Recent appellate ruling may provide future avenue for defense

My Kid Eats That!

The Organic Consumers Association (OCA) targeted Hain Celestial, maker of Earth’s Best brand infant and toddler formula products, for labeling the products “organic” when they actually were far, far from it. The ingredient list, OCA claimed in an April 2016 suit, contained a “spectacular array” of nonagricultural and nonorganic ingredients forbidden by the U.S. Department of Agriculture from being added to products that make the claim.

The “spectacular array” of alleged nonorganic ingredients included chemical preservatives, toxic chemicals and ingredients that are synthetically produced from toxic compounds.

The complaint, which was originally filed in the District of Columbia Superior Court but was later removed to the D.C. District Court, accused Hain of violating the Organic Food Production Act (OFPA) of 1990, which limits the use of nonagricultural ingredients in organic-labeled products to a “National List” of exceptions. The OCA claimed that 29 of the nonagricultural ingredients listed in the Hain products were not on the exceptions list.

The OCA alleged violations of the D.C. Consumer Protection Procedures Act and sought revised packaging, new advertising, costs and disbursements, and punitive damages.

We Interrupt This State-Law Litigation...

Hain moved to dismiss, claiming that D.C.’s state law was pre-empted by the OFPA – presenting an obstacle to “the accomplishment and execution of the full purposes and objectives of Congress,” as stated by a case cited in the District Court’s decision.

Hain argued that lawsuits demanding state enforcement of the OFPA would initiate a cacophony of dissonant rulings about what “organic” actually means. In addition, Hain maintained that the USDA is empowered under the OFPA to lead enforcement efforts – not the states.

The OCA countered that its case actually championed the OFPA’s standards. For example, it pointed out that the case was meant to enforce the “National List” – an inventory identifying substances that may or may not be used to produce organic crops, livestock or processed goods, published by the USDA.

The Takeaway

The court clearly sided with Hain on the question of federal pre-emption, relying most heavily on a 2010 ruling by the Eighth Circuit Court of Appeals in In re Aurora Dairy Corp. Organic Milk Mktg. & Sales Practices Litigation. Aurora dealt with alleged misrepresentations about the care of livestock under several different state statutes.

The Eighth Circuit ruled in this case that claims against the certifying agent were federally pre-empted, because direct challenges to the agent’s decision would “present an obstacle to the federal certification scheme itself …” Moreover, while consumers might be more comfortable with a state’s particular certification of organic, any standard thus enforced would chip away at the OFPA’s authority.

The court noted that District Court decisions have generally followed the Aurora decision, citing an Eastern District of New York decision which maintained that “[o]nce the federal government, through a USDA-accredited certifying agent, permits a manufacturer to label a product as ‘Organic’ because it has met that standard, any allegation that the product is not truthfully labeled … is a challenge to the certifying agent’s decision” – rather than to the manufacturer’s claims.