Monthly Archives: February 2013

GMO Labeling and the First Amendment

As the endless debate about GMO labeling continues, the LA Times has a nice article on an issue I’ve highlighted before — that the First Amendment might preclude legislation or ballot initiatives that mandate the labeling of GMO ingredients.   The article notes that:

Courts have ruled that forcing companies to label GM products violates their 1st Amendment right of free speech.  In a 1996 case, a federal appeals court blocked a Vermont law that required dairy producers to label milk from cows that had been treated with a growth hormone made by genetically engineered bacteria.  The hormone helped cows produce more milk, but the milk itself was the same as milk from untreated cows, the FDA determined. Because the law required labels to contain information that wasn’t “material” to the product, it was unconstitutional, the 2nd Circuit Court of Appeals ruled in a 2-1 decision.

Moreover:

Labels can be required only if they alert consumers to a change that affects a food’s composition or nutrition, its physical properties (such as shelf life), or the qualities that influence the sensory experience of smelling, tasting and eating it, the FDA says.

Not surprisingly, the FDA’s position is shaped by Court rulings on the First Amendment.  In that regard, government-mandated disclosures (i.e., “compelled commercial speech”) does not generally offend the First Amendment when it  prevents (or “cures”) deception or confusion.   In addition, compelled disclosures may serve interests in promoting public health, which explains labeling requirements for nutritional data and common allergens.

A nice article on these First Amendment issues can be found here.  And the LA Times complete article is here.

 

Monster Changes From Nutritional Supplement to Traditional Drink

Monster Beverage Co. is changing its labeling so that its energy drinks will no longer be considered dietary supplements, a move that changes the federal guidelines the drinks must follow.  Among other things, the drinks will now list “Nutrition Facts” rather than “Supplement Facts” and will disclose caffeine content.   As reported by Food Manufacturing

The change reflects the intensifying scrutiny energy drinks have come under over the past year, with lawmakers calling on the [FDA] to look into the safety of the caffeine levels and other ingredients used in the drinks.  It also highlights the confusion consumers may encounter when it comes to the labeling of energy drinks, with companies having the discretion to categorize them as either dietary supplements or traditional drinks.

The No. 2 energy drink, Red Bull, is already categorized as a traditional beverage.

The distinction between a nutritional supplement and a tradition beverage is significant.   Traditional foods and drinks can only use ingredients that are approved food additives or that are generally recognized as safe.  That is not the case for nutritional supplements, which often contain little-known ingredients such as taurine used in some Monster drinks.

In 2009, the FDA issued guidance stating that dietary supplements were being marketed in ways that suggested they were traditional drinks, including using terms such as “drink”, “juice” and “beverages.”  Presently, the FDA is working on final rules to better distinguish distinguish beverage and dietary supplement.

FDA Consent Decree Requires Jonlly Fruits to Retain a Labeling Expert

Last month, the FDA entered into a consent decree with Jonlly Fruits, Inc. and its president prohibiting the Puerto Rican company from distributing adulterated beverage products with false claims.  Besides the issue of adulteration, the FDA found that Jonlly’s juice products were misbranded because:

(1) their labels claim that the products are ‘natural,’ and ‘100% natural juice,’ even though the labeling and product formulation sheets indicate that the products contain chemical additives such as sodium benzoate, and artificial colorants Yellow #5 and Red #40″;

(2) their labels bear nutrient content claims, such as “Light,” “100% Vitamin C,” “Rich in Calcium,” “No Sugar,” but the products bearing these claims do not meet the requirements set forth in FDA’s regulations, 21 C.F.R. Part 101.23; and

(3) they fail to bear the common or usual name of the food.

Notably, the consent decree, signed by Judge Gustavo A. Gelpi of the U.S. District Court for the District of Puerto Rico, requires Jonlly to retain an independent “labeling expert” to review Jonlly’s labels and submit a report ensuring that they are in compliance with applicable FDA regulations.  The framework for resolving the serious violations found by the FDA also require  Jonlly to hire sanitation and HAACP experts to provide reports and corrective-action plans, and auditors to monitor the company over a period of years. 

See the FDA press release is here.

FDA “Consumer Update” on False or Misleading Labels

In a Consumer Update titled “Foods Must Contain What Label Says,” the FDA explains the steps it takes if it has reason to believe that a food product has been misbranded with information that is false or misleading.  The primary examples  in the article are imported foods such as 100% pomegranate juice and pure honey that were allegedly adulterated with other ingredients.  The article notes that,  “[i]n the case of the pomegranate juice … the burden is on the importer to show that the product labeling is accurate.”  “Otherwise, the juice is not going to make it into the U.S.”

Please see the complete article here.

Expansion of Use: Dispute Over CRACKER BARREL Trademark

Kraft Foods has filed suit against Cracker Barrel Old Country Store, Inc.  (“CBOCS”) in light of the latter’s announced plans to expand use of the CRACKER BARREL trademark into Kraft’s retail channels.

Kraft alleges that it has been “producing and selling CRACKER BARREL brand cheese in supermarkets, grocery stores, big-box stores and other food retail stores throughout the United States for almost 60 years.”  And “since 1954, the only CRACKER BARREL brand products offered at grocery and similar stores have come exclusively from Kraft or have been licensed by Kraft.”  During this period, Kraft contends that “CBOCS maintained a distance from Kraft both with respect to goods sold and channels of trade used” by only using the mark in connection with its combination restaurants and country stores, and its internet website.  However:

After more than four decades of the status quo, CBOCS on November 13, 2012 publicly announced that [it] “will bring [CRACKER BARREL branded] products consistent with the Cracker Barrel experience such as ham, bacon, assorted lunch meats, glazes, jerky and summer sausage to a wide range of retail outlets including grocery and club stores and mass merchandisers,” thereby extending the brand “beyond [CBOCS’] physical stores.”

Kraft asserts that customer confusion will be “inevitable” because these announced products will “enter into Kraft’s trade channels,” are “highly related to Kraft’s cheese products,” and will be sold “under the identical CRACKER BARREL mark.”  Accordingly, Kraft seeks a judicial declaration that any use of the CRACKER BARREL mark by CBOCS in connection with food products sold through third party retail food channels would constitute infringement of Kraft’s registered CRACKER BARREL mark.

Kraft’s Complaint is based on the principle that owners of the same trademark may co-exist if the nature of their respective goods and channels of trade are sufficiently distinct that consumers would not confuse the two products as coming from the same source.  But if the junior user of the mark expands its use to encroach upon the products and/or channels of trade of the senior user, then the trademark laws will protect the latter against such expansion.