An August 19, 2012, front page article in The New York Times reported that prominent lawyers with considerable experience in class action litigation have filed suit within the last few months against "industry leaders like ConAgra Foods, PepsiCo, Heinz, General Mills and Chobani." The NYT report further stated that the suits "asserted that food makers are misleading consumers and violating federal regulations by wrongly labelling products and ingredients."
Purpose of labels
The purpose of food product labels is to help inform and protect the consumer:
1- By detailing the ingredients used in the formulation of the product
2- Specifying the critical nutritional profile including any implied health claims
In the United States, the Food & Drug Administration (FDA) regulates the labelling of most foods and non-alcoholic beverages and derives its jurisdiction over food labelling from the Federal Food, Drug, and Cosmetic Act (FDCA) and the Nutrition Labeling and Education Act (NLEA). This legislation requires certain nutritional and ingredient information to be disclosed on the labels of all FDA-regulated food items. The United States Department of Agriculture (USDA) through the Food Safety and Inspection Service (FSIS), regulates labelling of meat, poultry, and liquid egg products. The USDA derives its labelling jurisdiction from the Federal Meat Inspection Act (FMIA) and the Poultry Products Inspection Act (PPIA). There is uniformity between the USDA and FDA nutritional and ingredient labelling requirements. The major difference between the two, is that whilst USDA stipulates a label pre-approval process, FDA food labels are not pre-approved.
The food industry in general has spent time, effort and resources to conform to legal requirements through proper identification of ingredients and nutritional profiles. However there are instances where the information on labels has been deemed to be insufficient or inaccurate by consumer advocacy agents. This has led to allegations by consumers and the lawyers representing them that there is some amount of abuse of these regulations.
Examples of deficiency
Some examples of product labels which have been scrutinised and alleged to be deficient are summarised below:
■ A major cooking spray used by the American consumer is marketed in a sprayable can. The ingredient label indicates that it uses a "propellant," which is the only information available to the consumer. The Material Safety Data Sheet (MSDS) has more detailed information. An MSDS is a document that is commonly used by food professionals and not by the consuming public and it indicates that the propellant that is used is a combination of "petroleum gas, propane and butane." The FDA has probably specified levels of these propellants that may be safely used for human consumption and the manufacturer has probably ensured that the propellant have been used within permitted levels. Since this information is not made known to the consumer, the potential exists for legal liability according to the lawyers involved.
■ A food manufacturer in New York has recently introduced a yogurt product that is gaining market share. The ingredient list for this yogurt includes "evaporated cane juice" which may be construed as a scientific euphemism for "sugar." The lawyer suing them has accused the company "of misleading, uninformative terminology" in this case. In fact the use of various sugar sources and types without specifically noting that the ingredient used is "sugar" is one of the major complaints of consumer advocates. It is conceivable that an uninformed consumer who may be diabetic or an overweight individual might suffer health effects as a result.
■ In another example, a popular chocolate spread implied in its advertisements that it may be used as part of a healthy breakfast. A consumer claimed she was misled since she did not understand that a serving of this product contained high levels of sugar, fat and calories. A subsequent class action suit resulted in a monetary settlement when the judge accepted the consumer complaint that the spread was not a "healthy, nutritious" food as implied in the advertisement.
Misuse and excessive use
Groups like the Union for Concerned Scientists, a non-profit science advocacy group, have complained about the misuse and excessive use of antibiotics, genetic modification issues etc. and lack of consumer information. Similarly for some time now consumer groups had called for some control on the use of BPA- Bisphenol A. BPA has been used widely in a variety of plastics and food packaging material including in baby formula packaging. Recently some controls been instituted in use of BPA with the concurrence of industry.
Such infractions of the labelling regulations have led consumer advocates and their lawyers to accuse the food manufacturers of marketing mislabelled products. A number of consumer advocacy groups have grown into consumer protection agencies. The Center for Science in the Public Interest (CSPI) is an example, an advocacy group founded in 1971 and is an off-shoot of the Ralph Nader consumer group - it is primarily funded by income from a newsletter and focusses on nutrition and food safety.
