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“Earth and Table”—Lane Powell's food, beverage, and hospitality law reporter

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Why Does Food Mislabeling Outrage Consumers?

By June K. Campbell on Posted in FDA Regulation, Food Adulteration, Food Labeling, Food Safety Modernization Act

Co-Authored by June K. Campbell and Paul D. Swanson

“There’s a Chinese restaurant on every block, and if you think mouths won’t water when you come strolling by, then you don’t know squat about Oriental cuisine.  They prize the taste of dog, friend.  The chefs round up strays and slaughter them in the alley right behind the kitchen—ten, twenty, thirty dogs a week.  They might pass them off as ducks and pigs on the menu, but the in-crowd knows what’s what, the gourmets aren’t fooled for a second.” — Willy G. Christmas talking to Mr. Bones, his dog, from the novel Timbuktu, by Paul Auster

Europe is abuzz with the horsemeat scandal.  After the Food Safety Authority of Ireland first discovered that a range of frozen beef products contained a large percentage of horse DNA, the story struck a viral nerve and spread like wildfire.

For consumers at the convoluted end of frozen food supply chains, the idea that you have been eating “Bessie” the horse probably comes as an emotional shock to the system.  It is yet another nagging reminder of how distant we are from our original sources of food and how easy it is to be fooled by food appearances and masked tastes.[1]

For the companies whose grocery store or packaged food brands are entangled in the horsemeat scandal, the damage to reputational interests can be profound.  Affected companies took public relations repair action first and terminated supply chain contracts in a peremptory fashion.  IKEA stopped serving its famous Swedish meatballs.  Burger King changed to a different supplier of burgers.  Tesco, a major European supermarket chain, dropped a major vendor after discovering its frozen spaghetti bolognese contained over 60% horsemeat. Continue Reading

Antitrust Monopolization Considerations in Licensing Cutting-Edge Food Technology Patents

By Paul D. Swanson on Posted in Antitrust Issues, Patent Litigation, Patents and Food Technology

The term pioneer patent [1] is often misapplied with hyperbole and exaggeration.  When it comes to the shrimp peeling machine invented by Fernand and James Lapeyre, however, that blockbuster label is spot-on. [2]  Their automated way of processing shrimp rocked the seafood processing industry in the 1950s by driving manual labor costs virtually out of existence.  In today’s vernacular, it was a real game-changer.

Patents (and intellectual property rights in general) do not necessarily confer natural monopoly rights as economists would understand the concept.  This is because excluding “others from using a particular name, word, image, product or process does not imply any substantial market power when substitutes are plentiful.” [3] When a groundbreaking patent is issued, however, the governmental grant can take on monopolistic tendencies—paradoxically even if unused and seemingly unexploited.

A monopoly is commonly defined as the “exclusive control by one group of the means of producing or selling a commodity or service.”[4]  A pioneer patent—and even more importantly nowadays, a conglomeration of related patents owned by a single entity—can sometimes create new product and service markets and legal barriers to entry capable of commanding what economists call “monopoly rents.”  As rational actors, it is also an economics truism that “monopolists invariably act like monopolists” as they strive to maximize profits.

Even though the United States Patent and Trademark Office is empowered to issue broad exclusionary rights to worthy inventors, another broad federal statute—the Sherman Act—exists to prevent abuses to the competitive process.  Section Two of the Sherman Act provides that every “person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony ….”  15 U.S.C. § 2.  The right to exclude others from co-opting inventions (in the absence of a license from the patent owner) is accurately described as a “time-limited government” conveyance of “potential monopoly power, which can be put to ‘good’ or ‘bad’ uses from a societal standpoint.”[5]

Where is the line drawn between lawfully exploiting patent rights and running afoul of antitrust law prohibitions regarding monopolization?  The answer is murky and perhaps unsatisfying to those seeking bright line licensing and competition rules.  The boundary line often only becomes clear in retrospect.  The demarcation between a patent owner lawfully exploiting exclusionary rights vs. an illegal monopolist abusing those same rights is highly fact-dependent.

The Lapeyre family’s very creative leasing scheme for its patented shrimp peeling machines offers a vital case in point.  With the invention of a single processing machine, the company irrevocably altered the cost dynamics of an entire shrimp processing industry.  Licensing disputes—collectively known as the “shrimp peeler” cases[6]—arose soon after the commercialization of the Lapeyre’s invention and were finally resolved in the mid-1960s.  These case holdings help demonstrate how the Lapeyre’s crossed the line between “good” and “bad” exercises of a patent’s potential market power.

