LAS VEGAS — Food and beverage companies making a significant investment in the manufacture and marketing of products perceived as clean label must ensure their supply chain is able to verify the claims being made about products are true. Otherwise, companies may find themselves embroiled in litigation.
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| Ryan Fournier, international trade associate with Armstrong Teasdale |
“You can take proactive steps to prevent actions against you,” said Ryan Fournier, international trade associate with the law firm Armstrong Teasdale, in an Oct. 5 presentation at the SupplySide West trade show. “Class actions are relying more and more on ingredient sources and evidence is easy to collect. Head to the store and send it to the lab.”
In the early portion of his presentation, Fournier referred to several cases in which manufacturers were the subject of legal actions for marketing products as natural. In one example, he referred to a case in which a company was marketing corn-based products as natural.
“It is argued that because of the use of corn it is not natural, because 50 percent of corn is GMO corn,” he said. “It is interesting how they do these tests. Long story short, when they did tests they are looking for genetic material you would not find in corn, like rabies or jellyfish genes.
“They do other things in the complaint. They compelled discovery and could tell if they (the defendant) were using the synthetic version of an ingredient or a natural ingredient. Once you start showing how complex the manufacturing process is it is hard to call something natural.”
He added that products intended for children and consumers with health risks are at higher risk for a class action claim.
To mitigate legal claims, Fournier presented an eight-point checklist manufacturers may use to ensure their products align with the claims being made.
“First, make sure all actors in the supply chain are knowledgeable about an ingredient’s end use,” he said. “Condition an ingredient’s purchase on the clean label principles that must be substantiated.”
Second, Fournier recommended requesting a supplier’s manufacturing processes for specific ingredients and to make sure they are documented.
For his third point, Fournier recommended food and beverage manufacturers take advantage of the Food Safety Modernization Act’s Foreign Supplier Verification Program. While the FSMA focuses solely on health and safety, he noted it may be feasible for companies to incorporate ingredient verification procedures into the FSVP process.
Fourth, Fournier said manufacturers should develop standard operating procedures for product development, and for every clean label claim.
“This must involve R&D, marketing, global sourcing and legal,” he said.
For his fifth point, Fournier strayed beyond the manufacturing process. He noted that plaintiffs also will review a company's web site and social media feeds for catch-all phrases that may prove difficult to defend in court.
“Carefully review website language, and determine whether clean label claims could be interpreted as applying to all products,” he said.
Fournier said manufacturers must create a system of internal auditing to ensure sourcing and processes align with claims that may be made, and he recommended manufacturers start considering product packaging as part of a clean label claim.
Finally, he noted that the industry must get ready for increased involvement from consumer watchdogs and state actors as the meaning of clean label expands.
“A checklist does a few things,” he said. “Most importantly, legal actions take into account the mismanagement of the global supply chain. This can help you take steps to prevent action against you from a complaint.”
