A federal court in Connecticut has ordered the payment of $1.9 million in equitable restitution to consumers who purchased Chinese Diet Tea and Bio-Slim Patch in 2003-2004. FTC v. Bronson Partners, LLC, No. 04-1866 (D. Conn., decided December 4, 2009). The court determined in 2008 that the Federal Trade Commission’s (FTC’s) claims of false advertising against the defendants had merit and issued this ruling to explain the basis for its damages award and why it was not allowing any offsets to the defendants from the gross amounts they received for all of the products sold. Essentially, the court found that the defendants’ poor recordkeeping and legal precedent did not allow offsets for credit card refunds, bounced checks, operating expenses, or revenue generated by reorders, which defendants claimed represented satisfied customers. According to the court, reorders could also have represented customers who “had not yet achieved the results promised in the…
Posts By Shook, Hardy & Bacon L.L.P.
In an unpublished opinion, the Fifth Circuit Court of Appeals has upheld the dismissal of a biscuit maker’s claim that the Food and Drug Administration’s (FDA’s) negligent testing of its product for Listeria monocytogenes resulted in a false positive report that caused it to lose its contract with a company that supplied 7-Eleven convenience stores with biscuit sandwiches. Lone Star Bakery, Inc. v. U.S., No. 09-50374 (5th Cir., decided November 17, 2009). The litigation arose under the Federal Tort Claims Act following a 2002 Listeria contamination incident for which the biscuit maker was initially blamed, but later cleared of any responsibility. The company sought $2.9 million in damages from the FDA. According to the court, which affirmed a grant of the FDA’s summary judgment motion, while the company submitted evidence showing “several instances where the FDA inspectors failed to follow agency collection and testing protocol,” its evidence was “devoid of…
According to a news source, a federal jury has awarded conventional rice farmers about $2 million in compensatory damages for the economic losses they allegedly experienced when European markets closed to U.S. rice imports that were found to be contaminated with genetically modified (GM) rice. In re: Genetically Modified Rice Litig., MDL No. 1811 (E.D. Mo., verdict reached December 4, 2009). The verdict was reached in the first bellwether cases to be tried. The next bellwether trial is apparently scheduled to begin in January and involves farmers from Arkansas and Mississippi. Defendant Bayer AG apparently indicated that it was pleased the jury did not award punitive damages and was preparing for the upcoming trials, which “will be different from these initial cases.” See Product Liability Law 360, December 4, 2009. In a related development, the MDL court has entered an order disposing of pre-trial motions related to the second bellwether trial. Among…
In collaboration with Health Canada and the U.S. Food and Drug Administration, the United Nations’ World Health Organization (WHO) and Food and Agriculture Organization (FAO) have announced an October 2010 expert meeting in Ottawa, Ontario, to discuss the safety of bisphenol A (BPA), calling for data from the scientific community on any “adverse human health effects at low doses of BPA, especially on reproduction, the nervous system and on behavioral development.” Meeting participants will apparently consider the current literature on BPA toxicology and exposure, weigh available risk assessments and address any knowledge gaps in an effort to develop international guidance. The agencies are specifically requesting both published and unpublished technical information on (i) “current levels of BPA in relevant food groups”; (ii) the analytical methodologies used to detect BPA “in food and other matrices”; (iii) “BPA migration from food contact materials into food”; (iv) “dietary exposure assessments of BPA from foods and other sources”;…
The last phase of the European Union’s (EU) food origin legislation takes effect January 1, 2010, requiring slaughterhouse operators and livestock keepers to provide Food Chain Information (FCI) for all cattle, sheep and goats sent to slaughter for human consumption. According to UK’s Food Standards Agency (FSA), FCI includes data about the “health of the animals being sent for slaughter, and other information relevant to the safety of meat derived from them, including medicines the animals have been given.” The rules already apply to other species such as pigs and calves. FSA urged slaughterhouse operators, markets and livestock keepers to prepare for the changes now because once the new rules are enforced, meat from cattle, sheep or goats without FCI information will not be passed for human consumption. “The new rules are an important part of ‘farm-to-fork’ food safety controls and highlight the food safety responsibilities of livestock keepers in…
