YOUR SOURCE ON FOOD LITIGATION AND REGULATION

The Food and Drug Administration (FDA) on Thursday announced the details of its planned delay to require manufactures to update Nutrition Facts and Supplement Facts labels on food packaging.[1] The finalized rule extends the compliance dates for manufactures with $10 million or more in annual food sales from July 26, 2018, to January 1, 2020, while compliance dates for manufactures with less than $10 million in annual food sales will move from July 26, 2019, to January 1, 2021.[2] As we previously discussed, FDA had announced last year that it was extending the compliance date to an undetermined time around the same time FSIS’s Nutrition Facts Panel proposed rule was placed on the list of “inactive” regulations by the White House Office of Management and Budget.

FDA explains in the final rule that the additional time will “help ensure that all manufacturers covered by the final rules have guidance from FDA to address, for example, certain technical questions [FDA] received after publication of the final rules, and that [manufacturers] have sufficient time to complete and print updated Nutrition Facts labels for their products before they are expended to be in compliance with the final rules.” Notably, FDA’s announcement came on the same day the US Department of Agriculture (USDA) published its much-awaited proposed rule establishing a National Bioengineered Food Disclosure Standard.[3] UDSA’s labeling disclosure requirements will potentially require additional modifications to some types of labels. Therefore, FDA’s extension of the Nutrition Facts labels may more closely align the two compliance dates and possibly eliminate the need to change the labels twice.

Since our last post, more than 41 comments have been submitted in response to the US Cattlemen’s Association’s petition (USCA Petition) requesting that the USDA FSIS exclude from the statutory definitions of “meat” and “beef” those products that are not “derived from animals born, raised, and harvested in the traditional manner.” Such excluded products would presumably include plant-based products that resemble the appearance and taste of beef products and cell-cultured meat (CCM). While an exhaustive analysis of the submitted comments is beyond the scope of this article, we would like to highlight two comments we found interesting. We also would also like to highlight a separate but related approach taken by Rep. Rosa DeLauro (D-Connecticut), to understand how best to regulate these innovative food products.

In a petition (USCA Petition) submitted to the Food Safety and Inspection Service (FSIS) on February 9, the US Cattlemen’s Association requests that FSIS exclude from the statutory definitions of “meat” and “beef” those products that are not “derived from animals born, raised, and harvested in the traditional manner.” Such excluded products would presumably include plant-based products that resemble the appearance and taste of beef products and cell-cultured meat (CCM)—meat grown in a cell culture instead of culled from an animal (jointly, Alternative Products). The USCA Petition presents the following assertions to support such exclusions:

  • Alternative Products, it maintains, do not meet the common dictionary or statutory/regulatory definitions of “meat,” “beef,” and related terms because the definitions contemplate products derived naturally from animals.
  • The marketing of Alternative Products is potentially misleading because consumers would reasonably expect products labeled as “meat” and “beef” to be derived from animals slaughtered in the traditional manner.

In almost any area where an emerging technology intersects with a highly regulated industry, there is a dynamic of entrepreneurial spirit facing the realities of existing regulatory frameworks. One novel product facing this dilemma is “cell-cultured meat” (CCM)—meat grown in a cell culture instead of culled from an animal.

CCM is part of a new and emerging area of biotechnology known as “cellular agriculture” through which agricultural products are produced from the cellular level rather than taken from the whole plant or animal. Proponents of cellular agriculture highlight the process as creating a more sustainable, efficient, and predictable food supply, and the National Academy of Sciences estimates products of cellular agriculture will be in the marketplace within the next five years.

On February 6, the Agriculture Marketing Service (AMS) posted a notice in the Federal Register announcing it will delay further rulemaking on a Federal Milk Marketing Order (FMMO) in California[1] while it awaits the US Supreme Court’s decision in Lucia v. Securities & Exchange Commission.[2] On January 12, 2018, the Supreme Court granted certiorari to resolve a circuit split between the US Court of Appeals for the Tenth Circuit and for the DC Circuit.[3]

Lucia calls into question whether administrative law judges (ALJs) working for the SEC are “inferior officers” under the Constitution and therefore fall under its Appointments Clause, which arguably mandates that ALJs be appointed by the president, a court, or a department head. While the immediate impact on the US Department of Agriculture’s (USDA’s) announcement will frustrate California dairy farmers, the broader impact is that a wide range of administrative proceedings within the USDA have been placed in abeyance pending Supreme Court action.

