Ever since the FDA announced in November 2015 it was opening regulatory proceedings to define the term ‘natural’ for food and beverage labeling, courts have consistently relied on the agency’s action to stay class action lawsuits challenging the use of that term.
With the passage of time, however, the plaintiffs’ bar has grown impatient: Some counsel have filed new ‘natural’ lawsuits, while others are trying to reopen previously stayed ‘natural’ cases. These lawyers argue that private class action litigation is more expedient than the FDA’s deliberative processes, speculating that the FDA will never act—or will not act soon enough.
The real source of these gripes may be the postponement of a hoped-for fees award or, depending on the FDA’s ultimate determination, the prospect that ‘natural’ lawsuits might be regulated out of existence altogether with uniform regulations that food manufactures would undoubtedly follow.
Regardless of motivation, the notion that class action lawsuits should take precedence over FDA rulemaking is wrong-headed policy that ignores the benefits of democratic and deliberative administrative processes.
And, when it comes to the suggestion that the FDA cannot be relied on to address the issue, these arguments are simply wrong, as repeated statements by the agency indicate it is poised to act soon.
FDA: We'll have more to say soon...
FDA commissioner Dr Scott Gottlieb told the New York Times in an emailed statement last month:
“We recognize that consumers are trusting in products labeled ‘natural’ without clarity around the term. Consumers have called upon the FDA to help define the term ‘natural’ and we take the responsibility to provide this clarity seriously. We will have more to say on the issue soon.”
'Natural' cases should be stayed on primary jurisdiction grounds
The doctrine courts have relied on to stay ‘natural’ lawsuits is one of primary jurisdiction. Primary jurisdiction is a decades-old principle of law that recognizes courts should defer to federal agencies in cases where the issue before the court is one that falls within an agency’s expertise, and would benefit from the uniformity that federal regulatory authority offers.
These two policy imperatives are especially salient in the class action context—where the desires and preferences of one consumer and her paid experts might otherwise dictate outcomes on an issue subject to widely varying perspectives.
On the issue of ‘natural’ food labeling, the FDA has received over 7,600 comments from consumers and interested stakeholders. The sheer volume of these submissions illustrates that opinions on ‘natural’ labeling vary widely.
The FDA has the expertise and discretion to harmonize these disparate views, and the Congressional authority to implement a regulatory solution with nationwide effect. Courts, meanwhile, rule only on the claim before them, based on evidence the parties hand-select—represented by counsel obligated to elevate the views of their clients over any competing voices. This process cannot be expected to produce outcomes reflecting all parties’ input and preferences.
In 2008 there were 20 active food labeling class actions pending in federal court; in 2016 there were 425
Moreover, in the case of food labeling, the number of cases filed poses a real risk of inconsistent rulings.
In 2008, there were about 20 active food labeling class actions pending in federal court. By 2016, that number had risen to 425 (US Chamber Institute for Legal Reform, The Food Court, Trends in Food & Beverage Class Action Litigation, Feb. 2017). And ‘natural’ cases are on the rise once again, with a with a 22% increase in filings in 2017 versus the number of cases filed in 2016.
So, when it comes to regulation of ‘natural,’ class action lawsuits both invite inconsistent outcomes, and threaten to prioritize the views of a select number of private plaintiffs over those of other consumers.
Indeed, the Supreme Court has cautioned that the class action vehicle should not be used as a quick-fix substitute for democratic processes. The Supreme Court touched on this in Amchem Products, Inc. v. Windsor, a mass-tort class action concerning asbestos. The judiciary asked Congress to “create a national asbestos dispute-resolution scheme,” but Congress did not act.
The parties in Amchem proposed a settlement-only class action that ostensibly created the settlement mechanism Congress had not. The Supreme Court rejected the settlement. Even though Congress there had not acted, the Court still recognized that class action lawsuits are not designed to legislate national policy matters: “The benefits asbestos-exposed persons might gain from the establishment of a grand-scale compensation scheme is a matter fit for legislative consideration.”
FDA commissioner: ‘We will have more to say on the issue soon'
The preference to have issues of national significance determined by the relevant federal agency, with the authority to implement a uniform solution, is reason alone to defer to the FDA. But moreover, in the case of ‘natural’ labeling, the critique that the FDA may not act soon enough is not just misdirected—it is wrong.
As recently as two weeks ago, the FDA reaffirmed that it is actively examining the issue and poised to act. In a statement provided to the New York Times this February, FDA Commissioner Dr. Scott Gottlieb explained, “Consumers have called upon the FDA to help define the term ‘natural’ and we take the responsibility to provide this clarity seriously. We will have more to say on the issue soon.”
This was the second time in five months Dr. Gottlieb has spoken out to confirm that the issue has the agency’s attention. So, consistent messaging from the agency rebuts any claim that the issue has withered or is being ignored. Thus, ‘natural’ labeling is receiving the ‘legislative consideration’ that the Court has commented may often be superior to class action-driven solutions.
Federal agencies like the FDA are deliberative by design. Weighing competing considerations in an open administrative process, on matters where opinions diverge, is a virtue, not a vice. So, in the case of ‘natural’ lawsuits, the continued judicial deference to the agency versus litigants is not only justified, it is fair.
Charles Sipos (partner) and Lauren Staniar (associate) work in the food litigation team at law firm Perkins Coie. Sipos has over 15 years' experience litigating complex commercial cases, with a focus on class action litigation and an emphasis on defending, while Staniar has substantial experience in the U.S. Court of Appeals for the Ninth Circuit, via two judicial clerkships.