Antitrust Law Daily Wrap Up, ADVERTISING—S.D. Cal.: Chef Boyardee learns to read, ‘No MSG’ means ‘No MSG’, (Jul 31, 2014)

By Bryant Storm, J.D.

A consumer class action challenging ConAgra Foods, Inc.’s (ConAgra) Chef Boyardee Mac & Cheese (Chef Boyardee) labeling practices will continue after a district court held that the class’s state law claims were not preempted by federal law. The court reasoned that because a Food and Drug Administration (FDA) interpretation of the phrase “No MSG” found on the agency’s website meant that the allegedly misleading labeling rendered the product “misbranded” under California and federal law, there was no preemption and the class action could continue (Peterson v. ConAgra Foods, Inc. July 29, 2014, Lorenz, M).

Preemption. Under the federal Food, Drug, and Cosmetic Act (FDC Act) (21 U.S.C. sec. 393(b)(2)(A)), the FDA is given authority to protect public health by regulating labeling in the food industry. Under the Nutrition Labeling and Education Act (NLEA) (21 U.S.C. sec. 343-1) the FDC Act was amended to grant further authority to the FDA to develop regulatory standards for food labels. The NLEA also amended the FDC Act by adding a preemption provision that prohibits states from developing additional food labeling regulations. In other words, the only permissible state labeling requirements are those that mirror the federal requirements found in the NLEA.

Chef Boyardee. Eric Peterson, a member of a class action, purchased Chef Boyardee Mac & Cheese. The product he purchased expressly stated that it had “No MSG” or “No MSG Added” on its label. Peterson allegedly purchased the Chef Boyardee product relying on the “No MSG” representations and indicated that he would not have purchased the product had he known the Chef Boyardee actually contained MSG. The class action asserted that ConAgra’s labeling violated California consumer, advertising, competition, and commercial laws. ConAgra responded by contending that the state law claims were preempted because they usurped the FDA’s exclusive authority to regulate food labels.

Regulations. The court held that there would be no preemption if the Chef Boyardee label would be considered “misbranded” under the FDC Act and California law. The court held that if the labeling requirements found in both laws mirrored one another, there would be no need for preemption and the claims could proceed. To decide whether the label would be considered misbranded under FDA requirements, as well as California law, the court looked to FDA regulations. The federal regulation on MSG labeling, found in 21 C.F.R. sec. 101.22(h)(5), requires that “any monosodium glutamate used as an ingredient in food shall be declared by its common or usual name ‘monosodium glutamate.” Because MSG occurs naturally in some ingredients, the FDA regulation allows those ingredients, such as yeast, to be labeled by their common names. The court held that the regulations left some ambiguity as to whether a label could state “No MSG” when a product included ingredients which naturally contained MSG, even when the product didn’t contain monosodium glutamate as an individual ingredient.

Website. The FDA website answered the court’s inquiry in the agency’s Questions and Answers section. The FDA answer clearly expressed the position that “foods with any ingredient that naturally contains MSG cannot claim “No MSG” or “No added MSG” on their packaging.” The court held that because the FDA regulation on MSG labeling was ambiguous, deference to the FDA’s website was appropriate because the court was permitted to treat the Q & A section as an agency interpretation of an ambiguous regulation.

Mirror. Looking at the California labeling requirements in connection with the FDA interpretation of its MSG labeling regulations, the court decided that both laws plainly forbid labels from representing that a product had “No MSG” when the product included ingredients containing MSG. Because the laws mirrored one another, the court held that the class action could continue. The court placed a slight caveat on its rejection of ConAgra’s attempt to dismiss the lawsuit, stating that the only claims that would survive were those that arose after November 19, 2012, when the FDA published the Q and A on its website.

The case number is 13-cv-3158-L (NLS).

Attorneys: Marc L. Godino (Glancy, Binkow & Goldberg, LLP) for Eric Peterson. David Robert Clark (The Clark Law Firm) for ConAgra Foods, Inc.

Companies: ConAgra Foods, Inc.

Cases: Advertising CaliforniaNews