Where can you find granola bars, salad dressing, dry pasta, peanut butter, breakfast cereal, almond milk, and ice cream? Besides the grocery store, or possibly your kitchen, all of these food products can be found on court dockets. This is because they have all been the subjects of class action lawsuits challenging their manufacturers’ use of the “natural” label.
If you have been in a supermarket recently, chances are you have encountered a variety of these “natural” products. Indeed, you might have specifically looked for and purchased certain food products simply because they were labeled “natural,” as fifty-nine percent of consumers reportedly do. Perhaps you were even willing to pay a higher price for these “natural” products, in comparison to the lower price of their non-“natural”-labeled equivalents, because you believed “natural” was indicative of healthfulness. If so, you were not alone: studies have shown that eighty percent of Americans are willing to pay price premiums for “natural” food products in their pursuit of a healthier lifestyle.
Foods marked as “natural” have skyrocketed in popularity, evolving from a limited niche market into a multibillion-dollar industry with a strong and devoted consumer following. Indeed, over the past decade, “natural” has been one of the most frequently used descriptive terms on new food labels in the United States—more than “organic,” “low/no calorie,” and “low/no/reduced trans fat.” Yet, despite its ubiquity, there is no legally binding definition of “natural” to regulate the food industry’s use of this attractive label.
The Food and Drug Administration (FDA) is currently working on defining the “natural” label through the rulemaking process. However, the FDA has been wrestling with this issue on-and-off for nearly thirty years, but to no avail. In the absence of any rule, manufacturers can, and in fact have, labeled as “natural” foods containing synthetic and bioengineered ingredients, as well as products that are genetically modified, contain incidental additives, or undergo heavy processing. Certainly, inherent in a consumer’s decision to purchase a “natural” food product is the notion that this label bears some meaning and is not being used in vain. But, to consumers’ dismay, the FDA’s current regulations do not require food manufacturers to satisfy any particular criteria when attaching the “natural” label to their products.
Consumers feel misled, and in response, they have filed hundreds of class actions against food manufacturers for fraudulent misrepresentation and false advertising, among other wrongs. For instance, over thirty class action lawsuits were filed against manufacturers of orange juice alleging that the product was not “natural” because of pasteurization methods and chemically engineered flavor additives. Similarly, more than ten class actions were filed against Frito-Lay claiming that its snack products were not “natural” because they contained genetically modified organisms. Practitioners anticipate this surge of “natural” claims will continue unabated. This litigious activity suggests that deficient regulatory schemes give rise to increased litigation.
To be fair, without any specific regulations to guide the food industry, manufacturers are left to their own devices in determining what the “natural” label means for their products. And, while labelers are confused about whether or when they may place “natural” on their food products, courts are even more unsure of precisely how to adjudicate “natural” food labeling claims—particularly given that the FDA is currently working on promulgating a rule defining the term. In some cases, manufacturers have moved to stay judicial proceedings under the primary jurisdiction doctrine pending the FDA’s creation of a new rule, while in other cases, courts have issued such stays sua sponte. Meanwhile, other courts have declined to stay “natural” claims pending the FDA’s upcoming rule. Just as manufacturers need the FDA’s guidance on the use of the term “natural” on food labels, so too do courts need guidance in determining the scope and use of their authority to stay proceedings on primary jurisdiction grounds pending a forthcoming agency rule. A more uniform approach is needed, and this Note intends to provide one.
This Note takes the common-sense view that courts should adjudicate lawsuits based on the laws and regulations as they exist at the time the litigant filed the complaint. To show how this practical approach would work in the real world, this Note engages in a case study of the intricacies of “natural” food labeling case law and the interplay between the courts and the FDA. Importantly, the proposed guidance it offers to the courts is not intended to be limited solely to the “natural” context; rather, it is applicable to any situation where litigants are bringing claims in court and agency rulemaking on a related issue is simultaneously underway.
Part I of this Note lays out the legal landscape with respect to “natural” food labels. Section I.A describes the federal courts’ involvement through consumer class actions, and Section I.B surveys the FDA’s regulatory approach through notice and comment rulemaking. Part II of this Note then analyzes the point at which these judicial and administrative authorities intersect by exploring the ways that courts are treating “natural” litigation. Section II.A focuses on the courts that are staying judicial proceedings under the primary jurisdiction doctrine, pending the FDA’s forthcoming rule defining “natural,” and Section II.B concentrates on the courts that are not staying “natural” actions. Finally, Part III of this Note provides guidance for the courts. Specifically, it proposes that courts should adjudicate cases based on the laws and regulations as they existed at the time the litigant filed the complaint, and in so doing, should not stay actions on primary jurisdiction grounds pending a forthcoming agency rule.
