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Legislation and Regulation Professor Saiger Spring 2016, Sections 9–10

Take-home Exercise 2: Intra-agency Memorandum

Scenario

Hampton Creek, a food company that makes plant-based egg substitutes, markets a food item under the brand name “Just Mayo.” “Just Mayo” is a substitute for mayonnaise that meets the requirements of a vegan diet. Ordinary mayonnaise contains egg yolks, which vegans do not eat. “Just Mayo” uses only plant foods to create a sauce that approximates the taste and texture of ordinary mayonnaise.

Hampton Creek sells two flavors of “Just Mayo”: regular and “sriracha.” “Sriracha” is the name of a condiment based upon spicy peppers.

On August 12, 2015, William A. Correll, Jr. sent a “Warning letter” to Hampton Creek. Correll is the Director of the Office of Compliance in the Center for Food Safety and Applied Nutrition. The Center for Food Safety and Applied Nutrition is a division of the United States Food and Drug Administration (FDA). The FDA is a unit of the United States Department of Health and Human Services (DHHS). The letter asserts that both “Just Mayo” flavors may not be sold in the United States under its current brand name or with its current label, pursuant to the Food, Drug, and Cosmetic Act (FDCA) and its associated regulations.

Mr. Correll’s office was first made aware of the potential noncompliance of Just Mayo with food labeling and marketing law because of a lawsuit, alleging noncompliance by Hampton Creek, filed by the Unilever Corporation. Unilever is the leading American manufacturer of ordinary, egg-based mayonnaise. Unilever’s mayonnaise is sold under the brand names “Hellmann’s” and “Best Foods.” In April 2015, Unilever dropped its lawsuit, without prejudice to its ability to refile.

After it received the warning letter, Hampton Creek conducted a negotiation with the Office of Compliance. Hampton Creek submitted a revised label to the Office. This new label, among other things, retained the original brand name “Just Mayo”; retained the original logo, which includes a picture of an egg; enlarged and made more prominent the words “egg-free”; and offered a definition of the word “just.”

On December 18, 2015, the Office of Compliance sent a letter to Hampton Creek that stated that, with the new label, the “Just Mayo” products would be in compliance with the law and could lawfully be sold in the United States.

Imagine that you are an attorney with the Office of the General Counsel in the Food and Drug Administration. Your office is reviewing this matter. Your supervisor has learned from a lawyer

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at Unilever that Unilever intends to file a formal agency appeal with FDA alleging that Just Mayo, even with its new label, may not be lawfully sold in the United States. Unilever’s appeal will allege that the 18 December letter permits unlawful behavior.

Your supervisor has also learned from lawyers at Hampton Creek that, should the FDA withdraw, alter, or materially supplement the 18 December letter, Hampton Creek will allege that its initial label is entirely lawful and seek to market its product with that original label. Hampton Creek, in other words, will allege that the 12 August letter misstated and misapplied the FDCA and its associated regulations.

Your supervisor tells you that the FDA has no preference between Unilever and Hampton Creek. Its only goal is correctly to apply the Act and its associated regulations.

Your supervisor also tells you to do no research, and to use only the packet of information that she has prepared. That packet is attached to this document. It includes:

(1) [starting at packet page 5] Relevant sections of the Food, Drug, and Cosmetic Act (2) [starting at packet page 17] Relevant sections of chapter 21 of the Code of Federal

Regulations (CFR) (3) [starting at packet page 21] Warning letter from FDA to Hampton Creek Foods, August

15, 2015 (4) [starting at packet page 25] Label for jars of Just Mayo prior to August 15 letter (top

half of page); revised label after negotiation with FDA (bottom half of page) (5) [starting at packet page 26] Close-out letter from FDA to Hampton Creek Foods,

December 18, 2015 (6) [starting at packet page 28] Amazon.com page for Just Mayo, downloaded April 4,

2016

Each of these items is appended to this document. Some material in items (1) and (3) has been removed to make the problem more tractable; omissions are indicated by white space.

Assignment

Your supervisor asks you to write a memo that:

1. States the argument Unilever is likely to make in its appeal;

2. States the arguments that Hampton Creek is likely to make should FDA modify, withdraw, or materially supplement its 18 December letter; and

3. Recommends to the General Counsel how FDA should respond to these arguments, and what course it should adopt when regulating the sale and labeling of Just Mayo products.

Write the memorandum.

