nutrition facts, it could say the same thing on the label, and any California
law to the contrary was preempted. “A
consumer would not be confused by the representation of ‘No Trans Fat’ on the
packaging of Benecol with the term ‘0 grams trans fat’ found on the Nutrition
Facts panel.” (Okay, confusion isn’t part of preemption—although I agree with
the preemption analysis. The problem is that the FDA requires some products with a teeny bit of trans
fat to say they have zero grams of trans fat.
A consumer might well be "confused" into thinking that zero means
zero. But that’s the FDA’s problem, not
defendants’.)
As a side note, the court declined to dismiss the case under
the primary jurisdiction doctrine, since despite the significant amount of
rulemaking and scientific research surrounding the issue, consumer protection
claims didn’t require or benefit from FDA expertise.
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