Food & Ag Weekly Round-Up: December 1, 2016

Reuters reported on Pilgrim’s Pride acquisition of organic chicken line.

Food Navigator discussed the launch of an EU program to prevent food waste.

The Business Insider reported on a recent drought analysis of the Southeast United States.

Vox reported on the impact of drought on California trees.

Farm and Dairy discussed the EPA’s recent renewable fuel standard volumes for ethanol.


Food & Ag Weekly Round-Up: November 17, 2016

AgriMoney discussed the impact of online auction on cattle prices.

Farm Business discussed a new report on the use of antibiotics on farm animals.

Convenience Store Decisions discussed a report on how millennials are influencing food packaging.

Reuters discussed the potential for bird flu outbreaks in the coming months.

BBC reported on the expansion of Amazon grocery delivery in the UK.


Appellate Court Rejects Ingredient List Defense in Cupcake Mix Case

All natural

Food manufactures facing deceptive food labeling claims under the Missouri consumer fraud statute were recently dealt a setback by the Missouri Court of Appeals for the Eastern District of Missouri. On November 8, 2016, the appellate court issued an opinion in Murphy v. Stonewall Kitchen, LLC, reversing the trial court’s adoption of the so-called “ingredient list” defense.   Although the ingredient list defense may be relevant at trial, the court held that the defense does not defeat a consumer fraud claim under the Missouri Merchandising Practices Act (“MMPA”) arising from the use of “all natural” labeling.  Finding that the plaintiff’s allegations were sufficient to survive a motion to dismiss, the court remanded the case back to the trial court for further proceedings.

In Murphy, the plaintiff filed a putative class action under the MMPA alleging that Stonewall Kitchen misrepresented its vanilla cupcake mix as “all natural” when the mix contained sodium acid pyrophosphate (“SAPP”), a synthetic leavening agent found in commercial baking powders.  Stonewall Kitchen in turn filed a motion to dismiss for failure to state a claim, asserting, in part, that plaintiff failed to allege an unlawful act under the MMPA because SAPP was included on the product’s ingredient list and the plaintiff’s proposed definition of “natural” was “fatally subjective and unworkable.”  Stonewall Kitchen further argued that the plaintiff failed to plead facts showing that his alleged loss was caused by any alleged wrongful act.  Agreeing with Stonewall Kitchen, the St. Louis Circuit Court determined that plaintiff failed to plead an unlawful act within the meaning of the MMPA.  Noting that the terms “natural” and “all natural” are ambiguous and lack any generally accepted meaning in the food labeling context, the court reasoned that the cupcake mix’s packaging, when taken as a whole, was not deceptive or misleading, because it disclosed that SAPP was an ingredient.

In reversing the trial court, the Missouri Court of Appeals determined that the assertion that the term “all natural” is subjective and ambiguous did not cause plaintiff’s claim to fail, as “a reasonable consumer’s understanding of the term ‘all natural’ or whether a practice is unfair or deceptive are questions of fact.” The court further held that that the parties needed to conduct more discovery to flesh out the facts needed to resolve those questions.

The appellate court also expressly rejected the assertion that the ingredient list defense defeated plaintiff’s claim as a matter of law. Relying on case law from the Ninth Circuit, the court stated that the U.S. Food and Drug Administration (“FDA”) does not require food manufacturers to provide an ingredient list on their products “so that manufacturers can mislead consumers and then rely on the ingredient list to correct those misrepresentations and provide a shield from liability for that deception.”  The court further noted that a reasonable consumer would expect an ingredient list to comport with the representations made on a product’s packaging and explained that the manufacturer is in a superior position to know whether the ingredients comport with its packaging.  Acknowledging that the ingredient list ultimately may be relevant to Stonewall Kitchen’s defense at trial, the court determined that the ingredient list defense could not defeat a MMPA claim as a matter of law.

Additionally, in response to Stonewall Kitchen’s argument that plaintiff failed to allege that SAPP is both artificial and synthetic and that it would not normally be expected in the cupcake mix, the court held that there was no requirement that the plaintiff plead that SAPP would not normally be expected in the cupcake mix. Finally, the court noted that plaintiff adequately pled an ascertainable loss under the benefit-of-the-bargain rule by asserting that he paid a premium price for Stonewall Kitchen’s “all natural” products out of a desire to purchase “healthy food products that do not contain potentially harmful synthetic ingredient.”

The appellate decision in Murphy is significant for any food manufacturer involved in litigating food labeling claims brought under the MMPA, as it reduces the claims that food manufacturers can make on their products without potentially incurring liability.  In the wake of the Murphy decision, food manufacturers may want to closely monitor the activities of FDA in case the agency breaks from its longstanding policy of declining to formally define the term “natural” given the agency’s recent request for comments on the use of the term “natural” on food labeling.  As FDA has previously mentioned, however, defining the term “natural” would require involving other federal agencies such as the United States Department of Agriculture, as well as considering any strictures flowing from the First Amendment.  Thus, even if FDA ultimately decides to formally define the term, it will likely take the agency a number of years to do so.

