Tuesday, February 12, 2008
Supreme Court Revives Suit Over Artificially Colored Salmon
By STEVEN M. ELLIS, Staff Writer
A class action alleging that various grocery stores violated state law by selling artificially colored farmed salmon without disclosing the use of color additives can proceed, the California Supreme Court ruled yesterday.
Unanimously reversing a decision by the Sixth District Court of Appeal, the justices held that the federal Food, Drug, and Cosmetic Act does not preempt deceptive marketing claims under California’s Sherman Food, Drug, and Cosmetic Law because Congress explicitly intended to allow states to establish their own disclosure requirements and remedies for violations, and because the plaintiffs’ claims were based on state, rather than federal, law.
The action arose when individual plaintiffs in Los Angeles, Alameda and Monterey counties filed suits against the grocery stores alleging that they sold fish that were fed the chemical additives canthaxanthin and astaxanthin in order to obtain a color of flesh resembling that of wild salmon. The plaintiffs claimed that the flesh of farmed salmon would appear grayish without the chemicals, and that the stores’ failure to disclose the artificial color caused consumers to believe that salmon was wild, rather than farmed, because consumers believe that the color of salmon is an indication of its origin, quality, freshness, flavor, and other characteristics.
The plaintiffs also claimed that concerns exist about the potential health risks of consuming the artificial coloring agents in particular, and farm-raised salmon in general. Although the chemical additives can occur naturally, they are manufactured from petrochemicals in order to be used as additives.
The suits were consolidated, and the plaintiffs in 2004 filed a coordinated complaint containing causes of action for unfair and unlawful business acts and practices in violation of the state’s Unfair Competition Law, which includes the Sherman Law; unfair or deceptive trade practices under the Consumers Legal Remedies Act; false and misleading advertising; and negligent misrepresentation.
In proceedings before Los Angeles Superior Court Judge Anthony J. Mohr, the defendants demurred, arguing the Sec. 337 (a) of the FDCA—which prohibits private enforcement of the act—preempted the plaintiffs’ state law claims. The defendants also argued that further consideration of the complaint could conflict with regulation and enforcement by the FDA or California’s Department of Health Services, and that the plaintiffs had failed to state a cause of action.
Mohr sustained each of the defendants’ demurrers with leave to amend, but the plaintiffs opted to appeal his decision.
Writing for the Court of Appeal, Justice H. Walter Croskey agreed with Mohr, affirming his findings that the plaintiffs’ suits were predicated on federal violations and therefore impliedly preempted. Writing that “Congress made clear its intention to preclude private enforcement of the FDCA,” Croskey concluded that “a state law private right of action based on an FDCA violation would frustrate the purposes of exclusive federal and state governmental prosecution of the act.”
However, in an opinion by Justice Carlos R. Moreno, the Supreme Court reversed the Court of Appeal’s decision and remanded the matter to the trial court.
Examining the FDCA as a whole, Moreno wrote that the Court of Appeal’s reasoning with respect to the preemptive effect of Sec. 337(a) was “seriously undermined when section 343-1 is taken into account.” Noting that Sec. 343-1 of the FDCA “clearly and unmistakably evince[s] Congress’s intent to authorize states to establish laws that are ‘identical to’ federal law,” Moreno concluded that this was “precisely what California did in enacting the Sherman Law.”
Determining that the plaintiffs’ causes of action arose on state law grounds, Moreno wrote that Section 337(a) did not preempt their claims
“Section 337 does not apply to the state law claims presented here,” he said. “The statute, by its very terms, only implicates efforts to enforce federal law. What section 337 does not do is limit, prohibit, or affect private claims predicated on state laws.”
Moreno was joined in his opinion by Justices Joyce L. Kennard, Marvin R. Baxter, Kathryn Mickle Werdegar, Ming W. Chin and Carol A. Corrigan, and by Sixth District Court of Appeal Justice Nathan D. Mihara sitting by assignment. Chief Justice Ronald M. George did not participate in the decision.
Plaintiffs’ counsel Craig R. Spiegel of Hagens Berman Sobol Shapiro in Seattle praised the decision, saying that it reflected “longstanding preemption principles,” and showed that “citizens of a state should be able to sue for losses they have suffered.”
However, defense counsel Rex S. Heinke of Akin Gump Strauss Hauer & Feld said that his clients believed that the court had decided the preemption issue incorrectly. Pointing to the language of Sec. 337(a), he said “Congress made it clear—no private enforcement,” and indicated that his clients would be considering an appeal to the U.S. Supreme Court.
Heinke’s clients included some of the state’s largest grocers, including Albertson’s Inc., Safeway Inc., The Kroger Co., Trader Joe’s, Costco Wholesale Corp., Whole Foods Market Inc., Bristol Farms Inc., Ocean Beauty Seafoods Inc., and various subsidiaries.
The case is Farm Raised Salmon Cases, 08 S.O.S. 995.
Copyright 2008, Metropolitan News Company