In a victory for cosmetics companies everywhere, the Second Circuit has affirmed the dismissal of slack fill allegations claiming that L’Oréal’s pump dispense mechanism for serums, lotions, and liquid makeup prevents consumers from utilizing every drop of product.

Last August, we reported on the Southern District of New York’s decision granting L’Oréal’s motion to dismiss a putative class action alleging that a common pump dispense mechanism used on L’Oréal’s cosmetics bottles deceptively prevented consumers from accessing the entirety of the product.  Judge Koetl disagreed, finding that consumers are familiar with pump dispensers on cosmetics packaging, and that the plaintiffs’ alleged “disappointment” did not “establish deception” or “transform [L’Oréal’s] accurate labeling of the product’s net weight into fraud by omission.”  Judge Koetl also found that the plaintiffs’ claims were preempted by the Federal Food, Drug and Cosmetics Act (“FDCA”).  Because federal law requires L’Oréal to label its cosmetics products with the net quantity of the product, irrespective of the amount that is accessible through the pump, Judge Koetl found that the plaintiffs’ claims were preempted.

The Second Circuit agreed.  Because the plaintiffs conceded that L’Oréal’s packaging complied with the FDCA with respect to the net-quantity of the product, the court found that, in order to avoid liability under the plaintiff’s theory, L’Oréal would have to “make an additional disclosure on its packaging, indicating that some cream cannot be retrieved or that the cream that is accessible is less than the net quantity displayed on the package label.”  (emphasis added).  Because such a theory would “impose labeling requirements on top of those already mandated in the FDCA,” the claims were preempted.

The Second Circuit did not reach the “reasonable consumer” grounds for the District Court’s decision, and we expect that the plaintiffs’ bar will continue to try to plead around FDCA preemption in slack fill cases.  But this decision will severely hinder their ability to do so—at least in the Second Circuit—and plaintiffs may start looking elsewhere to pursue these allegations.

Advertising and Privacy Law Resource Center - Another Slack Fill Preemption Win for the Cosmetics Industry (Jaclyn Metzinger)

Despite the lack of a private right of action to enforce the U.S. Federal Food, Drug and Cosmetics Act (“FDCA”), the plaintiffs’ bar continually tries to use the FDCA to support other causes of action, and more often than not class actions, challenging the marketing or labeling of cosmetics.  A recent decision by the Southern District of California, where many of these cases are filed, will hopefully deter this practice.  See Franz v. Beiersdorf Inc. et al., Case No. 3:14-cv-02241, (S.D. Cal. Apr. 15, 2020).

The FDCA defines cosmetics as “articles intended to be rubbed, poured, sprinkled, or sprayed on, introduced into, or otherwise applied to the human body… for cleansing, beautifying, promoting attractiveness, or altering the appearance.”  Drugs, by contrast, are articles “intended to affect the structure or any function of the body of man.”  While a seller must seek approval from the FDA before selling a drug, there is no pre-approval requirement for cosmetics, and Congress gave FDA the sole authority to police violations of the FDCA.

The original complaint in Franz, filed in 2014, alleged that Beiersdorf’s Nivea Skin Firming Hydration Body Lotion (the “Lotion”) claimed on its label that it provided skin firming hydration, improved skin’s firmness in as little as two weeks, and was proven to firm and tighten skin’s surfaces in as little as two weeks.  According to the plaintiff, because the Lotion was marketed to affect the structure or function of the skin, it was a drug (not a cosmetic), and should have gone through FDA’s pre-approval process.

After an amended complaint and two motions to dismiss, as well as an appeal to the Ninth Circuit, the Defendant filed a third motion to dismiss, arguing that the complaint failed to state a claim that the Lotion was, in fact, a drug.  The Court denied the motion.  Beiersdorf then filed a motion for summary judgment arguing that the plaintiff was preempted by the FDCA from privately enforcing the federal pre-market approval process for drugs and, in the alternative, asked the court to find that the Lotion was a cosmetic as a matter of law.