ALJs at USDA, like many other agencies, are not appointed but are chosen through a somewhat independent merit-based hiring system. If the Supreme Court in Lucia determines that such ALJs still function as government employees, the current selection process would be constitutional. But if it determines that ALJs have the power and responsibilities of “inferior officers,” they must be appointed by the president or an agency head to be constitutional.

An appellate court recently upheld the convictions of former employees of the now defunct Peanut Corporation of America (PCA),[1] affirming what is the longest criminal sentence in a food safety case.[2] Specifically, on January 23 the US Court of Appeals for the Eleventh Circuit unanimously denied the appeals of former PCA president Stewart Parnell, who was sentenced to serve 28 years in prison; his brother and peanut broker Michael Parnell, who was sentenced to serve 20 years; and PCA’s quality assurance director Mary Wilkerson, who was sentenced to serve 5 years.[3]

In 2009, the peanut processing company was identified as the source of a massive salmonella outbreak in the United States, which led to an extensive recall. More than 700 individuals were reported to have salmonella poisoning that was linked to the outbreak, and there were at least nine deaths. On February 13, 2009, PCA ceased all manufacturing and business operations, and filed for Chapter 7 bankruptcy liquidation.

On November 15, the US Food and Drug Administration (FDA) published a draft guidance on best practices to help parties interested in convening a panel of experts to evaluate whether a substance is “generally recognized as safe” (GRAS) under the conditions of its intended use.

Background
As previously discussed, the FDA last year published a Final Rule on the GRAS notification program, a voluntary premarket notification program for products used in food substances (GRAS notification procedure). This Final Rule was promulgated 19 years after the FDA established the “interim” GRAS notification program in a Proposed Rule.

As referenced earlier in this space, the Food Safety and Inspection Service (FSIS) hosted a public meeting on Whole Genome Sequencing (WGS) issues late in October (see meeting agenda). It provided a range of helpful information on the implications of the rapid and ongoing adoption of such technology by FSIS and other actors in the public health community at both federal and state levels. Also, in the nature of such events, it generated questions, particularly with regard to some of the core legal issues that surround WGS adoption.

The US Food and Drug Administration (FDA) opened a public comment period on November 12, 2015, seeking information and comments on use of the term “natural” on food labeling. The comment period was open until May 10, 2016. FDA received over 7,600 comments but has not yet issued any “natural” definition.

Anticipating FDA guidance, many courts stayed class actions involving allegations of the use of “natural” in food products under the primary jurisdiction doctrine, which permits a court to stay a lawsuit if doing so would give an administrative agency the opportunity to resolve the question at issue in the case. Now that it’s been more than a year since the comment period closed, some courts and parties are evaluating whether these cases should remain stayed. Plaintiffs argue that lack of FDA guidance weighs against a continued stay. But the US Congress and FDA made several statements over the past few months supporting food and beverage manufacturers’ requests for extending litigation stays.

On September 22, the US Food and Drug Administration (FDA) moved to dismiss a lawsuit filed by several public interest groups challenging its final rule that outlines how food manufacturers can establish food substances as “generally recognized as safe” (GRAS Rule). The Federal Food, Drug, and Cosmetic Act (FDCA) does not require premarket review by or notification to FDA of substances that are GRAS for their use in food. The GRAS Rule was finalized in August 2016 and sets forth a voluntary process whereby food manufacturers can choose to seek FDA confirmation of their own GRAS conclusions. This GRAS Rule is consistent with the informal process in place since 1997.

In Center for Food Safety v. Price, five advocacy organizations are challenging the GRAS Rule, alleging that it is deficient because it is not a mandatory reporting system. Specifically, the plaintiffs take issue with what they refer to as the “secret GRAS system”; they allege that the GRAS Rule is unconstitutional because it does not require FDA to conduct an independent review of all GRAS conclusions and fails to require food manufacturers to provide FDA or the public with notice of GRAS conclusions. Further details on the allegations in the complaint are available in our May 2017 LawFlash.