Thursday, May 30, 2013

USDA approval of chicken soup doesn't preempt all claims against product line

Krzykwa v. Campbell Soup Co., --- F. Supp. 2d ----, 2013 WL 2319330 (S.D. Fla.)

Krzykwa sued Campbell’s for labeling vegetable soups containing genetically modified corn as “all natural.”  He alleged that the soups contain GMOs, “plants whose genetic makeup has been altered through biotechnology to exhibit characteristics that would not otherwise occur in nature,” which poses distinct risks from natural plant breeding and may risk harm to consumers’ health.  He alleged that he relied on the ads and the label, and that he wouldn’t have bought the soups if he’d known they contained GMOs and weren’t “100% Natural.”  He also alleged that he paid a substantial premium compared to soups not labeled “100% Natural.”  He brought claims for false and misleading advertising in violation the Florida Deceptive and Unfair Trade Practices Act (FDUTPA) and unjust enrichment.

Campbell argued that the claims were preempted, subject to the primary jurisdiction doctrine, and protected by Florida’s safe harbor doctrine because Campbell complied with federal law.  Krzykwa responded that he was merely attempting to apply standards identical to those of federal law.

Campbell contended that the Department of Agriculture preapproved the “100% Natural” statement on two cans from the 100% Natural Soups line that contained the same GMO ingredients, so the USDA inspection’s preemptive effect extended to all such products.  See Meaunrit v. ConAgra Foods Inc., No. C 09–02220 CRB, 2010 WL 2867393 (N.D. Cal. July 20, 2010) (“Because the [USDA] pre-approval process includes a determination of whether the labeling is false and misleading, and the gravamen of Plaintiff's attack on the label concerns whether [the heating instructions] are accurate, the plaintiff's state causes of action are preempted by federal law.”). In addition, Campbell argued that although the FDA rather than the USDA regulates the vegetable soups at issue (because they don’t contain chicken or beef), the two agencies have similar policies about the “natural” label.  Thus, this claim created an issue of first impression that couldn’t be resolved by a court.

The court disagreed.  “From a purely logical standpoint … , if the Court adopted Campbell's position, the Court finds that there would be no authentic reason to not also necessarily take the position that because the USDA approved two Campbell poultry meat soups not at issue in this case that no claims can be made in any case against any defendant that it is misleading to using label a food product containing GMO corn as ‘100% Natural.’”  In any event, it didn’t necessarily follow that the USDA’s approval of the chicken soup label was binding on every other federal agency.  “We do not even know whether, when reviewing the label for whether it was ‘misleading,’ the USDA even knew that the soup contained GMO corn, particularly as there is nothing on the soup label to so indicate.”  There was no preemption.

The court also declined to dismiss the case under the primary jurisdiction doctrine.  Campbell argued that the FDA has said no “special labeling” is required when bioengineered ingredients are used in foods.  Just because disclosure isn’t required, that doesn’t make all labeling of GMO foods nonmisleading.  And the FDA has repeatedly declined to define “natural” through formal rulemaking, meaning that dismissal would serve no purpose.

Of course, this also meant that the safe harbor defense didn’t preclude the claims as a matter of law.

The court also declined to dismiss the unjust enrichment claim, which was properly pled in the alternative to the FDUTPA claim.

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