The Court granted Beiersdorf’s motion, explaining that claims seeking to enforce the FDCA must thread a “narrow gap” to escape preemption – the plaintiff must be suing for conduct that violates the FDCA, but not because the conduct violates the FDCA.  The plaintiff failed to meet this standard because she repeatedly referenced provisions of the FDCA and specifically alleged that “Defendant engaged in illegal conduct by unlawfully making skin firming representations about [the Lotion] that resulted in its being deemed a drug under FDA regulations, but did so without obtaining required FDA approval through the FDA NDA [New Drug Approval] process.”  Because there was “no reasonable way to construe this allegation except as an attempt to privately enforce the FDCA,” the claim was preempted.

Interestingly, the Court noted that because the relevant facts were not in dispute and because the motion largely turned on a question of law, a motion to dismiss would have been the better procedural vehicle for resolving the issue.  Cosmetics companies should always consider whether they have valid preemption arguments at the motion to dismiss stage.  This decision (from one of the more plaintiff-friendly jurisdictions in the country no less) is hopefully another tool to resolve costly class actions litigation at an early stage.

The decision was appealed to the 9th circuit on May 18, 2020.

Imagine you are perusing the coffee aisle in the grocery store and see a product described as “freshly ground,” “100% Arabica Coffee,” “Hazelnut Crème,” “Medium Bodied,” and “Rich, Nutty Flavor.”  Would you think that the coffee contains hazelnuts?  Should consumers be expected to consult the ingredient list to clarify any confusion?  And what exactly is “Hazelnut Crème?”

The First Circuit addressed these issues in Dumont v. Reily Foods Co., in which a split panel concluded that a reasonable consumer could be deceived into thinking that the product contained hazelnuts when, in actuality, it contained only naturally and artificially flavored coffee.  The court reversed the District of Massachusetts’ dismissal of the plaintiff’s Massachusetts General Law Chapter 93A claim, and permitted the case to proceed into discovery.

Judge William J. Kayatta Jr., writing for the majority, explained that while some reasonable consumers might be motivated to consult the ingredient label on the reverse side of the package, others might “find in the product name sufficient assurance so as to see no need to search the fine print on the back of the package, much like one might easily buy a hazelnut cake without studying the ingredients list to confirm that the cake actually contains some hazelnut.”  As support for this, Judge Kayatta noted that the plaintiff’s complaint set forth that the industry practice—in large part due to federal labeling requirements—is to state on the front of a package containing a product that is nut flavored (but that contains no nuts) that the product is naturally or artificially flavored.

The majority also found ambiguity in the phrase “Hazelnut Crème,” with one judge believing that “‘crème’ was a fancy word for cream, with Hazelnut Crème being akin, for example, to hazelnut butter.”

Finally, the majority held that the plaintiff’s state-law consumer fraud claim was not preempted by the Federal Food, Drug, and Cosmetic Act (“FDCA”), which imposes specific labeling requirements for the coffee product at issue.  The court ruled that such a claim must fit within a “narrow gap” to avoid preemption:  the plaintiff must be suing for conduct that actually violates the FDCA (otherwise the claim would be expressly preempted by the FDCA), but the plaintiff must not be suing because the conduct violates the FDCA (which would be implicitly preempted).  Because the complaint sought “to vindicate the separate and independent right to be free from deceptive and unfair conduct” separate and apart from any alleged FDCA violations, the chapter 93A claim was not preempted.

Former Chief Judge Sandra L. Lynch dissented, reasoning that the package as a whole undermined any reasonable belief that the coffee actually contained hazelnuts:  “the front label plainly states that the package contains ‘100% Arabica Coffee.’  It does not say it contains anything other than coffee.  The package here did not contain any misstatement of its contents, did not feature any pictures or illustrations of hazelnuts, and did not have any error in the ingredient list.”

Judge Lynch then addressed the phrase “Hazelnut Crème,” differentiating between the definition of cream—the oily or butyraceous part of milk—and that of crème—a “‘cream or cream sauce as used in cookery’ or ‘a sweet liqueur.’”  In her opinion, “[i]n the context of a package of ground, dry coffee, . . . the two words, ‘Hazelnut Crème,’ together plainly state the flavoring of the coffee.”  Judge Lynch similarly rejected the majority’s analogy to a hazelnut cake which, presumably, contains multiple ingredients and could very well contain hazelnuts.  In contrast, she noted that reasonable consumers would not approach a package of ground coffee in the same manner, especially one that was prominently labeled as “100% Arabica Coffee.”  Judge Lynch concluded that any consumer who was confused by the label, or specifically concerned with the presence of hazelnuts, could simply consult the ingredient label on the reverse side of the package to confirm the absence of hazelnuts.

