With No Definition of “Natural”, Food Labels and Promotions
Making Natural Claims Face Increasing Numbers of False and
Deceptive Advertising Lawsuits
Andrew MillerDecember 9, 2016
COMM 428B, Section 1
According to FoodNavigator.com (PULSE Innovation Forum), the organic food market will
increase 14% between 2013 and 2018. As consumer demand for natural foods increase, it is
interesting to note that the FDC does not have a definition of “natural” or its derivatives. The
FDA states that “From a food science perspective, it is difficult to define a food product that is
'natural' because the food has probably been processed and is no longer the product of the earth.”
(U.S. Food & Drug Administration - What is the meaning of 'natural' on the label of food?,
2016).
The FDA appears to be content with manufacturers’ use of the term if the product doesn’t
contain artificial flavors, added colors or synthetic substances. However the use of this term -
and lack of helpful industry definitions - seems to create subjective expectations from consumers
and industry stakeholders.
Differing expectations have led to consumer and industry confusion, and the lack of
standardization between the FDA the USDA and the FTC – fueled by deceptive advertising by
food marketers (Parasidis, Hooker, & Simons, 2015) – have resulted in lawsuits against
manufacturers and their “natural” products.
Food marketers and manufacturers beware: the lack of definition for the term “natural” in
product labels, promotions and advertising campaigns can confuse industry stakeholders and
consumers, resulting in an increase in lawsuits for false and deceptive advertising.
CONSUMER CONFUSION
With no standard industry definition of the term “natural”, consumer expectations – and
complaints - should be of no surprise to food marketers and manufacturers. According to a law
review in the American Journal of Law & Medicine, “The legal and regulatory framework is
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confusing for lawyers, academics, and courts, and nearly incomprehensible for the
average consumer.” (Parasidis, Hooker, & Simons, 2015).
The review goes on to state the a majority of Americans not only buy foods with “natural”
claims but they also believe that “natural” foods do not contain genetically modified ingredients
or pesticides that are used to grow food products (Parasidis, Hooker, & Simons, 2015).
Without proper industry definitions and regulations, “Natural” and “100% Natural” products
may contain a variety of inconsistent ingredients that seem to not only surprise consumers but
increasingly make them angry enough to pursue litigation. And when that consumer is willing to
pay more for “natural” products and those expectations are not met, litigation aimed at hitting
food manufacturers in their pocketbooks seems like fair play.
According Nielsen’s 2015 Global Health & Wellness Survey, “natural” product sales
rocketed to over $22 billion dollars is annual sales, with 88 percent of over 30,000 surveyed
online consumers [across all demographics] indicating that they are willing to pay more for
healthier foods (Gagliardi, 2015).
“Natural” product consumers are paying more for items they believe to be healthy, and when
they feel they’ve been deceived by false labels and claims, deceptive advertising lawsuits are
their response. Food marketers and manufacturers are feeling the heat for “natural” claims
advertising, and the list keeps growing.
THE ANGER IS IN THE MISSING INGREDIENTS
PepsiCo’s Quaker Oats is one of the most recent cases where angry consumers have fought
back. In May of 2016, consumers from California, Illinois and New York sued the food
manufacturer for false advertising over ingredients in its products (Progressive Media Company,
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2016). Plaintiffs from California and New York are seeking class-action status, refunds and
monetary damages (Ontario Farmer, 2016).
The plaintiffs claim that an undeclared ingredient in the product – glyphosate – is an herbicide
that was declared a carcinogen by the World Health Organization. The claim alleges that the
herbicide is used as a weed-killer and drying agent by oat farmers, and because of this use, the
manufacturer’s product claim of “100 Percent Natural” is misleading (Progressive Media
Company, 2016). Though the lawsuit doesn’t attack the methods used to farm the oats, it asserts
that Quaker Oats products are not “ ‘Natural,’ ‘100% Natural,’ or ‘100% Natural Whole Grain’
as labeled and marketed.” (Kell, 2016).
Lawyers for the New York plaintiffs wrote, “By deceiving consumers about the nature,
quality, and/or ingredients of its Quaker Oats, Quaker is able to sell a greater volume of Quaker
Oats, to charge higher prices for Quaker Oats, and to take away market share from competing
products.” (Ontario Farmer, 2016). The complaint filed in Brooklyn states, “Quaker knows that
consumers seek out and wish to purchase whole, natural foods that do not contain chemicals, and
that consumers will pay more for foods that they believe to be natural." (Progressive Media
Company, 2016).
