Reid v. Johnson & Johnson, 2015 WL 1089583, No. 12–56726,
-- F.3d – (9th Cir. Mar. 13, 2015)
Reid sued defendants (here J&J) based on claims about
Benecol, a vegetable oil-based spread sold as a healthy substitute for butter
or margarine. The label says the product contains “No Trans Fat” and that it contains
plant stanol esters that lower cholesterol (e.g., “Proven to Reduce
Cholesterol”). But Benecol does contain trans fat, which allegedly is harmful
to human health/raises bad cholesterol, counteracting the beneficial effects of
the plant stanol esters in Benecol.
J&J said the amount was so insignificant that it was authorized
under FDA regulations to make the statement. (The inside of
the packaging, where only a purchaser could see it, says: “A small amount of
partially hydrogenated oils are used in BENECOL® Spreads to maintain a
semi-solid structure and to enhance the melting characteristics of the BENECOL®
Regular Spread. As a result, BENECOL® Spreads[ ] contain an extremely low level
of trans fat. The FDA allows foods containing less than 0.5 grams of trans
fat/serving to be labeled 0 grams trans fat, since this is considered an
insignificant amount.”) Also, Benecol doesn’t
comply with the terms of the FDA’s regulation authorizing plant stanol
ester-based health claims, but J&J said that a 2003 FDA letter authorized
its statements and was entitled to preemptive effect.
The district court found that Reid lacked standing and that
his claims were preempted; the court of appeals reversed (while agreeing that
primary jurisdiction and abstention were not problems). Reid alleged that he
bought Benecol based on J&J’s misrepresentations and, since Benecol costs
more than similar products, paid a premium for doing so.
Along with Reid’s other claims, he argued that Benecol’s
name (a combination of “cholesterol” and “benefit”) and the heart and vegetable
graphics on the package reinforced the deceptive statements. He brought the usual California claims.
Though Reid alleged that he wouldn’t have been willing to
pay as much as he did for Benecol, if anything, if he had not been misled by J&J’s
misrepresentations about Benecol’s health effects, the district court found
that he lacked standing because he failed to “set forth alleged facts showing
that Benecol’s statements may deceive a reasonable consumer.” True, the
reaction of reasonable consumers is the standard for violations of the UCL,
FAL, and CLRA, but it’s not a standing requirement. Rather, it usually raises
fact questions inappropriate for resolution on a motion to dismiss.
If the district court meant Reid failed to state a claim, it
also erred, since it relied on disclosures in Benecol’s ingredient list, which
included partially hydrogenated vegetable oil.
But the 9th Circuit has already held that the ingredient list
can’t be used to shield manufacturers from liability for other
misrepresentations on the label. “Regardless, it is far from clear that typical
consumers understand that a product containing partially hydrogenated vegetable
oil necessarily has trans fat, so even if an ingredient list has a curative
effect in some cases, it might not here.”
Reid’s allegations were sufficiently plausible.
Preemption: The key question was whether the challenged
statements were authorized by the FDA’s regulations or other pronouncements of
similar legal effect. The NLEA expressly preempts non-identical state
regulations, but also says there’s no preemption unless the preemption is
express. FDA regulations require a
nutrition label, but the claims made in it are not considered “nutrient content
claims” for the purposes of FDA regulations. “While a required statement inside
a nutrition label escapes regulations reserved for nutrient content claims, the
identical statement outside of the nutrition label is still considered a
nutrient content claim …. As a result, a requirement to state certain facts in
the nutrition label is not a license to make that statement elsewhere on the
product.”
FDA regulations provide that trans fat should generally be
disclosed in the nutrition label “except that label declaration of trans fat
content information is not required for products that contain less than 0.5
grams of total fat in a serving if no claims are made about fat, fatty acid or
cholesterol content.” In such circumstances, the trans fat content has to be
expressed as zero on the nutrition label.
Outside the nutrition label, claimants may make nutrient content claims
such as “fat free,” “no fat,” “zero fat,” or “negligible source of fat” on
labels where the food contains less than 0.5 grams of fat per serving and
certain other conditions are met. There’s a parallel regulation permitting
similar claims about “saturated fat,” but not about “trans fat.” The FDA decided
not to authorize a “trans fat free” claim in light of “insufficient scientific
information.”