I. CONTEMPORANEOUS CHANNELS OF LITIGATION AND REGULATION
A. “Natural” and the Courts: Litigation Through Consumer Class Actions
1. The Mechanics of Class Actions
Rule 23 of the Federal Rules of Civil Procedure allows a litigant to bring a lawsuit on behalf of a larger group of similarly-situated individuals. In order to do so, the plaintiff must provide an appropriate class definition and satisfy the requirements set forth in Rule 23(a), which in simplest form, include: (1) numerosity, (2) commonality, (3) typicality, and (4) adequacy. By consolidating many claims with common questions into a single lawsuit, class actions promote judicial efficiency.
Class actions do not only benefit the courts. Class actions also provide a valuable tool to litigants whose claims might otherwise be too small to bring individually, but when considered in the aggregate, become lucrative. As a result, class actions allow misled consumers to join forces in litigating claims that would likely not be redressed by piecemeal litigation because the costs of individual adjudication would exceed any potential for relief. Class actions can also benefit defendants by providing a means for achieving “global peace” in the form of a single, negotiated settlement of all claims, thereby alleviating the risk of being subject to duplicative or inconsistent rulings.
2. The Rise of Food Marketing Class Actions
Consumer class actions alleging false, misleading, or deceptive food labeling have been on the rise. In 2008, there were about twenty food labeling class actions pending in federal courts; by 2016, that number had skyrocketed to 425. This trend does not seem to be slowing down: the number of food-related lawsuits continued to rise throughout 2017 and 2018.
These class actions target a variety of food products, such as cheese, coconut oil, canned tuna, snack foods, and many others. Plaintiffs often assert “slack fill” claims, which challenge the extra space in a product’s container on the ground that it misleads consumers into believing they are receiving more of the product. Another common allegation is that a specific health benefit listed on the product’s packaging is exaggerated, unsubstantiated, or cancelled out by other factors. Importantly, the most frequently litigated claim alleges economic harm resulting from the sale of foods mislabeled as “natural.”
3. “Natural” Food Labeling Consumer Class Actions
In the context of “natural” food litigation, scores of consumers are currently represented in over one hundred class actions alleging claims of false or misleading labels in violation of state consumer protection laws. The Federal Food, Drug, and Cosmetic Act (FDCA), which prohibits “misbranding” of foods, does not provide consumers with a private right of action to enforce its provisions. Accordingly, State Unfair and Deceptive Acts and Practices (UDAP) statutes have filled in the gaps by providing consumers with a right to access courts to litigate issues surrounding the misleading practices of manufacturers that arise in billions of transactions each year. The most popular forums—which, together, hear over seventy-five percent of food class actions—are federal courts in California, New York, Florida, and Illinois. California has particularly strong UDAP statutes and, as a result, the United States District Court for the Northern District of California has earned the nickname the “Food Court,” due to the vast quantity of food labeling cases filed within its jurisdiction.
In these lawsuits, consumers allege that the use of the “natural” label is misleading when a food product contains artificial, synthetic, or bioengineered ingredients that defy their reasonable expectation that “natural” connotes a pure and simple product of the earth. Consumers further allege that manufacturers have used the “natural” label for the purpose of deceiving consumers into paying more because they know consumers perceive this label as indicative of “healthier, better, and more wholesome” products. Indeed, marketers have been charging higher prices and consumers have paid these higher prices for these purportedly “natural” foods. Now, through class actions, consumers are seeking redress for their economic injuries in the form of damages, as well as declaratory and injunctive relief.
B. “Natural” and the FDA: Regulation Through Agency Rulemaking
1. The Mechanics of Agency Rulemaking
When an agency seeks to advance its regulatory goals so as to have the effect of law, it must promulgate a rule. Broadly speaking, rulemaking is the administrative procedure by which a federal agency amends or enacts rules and regulations. More specifically, “notice-and-comment rulemaking” describes one type of rulemaking procedure that involves participation from the general public. The process begins when an agency informs the public about a proposed rule, and then invites individuals, organizations, and corporations alike to provide their input on it. Before issuing a final rule, which will be legally enforceable, an agency must review all of the comments it received, thereby giving consideration to the public’s input. A consequence of this participatory, democratic process of notice-and-comment rulemaking is that sorting through mass quantities of the public’s comments can be very time-consuming. Moreover, there is no set time frame in which an agency must promulgate a rule after the comment period has closed. As a result, the rulemaking process has been the subject of frequent criticism for being unnecessarily slow. According to one study, it takes the FDA, on average, slightly over seven years to issue a final rule pertaining to drugs or medical devices. The FDA’s rulemaking in the food context is certainly not any speedier—for instance, it took the Agency over eight years to define “gluten-free” and over a decade to define “peanut butter.”