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Instructions

1. This assignment is in the form of a memorandum to your supervisor at the FDA. For the purposes of the assignment, you should not use a complete memorandum form. You should not waste space on formalities, e.g., by providing a header or restating the scenario at length. You should begin your memo with a brief “short conclusion.” The short conclusion should state in a sentence or two what you have been asked to determine, and in another sentence or two what you conclude and why. The short conclusion is an abstract of the memo that follows. The balance of the memo should be the discussion section of the requested memorandum.

This does not mean that your memo can be incoherent or disorganized. A discussion section has a beginning, middle, and end.

2. This is a “closed” assignment. It is to be completed using only the materials in this packet and concepts and cases we have studied in class. You should not rely upon or discuss any special knowledge you have regarding U.S. food law, the policies and practices of the FDA, or the mayonnaise industry.

Outside research is not permitted, except for the use of dictionaries, your casebook, and your classnotes. You may not rely upon any sections of the United States Code not attached, any sections of the Code of Federal Regulations not attached, any legislative history not attached, or any other materials. “Any other materials” in the previous sentence is not meant to be limited to materials like the United States Code or legislative history; it really means any other materials.

You should be aware that I have fictionalized the statute, the regulations, and other aspects of the problem. Therefore, outside research, in addition to being against the rules, is also likely to lead you astray.

The requirement that you rely only upon materials in the packet does not imply that everything in the packet is relevant to the memorandum.

3. Audience. You should assume that your memorandum will be read by FDA employees who work in the world of Washington, but who may or may not be lawyers. You should assume that your reader is familiar but not intimate with the contents of the assignment. So, you should set out relevant statutory language, but you need not, for example, explain what the U.S. Code, a regulation, or the FDA is.

4. Collaboration and groups. Groups of up to three students may make a single submission. Submissions will be graded without regard to the number of submittors; each submittor in a given group will receive the same grade on the assignment. The word limits for this assignment apply to each submission, without regard to the number of submittors. I will not be able to assist you with difficulties regarding the interactions or division of labor within groups.

Students need not join a group if they prefer to complete this assignment on their own.

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Your submission must be your own work. You may not discuss this assignment or collaborate with any persons outside of your group, if any. Once a group begins to collaborate, it cannot dissolve; otherwise its members will be in violation of the rule that they not collaborate with anyone outside their group.

5. Citation. Use the following citation conventions:

• Sections of the US Code or the Code of Federal Regulations: Cite using chapter, section, and subsections as relevant. Example: 5 U.S.C. § 553(b); 21 CFR § 130.3.

• Other materials in this packet: Cite as [short title] at [page number]. Use the package page number, not the page number internal to the document. Examples: Scenario at 1; Warning letter at 3; Amazon.com page at 2.

• Dictionaries: any form of citation that would allow me to find the dictionary you used in a library and that includes the word you looked up.

• Google searches: no citation necessary if you describe the search in the text.

6. The word limitation on this assignment is 1,250 words. This is approximately equivalent to three and one-half double-spaced pages in a standard font with standard margins. Use your word processor to count the number of words in your memorandum. Titles, headers, and citations count as words. Page numbers and your name do not count as words.

At the conclusion of your submission, add a paragraph that reads “This answer contains x words.” This paragraph does not count towards your word count. This is a hard limit; I will not read past 1,250 words.

7. Grammar, spelling, mechanics, and organization all count.

8. Your final paper should be uploaded to the TWEN assignment dropbox no later than Friday, 22 April 2015 at 1:00 p.m. Submit the paper in MS-Word format. Put your name at the top. If you are collaborating with others, list all names at the top of the paper in alphabetic order. Give your paper a filename that consists of the surname of each group member, in alphabetic order (e.g., “Diller”; “Denno Saiger Teachout”).

Again, please make sure to list the names of all group members at the top of the assignment itself. (Names do not count towards word limitations.)

Late papers will be penalized. Extensions will be granted only in unusual circumstances. Extensions requested fewer than 72 hours in advance of the duedate will be granted only in extremely unusual circumstances.

9. Pace yourself. We will continue to proceed through the assigned materials while you are working on this assignment. So will your other classes. Please come to (this and other) classes prepared to discuss the assigned reading.

10. This assignment counts for 12.5% (one-eighth) of your final course grade.

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21 USC 321

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TITLE 21 - FOOD AND DRUGS CHAPTER 9 - FEDERAL FOOD, DRUG, AND COSMETIC ACT

SUBCHAPTER II - DEFINITIONS

§ 321. Definitions; generally

For the purposes of this chapter— (a) (1) The term “State”, except as used in the last sentence of section 372 (a) of this title, means

any State or Territory of the United States, the District of Columbia, and the Commonwealth of Puerto Rico. (2) The term “Territory” means any Territory or possession of the United States, including the District of Columbia, and excluding the Commonwealth of Puerto Rico and the Canal Zone.

