The current unsettled status of restaurant menu labeling rules may be headed toward some form of resolution. FDA first promulgated a final federal menu labeling rule in December 2014 requiring that calorie information be posted on menu labeling boards in covered food retailers. The agency subsequently delayed the compliance date to December 2016, and again to May 2017. On May 4, 2017, the day before the rule was to take effect, FDA delayed the rule again, this time to May 7, 2018.[1] In response, on May 18, New York City announced it would begin to enforce its own local menu labeling rule.[2] Current circumstances have left retailers uncertain about how to proceed. Can a federal agency delay a final federal regulation for an indefinite period? Does a delayed federal regulation have preemptive effect over a local or state rule?

These questions are now likely to be resolved in the courts. On June 7, 2017, the Center for Science in the Public Interest and the National Consumers League filed a complaint in the District of Columbia alleging that FDA’s rule delaying the compliance deadline of the final federal nutrition labeling rule violates the Administrative Procedure Act (APA).[3] The plaintiffs allege in their complaint that the delay—made without notice-and-comment rulemaking—is a final agency action with legally binding effect that constitutes an unlawful amendment to the federal rule, in violation of the APA.

Since the complaint was filed, a decision on another topic with some potential relevance has been handed down by a DC appellate court, preventing the Environmental Protection Agency (EPA) from staying its implementation of an Obama administration methane regulation.[4] The EPA first issued a 90-day stay of the compliance date on April 18, then published a notice on June 5 granting reconsideration on certain aspects of the methane rule, and finally, on June 16, published a notice of proposed rulemaking announcing its intention to extend the stay for two years and to broadly reconsider the methane regulation. The appellate court stated that, pursuant to the APA, an agency could not amend, revoke, or alter a final agency rule without notice and comment. The court determined that industry had had ample opportunity to comment on and raise objections to the rule during the rulemaking process, and thus “EPA’s decision to impose a stay, in other words, was arbitrary, capricious, [and] . . . in excess of [its] . . . statutory . . . authority.”

In addition, on July 14, industry plaintiffs brought suit against the City of New York, alleging that its menu labeling rule is barred on federal preemption grounds.[5] Federal preemption is the doctrine that federal law “preempts” or supersedes state law when the laws are in conflict. It is based on the Supremacy Clause in Article VI of the US Constitution, which states that federal law is the “supreme law of the land.” The Supremacy Clause is understood to mean that the Constitution and federal laws govern where they apply, irrespective of a state law. However, in the absence of federal law or where federal law does not apply, the state law still governs.

As we explained in our prior post, Menu Labeling and Passive Federal Preemption, the city’s planned enforcement measures could conflict with an express federal preemption clause at 21 U.S.C. § 343-1, which states that “no State or political subdivision of a State may directly or indirectly establish . . . any requirement for nutrition labeling of food that is not identical to the requirement of section 343 (q) of this title [, which contains restaurant menu labeling requirements].”

On its face, the NYC menu labeling requirements differ in at least some material respects from those specified in the federal rule. For example, the city’s rule affects food service establishments that are part of chains with 15 or more locations in the United States, whereas the federal rule applies to chains with 20 or more locations. But more fundamentally, New York will arguably be prematurely enforcing rules that FDA has determined should not yet be applicable.

As interesting as the interplay between issues of preemption and rulemaking might be from a lawyer’s perspective, the practical question for the retailer is what it is required to do—at the moment, compliance with the federal requirement is voluntary, but New York facilities are operating under the mandate unless and until the courts say otherwise.