An agency’s decision to begin the rulemaking process can be mandated by Congress, but more commonly it is prompted by an agency’s evaluation of shortcomings or issues within its area of regulatory responsibility. Agencies can be apprised of such issues through petitions from interest groups, corporations, and members of the public. But, unless mandated by Congress, agencies exercise vast discretion in determining which of the issues within their jurisdiction should be prioritized in their rulemaking efforts.
2. History of the FDA and Labeling Regulations
The FDA is the federal agency with authority to promulgate rules pertaining to food definitions and standards of food quality. The FDA achieves this goal, in part, by ensuring that “foods are . . . properly labeled.” Despite this authority, the FDA has been criticized for its laissez-faire approach to regulating ordinary food items. Critics claim the FDA’s lenient food-related regulations are especially weak in comparison to the more comprehensive approach the Agency has taken with regard to other products under its purview, such as pharmaceutical drugs and medical devices.
FDA officials have conceded that the Agency’s regulatory approach with respect to food labeling needs improvement. In 2010, Michael Taylor, former Deputy Commissioner of the FDA, admitted that the Agency was not satisfied with its existent labeling regulations. In particular, the Agency was troubled by the food industry’s use of nutrition-related labeling claims as a marketing tactic, regardless of whether any scientific evidence supporting these claims existed. However, Taylor explained that, despite the FDA’s deficient regulatory scheme in this context, the ability to improve its food labeling regulations was curtailed by limited agency resources and more pressing priorities.
3. The FDA’s Long-Term Relationship with “Natural” Food Labels
The “natural” label has been haunting the FDA for decades. The saga officially began in 1989, when the Agency published an advance notice of proposed rulemaking (ANPRM) that requested comments regarding the use of “natural” and other descriptive food labeling terms. The FDA had received over 450 comments from the public, which provided a near unanimous consensus that the Agency should define these terms. In 1990, Congress amended the FDCA by passing the Nutrition Labeling and Education Act (NLEA), which fortified the FDA’s authority to regulate food labels by defining and setting criteria for labeling standards. The NLEA, in part, proposed to address certain descriptive labeling terms, including “natural.” In 1991, the FDA released notice for proposed rulemaking (NPRM) through which it invited the public’s comments on various issues, such as how to define the term “natural” on food labels. The preamble to the NPRM released a nonbinding advisory opinion suggesting that “natural” means that a food product does not contain unexpected artificial or synthetic additives. Two years later, the FDA decided not to promulgate a final rule defining “natural” on the basis that the comments it received from the public did not provide adequate guidance with respect to the term’s treatment. Instead, the FDA opted to maintain its informal policy regarding “natural.”
In 2010 and 2013, the FDA was asked by courts, but declined to make a determination, as to whether certain foods could bear the “natural” label. The FDA decided not to address this issue because of other agency priorities and the difficulty of the task. Instead, the FDA reiterated its informal policy from 1991, which suggested that “natural” precludes products with unexpected artificial and synthetic
additives. Importantly, though as a mere advisory opinion, this policy lacks the binding effect of an agency rule—in other words, the food industry is not required to adhere to its terms. A legally enforceable definition must be promulgated through the FDA’s rulemaking procedures.
In November 2015, after receiving numerous citizen petitions, the FDA’s regulatory approach regarding “natural” finally took a pivotal shift when Leslie Kux, the FDA’s Associate Commissioner for Policy, published a request for comments regarding the use of the term “natural” on food product labels. This signified the first step in the Agency’s efforts to promulgate a rule through the notice-and-comment rulemaking process. But, more than three years and over 7,600 comments later, the FDA has yet to issue a rule defining “natural.” Although sorting through this sheer quantity of comments is a time-consuming task, the Agency has not even issued any guidance on approximately when a rule might come. Some practitioners believe the issuance of a rule is imminent, while others believe that the FDA’s efforts to define “natural” are illusory at best.
4. Potential Impediments to Promulgation of a “Natural” Rule
There are many plausible explanations for why it is taking the FDA so long to promulgate a rule defining “natural.” Some possibilities include: (1) limited agency resources, (2) the complexity of the task, (3) changes in the presidential administration, and (4) lobbying.
A frequent justification—or to skeptics, an excuse—for slow agency action is a lack of fiscal funds and personnel. In 2010, Michael Taylor, former Deputy Commissioner of the FDA, described regulating food labelers as “playing Whac[k]-a-Mole, with one hand tied behind your back,” because of the Agency’s limited resources. This explanation, on its own, seems unpersuasive in the “natural” context because the FDA chose to begin rulemaking—it was not forced to do so. Presumably, the FDA conducted a cost-benefit analysis and concluded that promulgating a rule was doable, notwithstanding its tight budget. Accordingly, the lack of resources rationale appears pretextual in this context.