Husch Blackwell and its cross-disciplined team of litigators across our offices have been assisting food and consumer product manufactures in their defense in the latest round of putative class action filings, including for clients sued by the same Plaintiff’s law firm that filed and briefed the Murphy case.  These cases have involved, among other things, claims directed to “Natural” and “Made in America.”  The latest trend locally now seems to focus on “slack filling” claims and “evaporated cane juice” language.

Please contact a member of our team for further information or updates.

A Hugely Successful Ag Innovation Showcase

Conference Booth with Drone

The eighth annual Ag Innovation Showcase took place on September 12th through 14th and was organized by the Larta Institute, the Donald Danforth Plant Science Center, and the Bio Research & Development Grown (BRDG) Park.  The annual event brings together innovators, researchers, investors, and other thought leaders from across the globe to focus on the use of agricultural technology to further enhance productivity and sustainability and address other issues of significant interest to the agricultural community.

This year’s 20+ presenting companies offered innovative business platforms to address and assist with Precision Ag, Ag inputs, alternative food and feedstocks, and developing economies.

Husch Blackwell was proud to return as a sponsor for this event. Our firm sponsored the mid-day session on September 14th titled: Disruptive Dialogue: Zero Waste Across the Food Value Chain? The panel included Christine Moseley, Founder & CEO of Full Harvest, Dan Morash, Founder of California Safe Soil, and Joanie Taylor, Director of Consumer Affairs and Community Relations at Schnuck Markets, Inc., and Stephanie Potter, Vice President of Sustainable Business Development at Rabbobank North America Wholesale served as the panel moderator.  The panel explored the context and causes for food waste in the United States and highlighted innovations across the food value chain that enable more complete utilization of food production.  As with the other sessions at this annual event, attendance was significant and attendee participation was vast.

The dates for the 2017 showcase have already been announced as September 11-13, 2017.  For more information about the showcase, click here.

Food & Ag Weekly Round-Up: November 10, 2016

Reuters reported on the impact of warm weather on animal feed demand.

Ag Innovation Ontario discussed technology to make single serve coffee more environmentally friendly.

Food Safety News reported on FSIS enforcement actions.

Fresh Plaza reported on the launch of a food waste prevention app in New York.

The USDA discussed the use of high tech agriculture.


Food & Ag Weekly Round-Up: November 3, 2016

Water World discussed USDA investments for clean water in rural communities.

Farm Progress reported on the status of the 2016 harvest.

ABC News reported on drought impact on the South.

The Boston Globe reported on coffee demand from millennials.

 Nation’s Restaurant News discussed McDonald’s recent results.


Food & Ag Weekly Round-Up: October 27, 2016

The Conversation discussed urban farming.

Financial Buzz reported on new food recycling technology.

Farm Progress reported on the Iowa corn and soybean harvest.

Delta Farm Press discussed research on cellular agriculture.

Mother Nature Network discussed an Atlanta group helping to reduce food waste.


Food & Ag Weekly Round-Up: October 13, 2016

NPR discussed the impact of climate change on the world’s coffee supply.

The Los Angeles Times discussed the launch of a company in L.A. that helps eliminate food waste at restaurants.

NewsFactor reported on Amazon’s grocery delivery service.

GeekWire discussed Amazon plans for grocery sites.

FarmProgress reported on the status of the corn and soybean harvest.


New TTB Ruling Relaxes Formula Requirements For Distilled Spirit Products

Last week the Alcohol and Tobacco Tax and Trade Bureau (“TTB”) published Ruling 2016-3, TTB’s most recent effort to reduce regulatory burdens on industry members. Breaking with past regulations, Ruling 2016-3 approves general-use formulas for proprietors of distilled spirits plants producing vodka, whisky, brandy or rum products that incorporate certain specified harmless coloring, flavoring or blending materials. The TTB’s Ruling should help reduce regulatory burdens by streamlining the formula review process and allowing industry members to get their products to market without having to wait for additional formula approvals. A full copy of the TTB’s Ruling 2016-3 can be found here.

Particularly, TTB will now approve general-use formulas for the following spirits produced in accordance with applicable TTB Standards of Identity:

  • Vodka containing no harmless, coloring, flavoring or blending materials other than sugar (no more than 2 grams per liter), citric acid (no more than 1 gram per liter) or both.
  • Rum containing no harmless coloring, flavoring or blending materials other than sugar, brown sugar, molasses or caramel, if the blending materials are no more than 2.5 percent by volume of the finish rum product.

TTB also now approves general-use formulas for certain types of whiskey that contain sugar, caramel, or wine—if the flavoring or blending materials are no more than 2.5 percent by volume of the finished product. However, TTB makes clear that no coloring, flavoring, or blending materials of any kind may be used in the production of spirits that are designated as “bourbon whiskey” or “straight” whisky.

Finally, TTB will approve general-use formulas for certain types of brandy that contain sugar, caramel, fruit juice of the same fruit from which the brandy is distilled, or wine fermented from juice of the same fruit from which the brandy is distilled. As for other spirits, the total quantity of flavoring or blending materials may not exceed 2.5 percent by volume of the finished product.

TTB Ruling 2016-3 is a welcome step toward accomplishing the TTB’s goal of increased regulatory relief for distilled spirit industry members. We will continue to monitor developments in this area and keep you up to date on any future regulatory changes impacting alcohol beverage industry members. For more immediate information on this topic, please feel free to contact Andy Gilfoil.