The shrimp peeler cases predate wholesale policy changes in antitrust analysis that emerged out of the “Chicago School” of economic theory—especially the demand for the more rigorous determinations of market power championed by Judge Richard Posner.  However, despite paradigmatic changes in antitrust jurisprudence, the outcome of the shrimp peeler cases would likely be no different today.  Continue Reading

So, Are Organic Foods Really Safer and Healthier For Us After All?

By Paul D. Swanson on Posted in Food Labeling

Some of America’s best organic and sustainable food research is being conducted by the faculty, students and staff of Washington State University’s Center for Sustaining Agriculture and Natural Resources.

As Washington’s original and largest land grant university, WSU is fulfilling its mission and mandate “to teach such branches of learning as are related to agriculture . . . .”  7 U.S.C. § 304.

A clear case in point is Professor Charles Benbrook’s detailed analysis and critique of a recent Stanford study of organic versus conventional food consumption.  The Stanford study—entitled Are Organic Foods Safer and Healthier Than Conventional Alternatives? A Systematic Review[1]—appeared in a September 2012 issue of the Annals of Internal Medicine and immediately spawned eye-catching headlines in major newspapers, such as the New York Times, proclaiming that Stanford Scientists Cast Doubt on Advantages of Organic Meat and Produce.[2]  

The Stanford study came to two major conclusions: Continue Reading

“Hey Barkeep, Pour Me A Pint of…”: Trademark Tips for Microbreweries

By Nancy Pham on Posted in Food Labeling, Trademark Litigation

Nancy Pham is a Lane Powell 2012 summer associate and is currently attending her second year of law school at the University of Washington Law School.  She may be contacted at npham17@gmail.com.

For microbrewers, taste and memorable names mean everything.  Loyal customers often ask for specific brews and word-of-mouth advertising is indispensable, since microbrews are often purchased in local restaurants and bars.  

Like many small businesses though, protecting your microbrewery brand and trademarks often raises a basic financial issue: Is it worth it?  This brief article explores some cost-effective ways to build your own beer brand identity, while also guarding against the possibility that you may be infringing upon the already established trademark rights of others.  

The “Knockout” Search

So, before you begin taking that home brewing hobby to the next level and coming up with the perfect name for your craft beer and perhaps your own brewpub, you should take advantage of some readily available resources to make sure that someone else has not already beat you to the punch.   

What you’re undertaking is called a “knockout” search in trademark circles.  Your goal is to find a brand name that is not confusingly similar to other products already on the market for beers or other products that may be related to alcohol or beer consumption.  The goal of trademark laws is to prevent confusion among consumers as to the source or origin of products or services.

While it may seem tempting to be playful and incorporate someone else’s famous trademarks[1] on your microbrew label, you should avoid that form of potential instant name recognition.  Famous marks are protected from having their commercial impression diluted by even unrelated goods or services.   

Likewise, the owners of famous marks can prevent “tarnishment” of their marks by use on products they deem to be unsavory—alcohol being a common such product.  Owners of famous marks often have the financial means and incentives to pursue even small-time poachers of their brands. 

In the age of robust Internet search engine capabilities, the good news is that a simple knockout search only requires an investment of your time. 

First, visit the United States Patent and Trademark Office website.  Running a free Trademark Electronic Search System (TESS) search will come up with all federally registered trademarks (with a margin of error based on search terms or how marks may have been categorized in that database).  

Second, a similar search should be conducted for state-registered trademarks.  Each state varies and while there are currently no TESS-equivalent knock-out searches available[2] in Washington or Alaska, Oregon does have its own trademark search.  This is another reason why a thorough Internet search is valuable, since it is more difficult to research state-registered trademarks.  

Third, because trademark rights under common law accrue automatically when they are being used in commerce, a search on the Google, Bing, or other search engines may also provide useful information about business websites and social media pages that are using trademarks that may be protectable, even though they are not registered in state or federal trademark databases.   

You’ve Explored the World Wide Web.  Now What?  

