Mary Eichenberger, Research Fellow

On October 31, 2025, the Ninth Circuit Court of Appeals decided in Natural Grocers v. Rollins, that regulations implementing the National Bioengineered Food Disclosure Law should be set aside due to agency error in interpreting the applicable statute. The regulations created the National Bioengineered Food Disclosure Standard (“Standard”) and were promulgated by the U.S. Department of Agriculture’s (“USDA”) Agricultural Marketing Service (“AMS”). Specifically, this ruling will expand the Standard’s disclosure requirements to category of foods which were previously excluded, “highly refined foods.” 

Background

The disclosure and labeling of Bioengineered (“BE”) food and ingredients is governed by the National Bioengineered Food Disclosure Law, passed by Congress in 2016 and codified in the Agricultural Marketing Act of 1946 (“AMA”). This law required the USDA to create a national mandatory disclosure standard for BE foods through the publication of regulations. 7 U.S.C. § 1639b. The USDA, through AMS, published the Final Rule in 2018 creating the National Bioengineered Food Disclosure Standard. The Standard mandates regulated entities, including food manufacturers, importers, retailers, and other food labeling entities, to disclose whether a product contained a BE food or ingredient by 2022. To learn more about the Bioengineered Food Disclosure Standard, check out the NALC Factsheet.

Natural Grocers v. Rollins

On July 17, 2020, a coalition of food and agricultural organizations filed a complaint in a California federal district court against the USDA Secretary of Agriculture, the Administrator of the AMS, and the USDA, challenging the 2018 BE Standard Final Rule. National Grocers v. Perdue, No. 20-5151 (N.D. Cal. July 27, 2020). The complaint challenged three aspects of the 2018 regulations: (1) exclusion of highly refined foods from the definition of BE foods; (2) the requirement to use the term BE in the mandated disclosures; (3) two provisions governing the use of QR codes or text-messaging to accomplish the required disclosures (“electronic disclosure”).

In November of 2021, the plaintiffs filed a motion giving notice they planned to make a motion for summary judgment on all claims. On September 13, 2022, the federal district court for the Northern District of California granted the plaintiff’s motion for summary judgement on the electronic disclosure regulations, but rejected the other two claims. The district court invalidated the electronic disclosure regulations at issue (§ 66.106; § 108) and remanded the regulations without vacatur to AMS for further consideration. This means that even though the regulations were found to be unlawful they could still be enforced while AMS worked to make the changes mandated by the court. In the fall of 2025, the plaintiffs appealed the district court’s decision to the Ninth Circuit, and on October 31^st, the Ninth Circuit Court published their ruling.

Challenging the Non-Detectability Regulation

The Ninth Circuit (the “court”) first considered two claims regarding “detectability” brought by the plaintiffs. They first addressed the plaintiffs’ allegations that AMS unlawfully excluded highly processed foods containing BE material from the BE disclosure requirement, and second, the claim that AMS did not have statutory authority to institute a detectability standard.

The court first considered the plaintiff’s claim that the agency made an error when it excluded from the BE disclosure requirement any food which has undergone a level of processing that made its genetically modified material undetectable. To determine whether the agency did err when creating the disclosure requirement, the court first sought to determine the meaning of “bioengineered” as it relates to food. The AMA only provides a definition for “bioengineering” which “refers to a food – (A) that contains genetic material that has been modified through in vitro recombinant deoxyribonucleic acid (DNA) techniques; and (B) for which the modification could not otherwise be obtained through conventional breeding or found in nature.” 7 U.S.C. 1639 (1).

While the AMS regulation that established the BE food disclosure standard defines “bioengineered food” similarly to the AMA, the regulation includes a specific provision that states “such a food does not contain modified genetic material if the genetic material is not detectable pursuant to § 66.9.” Under § 66.9, the genetic material is not detectable if one of the three “non-detectability” options is true:

(1) “the food is sourced from a non-bioengineered crop or source”;

(2) “the food has been subjected to a refinement process validated to make the modified genetic material in the food undetectable”; or

(3) “analysis or … testing appropriate to the specific food … confirm[s] the absence of modified genetic material.” § 66.9.

In other words, if a food product meets any of the non-detectability options, then under the regulations, it is not considered to “contain modified genetic material” and is exempt from the BE disclosure requirements.

However, to fully understand what qualifies as “detectable” genetic material, the court then determined that it needed to define the condition, “contain[s] modified genetic material.” The AMA nor the regulations define the word “contains,” so the court had to rely on the word’s ordinary meaning. To determine the meaning of a word that is not defined in statute, courts and agencies use the plain language or plain meaning rule. This means that courts look to the “ordinary” or “plain” meaning of the word as it is used in everyday speech. Courts can rely on dictionary definitions to determine the words ordinary or plain meaning.

Here, the court choose to define “contains” as “to have within” or “to have as a component or constituent part.” After applying that definition, the court held that “a food is ‘bioengineered’ if it actually has modified genetic material within it.” Further, it found that “a showing of non-detectability of genetically modified material … is not legally equivalent to a determination that the food does not ‘contain’ such material.” In other words, the court disagreed with AMS’s interpretation that a food does not contain modified genetic material if the material is not detectable. Thus, the court held that the agency did make an error by excluding highly refined foods from the BE disclosure requirement.

Because the court found that the agency did err in its interpretation of the AMA, it reversed the district court’s decision and sent the regulations back to the agency to be reconsidered.

