15-Second Advertising Law Alert: FDCA and FDA REGS Preempt Lanham Act; Cal. Ad Law Clarified
The Ninth Circuit today issued its long-awaited opinion in Pom Wonderful LLC v. The Coca-Cola Co.*
Background
Pom marketed a pomegranate-blueberry juice blend. Coca-Cola marketed a juice blend named and labeled "Pomegranate Blueberry Flavored Blend of 5 Juices."
The Coca-Cola product contained 0.2% blueberry and 0.3% pomegranate juices, 99.4% apple and grape juices, and 0.1% raspberry juice. This product's principal display panel depicted each of these fruits, with the pomegranate and apple being about the same size. The product name and labeling were found to comply with U.S. Food and Drug Administration regulations.
Pom sued in the federal Central District of California. It alleged false and/or misleading advertising under the federal Lanham Act and under California's Unfair Competition Law and False Advertising Law.
Pom alleged that consumers were being misled into believing that the competitive product consisted primarily of the more expensive pomegranate and blueberry juices.
The District Court ruled that the Lanham Act claim was barred as it applied to the product name and labeling, due to the preemptive effect of the Federal Food, Drug, and Cosmetic Act and FDA's occupying the relevant regulatory field.
That trial court also barred the state law claims, finding that Pom had no standing under those statutes because it failed to show that it lost money or property.
Decision
The appeals court affirmed the federal law holdings, ruling that Ninth Circuit law "teaches that the Lanham Act may not be used as a vehicle to usurp, preempt, or undermine FDA authority. That teaching, however, operates as a presumption or a general principle – not as an automatic trump or a firm rule."
Nonetheless, the Circuit reversed and remanded the ruling on state law. The Circuit concluded, based on a new California Supreme Court ruling, that standing under those state statutes was not dependent on seeking restitution.
*No. 10-55861 (9th Cir. May 17, 2012).