While the majority found the case to present a close question for the very reasons set forth in Judge Lynch’s dissent, it ruled that the complaint stated a plausible claim for relief and reversed the lower court’s grant of the defendants’ motion to dismiss.

The First Circuit’s analysis resembles a recent Second Circuit decision involving Cheez-It crackers labeled as “WHOLE GRAIN” or “Made With WHOLE GRAIN” when the predominant ingredient was enriched white flour.  In Mantikas v. Kellogg Co., the Second Circuit concluded that while the product did, indeed, contain some whole grains, a reasonable consumer could be misled into believing that it was the predominant ingredient in the crackers.

While Dumont did not cite the Second Circuit’s opinion, it is based on the same premise that reasonable consumers should not be expected to consult an ingredient list to correct allegedly misleading information on the front label.  Judge Lynch’s dissent, however, cautioned that permitting “meritless labeling litigation” like this one to continue beyond the pleadings stage “will have the effect of driving up prices for consumers” and cause an entirely different type of “harm to the consumer.”  For now, the Dumont decision marks another plaintiff-friendly outcome sure to be relied on by class action plaintiffs in the First Circuit and elsewhere.

A label contains an accurate net weight of the amount of product inside.  The packaging is clear, allowing consumers to view a pump mechanism common in the cosmetics world.  So, where’s the deception?

According to the Southern District of New York – there is none.  In Critcher et al. v. L’Oreal USA, Inc., et al., 1:18-cv-05639 (S.D.N.Y.), the Court recently held that reasonable consumers would not be deceived by a cosmetics bottle utilizing a pump dispense mechanism.

The plaintiffs claimed that the pump mechanism prevented them from being able to access the entire product inside of the bottle.  But Judge Koeltl was not swayed.  He held that consumers are familiar with pump dispensers on personal care products such as soaps, shampoos and lotions, and are therefore aware that “they will not be able to extract every bit of product from such containers.”  Accordingly, the court held that a “reasonable consumer” would not be deceived by the packaging of the products, and that plaintiffs’ alleged “disappointment” did not “establish deception” or “transform [L’Oreal’s] accurate labeling of the product’s net weight into fraud by omission.”

The Court also found that plaintiffs’ claims were preempted by the Federal Food, Drug and Cosmetics Act (FDCA).  Because federal law permits – and requires – L’Oreal to label its cosmetics products with the net quantity of the containers’ contents irrespective of the amount accessible through the pumps, the labels followed the “federal regulatory scheme [that] addresses measurement and labeling of product quantity head-on.”  And since plaintiffs were seeking labeling that was different from the labeling requirements set forth in the FDCA, their claims were expressly pre-empted.

The Critcher decision comes on the heels of two recent dismissals of slack fill class actions in the Southern District.  Last year, Ad Law Access covered Daniel, et al. v. Tootsie Roll Industries LLC, Case No. 1:17-cv-07541, 2018 WL 3650015 (S.D.N.Y. Aug. 2, 2018), in which plaintiffs claimed that different-sized boxes of Junior Mints contained between 35 to 43 percent of empty air.  Judge Buchwald rejected these allegations, finding that no reasonable consumer would have been deceived because the Junior Mints boxes “provide more than adequate information for a consumer to determine the amount of product contained therein” and that the weight of the candy was “prominently displayed on the front” of each box.  Id. at *11-12.  Judge Buchwald then questioned the validity of slack fill cases more generally where the product’s label accurately reflects the weight of the product:  “[C]onsumers are not operating on a tabula rasa with respect to their expectations of product fill.  To the contrary,…‘no reasonable consumer expects the weight or overall size of the packaging to reflect directly the quantity of product contained therein.’….The law simply does not provide the level of coddling plaintiffs seek, [and] the Court declines to enshrine into the law an embarrassing level of mathematical illiteracy.”  Id. at *13.

