On June 4, 2021, the U. S. Court of Appeals for the Ninth Circuit affirmed the dismissal of a putative state law consumer class action claiming that chicken products marketed by Trade Joe's were mislabeled. Webb v. Trader Joe's Co., ___ F.3d ___, No. 19-56389 (9th Cir. June 4, 2021). The labels stated that the products contained "[u]p to 5% retained water," but plaintiff claimed that an independent laboratory test showed that the products "contained on average, 9% Retained Water." Slip op. at 5. The Ninth Circuit affirmed the district court's ruling that all of plaintiff's claims were pre-empted by the federal Poultry Products Inspection Act (PPIA), 21 U.S.C. § 467e.
Poultry labels are regulated by the PPIA. That statute pre-empts any state law claim regarding regulated labels that would impose requirements "in addition to, or different than those" already required by federal law. Id. The U.S. Department of Agriculture, through its Food Safety and Inspection Service (FSIS), administers the labeling approval program.
As required by the PPIA, defendant had made its water retention protocol available to FSIS, which lodged no objection to it. Consequently, the Ninth Circuit explained, "[t]his constitutes federal approval of Trade Joe's protocol because one purpose of FSIS's regulatory opportunity to review is to confirm 'that the data support the water-retention statements on product labeling.'" Slip. op. at 10-11 (citation omitted). That the lab hired by plaintiff apparently found 9% retained water was beside the point because there was no evidence that the lab had used the same protocol as Trader Joe's. Holding the defendant to a 9% standard would have been a requirement different than that required by federal law.
Pre-emption followed for the additional reason that FSIS had also reviewed the labels at issue. Here, the labels contained both a general statement (the retained water content) as well as special statements such as "no antibiotics ever," "no added hormones" and "all vegetarian fed." Such special statements require FSIS to review the entirety of the label which meant that FSIS's review of the special statements was also a review (and approval) of the retained water content statement. Slip op. at 13-14.
The PPIA not only pre-empted plaintiff's claims under the California Unfair Competition Law, False Advertising Law and Consumer Legal Remedies Act, but also her state law claims for breach of warranty, theft by false pretenses and unjust enrichment.
The outcome of this case is a useful precedent for businesses in the animal protein space that market products that can be made the subject of claims under the California consumer statutes that were at issue in this case. UCL litigation in Ninth Circuit courts is prolific. It is a familiar tactic of animal activists to make consumer law challenges to food product labels that go to the methods employed in animal raising or processing (e.g., "humane," etc.) and argue that such terms are misleading because they do not conform to what the activists claim the standards should be. In reality, it often has nothing to do with what the label says and everything to do with the the fact that the animal is raised for human consumption. As the Webb case shows, however, pre-emption can defeat these tactics. If a label has been through the PPIA process described above, state law claims that would impose additional or different requirements cannot be pursued.
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