Another explanation could be the complexity of promulgating a one-size-fits-all definition for an otherwise subjective term. The “natural” food label frequently connotes a more subjective meaning, which falls beyond the FDA’s usual territory as a science-based body. Therefore, the FDA’s technical expertise may not be of much help in capturing a single, objective definition. However, even if the term “natural” raises a variety of interpretations depending on context and usage, the FDA’s experience synthesizing public comments to form definitions should help alleviate this concern.
A more likely explanation for the delay in defining “natural” is the change in presidential administrations. “Natural” rulemaking was initiated in November 2015, shortly before the end of Barack Obama’s presidency. Concurrently, during the ongoing 2016 presidential campaign, then-candidate Donald Trump promised to eliminate certain regulations, including rules by “[t]he FDA Food Police” concerning food packaging. Once in office, President Trump took immediate action to implement this initiative. On January 30, 2017, he issued an executive order mandating that an agency must repeal at least two preexisting rules before implementing a new rule so as to offset the costs. Undoubtedly, rulemaking in the Trump-era of deregulation is an uphill battle.
Despite the Trump administration’s anti-regulatory agenda, Scott Gottlieb, former Trump-appointed FDA Commissioner, reiterated that the regulations initiated during the Obama administration—including a rule defining “natural” on food labels—remain at the core of the FDA’s goals. Indeed, in a keynote address delivered on March 29, 2018, then-Commissioner Gottlieb confirmed that “[w]e’ll have more to say on the [natural] issue soon.” While this may sound promising, more than a year has elapsed without further guidance. Unlike President Trump’s campaign promises about deregulation, which he has in fact implemented, Gottlieb’s optimistic remarks about the FDA’s forthcoming rule defining “natural” might have been mere lip service. And certainly, the FDA’s $70.9 million budget reduction for the 2018 fiscal year, which it sustained by decreasing its workforce and operating costs, will not accelerate the issuance of a rule defining “natural.”
This leads to another likely reason behind the delay in promulgating a “natural” rule: big food lobbying. The food industry spends exorbitant sums of money to protect its economic interests by influencing federal law and policy. Indeed, between 2009 and 2015, three of the big food industry players spent, in the aggregate, over $114 million on congressional lobbying. Studies show that, of these funds, around $52 million have been used to undermine public health initiatives. It is unsurprising, then, that so many of the defendant-manufacturers in “natural” lawsuits have spent large amounts of money in their lobbying efforts. To curry favor with politicians and lawmakers, the food industry hires lobbyists to meet with members of Congress, White House staff, and FDA officials. In fact, many former executives from big food and drug companies have a strong representative presence within the FDA itself. These ingredients trigger concerns of industry self-regulation to the detriment of consumers’ interests.
To be clear: the FDA exercises vast discretion in the timetable of its rulemaking endeavors. Indeed, the FDA could choose tomorrow to simply terminate its rulemaking efforts concerning “natural” on food labels altogether, and there is little any litigant, judge, or policymaker could do. Yet, despite the indeterminacy surrounding the FDA’s likelihood of promulgating a rule regarding what constitutes “natural” for food-labeling purposes, its promise to issue a rule has received immensely deferential treatment from the courts.
II. COURTS’ RESPONSES AT THE INTERSECTION OF JUDICIAL AND AGENCY DECISION-MAKING
A. Staying Judicial Proceedings Under the Primary Jurisdiction Doctrine
Many courts are staying “natural” proceedings on primary jurisdiction grounds pending the FDA’s forthcoming rule. In effect, this means that despite asserting allegations that are grounded in traditional tort law principles, these consumers are not receiving a “just, speedy, and inexpensive determination” of their claims. Just as the FDA is delaying the promulgation of a rule defining “natural,” some courts are delaying the adjudication of “natural” claims.
1. What is the Primary Jurisdiction Doctrine and When Does It Arise?
Primary jurisdiction is a judge-made doctrine that is invoked when the authorities of the judiciary and administrative bodies overlap. The doctrine is founded on principles of prudential restraint insofar as it aims to protect the integrity and efficacy of congressionally-delegated regulatory schemes. To achieve this goal of restraint, the doctrine allows a court to stay judicial proceedings that implicate issues within an agency’s domain, thereby allowing that agency to make an initial determination to assist in the court’s ultimate decision. Application of the doctrine serves dual purposes: (1) to promote uniformity vis-à-vis the judiciary and administrative agencies by obtaining a single determination, and (2) to secure an agency’s expertise regarding technical and scientific questions of fact that exist within the industry under its authority.