Similarly, in Hu v. Iovate Health Sciences, U.S.A., Inc., 2018 WL 4954105 (S.D.N.Y. Oct. 12, 2018), plaintiff alleged that a protein powder sold by the defendant was packaged in containers that were not adequately filled, yielding a slack fill of 41 percent, but conceded that the package accurately disclosed the amount of protein powder inside.  Citing Daniel, Judge Ramos stated that “generally, courts within this District have found that labels on packages that clearly indicate the product’s weight prevent plaintiffs from succeeding on non-functional slack-fill claims.”  Id. at *2.  Given the accuracy and prominence of the label’s statement of net weight, Judge Ramos concluded “that the allegedly nonfunctional slack fill would not mislead a reasonable consumer acting reasonably under the circumstances.”  Id. at *3.

*                      *                      *

The Critcher decision marks another welcome victory for cosmetics and consumer product companies, and demonstrates that judges (at least those in the Southern District) are viewing slack fill claims with increasing skepticism and willing to dismiss them at the pleadings stage.

The FDA and FTC jointly issued warning letters to three companies selling CBD products online.  The letters allege violations of the Federal Food, Drug, and Cosmetic Act (“FDCA”) and the Federal Trade Commission Act (“FTCA”).  Although this is the first time the FDA and FTC have issued joint warning letters relating to CBD, the FDA has been involved in CBD enforcement for the past few years.

Since the passing of the 2018 Farm Bill, which descheduled hemp and hemp derivatives under the federal Controlled Substances Act, the FDA has become the primary federal regulator relative to foods, drugs, cosmetics, and dietary supplements that contain CBD from hemp.  The FDA’s most visible enforcement on CBD products to date has been in the form of warning letters issued to online retailers of products labeled as dietary supplements that feature aggressive disease treatment claims. The FDA also tested CBD products in conjunction with warning letters issued in 2015 and 2016 to determine whether they contained the CBD levels listed on the labels.

In the letters from last week, the FDA turned its focus onto various CBD products marketed online as “drugs,” including “CBD Salve,” “CBD Oil,” “CBD for Dogs,” “Hemp Oil,” “CBD Softgels,” “Liquid Gold Gummies (Sweet Mix),” “Liquid Gold Gummies (Sour Mix),” and “blue CBD Crystals Isolate 1500mg.”  The FDA determined that the companies’ websites contained claims about their CBD products that established them as unapproved “drugs” under section 201(g)(1) of the FDCA. The letters also referenced the FTC’s substantiation standard, stating the FTC had concerns that certain efficacy claims that were made may not be substantiated by competent and reliable scientific evidence. They also warned that violations of the FTCA may result in legal action seeking a Federal District Court injunction or Administrative Cease and Desist Order, possibly including a requirement to pay back money to consumers.

As noted above, these letters are unique, as it is the first time the FDA has issued a joint FDA/FTC warning letter relating to CBD. This is also the first time the FDA has referenced the FTC’s substantiation standard or threaten any specific penalty for violations of the FTCA.  For companies marketing CBD, it is important to keep in mind that although the market has flourished despite a host of regulatory uncertainties, it is the regulators’ opinion that the rules regarding advertising and health claims are clear.  Competent and reliable scientific evidence remains the standard.

Over the last few years, however, the FTC’s health claim enforcement has featured several false cure-type products. Cases against Regenerative Medical Group, Cellmark, iV Bars, and Nobetes challenged unproven representations for products promising to treat Parkinson’s disease, macular degeneration, cancer, multiple sclerosis, and diabetes.  Although we have yet to see the FTC announce any settlements relating to CBD products, these letters signal that FDA is not alone in its concern over aggressive CBD treatment claims.

The warning letters can be found here:

The FDA & FTC today posted warning letters to 11 marketers and distributors of opioid cessation products, alleging that such products were unapproved new drugs that violated the Federal Food, Drug and Cosmetic Act (FDCA) and that made unsubstantiated, deceptive claims in violation of the FTC Act.  In addition to the 11 joint warning letters issued to named marketers and distributors, the FTC issued four additional warning letters to unidentified marketers of similar products.  It is not clear why these four marketers were not identified by name or targeted by FDA, although it is possible that they used less egregious claims than those targeted in the 11 joint warning letters.