In reply, PepsiCo stated, "Quaker does not add glyphosate during any part of the milling
process. Glyphosate is commonly used by farmers across the industry who apply it pre-harvest,"
and added that Quaker Oats are cleaned after they’ve been collected from the farms and that any
traces of glyphosate are well under “the maximum permissible limits set by the Environmental
Protection Agency.” (Progressive Media Company, 2016)
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“NATURAL” – SHOULD IT STAY OR SHOULD IT GO – OR SHOULD IT MOVE?
As lawsuits are settled, not only are manufacturers compensating plaintiffs, they’re changing
“natural” claims – and labels - giving a heads up to “natural” marketers that may be next in line
for litigation.
Kashi
It may come as a surprise to many to discover that Kashi – a brand noted for being “All
Natural” – has recently settled a false advertising class action lawsuit. Kashi was in a three-year
litigation battle fighting the class-action lawsuit which stated that Kashi’s claim of”100%
natural”, or “nothing artificial” was false advertising as their products contained genetically
modified organisms (GMOs) (LaFreniere, 2015).
The recent settlement resolved claims that the manufacturer mislabeled their products to
“persuade customers into buying their products.” (LaFreniere, 2015).
Though Kashi maintains that they didn’t do anything wrong and stands by its marketing, they
agreed to a cash settlement and agreed to remove all labels from Kashi products that contained
the GMO as identified by the lawsuit (LaFreniere, 2015).
General Mills
General Mills seems to be learning its “natural” lesson the hard way and appears to have had
its hands caught in the “granola bar” jar.
As recently as 2014, General Mills – the manufacturer of Nature Valley Granola Bars –
settled a class action lawsuit by agreeing to not include “100% natural” on their products if they
contained high-fructose corn syrup or any other highly processed ingredient (Shanker, 2016).
On August 24, 2016, new lawsuits [representing plaintiffs from California, New York,
Minnesota and Washington, D.C. ] against the food manufacturer were filed claiming their
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Nature Valley products – including their The Sweet & Salty Nut granola bar – made with “100%
natural whole grain oats” were deceptive as they were found to contain small amounts of a
popular pesticide, glyphosate (Shanker, 2016).
Similar to the lawsuit against Quaker Oats, the litigation isn’t focused on the use of
glyphosate in the processing of the product. According to lead attorney Kim Richman, “it is
much simpler – that oats can’t be ‘100% natural’ if they’re grown with a synthetic pesticide, and
that calling them as much misleads consumers.” (Shanker, 2016).
Though the General Mills lawsuits seek to have the label removed and reimburse consumers,
Richman states his goal: “I’m not interested in just seeing the word ‘natural’ removed. Ideally
the goal is to clean up the food system.” (Shanker, 2016).
As lawsuits increase with plaintiffs requesting the removal of labels using the word “natural”,
smart food manufacturers could avoid lawsuits by simply removing any product reference to the
term. According to public health attorney Michele Simon, “Every lawyer on the defense side
I’ve been in touch with is clearly advising their clients to avoid using this word.” (Shanker,
2016).
FDA SEEKS PUBLIC INPUT ON THE TERM, “NATURAL”
In 1993, the FDA allowed a comment period to collect responses to better grasp a common
meaning of the word “natural.” Though it commented that the term “natural” "is of
“considerable interest to consumers and industry" and that “the agency continues to believe that
if the term ‘natural’ is adequately defined, the ambiguity surrounding use of this term that results
in misleading claims could be abated," the FDA decided not to act (Parasidis, Hooker, & Simons,
2015). "Because of resource limitations and other agency priorities, [the] FDA is not
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undertaking rulemaking to establish a definition for ‘natural’ at this time." (Parasidis, Hooker, &
Simons, 2015)
Twenty three years later, because of increasing litigation, and “Because of the changing
landscape of food ingredients and production, and in direct response to consumers who have
requested that the FDA explore the use of the term ‘natural,’ the agency asked the public to
provide information and comments on the use of the term in the labeling of human food
products.” (Food & Drug Administration, 2016).
The time frame for public comment ran from November 2015 through May 10, 2016. The
FDA asked for public comment on these three questions:
“Whether it is appropriate to define the term “natural?”
“If so, how the agency should define “natural?” and
“How should the agency determine appropriate use of the term on food labels?”
