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Prop 37: What It Means For The Food Industry

Fri, 11/02/2012 - 9:46am
Michael Steel, Attorney, Morrison & Foerster

Proposition 37, the Genetically Engineered Foods Labeling Initiative, would require genetically engineered foods sold in California to be conspicuously labeled with the words “Genetically Engineered” or, in the case of processed foods, with the words “Partially Produced with Genetic Engineering.” It would be the first law in the United States to require any sort of labeling of genetically modified foods (GE foods).

In addition, Prop 37 would prohibit labeling “processed foods” with such terms as “natural” or “naturally grown.”

Labeling of genetically engineered foods

Proposition 37 defines “genetically engineered” to mean

“any food that is produced from an organism or organisms in which the genetic material has been changed through the application” of various in vitro nucleic acid techniques or by the fusion of cells in a manner that “overcome[s] natural physiological, reproductive, or recombination barriers.”

In the United States, foods made with corn, soybeans, tomatoes, sugar beets, and canola or rapeseed oil are generally made from crops grown with genetically modified seeds. About 70 to 80 percent of all processed foods sold in the United States are made with genetically engineered ingredients.

The label for such foods must clearly and conspicuously identify the food as “Partially Produced with Genetic Engineering” or “May Be Partially Produced with Genetic Engineering.” Similarly, if raw produce is genetically engineered, it must be labeled with the words “Genetically Engineered.”

Ban on marketing processed foods as “natural”

In addition to requiring labeling of all genetically engineered foods, Proposition 37 would also prohibit labeling or marketing “processed foods” as “natural” or “all natural.”  The language of Prop 37 says: “if a food meets any of the definitions in section 110808(c) or (d), . . . the food may not in California, on its label, accompanying signage in a retail establishment, or in any advertising or promotional materials, state or imply that the food is “natural” “naturally made”, “naturally grown”, “all natural” or any words of similar import that would have any tendency to mislead any consumer.”

The initiative says: “‘Processed food’ means any food other than a raw agricultural commodity and includes any food produced from a raw agricultural commodity that has been subject to processing such as canning, smoking, pressing, cooking, freezing, dehydration, fermentation or milling.”

Clearly, plaintiffs will argue the plain meaning of the statute (if adopted) is that any processed food, whether it contains or is made with genetic engineering, cannot be called “natural.” This would make dried fruit, canned vegetables, cooked carrots — and the list goes on — subject to litigation if they are labeled as natural, even though no genetic engineering has occurred.

Even the drafters of Prop 37 know that voters would reject this provision of the law if it were clear to them. This summer the drafters tried to get a court to order the California Attorney General and the State’s Legislative Analyst to say that this provision applied only to GE foods, but the court refused.

Exemptions from GE Labeling

The initiative exempts genetically engineered food if it has been grown or produced “without the knowing and intentional use” of genetically engineered seed or ingredients. To qualify for this exemption, a person must both prove that he or she had no knowledge of the GE ingredient, and must have a sworn statement from the supplier guaranteeing that ingredients are not knowingly or intentionally genetically engineered. Proving that one doesn’t know something can be challenging.

In addition, the following general categories of food are exempt from the labeling requirement:

  • Meat products made from animals fed or injected with genetically engineered foods or drugs
  • Alcoholic beverages subject to the Alcoholic Beverage Control Act;
  • Processed foods made with genetically engineered processing aids or enzymes
  • Foods labeled “organic” pursuant to the federal Organic Food Products Act of 1990
  • Foods served at restaurants for immediate human consumption

Enforcement

Perhaps the most significant feature of Prop 37 is its very liberal enforcement provisions. Prop 37 would allow any person to bring suit under the law, even if that person has not suffered any specific damages or injuries from alleged violations, and even if that person has not relied on the product label. A plaintiff may recover at least the full retail price of each package of a product offered for sale without the required label. The number of items for which damages may be sought would be the total number of packages offered for sale during the three-year period preceding the lawsuit (but after July 1, 2014). Plaintiffs may also be able to collect attorney’s fees and the costs of their investigation a suit.

These enforcement provisions make it very easy for plaintiffs to sue anyone in the chain of distribution — farmers, processors, distributors and retailers.

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