By Harold Berman, J.D.
A dietary supplement manufacturer could proceed with its Lanham Act claims against a distributor of a drink mix for misleading labeling concerning the drink mix’ protein content, but its state law claims were preempted, the U.S. Court of Appeals for the 11th Circuit ruled. The Court of Appeals reversed the federal district court’s decision dismissing the Lanham Act claims, finding instead that the manufacturer’s complaint plausibly alleged that the distributor overstated the drink mix’ protein content. However, the manufacturer’s claim under the Georgia Uniform Deceptive Trade Practices Act was preempted by the federal Food, Drug, and Cosmetic Act (FDC Act) because enforcing the state law claim would require labeling changes that were not identical to the FDC Act’s requirements (Hi-Tech Pharmaceuticals, Inc. v. HBS International Corp., December 4, 2018, Pryor, W.).
A Georgia-based manufacturer of dietary supplements sued a Canadian distributor of sports nutrition supplements in federal district court. The Canadian distributor distributed a protein powder drink mix marketed as a bodybuilding and workout recovery aid. The Georgia manufacturer alleged that the drink mix marketing label violated the Georgia Uniform Deceptive Trade Practices Act (GUDTPA) and the Lanham Act by misleading consumers by overstating the quantity of protein per serving, and the source of the protein.
The Canadian distributor filed a motion to dismiss, which the district court granted. The district court held that the manufacturer’s claim under the GUDTPA was preempted by the FDC Act. According to the district court, the Georgia manufacturer’s claim fell within the FDC Act’s express preemption clause, which prohibits state law claims that seek to impose food labeling requirements that differ from those in applicable federal regulations. Additionally, the manufacturer failed to allege that it had established the drink mix’ actual protein content by using a test consistent with the FDA’s protein testing requirements.
Finally, the district court found that the manufacturer did not state a claim under the Lanham Act because the drink mix’ label detailed all ingredients, including the amino acids that impacted the label’s purported claims concerning protein content, and so consumers were made aware that the drink mix included ingredients besides protein. The manufacturer appealed.
Preemption of GUDTPA claim. The district court correctly ruled that the manufacturer’s state law claim was expressly preempted. The FDC Act’s preemption provision barred the manufacturer’s GUDTPA claim, because that claim sought to impose liability for conduct that did not violate the FDC Act. With few exceptions, the FDC Act expressly preempted any state law requiring nutrition labeling for food that was not identical to the FDC Act’s requirements. The FDC Act specifically regulated disclosure of protein on food labels. It was undisputed that the distributor’s description of protein content included in its labeling complied with FDC Act regulations. The FDC Act did not require remedying the distributor’s labeling descriptions that the manufacturer claimed were misleading. To the extent the GUDTPA would require the distributor to change its labeling, it would establish requirements that were not identical to the FDC Act’s requirements.
Dismissal of Lanham Act claim. The district court erred in dismissing the manufacturer’s Lanham Act claim on the basis that the complaint did not allow a plausible inference that the distributor’s labeling was misleading. Rather, the manufacturer pleaded facts which could plausibly show that a reasonable consumer would find the distributor’s label misleading.
The manufacturer alleged that the front and left side labels and nutrition facts panel of the drink mix described the mix as containing 25 grams of protein per serving and comprising a blend of six high-quality proteins. Yet, according to the manufacturer’s complaint, the drink mix contained less than 25 grams of the six-protein blend, instead combining the protein with free form amino acids and non-protein ingredients. The labeling could plausibly mislead a reasonable consumer to believe that a serving of the drink mix contained 25 grams of protein derived from the specified high-quality protein blend described on the label.
Although the label also included information about amino acid content, the manufacturer did not contend, as the district court assumed, that the labeling would lead consumers to believe that the protein blend was the only ingredient in the drink mix. Rather, the manufacturer alleged that the label would induce a reasonable consumer to believe that the protein in the drink mix derived exclusively from the six-protein blend.
The distributor’s label did not suggest that the claimed 25 grams of protein per serving derived from any source other than the six-protein blend, and did not explain that the 25 grams included amino acids and other non-protein ingredients. Although the FDA permits protein calculations based on such ingredients, the FDC Act does not generally bar claims of false advertising of food under the Lanham Act.
The case is No. 17-13884.
Attorneys: David M. Barnes (Miller & Martin, PLLC) for Hi-Tech Pharmaceuticals, Inc. Ragesh K. Tangri (Durie Tangri, LLP) for ALLMAX Nutrition, Inc. and HBS International Corp.
Companies: Hi-Tech Pharmaceuticals, Inc.; ALLMAX Nutrition, Inc.; HBS International Corp.
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