(The FDA Requests Comments on Use of the Term “Natural” on Food Labeling)
Consumer Comments:
FoodNavigator- USA.com (Watson, 2015) provides a sampling of consumer feedback over
the term “natural” from the over 7,000 comments provided to the FDA during the public
comment period:
“Not sure why this is an issue, ‘natural’ is exactly that. No GMO’s, no radiation, no
chemicals of any kind.” Billie Johnson
“If the human food product comes in a box or packet and any of the ingredients have been
processed, the term ‘natural’ should never be allowed.” Michael Levine
“Food made by God is natural. Food made by a chemical company in the lab is not
natural.” Tracy Molyneaux
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“The term ‘natural’ is meaningless for the purpose of food labeling. It gives the impression
that this food is somehow healthy or good without providing any actual information about the
ingredients or methods of production. It is so open to misinterpretations that it could mean
anything at all. It provides a halo for food produces without providing any actual protections or
valuable information to consumers. To this extent, it is often downright misleading. It should
not be used on any food labels whatsoever.” Angela Bowman
Stakeholder Comments from Industry Associations:
Public comment came not only from concerned consumers but also from national industry
trade associations that have a vested interest in the use of the term “natural”:
“The data demonstrate that many to most consumers incorrectly believe that ‘organic’ and
‘natural’ have similar meaning…
“The most workable approach for the FDA to take is to clarify through guidance its
preference that, except where already provided for in FDA regulations (e.g. natural flavors), the
term ‘natural’ should not be used on food labels. Instead we urge FDA to focus its efforts on
identifying and defining the ‘single attribute’ claims that may be used on food labels (no
artificial colors of flavors). Should FDA define ‘natural’ it should proceed through program
establishment and rulemaking and ensure that processes are set up that include verification and
enforcement mechanisms, including third-party certification…” – The Organic Trade
Association (Ward, 2016)
“To foster transparency and flexibility, a definition of ‘natural’ should include a tiered
systems for labeling different categories of claims in four defined categories: 100% Organic;
Organic; Made With Organic; or identification of organic ingredients in the ingredient list…A
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similar scheme should be established for natural food products.” - The Council for
Responsible Nutrition (MacKay, 2016)
“The definition should be consistent with agency precedent, such as FDA’s definition of
‘natural flavors’. The definition should be clear and objective and readily capable of
verification. FDA should educate consumers about the definition, so that consumers will have a
more uniform and appropriate expectation about products bearing ‘natural’ claims. To help
avoid confusion, FDA should not exclude processing aids not required to be declared in the
ingredient declaration from an evaluation of ‘natural’ status.” - The American Bakers
Association (Sanders, 2016)
LET THE FOOD MARKETER BEWARE: ADVERTISING INDUSTRY CONCERNS
With the increase in lawsuits citing false and deceptive advertising, food marketers and
manufacturers continuing to claim “natural” on their labels and in their promotions, may well be
painting huge targets on their backs. Though the FDA has not announced when it may make a
decision, if at all, regarding a definition of “natural”, food marketers should be concerned that
the FTC may be stepping into this grey area and siding with consumers and industry
stakeholders.
A concerned marketer has no farther to look than at FTC’s three-step approach to analyze
deceptive advertising, where the key lies in whether a reasonable consumer could be misled.
According to Lesson 3 in our course (Allen, 2016), the three steps include:
1. “Is there a representation or an omission that is likely to mislead the consumer?”
2. “Could a reasonable consumer be misled?”
3. “Is the advertisement’s representation or omission material to the consumer’s decision?”
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In simply reviewing the facts of the Quaker Oat’s product and lawsuit, it would be safe to
conclude – regarding the three steps above:
Steps 1 and 2 : The omission that the herbicide was used in the processing of the farmed
oats and can be found [in trace amounts] in the final product could mislead the reasonable
consumer that the “100% Natural” product did not contain anything other than the natural
ingredients.
Step 3 : A reasonable consumer looking to purchase “100% Natural” products for health
and lifestyle purposes may be highly likely not to buy Quaker Oats if they knew that it
contained trace amounts of an herbicide.
In their American Journal of Law & Medicine law review, Parasidis, Hooker and Simons
noted the relationship between the FTC and food marketers making “natural” claims and why
they should be concerned. Interestingly enough, their review pointed out that the FTC was the
first federal agency that tried to define the term “natural” but eventually gave up during the de-
regulation atmosphere during the Reagan administration (Parasidis, Hooker, & Simons, 2015).
