Last year, we blogged about the District of New Jersey’s dismissal of a putative class action involving the margarine substitute, Benecol Spread. See here. In celebrating the win, we focused on the defense decision to lead with standing – a less often used argument than heavy-hitters like preemption or Twiqbal. A bench player, if you will, that came through in the clutch. But that was regular season play. Now we are talking about the playoffs. And, while we are happy to report that defense win stands, the Third Circuit sent standing back to the minors and let preemption swing away.
In Young v. Johnson & Johnson, 2013 U.S. App. LEXIS 9422 (3d Cir. May 9, 2013), plaintiff took issue with Benecol’s labeling that stated the product contained “NO TRANS FAT” and that it is “Proven to Reduce Cholesterol.” Id. at *2. Plaintiff claimed that those (and similar) statements were false and misleading because Benecol contains small amounts of trans fat. He also claimed that he paid a “premium price” for Benecol relying on those statements. Id. at *3.
As more fully explained in our prior post, the district court found that plaintiff had not pled a sufficient injury-in-fact (he got what he paid for and alleged no adverse health effects). While only addressed in a footnote by the Third Circuit, it is clear that they did not agree. The appellate court cites other decisions by the District of New Jersey which found standing under the New Jersey Consumer Fraud Act where plaintiff alleged “financial injuries based on their purchase of a product that did not have the attributes it claimed.” Id. at *6-7, n.4. We haven’t parsed through these other cases, we simply note that they exist and the Third Circuit apparently agreed with their reasoning instead. The court did acknowledge that plaintiff’s standing was “tenuous,” but enough to survive a motion to dismiss. Id.
But that’s what’s good about having a deep bench. The defendant had preemption waiting in the wings to bring home the victory. The Federal Food, Drug and Cosmetic Act (“FDCA”), as amended by the Nutrition Labeling and Education Act (“NLEA”), governs food nutritional labeling. And the NLEA has an express preemption clause. States can’t impose a nutritional labeling requirement “that is not identical to the requirement” imposed by the FDCA. Id. at *4. So, the court had to see what the FDCA had to say about trans fat and cholesterol claims.
As to nutrition labeling about fat content, the federal regulations provide “[i]f the serving contains less than 0.5 gram [of trans fat], the content, when declared, shall be expressed as zero.” Id. at *7. Each serving of Benecol contains less than .5 grams of trans fat, and so Benecol’s nutrition facts correctly reported trans fat as 0 grams per serving. But plaintiff’s issue was with labeling that the product – as a whole – contains no trans fat. Id. Both the court and the FDA found plaintiff’s argument splits too fine a hair:
The FDA has long recognized the potential for a discrepancy between required disclosure of “zero grams per serving” and an accurate nutrient content claim that the product is not, in fact “free” of the nutrient in question. Because “[s]uch declarations could be confusing to consumers, and this consequence is unintended[,] … the determination of whether a product is free of a nutrient [is] based on the value of the nutrient … per labeled serving.”
Id. at *8-9. So, because the FDCA expressly allows a nutrient content claim that a food contains “no fat” when each serving contains less than 0.5 grams per serving, plaintiff’s attempt to impose liability for making such a claim under state law is preempted. Id. at *9-10. The decision cites three other cases that reach the same conclusion, including Reid v. Johnson & Johnson, 2012 WL 4108114 (S.D. Cal. Sept. 18, 2012), that was discussed in a guest post here. The court also found the “NO TRANS FAT” claim “not misleading” in accordance with the federal regulations.
Plaintiff’s cholesterol claims met the same fate. Plaintiff alleged that FDA regulations allow claims that plant sterol/esters are proven to reduce cholesterol, which is different than defendant’s claims that Benecol is proven to reduce cholesterol. Young, 2013 U.S. App. LEXIS 9422 at *11. While the fat content was a nutritional claim, this is considered a health claim – and as such more expressly regulated. “Food labeling may not include a health claim, whether express or implied, unless the claim is specifically provided for in [the regulations].” Id. What do the regulations provide – that products containing a certain minimum amount of plant sterol esters (such as Benecol) are “permitted to make heart health claims.” Id. at *12-14. Since “the regulations expressly authorize [Benecol] to make the health claim,” plaintiff’s state law claims seek to impose standards that are not identical to FDCA regulations, and are therefore preempted.
So in summary — preemption racks up another win, Young gets added to the list of favorable appellate-level food labeling cases, and perhaps New Jersey looks a little less inviting to plaintiffs’ counsel looking to bring these claims somewhere other than California. It may not have been standings time to shine, but we’ll take the rest.