(b) The term “interstate commerce” means (1) commerce between any State or Territory and any place outside thereof, and (2) commerce within the District of Columbia or within any other Territory not organized with a legislative body.

(c) The term “Department” means Department of Health and Human Services. (d) The term “Secretary” means the Secretary of Health and Human Services. (e) The term “person” includes individual, partnership, corporation, and association. (f) The term “food” means

(1) articles used for food or drink for man or other animals, (2) chewing gum, and (3) articles used for components of any such article.

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21 USC 321

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(k) The term “label” means a display of written, printed, or graphic matter upon the immediate container of any article; and a requirement made by or under authority of this chapter that any word, statement, or other information appear on the label shall not be considered to be complied with unless such word, statement, or other information also appears on the outside container or wrapper, if any there be, of the retail package of such article, or is easily legible through the outside container or wrapper. (l) The term “immediate container” does not include package liners. (m) The term “labeling” means all labels and other written, printed, or graphic matter

(1) upon any article or any of its containers or wrappers, or (2) accompanying such article.

(n) If an article is alleged to be misbranded because the labeling or advertising is misleading, then in determining whether the labeling or advertising is misleading there shall be taken into account (among other things) not only representations made or suggested by statement, word, design, device, or any combination thereof, but also the extent to which the labeling or advertising fails to reveal facts material in the light of such representations or material with respect to consequences which may result from the use of the article to which the labeling or advertising relates under the conditions of use prescribed in the labeling or advertising thereof or under such conditions of use as are customary or usual.

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21 USC 321

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(ee) The term “Commissioner” means the Commissioner of Food and Drugs.

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21 USC 331

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TITLE 21 - FOOD AND DRUGS CHAPTER 9 - FEDERAL FOOD, DRUG, AND COSMETIC ACT

SUBCHAPTER III - PROHIBITED ACTS AND PENALTIES

§ 331. Prohibited acts

The following acts and the causing thereof are prohibited: (a) The introduction or delivery for introduction into interstate commerce of any food, drug, device, or cosmetic that is adulterated or misbranded. (b) The adulteration or misbranding of any food, drug, device, or cosmetic in interstate commerce. (c) The receipt in interstate commerce of any food, drug, device, or cosmetic that is adulterated or misbranded, and the delivery or proffered delivery thereof for pay or otherwise. (d) The introduction or delivery for introduction into interstate commerce of any article in violation of section 344, 355, or 360bbb–3 of this title.

(g) The manufacture within any Territory of any food, drug, device, or cosmetic that is adulterated or misbranded.

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21 USC 341

NB: This unofficial compilation of the U.S. Code is current as of Jan. 4, 2012 (see http://www.law.cornell.edu/uscode/uscprint.html).

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TITLE 21 - FOOD AND DRUGS CHAPTER 9 - FEDERAL FOOD, DRUG, AND COSMETIC ACT

SUBCHAPTER IV - FOOD

§ 341. Definitions and standards for food

Whenever in the judgment of the Secretary such action will promote honesty and fair dealing in the interest of consumers, he shall promulgate regulations fixing and establishing for any food, under its common or usual name so far as practicable, a reasonable definition and standard of identity, a reasonable standard of quality, or reasonable standards of fill of container. No definition and standard of identity and no standard of quality shall be established for fresh or dried fruits, fresh or dried vegetables, or butter, except that definitions and standards of identity may be established for avocadoes, cantaloupes, citrus fruits, and melons. In prescribing any standard of fill of container, the Secretary shall give due consideration to the natural shrinkage in storage and in transit of fresh natural food and to need for the necessary packing and protective material. In the prescribing of any standard of quality for any canned fruit or canned vegetable, consideration shall be given and due allowance made for the differing characteristics of the several varieties of such fruit or vegetable. In prescribing a definition and standard of identity for any food or class of food in which optional ingredients are permitted, the Secretary shall, for the purpose of promoting honesty and fair dealing in the interest of consumers, designate the optional ingredients which shall be named on the label. Any definition and standard of identity prescribed by the Secretary for avocadoes, cantaloupes, citrus fruits, or melons shall relate only to maturity and to the effects of freezing.

