What The Ninth Circuit Ruling On The Mandatory GMO Labeling Rule Means For F+B Businesses

On October 31, the Ninth Circuit Court of Appeals decided a case challenging the United States Department of Agriculture's ("USDA") mandatory labeling rule for bioengineered foods. The decision in Natural Grocers et al. v. Rollins, Case No. 22-16770 (9th Cir. 2025), addresses three issues: (1) the exclusion of bioengineered foods that have been "highly refined"; (2) use of the term "bioengineered"; and (3) use of the QR code and/or texting for the disclosure.

In 2016, Congress passed a law requiring a disclosure for foods that are or contain bioengineered food ingredients (commonly known as GMOs). 7 U.S.C. § 1639 et seq. The law directed USDA to promulgate regulations to effectuate the law. The regulation, finalized in 2018, established a List of Bioengineered Foods that would require a disclosure, outlined various exemptions, and identified four disclosure options that companies could select if they were required to make a disclosure, among other provisions.

The Ninth Circuit's decision in the Natural Grocers case impacts the "highly refined" exemption and the use of the electronic/digital link or text message disclosure options. Anyone relying on either of those provisions should keep reading!

The "Highly Refined" / Not Detectable Exception

Under the challenged rule, USDA essentially exempted from its disclosure requirements foods that are on the bioengineered list but that are highly refined.¹ The Ninth Circuit disagreed with how the lower court arrived at that conclusion, but agreed that USDA had the discretion to set a threshold amount below which a food on the bioengineered list would not be considered a bioengineered food.

The Court's discussion focused on the use of the word "contains" in Congress' definition of "bioengineering" and on Congress' direction that USDA "determine the amounts of a bioengineered substance that may be present in food, as appropriate, in order for the food to be a bioengineered food." The Ninth Circuit also discussed the difference between modified genetic material being "nondetectable" and a specific amount of modified genetic material below which a food is deemed to not contain a bioengineered substance ("the [USDA] relied entirely on the flawed legal premise that the non-detectability of a substance under the regulation was equivalent to its non-presence.").

The Ninth Circuit sent the case back to the lower court for it to direct USDA to review this issue again and for the district court to determine whether the existing exemption for highly refined foods should remain in place or set aside while the USDA revisits the issue.

What this means for F+B Businesses: Anyone that is relying on the "highly refined" exemption from disclosure should keep an eye out for whether the exemption stays in place or is discarded while USDA reconsiders this issue.

Other Terms for "Bioengineered"

Each of the four disclosure options provided under the final rule uses the term "bioengineered food" and does not expressly allow for use of other similar terms. This was challenged in the Natural Grocers case, with the plaintiffs arguing that consumers are more familiar with terms like "genetically engineered," "genetically modified," and "GMO" and that requiring the exclusive use of the term "bioengineered" would confuse consumers. The Ninth Circuit held that the USDA acted within its authority to decide that all disclosures under the rule should use a consistent term, that no other similar terms would be allowed, and that the term would be "bioengineered."

What this means for F+B Businesses: This has no practical impact on the existing requirement to disclose the presence of bioengineered food on a food package.

The Electronic or Digital Link (e.g., QR Code) & Text Message Options

The final rule established four ways to meet the disclosure requirement on food packages that contain a bioengineered food: (1) an on-package text disclosure; (2) a symbol disclosure; (3) an electronic or digital link disclosure; or (4) a text message disclosure. The plaintiffs asserted that the electronic or digital link disclosure and the text message disclosure options were unlawful based on specific statutory provisions and that they should not be allowed. The district court agreed with the plaintiffs and sent the issue back to the USDA to re-evaluate.

However, the district court did not vacate the latter two electronic or digital link or text message disclosures, meaning that those two disclosure options could still be used to meet the disclosure requirements. The plaintiffs appealed the district court's failure to vacate those two disclosure options. The Ninth Circuit held that the district court's blanket denial of vacatur was an abuse of discretion. The district court could have imposed a prospective vacatur, for example, "by delaying the effective date of the vacatur or 'setting a timeline' for selling through any existing inventory of already-labeled products." The Ninth Circuit sent the issue back to the district court "to fashion an appropriate prospective vacatur."

What this means for F+B Businesses: Anyone that is relying on the electronic or digital link or the text message disclosure options should keep an eye out for an update on when and how these two disclosure options will be vacated, and what, if anything will replace them.

Footnote

1. A "bioengineered food" (as defined) is deemed to "not contain modified genetic material if the genetic material is not detectable" pursuant to testing standards identified in the regulation.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.