Most commonly, the doctrine arises in lawsuits that trigger issues of fact that are not within the court’s traditional knowledge or that require administrative discretion over a heavily regulated industry. Courts most commonly justify recourse to an agency’s preliminary factual determination on the basis that such a referral manifests deference to that agency’s technical expertise. This reflects the theoretical view that an agency is best equipped to resolve underlying factual issues baked into a legal claim asserted against a regulated entity because of that agency’s familiarity with the particularities of the industry.
To be sure, there are over 400 administrative agencies with regulations spanning across a diversity of sectors, so it is conceivable that nearly every legal claim, to some degree, implicates a factual determination under an agency’s purview. Accordingly, courts have long recognized that application of the primary jurisdiction doctrine should be sparing. Nonetheless, scholars have noted that the primary jurisdiction doctrine is “becoming a shibboleth,” as courts are increasingly referring claims to agencies based on a façade of exaggerated agency expertise and relevance. This undermines the notion of judicial review because courts are often expected and relied upon by agencies to fill in regulatory gaps—even those pertaining to complex, technical issues. Additionally, overreliance on the primary jurisdiction doctrine could have a detrimental impact on the judicial system by frustrating its ability to adjudicate otherwise legitimate legal claims.
2. How Is the Primary Jurisdiction Doctrine Applied?
One of the most distinctive features of the primary jurisdiction doctrine is its flexible legal framework. Accordingly, the decision to stay proceedings on primary jurisdiction grounds is determined on a case-by-case basis. In an effort to create some guideposts for their analyses, courts have delineated various tests to determine whether to issue a stay pending agency action. Although the frameworks vary between jurisdictions, some of the recurrent overlapping factors include: (1) whether the particular issue has been subject to agency review; (2) whether disposition of the issue is unique to an agency’s regulatory purview and technical expertise; and (3) what effect, if any, an agency’s determination might have on the court’s resolution of the claim.
The Ninth Circuit has adopted a more flexible approach with respect to its primary jurisdiction criteria. Under its standard, courts must consider whether invoking the primary jurisdiction doctrine to stay proceedings would needlessly delay the resolution of claims. The Ninth Circuit’s approach is preferable to plaintiffs because it allows their claims to be heard before and evaluated by their chosen forum—namely, the court—without undue delay. The Second Circuit takes a contrary position. It has advised that the possibility of delay should not be weighed too heavily in determining whether to issue a stay because, in its view, the primary jurisdiction doctrine is not grounded in principles of judicial economy. Given that the two most common forums for “natural” food labeling class actions include California and New York, which sit in the Ninth and Second Circuits, respectively, their divergent views on the primary jurisdiction doctrine generate significant inconsistencies in the treatment, as well as the outcomes, of these cases.
In a number of “natural” actions, the defendant-manufacturers have successfully moved to stay judicial proceedings until the FDA’s forthcoming rule defining “natural” is promulgated. Meanwhile, in other “natural” cases, even when the manufacturers do not move to stay proceedings, some courts have ordered stays sua sponte. In furtherance of this procedural discrepancy, some courts have placed “natural” claims on hold indefinitely until the FDA promulgates its rule, while other courts have issued stays for shorter, finite periods of time, subject to renewal so long as the FDA’s rule continues to seem imminent.
3. An Evaluation of Staying “Natural” Claims
There are certainly some sound reasons for believing that staying “natural” class actions until the FDA issues its rule will promote fair and just results. However, many of the justifications for applying the primary jurisdiction doctrine in this context are undermined or outweighed by the contemporaneous dangers that accompany the stays.
Some of the proffered benefits attributable to staying “natural” claims on primary jurisdiction grounds pending the FDA’s forthcoming rule include: (1) utilizing the FDA’s technical expertise, (2) exercising prudential restraint to honor the separation of powers, and (3) promoting uniformity in decisions. While each of these explanations may seem plausible at face value, a deeper look suggests that these bases for staying proceedings are unpersuasive.
To many consumers, the “natural” label creates certain assumptions pertaining to a food product’s overall grade and quality. It is conceivable that such food standards derive from scientific and technical foundations. As an agency responsible for regulating the nation’s food supply, the FDA has vast scientific expertise in evaluating food standards. Certainly, it is sensible that the FDA should use this expertise to conclusively determine what “natural” should mean on food product labels. Indeed, this is precisely what the FDA is doing, as of this writing, by engaging in the rulemaking process. It seems reasonable, therefore, for courts to stay “natural” claims until the forthcoming rule is promulgated. Arguably, this approach fully utilizes the FDA’s scientific expertise concerning food standards and its familiarity promulgating formal definitions in the food industry more generally. But simply labeling food products as “natural” does not necessarily mean that using this term requires any scientific or technical substantiation. Indeed, to many consumers, the “natural” label attaches a softer, more subjective meaning that pertains to overall lifestyle choices, rather than a food’s genetic makeup, chemical composition, or processing methods. According to this theory, reliance on the FDA’s scientific expertise is moot.