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21 USC 342

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TITLE 21 - FOOD AND DRUGS CHAPTER 9 - FEDERAL FOOD, DRUG, AND COSMETIC ACT

SUBCHAPTER IV - FOOD

§ 342. Adulterated food

A food shall be deemed to be adulterated— (a) Poisonous, insanitary, etc., ingredients

(1) If it bears or contains any poisonous or deleterious substance which may render it injurious to health; but in case the substance is not an added substance such food shall not be considered adulterated under this clause if the quantity of such substance in such food does not ordinarily

render it injurious to health.1

(2) (A) if it bears or contains any added poisonous or added deleterious substance (other than a substance that is a pesticide chemical residue in or on a raw agricultural commodity or processed food, a food additive, a color additive, or a new animal drug) that is unsafe within the meaning of section 346 of this title; or (B) if it bears or contains a pesticide chemical residue that is unsafe within the meaning of section 346a (a) of this title; or (C) if it is or if it bears or contains

(i) any food additive that is unsafe within the meaning of section 348 of this title; or (ii) a new animal drug (or conversion product thereof) that is unsafe within the meaning of section 360b of this title; or

(3) if it consists in whole or in part of any filthy, putrid, or decomposed substance, or if it is otherwise unfit for food; or (4) if it has been prepared, packed, or held under insanitary conditions whereby it may have become contaminated with filth, or whereby it may have been rendered injurious to health; or (5) if it is, in whole or in part, the product of a diseased animal or of an animal which has died otherwise than by slaughter; or (6) if its container is composed, in whole or in part, of any poisonous or deleterious substance which may render the contents injurious to health; or (7) if it has been intentionally subjected to radiation, unless the use of the radiation was in conformity with a regulation or exemption in effect pursuant to section 348 of this title.

(b) Absence, substitution, or addition of constituents (1) If any valuable constituent has been in whole or in part omitted or abstracted therefrom; or (2) if any substance has been substituted wholly or in part therefor; or (3) if damage or inferiority has been concealed in any manner; or (4) if any substance has been added thereto or mixed or packed therewith so as to increase its bulk or weight, or reduce its quality or strength, or make it appear better or of greater value than it is.

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21 USC 343

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TITLE 21 - FOOD AND DRUGS CHAPTER 9 - FEDERAL FOOD, DRUG, AND COSMETIC ACT

SUBCHAPTER IV - FOOD

§ 343. Misbranded food

A food shall be deemed to be misbranded— (a) False or misleading label

If (1) its labeling is false or misleading in any particular, or (2) in the case of a food to which section 350 of this title applies, its advertising is false or misleading in a material respect or its labeling is in violation of section 350 (b)(2) of this title.

(b) Offer for sale under another name

If it is offered for sale under the name of another food. (c) Imitation of another food

If it is an imitation of another food, unless its label bears, in type of uniform size and prominence, the word “imitation” and, immediately thereafter, the name of the food imitated. (d) Misleading container

If its container is so made, formed, or filled as to be misleading. (e) Package form

If in package form unless it bears a label containing (1) the name and place of business of the manufacturer, packer, or distributor; and (2) an accurate statement of the quantity of the contents in terms of weight, measure, or numerical count, except that under clause (2) of this paragraph reasonable variations shall be permitted, and exemptions as to small packages shall be established, by regulations prescribed by the Secretary.

(f) Prominence of information on label

If any word, statement, or other information required by or under authority of this chapter to appear on the label or labeling is not prominently placed thereon with such conspicuousness (as compared with other words, statements, designs, or devices, in the labeling) and in such terms as to render it likely to be read and understood by the ordinary individual under customary conditions of purchase and use. (g) Representation as to definition and standard of identity

If it purports to be or is represented as a food for which a definition and standard of identity has been prescribed by regulations as provided by section 341 of this title, unless

(1) it conforms to such definition and standard, and (2) its label bears the name of the food specified in the definition and standard, and, insofar as may be required by such regulations, the common names of optional ingredients (other than spices, flavoring, and coloring) present in such food.