The European Union has reportedly granted Neapolitan pizza a status of “traditional speciality [sic] guaranteed” (TSG), a premium labeling designation that “does not refer to an origin, but highlights the traditional composition or means of production.” According to media sources, the Italian government has successfully persuaded EU member states to approve their application stipulating that pizza napoletana—also known as pizza margherita—must be hand-kneaded and cooked in a wood-fired oven, use mozzarella from the southern Apennine Mountains, and contain specific kinds of flour, yeast, salt, and tomatoes. In addition, the pie must apparently feature an elevated crust rim of 1-2 centimeters (cm), a base that does not exceed 1/3 cm in thickness and a diameter less than 35 cm. While EU restaurants will still be able to proffer their versions of pizza napoletana, only products meeting these exact requirements can boast the coveted TSG logo. The Italian agriculture ministry has since noted…
The European Chemicals Agency (EHCA) has announced that in January 2010 its Member State Committee will add acrylamide to the European Union’s Candidate List of substances of very high concern (SVHC). The chemical by-product of high-temperature cooking processes has been linked to cancer in laboratory rats. According to ECHA, the Candidate List represents the first step in the authorization procedure to include SVCHs in Annex XIV of the REACH Regulation, after which time “they cannot be placed on the market or used after a date to be set (the so-called ‘sunset date’) unless the company is granted an authorization.” In addition to 14 other substances, the agency has proposed listing acrylamide as a category two carcinogen and a category two mutagen, but “decisions on the need to subject these substances to authorization will be taken later.”
The National Consumers League has sent a letter to the Food and Drug Administration (FDA) urging the agency to issue industry guidance in a renewed effort “to prevent consumers from being misled by the deceptive labeling of tomato products remanufactured from concentrate.” According to the league, it initiated efforts in 1990 that led the government to define the term “fresh” and require manufacturers to differentiate products prepared directly from fresh ingredients and those made from concentrate. The organization contends that “the marketplace once again is littered with false and misleading labels for tomato products claiming to be packed or made directly from fresh tomatoes.” The letter claims that food companies are misleading consumers by using phrases such as “packed full of premium vine-ripened tomatoes,” “packed from 100 percent California tomatoes” and “picks the freshest tomatoes,” to describe products “made from industrial tomato concentrate.” Citing FDA regulations requiring “from concentrate” or…
The Investor Environmental Health Network (IEHN) has requested that the Securities & Exchange Commission (SEC) include in its 2010 2015 strategic plan the development of guidance for public companies requiring narrative disclosures in their annual financial reports about emerging risks such as nanotechnology. Attached to the IEHN November 15, 2009, letter is a report titled Bridging the Credibility Gap: Eight Corporate Liability Accounting Loopholes that Regulators Must Close that focuses on asbestos and nanomaterials “to assess the effectiveness of the existing financial disclosure regulations, and to develop recommendations for improvements.” According to IEHN, the report “found some companies heavily investing in nanomaterials today that appear to be engaging in inadequate or misleading disclosures related to potential hazards and the resultant financial implications. In particular, some of the materials being developed by nanomaterials companies have already been found to bear significant hazard similarities to asbestos, but this information is not contained in any…
The U.S. Department of Labor (DOL) recently announced the availability of its semiannual regulatory agenda, which includes plans to conduct a peer review of the health effects and risks associated with diacetyl in the workplace. According to DOL, “emerging hazards such as food flavorings containing diacetyl and airborne infectious diseases place American workers at risk of serious disease and death.” Although DOL opted not to grant an emergency temporary standard petition filed by two workers’ unions in 2006, the department’s Occupational Safety and Health Administration (OSHA) has noted that “evidence from NIOSH [the National Institute for Occupational Safety and Health] and other sources indicated that employee exposure to diacetyl and food flavorings containing diacetyl is associated with bronchilitis obliterans, a debilitating and potentially fatal disease of the small airways in the lung.” As part of its intent to develop diacetyl regulations, OSHA in July 2009 completed a panel report on a draft standard in accordance with the Small Business Regulatory Enforcement…