A strict interpretation of the separation of powers doctrine also supports applying primary jurisdiction to stay “natural” claims insofar as Congress has delegated to the FDA the power to create a uniform national regulatory scheme to ensure that consumers are not misled by food labels. The FDA has expressed a cognizable interest in using its authority over “natural” food labels by engaging in the rulemaking process to promulgate a legally binding definition of the term. As a result, some courts have reasoned that staying “natural” claims until the FDA has issued its final rule shows respect for a coequal branch. Undoubtedly, a certain amount of judicial deference is necessary to ensure the efficacy of the FDA’s rulemaking efforts. However, this deference need not be absolute. Indeed, where the FDA has yet to promulgate a rule, and no prior rule touching upon the issue exists, the argument for deference is weak because there is no articulable or concrete agency interpretation to which a court may defer. Under these circumstances, even a strict interpretation of the separation of powers doctrine does not mandate that judges sit idly by when faced with an otherwise legally cognizable claim.
Achieving uniformity in outcomes is another reason courts have issued stays pending the FDA’s forthcoming rule. Under this rationale, waiting to hear “natural” claims until after the FDA has promulgated a definition of the term protects against conflicting judicial decisions that could otherwise result in a patchwork system with different labeling standards for every state. To be sure, inconsistent rulings threaten to undermine Congress’s very purpose of establishing the FDA in order to implement a uniform regulatory system. But this line of reasoning is weakened by the fact that the primary jurisdiction doctrine has no fixed standard, and therefore, the very doctrine itself is not being applied uniformly. Consequently, staying natural actions on primary jurisdiction grounds not only fails to further the purpose of uniformity, but also threatens to defeat it. Before there can be uniformity between the courts and the FDA, there must first, by definition, be uniformity amongst the courts themselves. In order to achieve this result, courts should focus on attaining uniformity in their legal standards. Uniformity in outcomes is of lesser concern because there may be drastic factual disparities between claims that invoke the same legal question, thereby warranting different dispositions. Ultimately, the downsides of staying “natural” proceedings override the theoretical gains.
B. Declining to Stay Judicial Proceedings Under the Primary Jurisdiction Doctrine
1. Dismissing “Natural” Claims
Importantly, some courts have abstained from staying “natural” proceedings despite the pendency of the FDA’s forthcoming rule. Most frequently, these courts have dismissed the claims at the pleading stage based on the conclusion that they were simply not plausible, irrespective of whether the FDA issues a rule defining “natural.” Specifically, these courts have determined that no reasonable consumer would be deceived or misled by the particular “natural” labels at issue, and therefore, staying judicial proceedings on primary jurisdiction grounds would be futile. This rationale suggests that the reasonable consumer expectation standard can be a useful tool for interpreting “natural” claims.
2. Litigating “Natural” Claims
Several courts have not only declined to stay judicial proceedings under the primary jurisdiction doctrine, but have also found that the “natural” claims raised triable issues of fact. These courts have relied, in part, on expert reports to shed light on whether a reasonable consumer would be misled by the “natural” labels at issue. But, these actions have mainly been settled privately—before trial—and therefore, they do not provide comprehensive guidance with respect to adjudicating “natural” claims through fact finding.
Notably, however, some courts are beginning to lift stays, which they had previously ordered under the primary jurisdiction doctrine, because of the FDA’s failure to provide further guidance with respect to when or how it will define “natural” through rulemaking. Due to the recency of their orders to lift stays, these courts have not yet grappled with the merits of these “natural” claims. Nevertheless, per the parties’ requests, jurors will serve as the factfinders during trial. This suggests that a jury, like an expert, can provide the court with insightful guidance as to what “natural” means for the particular food product at issue.
3. An Evaluation of Declining to Stay “Natural” Claims
There are many strong reasons for declining to stay judicial proceedings on primary jurisdiction grounds pending the FDA’s forthcoming rule defining “natural.” Indeed, some of the dangers inherent in staying “natural” claims include: (1) undue delay, (2) lobbying concerns, and (3) overall futility. Collectively, these grounds present a strong basis for concluding that courts should adjudicate “natural” claims based on the merits, notwithstanding the pendency of the Agency’s forthcoming rule.
