California Proposition 37’s Take On “Natural”

October 23, 2012

By Ricardo Carvajal

As the November 6 election draws near, debate over California’s Proposition 37 is heating up.  If the measure passes, genetically engineered ("GE") foods sold at retail in the state would have to be labeled as such – a requirement that would have national (if not international) implications for the conventional food and dietary supplement industries.  For those not yet familiar with the measure, the state’s Official Voter Information Guide provides the text, an analysis, and arguments for and against.

Among other things, Prop 37 would restrict the use of the term “natural” in relation to GE foods.  One issue that has drawn attention is whether Prop 37 would also restrict the use of the term “natural” in relation to processed foods that are not GE.  The analysis by the Legislative Analyst’s Office states:

Given the way the measure is written, there is a possibility that these restrictions would be interpreted by the courts to apply to all processed foods regardless of whether they are genetically engineered.

(Emphasis in original).  In relevant part, the text of the measure reads as follows:

[I]f a food meets any of the definitions in subdivision (c) or (d) of section 110808, and is not otherwise exempted from labeling under section 110809.2, 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.

(Emphasis added).  The definitions referred to are those of the terms “genetically engineered” (subdivision c) and “processed food” (subdivision d) – and therein lies a potential source of confusion.  As written, the reference to the definitions could be read to suggest that if a food is either GE or processed, then it may not be promoted as “natural.”  The definition of “processed food” is so broad that essentially all foods other raw agricultural commodities would be affected.  However, that outcome does not seem to be what the legislature had in mind, as signaled by the qualifying clause that immediately follows the reference to the definition of processed foods (i.e., “…and is not otherwise exempted from labeling under section 110809.2…”).

Section 110809.2 provides several exemptions from the GE labeling requirement, including for (1) a processed food that would be subject to the labeling requirement solely because it includes small quantities of GE ingredients (until July 1, 2019) or a GE processing aid or enzyme, and (2) a processed food that is not packaged for retail sale and is prepared and intended for immediate human consumption.  Also exempt would be any “raw agricultural commodity or food derived therefrom [presumably including processed food] that has been grown, raised, or produced without the knowing and intentional use of genetically engineered seed or food.”

The debate over Prop 37’s impact on the use of “natural” claims is just one of several already spawned by the measure.  Also noteworthy is the fact that the measure is very friendly to plaintiffs because it can be enforced by “any person,” and that person is not “required to allege facts necessary to show, or tending to show, lack of adequate remedy at law, or to show, or tending to show, irreparable damage or loss, or to show, or tending to show, unique or special individual injury or damages.”  Further, plaintiffs can recover “reasonably attorney’s fees and all reasonable costs incurred in investigating and prosecuting the action.”  Whatever the merits of Prop 37, one thing is clear: it will generate lots of work for lawyers.