Antitrust Law Daily Wrap Up, ADVERTISING—N.D. Cal.: False, misleading trans fat claims preempted by federal labeling law, (Feb 9, 2016)

By Greg Hammond, J.D.

A consumer’s mislabeling claims, that a food manufacturer misrepresented that its taco shells contain “0g Trans Fat,” were preempted by the federal Nutrition Labeling and Education Act (NLEA). In dismissing the Unfair Competition Law (UCL), False Advertising Law (FAL), and Consumers Legal Remedies Act (CLRA) mislabeling claims, the federal district court in San Francisco reasoned that the state law claims would impose a burden that is not identical to the NLEA’s requirement that products containing 0.5 grams of trans fat per serving or less must be represented as 0 grams on the Nutrition Facts Panel (Walker v. B&G Foods, Inc., February 8, 2016, Tigar, J.).

The consumer alleges that B&G Foods, Inc.’s tacos were made with partially hydrogenated oils but contained the deceptive health and wellness claim “0g Trans Fat!” displayed on the front of the products’ packaging. In addition, the consumer claims that he suffered physical injury when he repeatedly consumed the taco shells at issue due to consuming artificial trans fat, which “inflames and damages vital organs and increases the risk of heart disease, diabetes, cancer, and death.” B&G moved to dismiss the UCL, FAL, and CLRA claims.

Preemption of mislabeling claims. The Food and Drug Administration has promulgated regulations pursuant to the NLEA that require a product’s Nutrition Facts Panel to express the amount of trans fat per serving as zero if a product contains 0.5 grams of trans fat per serving or less, according to the court. Noting that the taco shells at issue contain less than 0.5 grams of trans fat per serving, the court concluded that the state law mislabeling claims would impose a burden through state law that is not identical to the requirements under the NLEA. The state law misbranding claims were therefore expressly preempted by the NLEA.

Standing to assert unfairness claim. The consumer, however, had standing to bring its claim under the unfair prong of the UCL, the court concluded. Allegations that the quantity of trans fat that he actually consumed as part of B&G’s taco shells inflamed and damaged his vital organs were more than sufficient to demonstrate physical injury and causation to confer standing. In addition, because B&G merely appears to be in the process of removing partially hydrogenated oils from their taco shells, but has not yet done so, the consumer had standing to pursue injunctive relief with regard to his remaining UCL claim.

Primary jurisdiction doctrine. Finally, the court concluded that application of the primary jurisdiction doctrine is appropriate with the remaining claim under the unfair prong of the UCL and the breach of implied warranty of merchantability claim. In particular, the court found: (1) both of the remaining claims require resolution of whether the amount of trans fats that were presents in B&G’s taco shells was safe for human consumption; (2) Congress granted the FDA authority to regulate food safety by requiring pre-market approval of food additives and exempting foods that are generally recognized as safe; (3) it is clear that the federal Food, Drug, and Cosmetic Act subjects the food industry to comprehensive regulation; (4) resolution of these issues require expertise and uniformity in administration; and (5) the FDA has stated it intends to act on petitions seeking food additive approval for one or more specific uses of partially hydrogenated oils with supposed data demonstrating a reasonable certainty of no harm of the proposed uses. The court therefore stayed the consumer’s remaining claims pending further guidance from the FDA.

The case is No. 15-cv-03772-JST.

Attorneys: Gregory Weston (The Weston Firm) for Troy Walker. Jonas Noah Hagey (BraunHagey & Borden LLP) for B&G Foods, Inc. and B&G Foods North America, Inc.

Companies: B&G Foods, Inc.; B&G Foods North America, Inc.

Cases: Advertising CaliforniaNews