Challenging Agency Authority

Next, the court considered the plaintiffs claim that the detectability standard is unlawful because, under the AMA, the agency does not have the authority to “adopt a detectability exception for highly processed foods made from bioengineered ingredients.” Rather, the plaintiffs allege the “agency must impose a disclosure requirement on all such highly processed foods.” In other words, the plaintiffs claim the agency did not have the statutory authority to create detectability limits but was required to mandate disclosure for all highly processed foods.

Here, the court held that the agency is permitted to create detectable limits. Specifically, the court found that the language of the AMA gives AMS the “discretionary authority” to set standards on the “amounts of bioengineered substance” that can be present for food to qualify as bioengineered food. In conclusion, the court rejects the plaintiff’s request that the AMS should impose a disclosure requirement on all highly processed foods made from BE ingredients.

Required Term Usage

Next, the court takes up plaintiffs’ claim that required use of the term “bioengineered” in the disclosure is improper under the APA. The plaintiffs advocate for terms that are “more familiar to consumers” like “genetically modified” to be used. The district court rejected the plaintiff’s claim and the Ninth Circuit court affirmed their rejection.

A court will uphold an agency action if it is not “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S C. § 706(2)(A); Defenders of Wildlife v. Zinke, 856 F.3d 1248, 1256-57 (9th Cir. 2017). Arbitrary and capricious means the agency’s action was unnecessary and not reasoned. Additionally, a court will find an agency action is arbitrary and capricious, “if the agency relied on factors Congress did not intend it to consider, entirely failed to consider an important aspect of the problem, or offered an explanation that runs counter to the evidence before the agency or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.” Id.

Here, the court held that AMS did not rely on factors Congress did not intend it to consider because the term “bioengineered” was the “term ‘used by Congress,’ it ‘clearly and accurately described the technology’ being disclosed, and it would avoid ‘inconsistencies with the preemption provisions’ of the Act.” Additionally, the court held AMS had the statutory authority to pick the terms to use, and the discretion to rely on other similar terms. AMS did not act arbitrarily and capriciously when it decided to require “one single, uniform term” to avoid confusion in the marketplace. Thus, the court held AMS’s decision to require BE disclosures to include the term “bioengineered” was reasonable and not arbitrary and capricious.

Electronic Methods of Disclosure

Finally, the court addressed the plaintiffs challenge of the electronic disclosure regulations under the APA as being contrary to the law. The first regulation in question is § 66.106 which requires that an electronic or digital link printed on the BE label must have an accompanying statement (“scan here for more food information”), telephone number that will provide the bioengineered food disclosure regardless of the time of day, and when the link is accessed it must go directly to a product information page. § 66.106 The second regulation in question is § 66.108 that permits a text message disclosure that allows a consumer to access information by texting a number (“text [word] to [number] for bioengineered food information”) that sends an immediate response with appropriate bioengineered food disclosure information in accordance with the regulation. § 66.108

The district court agreed with the plaintiffs and remanded the regulations back to the agency without overturning them. The district court determined AMS acted unlawfully when it allowed “manufacturers to use an unremedied electronic or digital link option that the statutorily required study had shown to be deficient” and added “a freestanding non-statutory fourth option allowing for a text-message disclosure.” However, on appeal, the plaintiffs challenge the court’s decision to not invalidate the regulations.

When deciding whether to vacate a regulation under the APA, a court must consider “how serious the agency’s errors are and the disruptive consequences of an interim change that may itself be changed.” Montana Wildlife Fed. v. Haaland, 127 F.4th 1, 50 (9th Cir. 2025). The court’s application of these two factors “is reviewed for abuse of discretion.” Id. Here, the court held that the seriousness of the agency’s error is substantial enough because it “unquestionably precludes readoption” of the regulations as they currently stand. In other words, the existing form of the regulations is contrary to the law and on remand cannot be carried out, so the regulations must be overturned. The disruptive consequences as anticipated by the district court, which include the disruption of the food industry and of consumer’s access to BE disclosure, were found to pale in comparison to the refusal of the court to vacate the proven inadequate regulations. Thus, the court held the district court did abuse its discretion by sending the regulations back to AMS without overturning them.

The court reversed the district court’s decision to refuse to overturn § 66.106 and § 66.108 and sent the regulations back to AMS. The court instructed the agency to take in feedback from the parties and to overturn portions of the regulations as needed. In other words, the agency must rework the regulations in conjunction with the court’s decision, and overturn parts of the regulations that are unlawful under the court’s reasoning.

Concluding Thoughts

Following the Ninth Circuit’s decision, all eyes are now on AMS and the district court as they move to vacate the two electronic disclosure regulations, and address the BE detectability concerns in highly processed foods. Ultimately, the court held AMS is not permitted to exclude highly processed foods containing BE ingredients from the BE disclosure standard, and manufacturers of highly processed foods that are made with BE ingredients should be prepared to adhere to the BE disclosure standard in order to ensure compliance with the National Bioengineered Food Disclosure Law moving forward.

To read the Ninth Circuit’s decision in Natural Grocers v. Rollins, click here.

To learn more about the Standard, click here to read NALC factsheet “The Bioengineered Food Disclosure Standard.”

To learn more about a recent BE disclosure update, check out NALC’s blog, “AMS Updating the National Bioengineered Food Disclosure Standard of Bioengineered Foods.”