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As a consequence of the United States Supreme Court’s recent unanimous ruling in Pom Wonderful LLC v. Coca-Cola Co., food labels will now come under increased scrutiny and attack by competitors. The issue under consideration was not actually the label but rather the interplay between two federal laws. Specifically, the Food and Drug Administration (FDA) regulates and enforces food and beverage labeling under the Food Drug & Cosmetic Act (FDCA) which allows companies to name drinks using the juices that provide flavor even if they do not provide the volume. In turn, the Lanham Act, which provides competitors the private right to sue, prohibits false and misleading statements about a product. Prior to the ruling, compliance with the FDA labeling regulations generally meant a product was immune from a claim that its labeling is deceptive or misleading with respect to those aspects of the label sanctioned by FDA regulations.

The case originated in 2008 when Pom Wonderful LLC (Pom) alleged that Coca-Cola Co. (Coca-Cola) was misleading consumers about its Minute Maid Pomegranate Blueberry Juice. Specifically, Pom claimed the label was misleading because the product contains approximately 99 percent apple and grape juices with very little of the more expensive pomegranate and blueberry juices. Coca-Cola responded by noting that the images on its product correctly identified the five fruits in the juice blend and the name of the product fully complied with the FDA juice-naming regulations permitting a beverage to be named after a non-predominant juice.

The district court initially sided with Coca-Cola, finding that the FDA effectively pre-empted labeling oversight. The Supreme Court, however, over-ruled that decision, concluding that the FDCA can coexist with the private lawsuits authorized under the Lanham Act. Rather than viewing the Lanham Act and FDCA as conflicting, the Supreme Court held they were complementary with one protecting commercial interests against unfair competition and the other protecting public health and safety. Indeed, the Supreme Court found that even if an aspect of a label is specifically required or authorized by the FDCA or FDA regulation, it may be subject to a Lanham Act claim because the FDCA and its regulations are not a “ceiling on the regulation of food and beverage labeling.” The Supreme Court sent the case back to the district court to allow Pom to try to prove its claim.

Food and beverage companies now need to reevaluate their marketing and labeling practices to assess whether any product might be susceptive to a competitor’s claim that its label is false or misleading, based in whole or in part, on aspects of the label regulated by the FDA. Food labels should be reviewed as a whole and with knowledge that mere compliance with FDA regulations is no longer enough.

For assistance in evaluating whether your label complies with the Supreme Court’s new ruling, please contact:

Jenny McGovern
312.642.6151
jmcgovern@mcdonaldhopkins.com

Todd A. Benni
216.348.5712
tbenni@mcdonaldhopkins.com

Business Litigation

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