Antitrust Law Daily Wrap Up, ADVERTISING—N.D. Cal.: Primary jurisdiction doctrine bars soy yogurt labeling claims, (Jul 15, 2013)

By Jody Coultas, J.D.

The federal district court in Oakland has decided that a soy yogurt purchaser’s California consumer protection law claims against manufacturer Wholesoy & Co. were better suited to adjudication by the Food and Drug Administration (FDA) (Hood v. Wholesoy & Co., July 12, 2013, Rogers, Y.).

The consumer alleged that Wholesoy’s soy yogurt product listed “organic evaporated cane juice” as an ingredient instead of “sugar” or “dried cane syrup” in violation of FDA labeling rules and that Wholesoy’s products failed to comply with the FDA standard of identity for yogurt. The labeling purportedly misled purchasers into buying the yogurt.

Wholesoy contended that the primary jurisdiction doctrine applied to bar the claims because the FDA had regulatory authority over food labeling and the issues in this case required expertise or uniformity in administration. The primary jurisdiction doctrine allows courts to stay or dismiss a complaint without prejudice pending the resolution of an issue within the purview of an administrative agency where the claim involved an issue of first impression or a particularly complicated issue Congress has committed to a regulatory agency.

The court found that the primary jurisdiction doctrine applied and deferred to the FDA to determine the appropriate rules with respect to “soy yogurt” and “evaporated cane juice.” Courts look at whether the issue was within the jurisdiction of an administrative body having regulatory authority pursuant to a statute that subjects an industry or activity subjects an industry or activity to a comprehensive regulatory authority. Without a clear indication of how FDA would view an issue, the primary jurisdiction doctrine is appropriate. The FDA had regulatory authority over food labeling and the Food, Drug, and Cosmetics Act (FDCA) established a uniform federal scheme of food regulation to ensure that food is labeled in a manner that does not mislead consumers. States may not directly or indirectly establish food labeling requirements that are not identical to the FDCA. Here, the FDA had not yet set a uniform enforcement standard or settled on a position concerning “evaporated cane juice.” The FDA has not ruled as to whether “soy yogurt” should be subject to the same standards as dairy yogurt. Without a clear indication of how the FDA would handle the claims at issue, the court dismissed the claims.

The case is No. 12-cv-5550-YGR.

Attorneys: Ben F. Pierce Gore (Pratt & Associates) for Janet Hood. Kelly Marie Morrison (Jenner and Block LLP) for Wholesoy & Co.

Companies: Wholesoy & Co.

Cases: Advertising StateUnfairTradePractices CaliforniaNews