Most importantly, they make sure to note that, though the FTC ultimately passed on defining
the term, “a number of provisions of the FTC Act apply to food advertising. For example,
Section 5 prohibits ‘unfair or deceptive acts or practices’, Section 12 prohibits ‘false
advertising,’ and Section 15 prohibits food advertising that is ‘misleading in a material respect.’”
(Parasidis, Hooker, & Simons, 2015).
In “anticipating and addressing First Amendment challenges to regulation of natural claims”,
Parasidis, Hooker and Simons conclude, “When regulations are aimed at addressing misleading
or deceptive commercial speech, the regulations are constitutional if they are ‘reasonably related
to the State's interest in preventing deception of consumers.’ Not only can the government
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restrict misleading or deceptive commercial speech, it can force companies to include on labels
information that is "purely factual and uncontroversial information." (Parasidis, Hooker, &
Simons, 2015).
And it is not just consumers who have something at stake, “Not only does such misbranded
food impact consumers… (it) is problematic…for companies that invest significant resources to
comply with USDA and FDA guidelines regarding Natural claims.” (Parasidis, Hooker, &
Simons, 2015).
Perhaps it is because the FTC was the first federal agency to step into the “natural” definition
conversation coupled with the FDA’s recent announcement that it was seeking public comments
on the same issue that the agency recently made a surprise move that should send a warning to
food marketers: false use of “natural” could have agency-backed consequences.
On April 12, 2016, the FTC announced that four companies agreed to settle agency charges of
false and misleading advertising because they used the claims of “all natural” or “100% natural”
when, in fact, their skin and beauty products contained synthetic ingredients (Vetesi, 2016).
Under the consent orders, “the companies may not make such representation unless they have
evidence to support the claim. They must have competent and reliable evidence to substantiate
any ingredient-related, environmental, or health claims they make.” (van Laack, 2016).
These recent FTC actions should act as yet another reminder to food marketers and
manufacturers to carefully consider the use of claims for their products that are “natural”, all
natural” or “100% natural.”
CONCLUSION
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With the increased demand for natural products by health-conscious consumers who are
willing to pay more for such products, the stakes are higher than ever for food marketers and
manufacturers who claim their products are “natural”, all natural” or “100% natural.”
Unhelpful and loose definitions of the term “natural” leave the door wide open for litigation
and class-action lawsuits against food manufacturers by confused consumers and industry
stakeholders whose subjective expectations are not met.
As the FTC steps into the “natural” fray and the FDA reviews public comment on the term,
food advertisers should scrutinize their tactics and “natural” claims to avoid costly and lengthy
litigation against false and deceptive advertising. Pressure from the courts and industry
stakeholder may cause the agencies to move swiftly on defining the term “natural.”
Legal experts are providing some insight into what may happen as a result of closer scrutiny
on the “natural” claim.
“While it may cause a hiccup in existing all-natural label lawsuits, it’s unlikely to stem the
tide of new suits altogether,” says Attorney Kristen Polovy (Polovoy, Food Navigator-USA,
2016), “However, since FDA action…is likely years away, it’s unlikely that plaintiffs’ lawyers
will see this FDA comment period as an all-out stop-sign. If anything, defendants’ self-initiated
removal of ‘natural’ from labels in recent months is likely to have more of an effect on the
volume of new cases than the FDA comment process itself.”
Char Pagar, marketing and advertising attorney with the VLP Law Group, suggests that as
industry stakeholders await a response from the FDA, food product companies would be wise to
avoid using the term “natural” and all similar claims (Ciccatelli, 2016).
Harking back to 1993 when the FDA failed to make any decision on the definition of
“natural”, Attorney Ivan Wasserman, a partner at Manatt, Phelps & Phillips, warns that the
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recent request and probe by the FDA by no means indicates that there will be a new definition of
“natural” and “that the whole ‘what is natural’ question could ultimately end up in the ‘too
difficult’ box (Watson, What is natural? Over to you, FDA..., 2016).
In the meantime, it will be interesting to see how many more lawsuits are initiated against
those who make “natural” claims in their product labels and advertising. No doubt, consumers,
industry stakeholders and the advertising industry will be watching and waiting – and thinking
twice before using “natural” in their labels and advertising claims.
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