An FDA compliant label can still be misleading

The Food and Drug Administration (FDA) has adopted regulations under the Federal Food Drug and Cosmetic Act ("FDCA") regarding labeling drinks containing juice blends.  Coca-Cola Company’s Minute Maid label most prominently displayed the words “pomegranate blueberry” for a blend of apple, grape, pomegranate, blueberry and raspberry juice (containing 0.3% pomegranate juice).  POM Wonderful LLC, maker of a pomegranate-blueberry juice blend, claimed the Minute Maid label was misleading and caused lost sales as a result of customer confusion. The Minute Maid product name and label complied with the FDA regulations.

The District Court and the Ninth Circuit Court of Appeals held the Lanham Act claim was precluded by the comprehensive and specific FDA regulation. The Supreme Court disagreed and allowed the Lanham Act claim to proceed.

The Lanham Act prohibits any "false or misleading representation of fact which … misrepresents the nature, characteristics, qualities or geographic origin of his or her or another person's goods …"  15 U.S.C. § 1125(a)(1).  The FDCA expressly preempts certain state misbranding laws but does not preclude enforcement of the federal Lanham Act.

The Supreme Court held statutory construction showed Congress intended the Lanham Act requirements to remain enforceable against the disputed label. The Lanham Act and the FDCA have co-existed for over 70 years.  This is "powerful evidence” that Congress did not intend FDA regulation to preclude liability under the Lanham Act.  To the contrary, the two statutes are “complimentary”.  The FDCA protects public health and safety, while the Lanham Act protects commercial interests against unfair competition.  Private parties can sue competitors to protect their interests under the Lanham Act on a case by case basis without impairing the FDA regulations protecting public health and safety.  Prohibiting private enforcement would leave the public less protected from misleading food and beverage labels.  Both statutory schemes can be simultaneously implemented and enforced. 

The FDA regulations cannot abrogate the obligations of the Lanham Act without congressional authorization. Compliance with a comprehensive regulatory scheme does not preclude liability for false or misleading advertising under the Lanham Act.