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American Meat Institute v. Leeman

December 22, 2009


APPEAL from a judgment of the Superior Court of San Diego County, Thomas P. Nugent, Judge. Affirmed. (Super. Ct. No. GIN044220).

The opinion of the court was delivered by: Irion, J.


American Meat Institute and National Meat Association (the Trade Associations) filed suit against Whitney R. Leeman seeking a declaration that the consumer warnings required by the California Safe Drinking Water and Toxic Enforcement Act of 1986, Health and Safety Code section 25249 et seq., commonly known as Proposition 65, are preempted by the Federal Meat Inspection Act (21 U.S.C. § 601 et seq. (the FMIA)).

In this appeal, Leeman challenges two rulings. First, she challenges the trial court's decision overruling her demurrer, in which she contended (a) that the complaint failed to plead an actual controversy between the parties to support a declaratory relief; and (b) that, for several reasons, it was not necessary or proper for the court to exercise its power to grant declaratory relief. Second, Leeman challenges the trial court's decision granting summary judgment in favor of the Trade Associations, in which it concluded that the FMIA preempted Proposition 65 point of sale warning requirements with respect to meat.

We conclude that the trial court properly overruled the demurrer. Further, we conclude that the FMIA expressly preempts point of sale warning requirements imposed by Proposition 65 with respect to meat, and on that basis we affirm the trial court's ruling on the motion for summary judgment.


A. The Applicable Legal Framework

1. Proposition 65

Proposition 65, which was passed as a ballot initiative in 1986, requires the state to develop and maintain a list of chemicals "known to the state to cause cancer or reproductive toxicity." (Health & Saf. Code, § 25249.8, subd. (a).)*fn1 It also requires that businesses provide warnings before consumers are exposed to such chemicals. Specifically, Proposition 65 states that "[n]o person in the course of doing business shall knowingly and intentionally expose any individual to a chemical known to the state to cause cancer or reproductive toxicity without first giving clear and reasonable warning to such individual . . . ," except as otherwise provided by the statute. (Health & Saf. Code, § 25249.6.)*fn2

The warning required by Proposition 65 "may be provided by general methods such as labels on consumer products . . . , posting of notices, placing notices in public news media, and the like, provided that the warning accomplished is clear and reasonable." (Health & Saf. Code, § 25249.11, subd. (f).) According to the regulations implementing Proposition 65, warnings for consumer products may take the form of "[a] warning that appears on a product's label or other labeling"; "[i]dentification of the product at the retail outlet in a manner which provides a warning" such as "shelf labeling, signs, menus, or a combination thereof"; or "[a] system of signs, public advertising identifying the system and toll-free information services, or any other system that provides clear and reasonable warnings." (Cal. Code Regs., tit. 27, § 25603.1, subds. (a), (b), (d); see also People ex rel. Lungren v. Cotter & Co. (1997) 53 Cal.App.4th 1373, 1378 ["a merchant can comply with Proposition 65 by posting a sign stating the products are known to the state to cause cancer and/or are reproductively toxic"].)*fn3

A private citizen may bring an action to enforce Proposition 65 provided that (1) at least 60 days before filing a lawsuit the citizen gives notice to the alleged violator, the Attorney General, district attorneys and city attorneys in the jurisdiction where the violation occurred; and (2) no public official has already commenced prosecution of the same violation. (Health & Saf. Code, § 25249.7, subd. (d)(1).)

If found in an enforcement action to have violated the requirements of Proposition 65, a violator "shall be liable for a civil penalty not to exceed two thousand five hundred dollars ($2,500) per day for each violation in addition to any other penalty established by law." (Health & Saf. Code, § 25249.7, subd. (b)(1).)

2. The FMIA

The FMIA regulates meat and food products made from meat.*fn4 (21 U.S.C. § 602.) As Congress explained, the FMIA was enacted because "[i]t is essential in the public interest that the health and welfare of consumers be protected by assuring that meat and meat food products distributed to them are wholesome, not adulterated, and properly marked, labeled, and packaged." (21 U.S.C. § 602.)

The FMIA requires governmental inspectors under the United States Department of Agriculture (USDA) to perform pre- and postslaughter inspection of the animals used for meat. (21 U.S.C. §§ 603-605.) Thereafter, the meat is to be marked either " 'inspected and passed' " or " 'inspected and condemned,' " based on whether the meat is found to be adulterated or unadulterated. (21 U.S.C. § 606.) As relevant here, meat is adulterated if, among other things, "it bears or contains any poisonous or deleterious substance which may render it injurious to health; but in case the substance is not an added substance, such article shall not be considered adulterated under this clause if the quantity of such substance in or on such article does not ordinarily render it injurious to health." (21 U.S.C. § 601(m)(1).)

The FMIA prohibits any person from offering meat for sale if it is "adulterated or misbranded at the time of such sale [or] offer for sale." (21 U.S.C. § 610(c).)*fn5 Meat is misbranded if, among other things, "its labeling is false or misleading in any particular." (21 U.S.C. § 601(n)(1).) "The term 'labeling' means all labels and other written, printed, or graphic matter (1) upon any article or any of its containers or wrappers, or (2) accompanying such article." (21 U.S.C. § 601(p).)*fn6

The federal regulations that implement the FMIA (9 C.F.R. § 300 et seq. (2009)) describe in great detail the rules for the labeling of meat. (9 C.F.R. §§ 317.1-317.400.) The regulations provide, among other things, that with the exception of certain generically approved labeling, "[n]o final labeling shall be used on any product unless the sketch labeling of such final labeling has been submitted for approval . . ." to the applicable federal regulatory agency. (9 C.F.R. § 317.4(a).) Further, according to the regulations, "[n]o product or any of its wrappers, packaging, or other containers shall bear any false or misleading marking, label, or other labeling and no statement, word, picture, design, or device which conveys any false impression or gives any false indication of origin or quality or is otherwise false or misleading shall appear in any marking or other labeling."*fn7 (9 C.F.R. § 317.8(a).)