As to issues under the FDCA, the warning letters allege that the identified products are unapproved new drugs because they are intended to diagnose, cure, mitigate, treat, or prevent disease.  The warning letters identify representative claims that render the products “drugs” under the FDCA, including:

  • “For temporary relief of cravings, irritability, and inability to concentrate related to the use and over-use of. . .  alcohol and narcotics”;
  • “Support withdrawal relief, effective detox, and lasting recovery from addiction”; and
  • “Opiate withdrawal aid supplement.”

Because the products are not generally recognized as safe and effective for these marketed “drug” uses, the products constitute unapproved new drugs that violate the FDCA, according to the warning letters.  The warning letters further provide that the products are marketed for treatments that are not amenable to self-diagnosis or treatment without the supervision of a licensed practitioner, and thus would be prescription drugs even if they were recognized as a safe and effective treatment for opiate withdrawal.

Two warning letters targeted products labeled as “homeopathic” under FDA enforcement policies set forth in FDA’s Compliance Policy Guide (CPG), “Conditions Under Which Homeopathic Drugs May be Marketed.”  While that policy suggests that FDA will exercise enforcement discretion as to certain drug products labeled as “homeopathic” and marketed without FDA approval, the letters state that the CPG acknowledges that special circumstances may apply that supersede that policy.  According to the warning letters, the nationwide public health emergency relating to opioid addiction is one such circumstance and thus the enforcement policy does not apply to drugs marketed for opiate addiction.  In December 2017, FDA released a draft guidance that proposed a new risk-based enforcement approach to homeopathic drug products marketed without FDA approval that would prioritize regulation and enforcement for products that pose the greatest risk to patients.

As to the FTC Act violations, the warning letters note that health-related claims must be supported by competent and reliable scientific evidence at the time the claims are made.  The warning letters point to previous FTC enforcement actions challenging unsupported claims for the treatment of opiate addiction and withdrawal symptoms as evidence that such claims are likely unsubstantiated under the FTC Act.

The warning letters request unique responses to both FTC and FDA within 15 working days and direct the marketers and distributors to explain the steps they are taking to address both FDA and FTC-related concerns.

The Oregon AG recently announced a $545,000 settlement with the Vitamin Shoppe over allegations that the store violated Oregon state law by selling dietary supplements containing ingredients that FDA has deemed unsafe or unlawful. The new settlement agreement places significant burdens on the Vitamin Shoppe to monitor developments on ingredient status. The burdens are the same regardless of whether the Vitamin Shoppe sells a product under one of its own brands – or if it sells a product that was manufactured, labeled, and sold to it by a third party vendor.

Under the terms of the agreement, if the Vitamin Shoppe “receives or learns of” a “written notice” from FDA that an ingredient may be unsafe or unlawful, it must “take immediate action to suspend the sale of such products or products known to contain the ingredients.” If the Vitamin Shoppe becomes aware of any other “public announcement, warning, alert, publication, notice, or report” suggesting that the U.S. government, Australia, Canada, Britain, or the EU might consider a dietary ingredient unsafe or unlawful under the FDCA, then the Vitamin Shoppe must conduct a “reasonable due diligence review,” which may result in a decision not to sell any products containing the ingredient.

This settlement is notable for at least two reasons:

  1. It identifies FDA warning letters sent to the Vitamin Shoppe or anyone else as “written notice” that FDA has deemed an ingredient unsafe or unlawful.  Warning letters, however, state only allegations and are not considered “guidance” under FDA’s rule on “good guidance practices.”  Well after a warning letter is issued, the lawfulness of a particular dietary ingredient can be the subject of much ongoing debate, and even the FDA’s official guidance document on ingredient status remains in flux after years of debate.
  2. The settlement represents an aggressive stance by Oregon on a retailer’s liability for product formulation and labeling by third parties.  As we’ve discussed before, there isn’t a whole lot of precedent for regulators going after the retailer, rather than the product seller.

The Oregon Attorney General is currently in litigation against another retailer over similar allegations related to the legal status and safety of a dietary ingredient.

Kelley Drye Ad Law publishes News & Views: Dietary Supplement Advertising, which covers developments ranging from FTC and FDA regulation, class actions, Customs developments, and Prop 65. Subscribe to future issues by filling out your information and checking the Dietary Supplements Practice Group box here.

