Franco v. Chobani, LLC, 2026 WL 2150193 (7th Cir. July 27, 2026), is a food case, not a drug or device case, but it is vital reading for anyone who litigates over products regulated by the Food and Drug Administration (FDA). In litigation involving regulated products, the fact of such regulation is usually a component of the defense. We defense hacks invoke regulatory compliance as both bona fides and bodyguards. We (and our clients) rely on what regulations say, and what regulators say about those regulations.
Sometimes such reliance is misplaced.
Preemption is the apotheosis of a regulatory defense. The recent SCOTUS opinion in the Roundup litigation (Durnell) explained the fundamental policy bases of regulatory preemption: consistency and uniformity. Companies making products that improve and extend our lives simply cannot carry on their business if they must conform to different, perhaps contradictory, rules set within different jurisdictions, and maybe even set by different juries within the same jurisdiction. Moreover, whereas rule by regulation is driven by data, science, and experts, rule by litigation is driven by trial lawyer storytelling, cynicism, and faux morality tales of corporations elevating “dollars over lives.” Regulation balances risks and benefits; jury trials are crazy-quilt lotteries. Regulation imposes order; litigation exploits chaos.
But what if the regulation succumbs to chaos? Franco is a festival of disillusionment. This adverse decision by the Seventh Circuit in a food preemption case is more proof, if any was needed, that with the FDA under the control of a plaintiffs’ lawyer, the FDA is about as reliable as the Phillies bullpen. The plaintiffs brought consumer deception claims on behalf of themselves and a putative class against Chobani over its “Zero Sugar” yogurt. The plaintiffs alleged that they purchased the product advertised as “sugar free,” though it contained four grams per serving of allulose, a monosaccharide sweetener. The plaintiffs sought relief under various state consumer protection statutes. The district court dismissed the complaint under Rule 12(b)(6), deferring to FDA enforcement guidance and holding that the claims were preempted.
The plaintiffs appealed the ruling to the Seventh Circuit. The central issue was whether allulose is a “sugar” under 21 C.F.R. § 101.9(c)(6)(ii), which defines “total sugars” as “the sum of all free mono- and disaccharides (such as glucose, fructose, lactose, and sucrose).” Allulose is a “novel” sugar that differs from the not-so-novel sugars in terms of how it is metabolized and how it affects dental caries. Somewhere along the way, the FDA realized that its regulatory definition of “total sugar” (issued more than 30 years ago) had become outdated, given advances in materials science. The FDA had in 2016 anticipated “future rulemaking” (that never occurred) to remove allulose from the definition of “total sugar” because it did not have the adverse physiological effects associated with ordinary sugars. Rather than commence that rulemaking, in response to a citizen’s petition, in 2020 the FDA issued an allulose “guidance” that it would exercise “enforcement discretion” against prosecuting omission of this specific sugar from the declared quantities of total sugars. That guidance was relied upon by the manufacturer in drafting the Nutrition Facts panel. It was also relied upon by the district court when it granted the motion to dismiss the Franco case.
During appellate oral argument, “both parties agreed that seeking the FDA’s perspective in this case would be helpful.” Given the regulatory history, especially the allulose guidance, one could see why the defendant would expect some help from the FDA in this case. But then the FDA filed an amicus brief and took the position that section 101.9(c)(6)(ii) was unambiguous and that total sugars as defined in that regulation included all monosaccharides, such as allulose. Talk about a reversal of fortunes! The district court had read section 101.9 to be ambiguous, and then deferred under Auer to the FDA’s Allulose 2020 guidance. (Chevron deference to an agency’s interpretation of statutes might be dead, but Auer deference to an agency’s definition of its regulations is not dead – yet.) But the FDA’s reversal of position led to the Seventh Circuit’s reversal of the district court. Relying on the regulation’s text and finding the FDA’s position in its amicus brief persuasive under Skidmore, the Seventh Circuit court concluded the sugar definition unambiguously includes all monosaccharides, and thus allulose is a sugar. Because foods labeled “sugar free” must contain less than 0.5 grams of sugars as defined by § 101.9(c)(6)(ii), the plaintiffs’ state-law claims, which mirror federal requirements, were not preempted. The court rejected the district court’s Auer deference to the FDA’s 2020 allulose guidance, characterizing it as enforcement discretion rather than a binding interpretation.
That last point is particularly disturbing. So much for settled expectations. The FDA took the position that its 2020 allulose guidance did not have the force of law, and therefore could not be considered preemptive. The Seventh Circuit agreed. Under the preemption requirements imposed by the Supreme Court in Albrecht, that may well be legally correct, but the independent preemptive effect of FDA enforcement discretion is nowhere mentioned. For our purposes, the broader take away is that the RFK, Jr FDA can no longer be trusted to stand up for its actions when those actions would have supplied the bona fides and bodyguards referred to above. According to the Seventh Circuit, the FDA allulose guidance was not a regulatory interpretation but merely “an announcement of the agency’s enforcement position.” The guidance was of no weight because it was not an agency “official position.”
What about the defendant’s reliance interest? The Seventh Circuit essentially said, tough. FDA regulated manufacturers are “sophisticated actors” that understand how mere FDA enforcement decisions “would not immunize the company” from product liability litigation. To quote from another rotten ending, “Forget it Jake, it’s Chinatown.” Thus, regulated parties can no longer be content with ad hoc, FDA half-measures to resolve disputes, and should press for actual, legally binding regulatory changes. Non-binding “guidance” is not enough, when the FDA can cut and run when called upon to give its views in litigation. The less we say about the current FDA’s muddle-headedness’ and malevolent motives, the better.
Beyond that, the Seventh Circuit was content to allow a parenthetical – the “(such as glucose, fructose, lactose, and sucrose)” — in the original regulation to become a “redundancy” in light of the FDA’s position. For the second week in a row, we consider a case involving the interpretation canon of noscitur a sociis. The notion of that canon is that a word is known by the company it keeps. Allulose is different in important ways from the sugars specified in the regulation. But the Seventh Circuit thought the defendant was making the “such as” do too much work.
Our disappointment and indignation cannot surpass what was eloquently expressed in a recent article by Cory Andrews at the Washington Legal Foundation, “Guidance for Thee, But Not for Me: The FDA’s Bait-and-Switch in Franco v. Chobani.” (Link here.) Here is the conclusion of that article: “Franco tells every regulated business in the Seventh Circuit that FDA guidance is not a shield but a trap, and that the only safe course is to demand formal rulemaking the agency rarely and begrudgingly delivers. That is bad administrative law and bad policy.” At least one can always rely on WLF to get things right. Consistency and logic go a long way.
Addressing the defendant’s alternative Rule 12(b)(6) argument, the Seventh Circuit held that the complaint plausibly alleged consumer deception. The labels allegedly promised “sugar free” despite four grams per serving of allulose, and the court found it plausible that reasonable consumers could be misled by the absolute “sugar free” claim. Forget about whether allulose would not implicate any of the physiological effects that make consumers fret about the other sugars. The court held that “how reasonable consumers perceive Chobani’s labels and make decisions about its products are questions of fact that cannot be answered now.” Hello, discovery.
The only good thing about the decision is that the defendant gets to try again on different preemption grounds, based on the effect of FDA labeling approval after Durnell.
The result in Franco is certainly bitter, not sweet. We remember when one could rely on the Seventh Circuit. (Okay, forget about Bausch for the moment. Let us momentarily wallow in our University of Chicago nostalgia over Posner, Easterbrook, and Wood.) We also remember when one could rely on the FDA.