As discussed earlier, the “natural” food label has been teasing the FDA for decades, and the Agency’s previous attempts to define the term were proven to be illusory or were abandoned. Consequently, it is possible that the FDA’s current rulemaking efforts will be dropped altogether, too. Even if the FDA does eventually promulgate a definition, there is no way to know how long it will take. To be sure, staying any claim on primary jurisdiction grounds inevitably results in a delay of judicial proceedings. However, in the context of “natural” claims, waiting for the FDA to promulgate an entirely new rule, instead of simply interpreting preexisting regulatory language, may take an exceedingly long amount of time. And, while courts are not outright denying the claimants their due process rights, implicit in a litigant’s right to have a meaningful opportunity to be heard is the ability to do so without unreasonable delay.
Courts are also justified in declining to apply the primary jurisdiction doctrine in light of various concerns about lobbying. Lobbyists may intentionally delay the FDA’s rulemaking efforts, which in and of itself is harmful to consumers. Alternatively, big food lobbyists might coerce the FDA into defining “natural” in a manner that is most favorable to their private interests and positions in the stayed class actions. This buttresses the theory that an agency’s determinations are already influenced by an implicit preference for the regulated industry. In 2017, for example, the food industry pressured the FDA into delaying the implementation of its modified nutrition labeling requirements because the industry feared that the revisions promoting greater transparency would hinder sales. Michael Jacobson, President of the Center for Science in the Public Interest, believes the industry’s conduct not only impedes efforts to improve public health, but also sabotages the industry’s own credibility. While the FDA may be economically beholden to the big food conglomerates, courts need not be at the behest of the FDA. This theory weighs heavily in favor of declining to stay “natural” litigation.
The most basic—and yet arguably the most persuasive—reason not to stay “natural” proceedings is that courts are not bound to apply the forthcoming rule retroactively. Courts resolve cases alleging past misconduct, while agencies promulgate rules guiding future behavior. Therefore, at best, a newly-promulgated rule would merely be persuasive on pending litigation, and it is hard to justify substantially delaying lawsuits solely for a rule that the court may or may not ultimately consider. The Supreme Court has articulated this theory by recognizing that the primary jurisdiction doctrine is not one of futility. Indeed, the primary jurisdiction doctrine’s purpose is to help facilitate effective regulatory schemes, not to snatch from plaintiffs their otherwise valid legal claims. Accordingly, the doctrine should not be invoked when the outcome of a pending legal claim is independent of an agency’s forthcoming determination, or when issuing a stay of judicial proceedings does not promote a public interest.
Furthermore, when a court stays proceedings pending an agency’s interpretation of preexisting regulatory language in connection with a particular litigant’s claim, the case-by-case determination of whether to apply the primary jurisdiction doctrine seems appropriate because that agency’s resolution only affects an individual claim. However, in the “natural” context, courts are waiting for the FDA to create an entirely new rule that will bind all food products alike; in other words, the Agency is not merely interpreting how an existent definition of “natural” applies to a particular factual issue in one consumer’s lawsuit. Therefore, instead of employing a case-by-case determination of whether to stay “natural” proceedings under the primary jurisdiction doctrine, courts should treat all of the “natural” claims equally with respect to the pendency of that definition unless and until it is promulgated.
To be sure, one way to achieve this result would be to adopt a judicial presumption in favor of staying all “natural” claims on primary jurisdiction grounds pending the FDA’s forthcoming rule. Such an approach is flawed, however, insofar as the courts are not bound to retroactively apply this rule, and thus the stays would be futile. Therefore, this Note sides with the courts that have declined to stay proceedings by advocating that courts should adjudicate “natural” claims under current law, despite the pendency of a forthcoming agency rule.
III. PROPOSAL
A. Proposed Guidance for the Courts
By applying the primary jurisdiction doctrine in “natural” labeling actions, courts are glossing over a fundamental judicial principle—namely, that courts do not wait for laws to be created in determining the merits of an ongoing lawsuit. Holding otherwise is unfair to both parties in the pending litigation. As to the plaintiffs, it is unfair to deny them a just and speedy trial. As to the defendants, it is unfair to potentially hold them liable for using the “natural” label in contradistinction to the FDA’s rule because, by definition, compliance with a rule that was not in existence at the time of the alleged injury was impossible. Therefore, rather than staying the actions in order to retroactively apply an agency’s forthcoming, ex-post facto rule, courts should adjudicate these lawsuits based on the laws and regulations that existed at the time the complaints were filed.
In cases where no preexisting rule existed at the time the complaint was filed, such as the “natural” labeling litigation, courts should adjudicate claims based on traditional common law principles of judicial interpretation. This analysis will look different depending on the context and nature of the alleged injury. With respect to “natural” claims, courts may: (1) consider the dictionary definition, (2) apply the reasonable consumer standard, and (3) utilize a jury’s “expertise.”