Most major food companies respond that they are very cognisant of their responsibility to consumer safety and health. To be fair, food processors complain that they have to operate within a set of complicated and vague regulations written by the Food and Drug Administration (FDA).
For example a number of legal actions have been filed alleging that claims of "0 trans fat" or "trans fat- free" on product labels are misleading when the product contains some form of partially hydrogenated vegetable oil. However, FDA regulations specifically permits a product containing less than 0.5 gram of trans fat per serving to be labelled as "0" gram of trans fat and therefore trans fat-free. Thus, the food companies allege that many of the suits are without merit and accuse the legal profession and some consumer groups of irresponsible litigation.
A popular breakfast cereal is marketed under the enticing label of "Cap'n'Crunch Berries." The manufacturer was sued by a consumer for false advertising as the product did not contain real berries. In this case a judge ruled in favour of the food company as he concluded that a "reasonable consumer would not be deceived…..". Similarly attempts to sue the major fast food chains for causing obesity in consumers have not succeeded.
Natural products
"Natural" food products are a segment with substantial sales and growth potential and a number of complaints of misleading labeling. The FDA has contributed to the problem as it has to date not laid down specifications and regulations on what constitutes a natural product leading not only to confusion but also to substantial abuse. FDA's informal policy seems to be that "natural" means that "nothing artificial or synthetic has been included in" the formulation of the natural product. A whole range of products with dubious claims to be natural have been marketed. This includes a number of "natural" products that contain High Fructose Corn Syrup. The consumer advocacy group - CSPI - challenged a prominent ice cream for using HFCS, hydrogenated oil and processed cocoa in their "natural ice cream" and the manufacturer amended their labelling and advertising. Similarly a range of beverages have used HFCS and claimed to be "natural" leading to challenges by consumer lawyers and advocacy groups.
Meanwhile, the "organic" sector which has both a growing market niche as well as a good financial margin potential has strict FDA rules on what constitutes an organic product. There is a minimal amount of complaints in this sector as the food companies have specific guidelines to follow.
Another area of conflict is the proliferation of health-related claims which connect consumption of specific food product with some health benefit. Some products go so far as to state or imply that the food in question is "clinically proven" to cure/prevent some ailment. The FDA is now demanding substantial scientific evidence to permit such claims. Claims that have been questioned include anti-oxidant and immunity boosting properties, cholesterol reduction, cancer prevention, heart health, probiotics in yogurt and so on.
Greater scrutiny
Food companies today face greater scrutiny not only on product labelling but also on nutritional claims and advertising. Food advertising is subject to Federal Trade Commission - FTC - jurisdiction. The FTC is empowered to prohibit unfair or deceptive advertising. The FTC's authority extends to all advertising, including that on labels as well as on the manufacturer's website. In a recent example FTC objected to a prominent multinational's claim that its children's breakfast cereal was "clinically shown to improve kids' attentiveness by nearly 20%." This resulted in an out-of-court settlement between the company and the FTC. Subsequently the manufacturer had to deal with a followup consumer class action suit.
The FDA, USDA and FTC are trying to take a more pro-active role in assessing food labelling and advertising. For instance, the FTC, USDA and FDA, along with the Centers for Disease Control (CDC) have proposed voluntary principles to guide food industry marketing to children. The growing awareness of food regulations and consumer protection has also led the FDA to institute more controls not only over domestic manufactures but also internationally. There are over 200,000 international facilities that play a role in preparing foods which then enter the US market. Since 2010, the FDA has developed a registry, which requires manufacturers, processors, packagers and distributors of human and animal food to report safety issues that are likely to have public health consequences.
In an environment where there is increased scrutiny of food labels, consumer groups will continue to evaluate, educate and influence public opinion. Food companies must recognise that certain claims which are not in compliance with regulations will continue to face challenges.
