So much happened in 2020 in the food law world. This article highlights some of the major themes from the past year with ongoing cases used to illustrate the issues.
Challenge to the National Bioengineered Food Standard Disclosure
In 2018 the United States Department of Agriculture (USDA) passed the National Bioengineered Food Disclosure Standard that established labeling requirements for bioengineered foods. There has been pushback to this rule culminating in July of 2020, when the Center for Food Safety filed a complaint against the USDA challenging the final rule for the labeling of bioengineered foods. The complaint alleges that the final rule is discriminatory, misleading, and does not require labeling for all bioengineered foods. In their amended complaint, the Center for Food Safety added a challenge to states’ rights to label seeds as genetically modified. The outcome of this lawsuit will be significant. If the suit is decided in favor of the Center for Food Safety, either on all the claims or part of the claims, the USDA Bioengineered rule would have to undergo major changes. This would require another round of notice and comment rulemaking by the Agency. However, if the USDA is successful, implementation of the rule would continue to be in effect with the mandatory deadline for compliance on January 1, 2022.
The main poultry antitrust case, In re Broiler Antitrust Litigation, moved forward in 2020, with the DOJ indicting 10 poultry company executives for attempting to fix broiler chicken prices. The civil lawsuit was temporarily stayed pending the DOJ investigation. Once the suit resumed, the parties engaged in a disagreement regarding bid-rigging claims included in four new plaintiffs’ claims. Defendant poultry companies stated that because these claims were not included in the original cases that formed the consolidated case, they should be dismissed. Plaintiffs opposed defendant’s position stating that bid-rigging is one of the central issues in the case. Each direct-action plaintiff, that is, the plaintiffs who filed individual lawsuits, was ordered to specify which bid-rigging claims they were bringing. These claims were included in the consolidated complaint but will be litigated separately from the original claims. The latest companies to join this suit are Chick-fil-A and Target. Several poultry companies recently settled with certain groups of plaintiffs. Peco Foods, Inc., George’s, Inc., and Amick Farms LLC settled with a group of indirect buyers for $13 million.
As this case continues through the discovery phase, DOJ is still actively involved and conducting their own investigation while also pursuing criminal charges against the ten individuals referenced above. In October, Pilgrim’s Pride announced that it was willing to agree to a plea deal and pay $110.5 million in fines to settle the DOJ’s ongoing investigation of the company’s participation in the alleged price-fixing conspiracy. This deal will prevent the DOJ from any further investigation into Pilgrim’s Pride.
In 2020 several new lawsuits were filed challenging state labeling laws related to the labeling of alternative proteins such as cell-cultured meats, insect-based meats, and plant-based proteins. Three of the lawsuits are at the preliminary injunction stage, yet all have had vastly different outcomes. A key note is that the main plaintiffs in these lawsuits are either Upton’s Naturals Foods, or Turtle Island Foods. In the Arkansas case, the district court found the labeling on Tofurky’s packaging not misleading and therefore granted the preliminary injunction based on the likelihood of Tofuky’s success. In Oklahoma the judge specifically disagreed with the Arkansas judge in a footnote, stating that when viewed as a whole, the modifier of “VEGAN” and “100% VEGAN” were misleading when paired with “real meat” terms. The Missouri court denied the preliminary injunction because the judge found the language on the alternative meat product was not misleading and permitted under the law. These varying outcomes at the preliminary injunction stage showcase the differences in these laws and the difficulties that courts have when interpreting them. As a result, several states with pending legislative actions regarding meat labeling have abandoned their efforts. Pending the appeals of the injunctions and federal legislation, this area of the law will likely continue to be a divisive issue. To alleviate the discrepancies between the states, federal regulation of meat labeling would be necessary. For more information please see the NALC’s recent blog post on current meat-labeling lawsuits.
Further, cell cultured chicken developed by Eat Just received regulatory approval in Singapore this past month paving the way for cell cultured meat production to be ramped up to full commercial scale. This marks the first regulatory approval for any cell cultured meat world-wide. In the U.S. regulators are still trying to decide how these products will be overseen. Currently, the FDA and USDA are operating under a memorandum of understanding that was signed in March of 2019. Under this agreement, FDA oversees the initial stages of production and manufacturing for cell-cultured food products and confirming the safety of the cells used in the development. USDA’s FSIS is responsible for activities that occur after harvesting the cells in the lab. This would include food processing, inspection and labeling. For more information on the U.S.’s cell cultured meat regulation, see the NALC’s blog post on the topic.