As a starting point, courts can begin their analyses by considering the dictionary definition of “natural.” Undoubtedly, absolute reliance on this definition, without more, would be a drastic oversimplification of a complex matter. Of course, if defining the term were so simple, the FDA likely would have promulgated its definition years ago. Nevertheless, given that there is no preexisting statutory language to interpret, dictionary definitions provide an objective frame of reference that can be helpful if used in conjunction with other techniques.
Courts should also consider the reasonableness of a claim as it specifically pertains to the particular food product at issue. In effect, this would entail a fact-intensive, three-step inquiry that assesses: (1) whether the food product itself is inherently artificial or heavily processed, (2) the particularities of the challenged ingredients and/or methods of production that purportedly contribute to the product’s being unnatural, and (3) the likelihood that a reasonable consumer would be misled and pay a price premium for the food product based on the relationship between the prior two responses. Ultimately, the purpose of this inquiry is to determine whether a reasonable consumer would have sustained the economic injury in reliance on the “natural” label, and whether reliance on the allegedly misleading character of the label was reasonable. This test aims to balance a consumer’s interest to be truthfully and accurately informed, with a manufacturer’s pragmatic need to assume, in the labeling of its products, that consumers’ expectations will be reasonable. By evaluating whether a prudent consumer would have relied on the “natural” label, courts can reach more tailored outcomes based on the particularities of the claim and the totality of the circumstances.
Additionally, courts should honor the “expertise” of juries in shedding light on whether the prudent consumer would be misled into paying a price premium in reliance on the deceptive “natural” label. Indeed, jurors are well-equipped to provide insight into this inquiry because it turns on reasonable consumer perceptions rather than on scientific technicalities. Therefore, as ordinary consumers themselves, jurors serve as an appropriate body to voice reasonable expectations regarding food product labels. Parties may also bring in experts to testify and help guide jury deliberations if they want a more empirically-driven determination.
B. Possible Objections
A case-by-case approach may raise concerns regarding judicial efficiency. It could be argued that courts should wait and see how the FDA defines “natural” because, even if not dispositive, that definition could provide strong guidance, which could expedite proceedings. While it is true that reaching the merits of these claims will require judicial time and resources, this concern is outweighed by the interests of justice to the extent that every litigant has the fundamental right to a just and expeditious disposition of a valid legal claim. Moreover, the formation of these lawsuits as class actions reduces concerns of inefficiency.
It may further be argued that in reaching the merits before the FDA defines “natural,” courts would, in effect, be defining the term themselves, thereby trespassing into the FDA’s regulatory territory. But, courts would only be doing so until the FDA’s rule is promulgated. Indeed, once the FDA issues a rule, the regulated industry, as well as the courts, will be bound. Understandably, the FDA may still feel like the courts are overstepping by adjudicating these claims. This concern, however, may place some well-deserved pressure on the Agency to accelerate its rulemaking efforts and to finally—after nearly thirty years—promulgate a rule defining the term. This is precisely what the current regulatory landscape is craving.
Additionally, it may be argued that this approach promotes disparate results because some of the challenged foods will be deemed “natural,” while others will not. But, so long as all courts apply the same legal standard by disregarding the forthcoming rule, concerns for uniformity are alleviated. It would seem prejudicial for some courts to defer to a forthcoming definition while others ignore it. However, it does not seem prejudicial for all courts to ignore the pending definition by engaging in fact-intensive analyses to adjudicate individual claims, particularly because the meaning of “natural” can attach very different meanings depending on its context. Even if courts decided to stay all of the “natural” lawsuits, once the FDA defines “natural,” the disposition of such claims would still not be uniform because, in light of the diversity of food products involved, some of them would likely meet the FDA’s standard of “natural” while others would not. This Note’s proposed case-by-case approach balances these concerns by accounting for the intricacies of each claim without unduly delaying proceedings.
CONCLUSION
Courts are struggling to reach consistent and sensible results when confronted with “natural” claims pending the FDA’s forthcoming rule defining the term. Many courts are staying judicial proceedings under the primary jurisdiction doctrine in the hopes of obtaining regulatory guidance. These courts must be reminded, however, that this doctrine was meant to be used sparingly. Indeed, a line must be drawn and this Note intends to draw one by proposing that the primary jurisdiction doctrine is an inapplicable basis for staying judicial proceedings when the creation of a new agency rule is pending and where no prior rule exists. The interests of justice demand that, based on a plaintiff’s right to be heard in court and a defendant’s right to be bound only to existent law and policy, courts adjudicate cognizable legal claims based on the laws and regulations as they existed when the litigants filed their complaints, notwithstanding a forthcoming agency rule.