FDA also authorized certain health claims, as long as
they’re “complete, truthful, and not misleading.” Claims for plant stanol
esters being associated with reduced risk of heart disease (CHD) are among
those authorized. They have to use “may” or “might”; specify the daily intake
necessary to reduce the risk; indicate the contribution one serving of the
product makes to the specified intake level; and specify that the daily dietary
intake of plant sterol or stanol esters should be consumed in two servings
eaten at different times of the day with other foods. The claim may state that the heart disease
relationship is through the intermediate link of cholesterol.
In a 2003 letter, the FDA indicated that it “will consider
exercising enforcement discretion with regard to the use of a claim about
reduced risk of CHD in the labeling of phystosterol containing food” that did
not meet the requirements in the regulation. Qualifying health claims had to
relate to foods containing 400 mg per serving, had to specify “that the daily
dietary intake of phytosterols that may reduce the risk of CHD is 800
milligrams (mg) or more per day,” and the food had to satisfy the regulation’s
other requirements.
The FDA also recognizes a heart symbol as a health claim,
and requires a complete claim to appear in immediate proximity.
The first question was whether the “No Trans Fat” claim was
authorized by FDA regulations. In a
warning letter, the FDA indicated that “No Trans Fat” is “an unauthorized
nutrient content claim ... which has not been defined by FDA.” This interpretation, albeit informal and
nonfinal, deserved deference unless clearly erroneous. The court of appeals agreed that, because
Benecol contains some trans fat, its “No Trans Fat” claim was misleading. The FDA regulations don’t allow a “No Trans
Fat” claim similar to allowed “No Fat” and “No Saturated Fat” claims for
products that contain less than 0.5 grams of fat or saturated fat per serving;
the warning letter made the most sense of the overall labeling regime. As noted above, the statement on the
ingredient list didn’t authorize a “No Trans Fat” nutrient content claim
elsewhere on the label. Thus, the trans fat claims weren’t preempted.
J&J admitted that its plant stanol esters and
cholesterol reduction claims didn’t satisfy the relevant regulation, but
claimed that they met the criteria described in the FDA’s 2003 letter about its
enforcement intentions. The FDA explicitly found that “[t]he scientific
evidence establishes that including plant sterol/stanol esters in the diet
helps lower blood total and LDL cholesterol levels.” So, if Benecol contained
the minimum amounts necessary to make the health claims at issue, it was
consequently also proven to reduce cholesterol as far as the FDA was concerned. Was this letter a “law” with preemptive
effect? “Creation of federal law should demand at least the same formality for
purposes of preemption as it does for purposes of Chevron deference.” Thus, the court declined to give preemptive
effect “to agency actions that do not carry the force of law under Mead and its progeny.”
Under that rule, the 2003 letter lacked preemptive effect;
enforcement guidelines like those in the letter “are beyond the Chevron pale.” It did not indicate that FDA had a lawmaking
purpose, but was “couched in tentative and non-committal terms.” It didn’t
promise not to enforce existing regulations, but announced an “inten[t] to
consider the exercise of enforcement discretion” in certain circumstances. A separate statement firmed up the FDA’s
intent not to object to the use of the claim specified in the letter, but that
wasn’t enough. “The FDA’s equivocal language regarding its intention to
foreclose its own ability to enforce noncompliance with existing rules is a
good indication that it did not intend to foreclose state law challenges to
health claims that do not comply with existing rules.” The FDA could have acted more formally—it has
the power to approve health claims effective immediately, pending consideration
of public comment and publication of a final regulation. The fact that it didn’t
do so for the claims in the letter indicated that it didn’t intend to create a
standard with the force of law, foreclosing state-law protections. “Giving the
2003 letter preemptive effect would effectively open an additional shortcut
allowing the FDA to authorize health claims without notice and comment.” That’s not inherently bad and notice and
comment isn’t always required, but Congress showed that it knew how to create a
shortcut and didn’t do so here.
The court noted an additional prudential consideration: “we
are concerned that allowing the FDA effectively to authorize health claims by
way of statements of its enforcement policy could place those authorizations
beyond judicial review. This is so because agency decisions not to take
enforcement action are usually committed to agency discretion by law and thus
generally not subject to judicial review.”
Foreclosing challenges to such approvals wouldn’t serve Congress’s goals
of improving protection for public health and safety (citing Pom Wonderful).
The court of appeals then agreed that the doctrine of
primary jurisdiction didn’t bar the claims. There were no issues of first
impression, since the FDA had already addressed the substance. And, though the FDA said it would someday
issue a new final plant stanol esters rule, that was over a decade ago; there
was no indication that it was thinking about authorizing “No Trans Fat.” Courts are competent to address the key issue
of misleadingness.
Posts
No comments:
Post a Comment