Genetically Engineered Animals
Two animals with intentionally altered genomic DNA have been approved for human consumption as animal drugs. The two products are AquAdvantage Salmon (2018) and GalSafe Pigs (2020). FDA and USDA have both committed to developing regulations for the development of these animals with intentionally altered genomic DNA (IGA Animals), however, neither agency has come out with any type of rulemaking. Due to this lack of consistent oversight, there has been pushback to the approval of these animals.
Specifically, the approval of AquAdvantage Salmon has been challenged due FDA’s failure to conduct an appropriate environmental assessment under the National Environmental Policy Act (NEPA). A California federal judge ruled that FDA had not conducted an environmental analysis that looked into the potential environmental consequences of the AquAdvantage salmon escaping into the wild. However, the judge did not stop production of the genetically modified fish. While the Center for Food Safety originally touted this order as a victory, they have since filed a motion to alter the judgment, requesting that no more AquaBounty facilities be approved, namely AquaBounty’s planned facility in Kentucky. In the coming year the NALC will be following this case and specifically looking for the order regarding the permitting of future facilities and an updated environmental assessment by the FDA. For more information see the NALC’s blog posts on BE Salmon here and here.
The Animal and Plant Health and Inspection Service (APHIS) and the Food Safety Inspection Service (FSIS) have also issued a proposed rule regarding the regulation of the movement of genetically engineered animals. Under the proposed rule, the USDA will issue regulations requiring safety assessments of genetically engineered animals that would be subject to the Federal Meat Inspection Act (FMIA), and the Poultry Products Inspection Act (PPIA). Further, the FSIS will be responsible for food safety inspections and ensuring that products are not adulterated or misbranded.
Labeling hydroponically grown crops as organic has been in controversy since the USDA enacted the Organic Foods Production Act (OFPA) in 1990. The agency has stated that hydroponics can be certified organic if they meet the regulatory requirements despite recommendations from the National Organics Standards Board. This controversy came to a head in March of 2020, when the Center for Food Safety along with a group of organic farmers and stakeholders (Plaintiffs) filed a lawsuit in the Northern District of California which challenges the USDA’s decision to allow hydroponic operations to be certified organic. The crux of the argument is that hydroponic crops cannot be organic as they do not meet the soil fertility requirements of 7 C.F.R. §205.203(a) as the crops are grown without soil. The plaintiffs have filed for summary judgment with a hearing set for January 21, 2021. Plaintiffs have requested varying forms of relief including: a preliminary and permanent injunction barring USDA from authorizing organic certification to hydroponic operations; declarations affirming their allegations; a mandate that vacates the denial of the plaintiffs’ petition to USDA; and requiring USDA to promulgate regulations that prohibit organic certification of hydroponic operations. For now, hydroponic operations can be certified as organic, however, there are reports that some certifiers refuse to grant certifications to hydroponic growers.
Labeling and Animal Welfare
A pervasive issue in the meat and poultry industry revolves around labels claiming products are “natural” or “antibiotic free.” There have been several lawsuits related to these qualifiers, yet no regulatory action. In a similar vein, Smithfield has been unable to toss out court claims regarding its product label which states that Smithfield’s pork products are “safer pork.” The Organic Consumer Association sued Smithfield, stating that Smithfield “employs production practices that result in less-safe conditions, effects, and Products, including the routine preventative use of medically important antibiotics, crowded conditions, the use of potentially carcinogenic drugs, and rapid slaughter methods.” The Organic Consumer Association alleges that these practices should prevent Smithfield from using the label “safer pork” on its labels and in its marketing. Smithfield argued in its motion to dismiss, that the marketing statements were “too general to be actionable.” However, the court found the marketing statements regarding the safety of Smithfield’s pork products to be specific.
These labeling issues are a major animal welfare issue, especially for the “safer pork” claim. The Organic Consumer Association is claiming through Smithfield’s own marketing and labeling, they are leading the consumer to believe that Smithfield pigs are raised in a safer way than pigs raised by other companies. However, the Organic Consumer Association alleges that Smithfield engages in practices such as “the routine preventative use of medically important antibiotics, crowded conditions, the use of potentially carcinogenic drugs, and rapid slaughter methods.” If proven, these allegations would show that the pigs are neither natural or safer.
The cases and issues covered in this article are examples of ongoing issues in food law which will continue into 2021. Each of these cases is still developing, but all have the potential to impact the agricultural industry. The NALC will continue to monitor these issues and provide updates where needed.