There are several scenarios that can happen after a knockout search is performed:  Continue Reading

The Growing Allure of Plant Patenting for Brand Differentiation

By Paul D. Swanson on Posted in Patent Litigation, Patents and Food Technology, Trademark Litigation

Plant patents occupy a seldom studied corner of potential patent protection.  But plant patenting is taking on new importance as growers and producers of fruits and vegetables—once branded only as commodities—take advantage of the premium price points more specific patent and trademark rights can yield.  Commodities appeal to the undifferentiated masses; but marketing targeted to individual taste preferences is now the order of the day.

What are Plant Patents?

Established through the Plant Patent Act of 1930 (the PPA), this intellectual property right is granted to any person who “invents or discovers and asexually reproduces any distinct and new variety of plant, including cultivated sports, mutants, hybrids, and newly found seedlings . . . .”  35 U.S.C. § 161.[1]

The Act’s legislative history describes this provision in layperson terms: “[T]he bill provides that any person who invents or discovers a new and distinct variety of plant shall be given by patent an exclusive right to propagate that plant by asexual reproduction; that is by grafting, budding, cuttings, layering, division, and the like, but not by seeds.”

The PPA does not provide patent protection for varieties of plants found growing in an uncultivated or wild state.  So, sorry to all you plant foragers!  Tuber propagated plants (e.g., potatoes) are also excluded from plant patent protection.

Before the PPA was enacted in 1930, patent laws seemed to favor industrialists over farmers.  This rankled the most famous American plant breeder of the time, Luther Burbank.  He bemoaned the fact that:

I have been for years in correspondence with leading breeders, nurserymen, and Federal officials and I despair of anything being done at present to secure to the plant breeder any adequate returns for his enormous outlays of energy and money.  A man can patent a mousetrap or copyright a nasty song, but if he gives to the world a new fruit that will add millions to the value of earth’s annual harvests, he will be fortunate if he is rewarded by so much as having his name connected with the result.[2]

In the 21st century, the goals of the PPA may be coming closer to fulfilling Luther Burbank’s plant breeder aspirations.  Take cherries, for example, which are now coming into season in droves.  While Bing cherries—Royal Annes in an earlier era of canned cherries—still dominate the U.S. market for fresh cherries, it is becoming more highly differentiated with new market entries.[3]  Aficionados can distinguish among and may prefer a Rainer, a Chelan, a Lapin or a Summit cherry, instead of that good ol’ Bing cherry. Continue Reading

Patenting Enhanced Taste and Food Processing: Some Engaging Current Developments

By Paul D. Swanson on Posted in Patent Litigation, Patents and Food Technology

Patenting food processing and flavor-enhancing techniques is a cutting-edge legal endeavor.  This article reviews some fascinating new developments in food processing technology and patent litigation.

Today’s patent law market basket is filled with two patentable innovations: an edible biofilm to address and prevent the problem of cherry cracking; and an acoustic sound technique designed to enhance the taste of food.  On the patent litigation front, a sizable plaintiff’s jury verdict in roiling litigation over patented egg pasteurization techniques shows that infringing food processing patents can lead to expensive life lessons.

“SureSeal” Biofilm and Harvesting the Perfect Cherry

Pacific Northwest rains are both a boon and a curse for cherry growers.  Rain-induced cherry cracking is a perennial problem.  Most growth in cherries occurs in the final few weeks before their harvesting.  That is when cherry cracking susceptibility develops.[1]  Nearly ripe cherries absorb moister faster than their skins can expand.  If the cherries split, a year’s crop may be ruined in one fell swoop.

Manual efforts to prevent cherry splitting can lead to tragic results.  After a recent brief, but heavy rainfall, a helicopter pilot and his passenger were fanning moisture off a cherry tree orchard near Wenatchee, Washington.[2]  The helicopter’s main rotor clipped a power line.  The helicopter crashed into the orchard.  The passenger died, and the pilot suffered severe injuries.

Oregon State University scientists are trying to solve this vexing cherry cracking problem.  They developed SureSeal, a hydrophobic, elastic biofilm that consists of a copolymer of stearic acid, cellulose and calcium.  It significantly reduced cherry cracking in field tests.  The United States Patent and Trademark Office (USPTO) recently published the inventors’ patent application directed to this SureSeal innovation.  It is entitled  “Flexible Films and Methods of Making and Using Flexible Films.”