The FMIA contains a preemption provision, which provides in relevant part:

"Marking, labeling, packaging, or ingredient requirements in addition to, or different than, those made under this chapter may not be imposed by any State or Territory or the District of Columbia with respect to articles prepared at any establishment under inspection in accordance with the requirements under subchapter I of this chapter,*fn8 but any State or Territory or the District of Columbia may, consistent with the requirements under this chapter, exercise concurrent jurisdiction with the Secretary over articles required to be inspected under said subchapter I, for the purpose of preventing the distribution for human food purposes of any such articles which are adulterated or misbranded and are outside of such an establishment, or, in the case of imported articles which are not at such an establishment, after their entry into the United States." (21 U.S.C. § 678.) *fn9

3. The Trade Associations' Declaratory Relief Lawsuit

The Trade Associations represent packers and processors of meat. In November 2004, Leeman sent notices to eight meat processors and retailers, including six members of the Trade Associations, as well as to the Attorney General, the district attorneys for each of California's 58 counties and certain city attorneys (the Notices). The Notices were titled "60-day Notice of Violation," and specified that they were sent in compliance with that portion of Proposition 65 requiring a 60-day notice before the filing of a citizen suit. (Health & Saf. Code, § 25249.7, subd. (d).)*fn10 In the Notices, Leeman identified dioxins as a carcinogen and PCB's as both a carcinogen and a reproductive toxin, and she stated that the companies at issue were selling either ground beef or beef liver products containing PCB's and dioxins without supplying the warnings required by Proposition 65. Accompanying each of the Notices was a certificate of merit signed by Leeman's attorney, as required by Health and Safety Code section 25249.7, subdivision (d), which stated, among other things, that "there is a reasonable and meritorious case for the private action."

After their members received the Notices, the Trade Associations negotiated with Leeman on behalf of their members. Leeman agreed that she would wait several months longer than the required 60 days before filing a citizen suit. The delay would allow more time to explore a potential resolution and give the Attorney General's Office time to more fully assess the matter.

On the day that the extended waiting period expired, the Trade Associations filed this declaratory relief action against Leeman (the complaint), seeking declaratory relief on behalf of all of the Trade Associations' members that, "as applied to meat and meat products, the warning requirement of [Proposition 65] is preempted by the [FMIA] and its implementing regulations."*fn11 The complaint contended that the FMIA both impliedly and expressly preempted Proposition 65 with respect to meat labeling requirements.*fn12

Leeman filed a demurrer to the complaint. In the demurrer, Leeman raised two contentions that are relevant here. First, Leeman argued that the facts pled in the complaint did not establish an actual controversy between the parties sufficient to support a claim for declaratory relief because it was not certain, based on Leeman's service of the Notices alone, that she intended to bring a citizen's enforcement action against the Trade Associations' members. Second, Leeman argued that it was not "necessary" or "proper" (Code Civ. Proc., § 1061) for the trial court to grant declaratory relief on the preemption issue because (1) the same issue could be raised and decided as an affirmative defense in any enforcement action eventually filed by Leeman; and (2) "the purpose of the declaratory relief action - to expeditiously settle rights and obligations - would be frustrated as to potential plaintiffs beyond [Leeman]" because "[t]he Attorney General as well as all other citizen enforcers would not be bound by a judgment against [Leeman], and would still be free to bring a similar suit under Proposition 65."

The trial court overruled the demurrer. The minute order ruling on the demurrer stated that "sufficient facts have been pled to establish an actual controversy." The trial court did not specifically address Leeman's contention that it should exercise its discretion to dismiss the complaint on the ground that declaratory relief it was not necessary or proper.

The Trade Associations filed a motion for summary judgment, in which it argued that the FMIA preempted the warning requirements of Proposition 65 with respect to the sale of meat. The trial court granted the motion, ruling that the doctrine of implied preemption applied, but that the doctrine of express preemption did not.

Leeman filed a notice of appeal from the judgment. The Trade Associations filed a protective cross-appeal, which challenges the trial court's ruling that the doctrine of express preemption does not apply.


A. Leeman's Challenge to the Trial Court's Decision Overruling Her Demurrer

We first examine Leeman's contention that the trial court erred in overruling her demurrer. Leeman argues (1) the complaint did not plead an actual controversy sufficient to support a complaint for declaratory relief; and (2) the trial court abused its discretion in deciding to entertain the declaratory relief action because such relief was not necessary and proper in that (a) the same issue could be decided as an affirmative defense in an eventual enforcement action brought against the Trade Associations' members, and (b) the ruling on the preemption issue presented in this action would not have a binding effect in an enforcement action brought by a party other than Leeman.

1. Standard of Review

"Whether a claim presents an 'actual controversy' within the meaning of Code of Civil Procedure section 1060 is a question of law that we review de novo." (Environmental Defense Project of Sierra County v. County of Sierra (2008) 158 Cal.App.4th 877, 885.) When an actual controversy does exist, Code of Civil Procedure section 1061 gives the trial court discretion to determine whether it is "necessary" and "proper" to exercise the power to provide declaratory relief. (Code Civ. Proc., § 1061.) A trial court's decision to exercise that power is reviewed under an abuse of discretion standard of review. (Meyer v. Sprint Spectrum L.P. (2009) 45 Cal.4th 634, 647 (Meyer).)

2. Actual Controversy Requirement

In analyzing Leeman's challenge to the trial court's ruling sustaining the demurrer, we first consider whether the complaint described an actual controversy ...

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