We hope at least some of our readers will recall the classic ad campaign where a tub of Parkay margarine would try to trick celebrities into thinking it was butter. (this one stars Deacon Jones). Clever and catchy? Yes. Misleading? No. Now, you may be saying: well, back then there were only two choices – butter or margarine. Now the “butter” section of your local supermarket contains a panoply of choices -- butter, unsalted butter, flavored butter, spreadable butter, margarine, low fat margarine, dairy spread – and on and on. There is even a product called “I Can’t Believe It’s Not Butter.” Really? I can. But while more choices may cause the need to linger a bit longer in the dairy aisle, is anyone really being misled? At least one California state court said no – Simpson v. The Kroger Corp., 2013 Cal. App. LEXIS 769 (Sept. 25, 2103).
Before we get to the decision, we have to emphasize the importance of a win at the state appellate level in California. While food labeling litigation isn’t our primary focus on this blog, it is a close cousin to drugs and devices and almost always involves preemption, which is one of our core interests. But, if you look back at our food-related posts, they are almost exclusively from federal court (almost always a California federal court too). Ever since the California Supreme Court’s decision in Farm Raised Salmon, 175 P.3d 1170 (Ca. 2008) (see our discussion here) finding California’s Sherman Law (which incorporates the requirements of the FDCA) provides a basis for non-preempted state-law parallel violation claims, we haven’t held out much hope for California food labeling claims. But, the Simpson court’s hard line on the “identical” requirement in its preemption analysis and its application of the “reasonable consumer” standard have perked us up a bit.
We’ll try not to get bogged down in the details, of which there are many. But, as we’ve already implied, the case is about butter, or more accurately “spread.” Plaintiff purchased a tub of Challenge Spreadable Butter with Canola Oil believing that it was simply butter. 2013 Cal. App. LEXIS 769 at *3. Plaintiff alleged causes of action for unfair competition, false advertising, and violations of the Consumer Legal Remedies Act. She based her claims on allegations that defendant’s product did not comply with the California Milk and Milk Products Act of 1947 (“MMPA”). Id. at *5. Plaintiff also sought to amend her complaint to add mislabeling claims under the Sherman Law. Id. at *2. The court held the first were preempted and the second would be futile. Id.
Just a quick reminder that food is governed by the Nutrition Labeling and Education Act (“NLEA”) and the NLEA has an express preemption provision:
''no State or political subdivision of a State may directly or indirectly establish under any authority or continue in effect as to any food in interstate commerce-- ... (3) any requirement for the labeling of food of the type required by section ... 343(k) of this title that is not identical to the requirement of such section ...
Id. at *9 (quoting 21 U.S.C. § 343-1(a)). So, the first question for the Simpson court was whether California’s MMPA requirements were different than FDCA requirements for butter, margarine, and spread. And the decision contains a lengthy discussion of how all of those foods are defined and required to be labeled under both acts. See id. at *10-15. For example, the FDCA requires margarine to be labeled as such “in type or lettering at least as large as any other type or lettering on such label” whereas the MMPA “requires the word ‘margarine’ to be in type at least as large as any other type or lettering on the label in ‘a color in strong contrast to the color of the container.” Id. at *27-28. The FDCA also provides requirements for the height, prominence and boldness of each letter, not contained in the MMPA. Id.
Plaintiff’s sole argument against preemption was that the FDCA and MMPA requirements are “substantially identical.” Id. at *27. But “substantially identical” isn’t “identical”:
''These provisions are not identical, despite plaintiff's efforts to characterize them as such. Nothing in the preemption provision of the FDCA, or in the rationale of the [California] Supreme Court in Farm Raised Salmon Cases, extends the exemption from preemption to state laws which are "substantially identical" rather than identical as plaintiff asserts. We conclude that plaintiff's MMPA claims are preempted under section 343-1 of the FDCA.
Id. at *28. That language could certainly be helpful in a drug or device case in fighting off a parallel violation claim. The standard there is whether the state law claim imposes a duty that is “different from or in addition to” federal regulations. Isn’t that the same as saying the state law requirement must be identical to the federal requirement? If so, Simpson is strong support for what exactly “identical” means. And, the standard appears to be high.
Moving on to plaintiff’s attempt to add Sherman Law violation claims. First, under Farm Raised Salmon, such claims are not preempted. Id. at *26. But, the court didn’t end its inquiry there. Plaintiff’s allegation here is that the word butter was overly prominent on the label (larger than the words “with Canola Oil” or “Spread”) and therefore misleads consumers into thinking the product is butter. Id. at *29-30. However, to state a false advertising claim, “plaintiff must establish that consumers were likely to be deceived by the product” – the reasonable consumer test. Id. at *31. And, this brings us back to where we started, is anyone really being misled?
''The labels on the products here clearly informed any reasonable consumer that the products contain both butter and canola or olive oil. This was plain on both the top and side panels of the tubs in which the products are sold. No reasonable person could purchase these products believing that they had purchased a product containing only butter.
Id. at *33. Hence, no need to add Sherman Law claims because, as a matter of law, plaintiff can’t prove them. Id. at *2. We like this finding as well because plaintiffs like to file false advertising claims against drug and device manufacturers too. So, while the food industry should obviously be excited about this decision, its implications for drug and device litigation are positive also. We hope you find the potential cross-over between food/beverage and drug/device litigation valuable. We do, so we'll keep writing about it