Friday, December 4, 2015
State Supreme Court Rules:
U.S. Law No Bar to Suit Over Misuse of ‘Organic’ Label
From Staff and Wire Service Reports
Consumers have a right to file lawsuits under California law alleging food products are falsely labeled “organic,” a unanimous state Supreme Court ruled yesterday.
The ruling overturned a lower court decision that barred such suits on the grounds they were preempted by the federal regulatory scheme governing certification of organic growers.
Congress created a scheme involving exclusive enforcement by state and federal regulatory agencies, in order to create a national standard for organic foods, impliedly preempting suits under the laws of the various states, this district’s Court of Appeal ruled in 2013. But the state high court said Congress only intended to preempt state law with regard to certification, leaving room for litigation under state law over the misuse of the label, even by federally certified growers.
“Moreover, a central purpose behind adopting a clear national definition of organic production was to permit consumers to rely on organic labels and curtail fraud,” Justice Kathryn Werdegar wrote. “Accordingly, state lawsuits alleging intentional organic mislabeling promote, rather than hinder, Congress’s purposes and objectives.”
Werdegar noted that there is specific exclusivity language in the portion of the Organic Foods Act dealing with certification, but not in the portion permitting sanctions—in the form of civil penalties and loss of certification—for mislabeling. There is “no reason to conclude Congress intended its federal remedies as not only a floor—ensuring that, whatever else state law might provide for, some teeth would back up the new federal regulation of organic labeling—but also a ceiling, with states prohibited from continuing to augment these limited remedies.”
The ruling will have an impact beyond California’s borders, Marsha Cohen, a professor at UC Hastings College of the Law in San Francisco, said.
“Nothing in here is irrelevant to a parallel case in another state,” she said. “The court is simply saying federal law does not supersede our consumer protection functions.”
At issue were allegations in a lawsuit by consumer Michelle Quesada that Herb Thyme Farms Inc.—one of the nation’s largest herb producers—mixed organic and non-organic herbs, then falsely labeled the product “100 % organic.”
The term “organic” means the food was produced using sustainable practices and without synthetic fertilizers, sewage sludge, irradiation, or genetic engineering, according to the California Department of Public Health. The department says products labeled “100% organic” must consist of only organic ingredients.
Quesada sued on behalf of a class of consumers, under the unfair competition and false advertising laws and the Consumer Legal Remedies Act. Her attorneys argued in their brief that she “fell victim to Herb Thyme’s scheme to mislead consumers into paying premium prices for impostor products.”
A call to Cliff Neimeth, an attorney for Herb Thyme Farms, was not immediately returned.
The company argued it had been authorized by the U.S. Department of Agriculture to use the organic label. Allowing individual lawsuits challenging that designation would open it up to interpretation by a “lay jury,” creating a patchwork of standards for the term “organic” that would defeat the goal of a national organic foods marketplace, the company said.
“If a lone consumer can second-guess the USDA’s certification, and a grower cannot rely on its federal authorization to use the term, the already high cost of production of such products will skyrocket, or more likely, there will be no organic products to enjoy,” the company argued in its brief.
Werdegar said judges — not juries — would decide such lawsuits using the federal organic labeling standard.
Raymond Boucher, an attorney for Quesada, said the ruling was a big victory for consumers.
“When Ms. Quesada goes in to buy a product that’s stamped as organic, she wants to know this truly is organic, and she can feel good about it,” he said.
The case is Quesada v. Herb Thyme Farms, Inc., 15 S.O.S. 5759.
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