U.S. Supreme Court Allows Pom Wonderful to Pursue Lanham Act Claims against Coca-Cola

Further to our April 23 post on the Pom Wonderful-Coca-Cola U.S. Supreme Court case, the  Court on Thursday June 12 issued an unanimous decision (with Justice Breyer taking no part in the consideration or decision of the case) reversing the Ninth Circuit  and holding that competitors may bring Lanham Act claims, like those brought by Pom, challenging food and beverage labels regulated by the FDCA.

In its decision, the Court stated that the issues in the case did not involve preemption, but, rather, concerned the alleged preclusion of a cause of action under one federal statute by the provisions of another federal statute, requiring statutory interpretation under traditional rules. A review of the text of the two statutes showed that “neither the Lanham Act nor the FDCA, in express terms, forbids or limits Lanham Act claims challenging labels that are regulated by the FDCA.” This fact was significant, the Court stated, since the two statutes had coexisted since 1946 and Congress, despite having made amendments to both Acts since that time, never enacted any provisions addressing the preclusion of other federal laws. Moreover, the Court stated that “the structures of the FDCA and the Lanham Act reinforce the conclusion drawn from the text. When two statutes complement each other, it would show disregard for the congressional design to hold that Congress nonetheless intended one federal statute to preclude the operation of the other.” To hold otherwise, the Court concluded, would “lead to a result that Congress likely did not intend.”

The Court also rejected arguments that the FDCA’s delegation of enforcement authority to the federal government indicated congressional intent to achieve national uniformity in labeling, precluding the Lanham Act claim.

Finally, the Government, disagreeing with both Parties’ positions, argued that a Lanham Act claim was precluded “to the extent the FDCA or FDA regulations specifically require or authorize the challenged aspects of [the] label.” The Court stated that the Government mistakenly assumed that the FDCA and its regulations are at least in some circumstances a ceiling on the regulation of food and beverage labeling, and that its holding that Congress intended the Lanham Act and FDCA to complement each other with respect to food and beverage labeling dispelled this argument.

The case has been remanded to the Ninth Circuit for further proceedings.

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