Fourth Circuit Tackles Federal Preemption in Bottled-Water Labeling Claim

By Derek Stikeleather

From a distance, the federal-preemption doctrine seems rather straightforward – states can regulate virtually anything unless the federal government has put it off-limits. In practice, however, the doctrine is anything but simple, and the line between preempted and non‑preempted claims can be hard to find. In the context of FDA-regulated products, such as food, prescription drugs, and medical devices, defendant manufacturers/sellers are quick to point to the Supreme Court’s Buckman opinion for the proposition that state-law claims involving FDA-regulated products are completely preempted. See Buckman Co. v. Plaintiffs’ Legal Comm., 531 U.S. 341 (2001). But plaintiffs are just as quick to point to the Supreme Court’s opinion in Medtronic v. Lohr, 518 U.S. 470 (1996), to argue that states are perfectly free to regulate the same products. Despite the controlling effect of both precedential decisions, in the vast majority of cases where preemption is argued, there is a correct answer under existing law. It just usually takes careful analysis to find.

In Nemphos v. Nestle Waters North America, Inc., No. 13-2146 (Jan. 8, 2015), the Fourth Circuit recently applied preemption in a case that presented no close questions. The plaintiff, Ms. Nemphos, asserted various Maryland state-law tort and fraud claims premised on allegations that the defendant improperly promoted fluoride’s health benefits for children and that its label failed to warn of the risk to her child of tooth enamel damage from long-term, excessive fluoride exposure. Slip op. at 4-5. Affirming the trial judge in the federal District of Maryland, the precedential opinion held that federal preemption barred Ms. Nemphos’s claims. Id. at 3. Yet, the fact that it took the Court 30 pages to do so underscores just how complex the analysis can become.

At issue was the Federal Nutrition Labeling and Education Act of 1990 (“NLEA”), which “secures the FDA’s authority to oversee food labeling,” an area where federal preemption typically applies. Id. Ms. Nemphos’s state-law claims sought enhanced warnings regarding flourosis on bottled-water labels. Id. at 13. Her claims, however, collided with the FDA’s exclusive regulation of bottled water’s “standard of identity,” which “specifies the defining characteristics of a food.” See id. Specifically, the NLEA includes a series of express preemption provisions that “forbid states from establishing any requirement that is ‘not identical to’ the federal requirements in five areas of food labeling,” one of which is the “standard of identity.” Id. at 10 (citing 21 U.S.C. 343-1(a)(1)). The Court explained that Section 341 “empowers the FDA to establish ‘a reasonable definition and standard of identity’ for almost any food” and “deems a food product ‘misbranded’ if it is represented as a particular food yet fails to conform to the standard of identity.” Id. at 11.

The powerful preemptive effect of the “standard of identity” rules “reflects the all-around benefits of uniform food labeling.” Id. at 18. The Court stressed that the NLEA “preempts ‘any’ applicable state requirement, not just some of them.” Id. at 11. “Put simply, . . . for a food that is the subject of a federal standard of identity, this provision preempts any pertinent state requirement that is not identical to the federal requirement.” Id. at 12.

Critical to the Nemphos court’s preemption analysis, the FDA [1] “regulates bottled water as a food,” [2] “has promulgated a standard of identity for it,” and [3] has made fluoride in bottled water “the subject of a great deal of discussion and regulation.” Id. at 18-19 (citing 21 C.F.R. 165.110). Specifically, the Court noted that “[m]anufacturers may add fluoride to bottled water within the limitations established in the FDA’s ‘standard of quality’ for bottled water.” Id. 15. “If the level of fluoride surpasses the specified maximum concentration, the bottled water is deemed ‘substandard’” and must have one of two specific warnings about the excessive level. Id. at 16. Despite FDA’s extensive regulations specific to fluoride levels in bottled water, it “requires no particular warning regarding dental flourosis.” Id. at 19. And, in Nemphos, there was no dispute that defendants’ bottled water met the FDA standard limiting the fluoride concentration level. Id. at 22.

Given this regulatory and factual posture, Ms. Nemphos’s state-law tort and fraud claims were preempted and could not proceed. Because “common-law rules and duties from the judiciary” are among the state “requirements” preempted by the NLEA, there was no reasonable construction of her claims that would allow the Court to grant relief without “impos[ing] a requirement in the form of a warning under Maryland law.” Id. at 20-21. Her failure-to-warn and misleading marketing claims, which also focused on the label, all failed for the same reason: The “FDA’s standard of identity reaches warnings, and it does not demand a warning about dental flourosis.” Id. at 21-22.

Despite this resounding rejection of Ms. Nemphos’ state-law claims in the trial and appellate courts, plaintiffs are likely to continue to bring state-law claims that challenge the safety of products, even where producers of foods with a federal “standard of identity” have dutifully complied with the NLEA’s extensive food-composition and -labeling regulations. The Fourth Circuit appears to anticipate this when noting that “[b]ecause Nemphos limits her marketing and advertising allegations to claims made on labeling and packaging, we need not reach the question of whether state-law requirements for out-of-store advertising and promotions would be preempted. Those matters are not before us and we express no opinion on them.” Id. at 27.

The sheer complexity of federal-preemption doctrine makes it likely that plaintiffs will continue to file preempted state-law claims, even in areas where the arguments against preemption are weak. This can arise from a mistaken belief that a preempted claim is not preempted or the cold calculation that the court may let the preempted claim proceed because it lacks the resources to conduct the complex and time-consuming analysis to determine that it is preempted. For all cases that raise the preemption doctrine, this careful analysis remains vital to protecting the important – yet competing – federal and state interests that these cases implicate. There are no easy shortcuts.

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