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Fruit Juice Misbranding Claims Lose Their Lanham Act Bite

By Paul D. Swanson on Posted in False Advertising, FDA Regulation, Food Labeling

Food label lawsuits are often exercises in byzantine legal logic.  This is so because of the peculiar interplay between preemptive federal food labeling laws and regulations on the one hand and federal and state unfair competition and false advertising claims on the other.

The ability of individuals to pursue food mislabeling claims depends on whether allowing such claims to proceed would conflict with the purpose and intent of federal food labeling law and implementing regulations, such as those promulgated pursuant to the Food, Drug and Cosmetic Act of 1938 (“FDCA”) or the Nutrition Labeling and Education Act of 1990 (“NLEA”).  Those federal laws do not allow private lawsuits to enforce their provisions.

In Pom Wonderful v. The Coca-Cola Co., the Court of Appeals for the Ninth Circuit just eliminated a federal Lanham Act basis for pursuing food misbranding claims over regulated juice products.  This brief article examines the Pom case and what it means for the future of food label litigation.

The Nature of Pom’s Fruit Juice Label Claim

Pom contends that Coca-Cola’s labeling of its Minute Maid “Pomegranate Blueberry” juice label is misleading and deceptive because the juice product only contains 0.3% pomegranate juice, 0.2% blueberry juice (and 0.1% raspberry juice).  Most of the product consists of 99.4% apple and grape “filler” juices.  The brand label prominently displays the “Pomegranate Blueberry” name and features a colorful fruit vignette with a split ripe pomegranate, a sliced apple and a handful blueberries, raspberries and red grapes.  The label includes the legend “Pomegranate Blueberry Flavored Blend of 5 Juices.”  Although not at issue in the case, Minute Maid’s label also touts the fortified inclusion of an omega-3 fatty acid nutrient, DHA (docosahexaenoic acid), with the tag line of how its inclusion will “help nourish your brain.”

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The FDA Rejects Renaming of HFCS as “Corn Syrup”

By Paul D. Swanson on Posted in FDA Regulation, Food Labeling

In 1969, the Archies combined granulated and aqueous forms of fructose and glucose in a bubblegum song called “Sugar, Sugar.”   It topped out at No. 1 in the U.S. Billboard Hot 100 charts.  The lyrics “Sugar / Oh, Honey, Honey / You are my candy girl, and you got me wanting you” lilted through and permeated the AM and FM airwaves.

In 2010, manufacturers of “high fructose corn syrup” (HFCS) sought to break down the FDA regulatory barriers that exist between granulated and aqueous forms of fructose and glucose—but their efforts would be met with much less glamorous success.  By then, HFCS had become a persona non grata among anxious consumers.  Scientific studies issued earlier in the decade had suggested a correlation between its overconsumption and the epidemic of bulging waistlines and type 2 diabetes spreading across the United States.

While those early studies would later be debunked, perceptions actually matter more than concrete reality when it comes to the very personal act of ingesting food.  That act is imbued (and fraught) with emotional and spiritual qualities that can readily override or distort facts.  Just as Morris—the world’s most finicky cat—would not deign to touch anything other than 9-Lives cat food, American consumers began to thumb their noses at food products incorporating HFCS.  While it is a useful and cost-effective sweetener for industrial food processing purposes, it could not rise above its bad rap.

We’d Rather Switch Than Fight

Once upon a time in advertising lore, Tareyton smokers “would rather fight than switch” their cigarette brands.  HFCS did not follow that playbook.  Instead of defending the words, “high fructose corn syrup,” HFCS manufacturers decided to change its product stripes altogether.  Following the age-old adage that if it “looks like a duck, quacks like a duck, it must be a duck,” the Corn Refiners Association (CRA) embarked on a $30 million dollar marketing campaign to convince wary American consumers that “HFCS is corn sugar,” that “HFCS is natural,” and that “sugar is sugar.”

By way of background, HFCS was first produced in Japan and entered the American food supply in the early 1970s.  Its name accurately describes its composition.  Unlike table sugar, which consists of 50% glucose and 50% fructose chemically bonded together, the main form of HFCS included in soft drinks is made from an enzymatic process that blends together 55% fructose and 45% glucose.  The distinction between sugar components being bonded versus blended creates potential implications for human digestion and metabolic fate purposes, but those distinctions appear to have been overplayed in early scientific studies leading to HFCS’s demonization.

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