California Supreme Court Opens The Door To Organic Mislabeling Claims

Last week, the California Supreme Court issued a long awaited ruling on organic labeling in Quesada v. Herb Thyme Farms, Inc., No. S216305, 2015 WL 7770635 (Cal. Dec. 3, 2015). At issue in Quesada was whether consumers may bring state law fraud and misrepresentation claims to challenge herb products allegedly mislabeled as "certified organic." The defendant, Herb Thyme Farms Inc., argued that plaintiff's claims were preempted by the federal Organic Foods Production Act of 1990 (OFPA).

In a unanimous decision, the California Supreme Court disagreed, holding instead that private enforcement of national organic standards enhances, rather than inhibits, federal organic regulations. In reaching this decision, the California Supreme Court may have opened the floodgates for "organic" claims, permitting anyone to stand in the shoes of a regulator to police (and demand payouts) for technical violations of this complex and developing area of law.

BACKGROUND

Herb Thyme, a large California herb-growing operation, uses both conventional and organic methods to grow its herbs. Herb Thyme's organic operations are federally certified, and the company has federal approval to label organically grown herbs as "USDA Organic." Plaintiff Michelle Quesada, on behalf of herself and a putative class, alleged that Herb Thyme mislabeled its products as "Fresh Organic" and misused the "USDA Organic" seal by mixing organically and conventionally grown herbs. Quesada also alleged that Herb Thyme sold some products under the "Fresh Organic" label that were grown entirely using conventional methods. Plaintiff stated California's consumer protection claims, and requested both injunctive and monetary relief.

The district court dismissed plaintiff's action on federal preemption grounds, finding Quesada's suit barred under both the doctrines of express and implied preemption. Plaintiff appealed, and the Second District Court of Appeals affirmed. Although it held that OFPA did not expressly preempt plaintiff's state law claims, it agreed that the law impliedly preempted her private action. Plaintiff again appealed.

CALIFORNIA SUPREME COURT REVERSES THE APPELLATE COURT

In considering Herb Thyme's express and implied preemption arguments, the Court held that neither doctrine applied. Plaintiff's state law claims were not barred.

First, the Court found that OFPA did not expressly preempt Plaintiff's claims. As an initial matter, the Court acknowledged that OFPA explicitly...