(h) Representation as to standards of quality and fill of container

If it purports to be or is represented as— (1) a food for which a standard of quality has been prescribed by regulations as provided by section 341 of this title, and its quality falls below such standard, unless its label bears, in such manner and form as such regulations specify, a statement that it falls below such standard; (2) a food for which a standard or standards of fill of container have been prescribed by regulations as provided by section 341 of this title, and it falls below the standard of fill of container applicable thereto, unless its label bears, in such manner and form as such regulations specify, a statement that it falls below such standard; or

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21 USC 343

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(3) a food that is pasteurized unless— (A) such food has been subjected to a safe process or treatment that is prescribed as pasteurization for such food in a regulation promulgated under this chapter; or (B) (i) such food has been subjected to a safe process or treatment that—

(I) is reasonably certain to achieve destruction or elimination in the food of the most resistant microorganisms of public health significance that are likely to occur in the food; (II) is at least as protective of the public health as a process or treatment described in subparagraph (A); (III) is effective for a period that is at least as long as the shelf life of the food when stored under normal and moderate abuse conditions; and (IV) is the subject of a notification to the Secretary, including effectiveness data regarding the process or treatment; and

(ii) at least 120 days have passed after the date of receipt of such notification by the Secretary without the Secretary making a determination that the process or treatment involved has not been shown to meet the requirements of subclauses (I) through (III) of clause (i).

For purposes of paragraph (3), a determination by the Secretary that a process or treatment has not been shown to meet the requirements of subclauses (I) through (III) of subparagraph (B)(i) shall constitute final agency action under such subclauses.

(i) Label where no representation as to definition and standard of identity

Unless its label bears (1) the common or usual name of the food, if any there be, and (2) in case it is fabricated from two or more ingredients, the common or usual name of each such ingredient and if the food purports to be a beverage containing vegetable or fruit juice, a statement with appropriate prominence on the information panel of the total percentage of such fruit or vegetable juice contained in the food; except that spices, flavorings, and colors not required

to be certified under section 379e (c) of this title 1 unless sold as spices, flavorings, or such colors, may be designated as spices, flavorings, and colorings without naming each. To the extent that compliance with the requirements of clause (2) of this paragraph is impracticable, or results in deception or unfair competition, exemptions shall be established by regulations promulgated by the Secretary.

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21 USC 350

NB: This unofficial compilation of the U.S. Code is current as of Jan. 4, 2012 (see http://www.law.cornell.edu/uscode/uscprint.html).

- 1 -

TITLE 21 - FOOD AND DRUGS CHAPTER 9 - FEDERAL FOOD, DRUG, AND COSMETIC ACT

SUBCHAPTER IV - FOOD

§ 350. Vitamins and minerals

(a) Authority and limitations of Secretary; applicability (1) Except as provided in paragraph (2)—

(A) the Secretary may not establish, under section 321 (n), 341, or 343 of this title, maximum limits on the potency of any synthetic or natural vitamin or mineral within a food to which this section applies; (B) the Secretary may not classify any natural or synthetic vitamin or mineral (or combination thereof) as a drug solely because it exceeds the level of potency which the Secretary determines is nutritionally rational or useful; (C) the Secretary may not limit, under section 321 (n), 341, or 343 of this title, the combination or number of any synthetic or natural—

(i) vitamin, (ii) mineral, or (iii) other ingredient of food,

within a food to which this section applies. (2) Paragraph (1) shall not apply in the case of a vitamin, mineral, other ingredient of food, or food, which is represented for use by individuals in the treatment or management of specific diseases or

disorders, by children, or by pregnant or lactating women. For purposes of this subparagraph,1 the term “children” means individuals who are under the age of twelve years.

(b) Labeling and advertising requirements for foods (1) A food to which this section applies shall not be deemed under section 343 of this title to be misbranded solely because its label bears, in accordance with section 343 (i)(2) of this title, all the ingredients in the food or its advertising contains references to ingredients in the food which are not vitamins or minerals. (2) The labeling for any food to which this section applies may not list its ingredients which are not dietary supplement ingredients described in section 321 (ff) of this title

(i) except as a part of a list of all the ingredients of such food, and (ii) unless such ingredients are listed in accordance with applicable regulations under section 343 of this title. To the extent that compliance with clause (i) of this subparagraph is impracticable or results in deception or unfair competition, exemptions shall be established by regulations promulgated by the Secretary.

(c) Definitions (1) For purposes of this section, the term “food to which this section applies” means a food for humans which is a food for special dietary use—

(A) which is or contains any natural or synthetic vitamin or mineral, and (B) which—

(i) is intended for ingestion in tablet, capsule, powder, softgel, gelcap, or liquid form, or (ii) if not intended for ingestion in such a form, is not represented as conventional food and is not represented for use as a sole item of a meal or of the diet.

(2) For purposes of paragraph (1)(B)(i), a food shall be considered as intended for ingestion in liquid form only if it is formulated in a fluid carrier and it is intended for ingestion in daily quantities measured in drops or similar small units of measure.

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