A California court recently dismissed, in part, a consumer class action against labeling and advertising claims for twenty different Bayer One-A-Day multivitamins. The plaintiffs had alleged that the claims, “supports heart health” and “supports immunity” – which Bayer used for many of the products – were impermissible disease claims. The court rejected these allegations. It found, first, that FDA has determined that such claims are permissible, non-disease “structure/function” claims. It pointed to FDA guidance providing that similar claims, such as “helps maintain a healthy circulatory system” and “supports the immune system,” are permissible structure/function claims. The court, next, found that, under an express pre-emption provision in the federal Food, Drug, and Cosmetic Act, a litigant cannot upset FDA’s prior determination. The FDCA pre-emption provision provides that state law cannot impose a labeling requirement that conflicts with or adds to FDA requirements. In contrast to its holding regarding the heart health and immunity claims, the court refused to dismiss allegations against the claim, “supports physical energy.” The difference is that while the plaintiffs challenged the substantiation for the energy claim, they did not allege that the claim was an impermissible disease claim.

The lawsuit, which was filed with the support of the Center for Science in the Public Interest, is a clear winner for industry. The specter of a court finding that a clear structure/function claim, like “supports heart health,” is a disease claim loomed large and could have affected the types of claims that dietary supplement and food companies choose to make. This decision, we hope, will discourage future litigants from picking fights over what is and isn’t a disease claim. We wonder, too, if this decision or others like it could eventually affect the FTC’s position on disease claims. In 2010, the FTC began including in many of its orders specific requirements for any future claims that a food or supplement “treats, prevents, or cures any disease.” With the duty to enforce the new provisions, the FTC effectively entered the business of disease claim determination. The FTC orders neither define what constitutes a disease nor refer to FDA regulations on the matter. An open question, thus, has been how exactly is the FTC defining what is and isn’t a disease claim? And, should the FTC really be the agency making such determinations?

Jennifer Rodden, a law clerk with Kelley Drye & Warren, assisted in the drafting of this post.

The United States Court of Appeals for the Fourth Circuit recently affirmed a West Virginia federal district court’s holding that a plaintiff’s common law tort claim was preempted by the 1976 Medical Device Amendments (“MDA”) to the Food, Drug, and Cosmetic Act (“FDCA”). Under the MDA, certain medical devices, known as Class III devices, are required to receive premarket approval from the Food and Drug Administration (“FDA”).  The MDA also allows the FDA to condition a grant of premarket approval on a requirement that a device meet certain performance standards. The establishment of a performance standard is a formal process that requires publication in the Federal Register and providing interested parties with an opportunity to comment.  The MDA expressly preempts state medical device regulations that are “different from, or in addition to, any [federal] requirement.”

Continue Reading Fourth Circuit Clarifies Scope of Federal Preemption for Requirements Governing Medical Devices

In a unanimous opinion published on January 23, 2012, the Supreme Court reversed the Ninth Circuit Court of Appeals and held that a California law prohibiting the sale, processing or holding of a nonambulatory animal was expressly preempted by the Federal Meat Inspection Act (FMIA).

The case, National Meat Association v. Harris, dealt with Section 599f of the California Penal Code, which was enacted in 2008 in response to an undercover video released by the Humane Society showing workers in California kicking and electroshocking sick and disabled cows in an attempt to move the cows. The law makes it a crime for any slaughterhouse to “buy, sell or receive a nonambulatory animal,” or to “process, butcher or sell meat or products of nonambulatory animals for human consumption,” or “hold a nonambulatory animal without taking immediate action to humanely euthanize the animal.”

The National Meat Association (NMA) sued to enjoin enforcement of the law as applied to swine slaughterhouses and argued that the FMIA’s broad express preemption provision prohibited California from enacting distinct requirements for the handling of nonambulatory pigs. The FMIA and implementing regulations enacted by the Department of Agriculture’s Food Safety and Inspection Service (FSIS) broadly regulate slaughterhouses to promote meat safety and humane treatment. With respect to the treatment of nonambulatory pigs, FSIS regulations permit slaughterhouses to hold and eventually sell nonambulatory animals, subject to a “post-mortem” examination.

Continue Reading Supreme Court Unanimously Holds California Law Prohibiting Sale, Processing or Holding of Nonambulatory Pigs Expressly Preempted under the Federal Meat Inspection Act