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Simpson v. Kroger Corporation

California Court of Appeals, Second District, Fourth Division

September 25, 2013

MARY L. SIMPSON, Plaintiff and Appellant,
THE KROGER CORPORATION, et al., Defendants and Respondents.

APPEAL from a judgment of the Superior Court of Los Angeles County, No. BC475665, BarbaraM. Scheper, Judge.

Morris Polich & Purdy, Jens B. Koepke and David J. Vendler for Plaintiff and Appellant.

Kelley Drye & Warren, Keri E. Campbell, Sarah L. Cronin, Kenneth D. Kronstadt, Sarah Roller and Donnelly McDowell for Defendants and Respondents.


The issue in this case is whether products produced by defendant Challenge Dairy Products, Inc. and sold by defendant The Kroger Corporation in its supermarkets, which combine butter with canola oil or olive oil, are mislabeled under state and federal law. In her opening brief, plaintiff Mary L. Simpson claims the products are not “butter” and that they were mislabeled in violation of federal and state law by being labeled “spreadable butter with” either canola oil or a combination of canola and olive oil. In her reply brief, plaintiff changes her theory and asserts that her claim is that the additional oils are not identified with requisite prominence on the labels. Defendants argue that the California food labeling statutes under which plaintiff sues are preempted by federal food labeling standards. They contend that under controlling federal law, the products are properly labeled with their usual and common names, i.e., butter with canola oil or with olive and canola oil.

We conclude that the labeling requirements of the California Milk and Milk Products Act of 1947 (Food & Agr. Code, § 32501 et seq., (MMPA)) are not identical to the applicable federal labeling requirements and therefore plaintiff’s claims under the MMPA are preempted; that plaintiff’s mislabeling claims under the California Sherman Food, Drug and Cosmetic Law (Health & Saf. Code, § 109875 et seq. (Sherman Law)) are not preempted by federal law; and that the trial court did not abuse its discretion in denying leave to amend to allege claims based on violation of the Sherman Law because, as a matter of law, plaintiff has failed to demonstrate that a reasonable consumer would be misled by the labels on the products.


In October 2011, plaintiff purchased a tub of one of the relevant products at her local Ralphs supermarket.[1] She alleges that she purchased the product because she was already familiar with whipped butter products that are spreadable. Only when she got home did she realize “that the product she purchased was not in fact butter, but contained edible oils and other ingredients.” The action concerns two Challenge butter products, but the complaint does not state which was purchased by plaintiff.

Challenge Spreadable Butter with Canola Oil is packaged in a tub. On the top panel of the tub the color backdrop depicts a mountain scene with a stag. At the top of this scene is a blue ribbon banner with white lettering with the words: “CHALLENGE BUTTER.” To the left of the stag on a red ribbon banner in smaller yellow type are the words: “with DHA Omega-3 [¶] Supports Healthy Brain & Eyes.” To the right of the of the stag there is a red oval with lettering in yellow type stating “Soft [¶] Even When [¶] Cold.” Below the stag is a long yellow banner with the words “SPREADABLE BUTTER” in capital letters in blue type which is larger than the type in the red portions of the label. Centered at the bottom of this yellow banner is a blue banner with smaller white type stating “WITH CANOLA OIL.” Underneath this statement, in white type of the same size is the word “SPREAD.” The label on the side of the tub is the same except the word “SPREAD” is omitted. The label on the bottom panel of the tub lists the ingredients: “Pasteurized Cream (derived from milk). Canola Oil, Salt, Vitamin A Palmitate, Beta Carotene, DHA, Algal Oil.”[2]

Challenge Tuscan Style Spreadable Butter is sold in a tub with similar labeling. The label on the top of the tub is a color backdrop depicting white buildings with red roofs against a rolling pastoral landscape. The label “CHALLENGE BUTTER” appears at the top of the landscape in white lettering on a red banner. Below and to the left is a blue ribbon banner stating in yellow type “with Olive Oil” in smaller print. Below that, on the blue ribbon, and in smaller white type appears “Garlic & Italian Herbs.” In the center bottom of the top label in red lettering on a gold banner are the words “TUSCAN STYLE” in larger type. Immediately below is a blue banner with smaller white lettering stating: “SPREADABLE BUTTER with CANOLA & OLIVE OIL.” Centered below that statement is the word “SPREAD” in the same size type. The side panel is the same, but the word “SPREAD” is omitted. The bottom panel on the tub lists the ingredients: “Pasteurized cream (derived from milk), canola oil, olive oil, roasted garlic puree, natural flavors, garlic puree, dried garlic, spices, sea salt, vitamin A palmitate, beta carotene.”[3]

The operative pleading in this case is the first amended complaint, a putative class action alleging causes of action for unfair competition (Bus. & Prof. Code, § 17200 et seq.), false advertising (Bus. & Prof. Code, § 17500 et seq.), and violation of the Consumer Legal Remedies Act (Civ. Code, § 1750 et seq.). Plaintiff sought damages, a permanent injunction prohibiting the sale of margarine, spread, or dairy spread if not in compliance with the provisions of the MMPA, costs and fees.

Defendants jointly demurred to the complaint on the ground that the products were properly labeled under the MMPA. They also argued the MMPA is expressly and impliedly preempted by the federal Food Drug and Cosmetic Act (FDCA) (21U.S.C. § 301 et seq.).[4] In opposition, plaintiff argued that the products are a “spread” rather than “butter” under the definitions of the MMPA. In arguing that her claims under the MMPA are not preempted by the FDCA, plaintiff cited a provision of the Sherman Law which incorporates Federal Drug Administration (FDA) regulations regarding the branding of food (Health & Saf. Code, § 110100, subd. (a)). But she did not seek leave to amend to allege a cause of action under the Sherman Law.

The trial court agreed with defendants, finding that plaintiff’s California claims were preempted. The court found that the products are nonstandardized butter, for which there is a federal labeling requirement, but no comparable California labeling requirement. The court denied leave to amend because an amendment could not address the legal issues on which its ruling was based. The action was dismissed with prejudice. An order of dismissal with prejudice was entered. Plaintiff appeals from the order of dismissal. “We apply a de novo standard of review because this case was resolved on demurrer [citation] and because federal preemption presents a pure question of law [citation].” (Farm Raised Salmon Cases (2008) 42 Cal.4th 1077, 1089, fn. 10.)



The labeling of food products is heavily regulated by both federal and state law. The gravamen of the first amended complaint is that the labels on the products at issue violate the MMPA. On appeal, the thrust of plaintiff’s argument shifted. Her primary argument became that she should have been granted leave to amend to allege the labels violated the Sherman Law, rather than the MMPA, a claim which she argues is not preempted. She also argues that her MMPA claims are not preempted. We address both the MMPA and the Sherman Law as a basis for plaintiff’s claims.

Under both the FDCA and the Sherman Law, foods fall into two broad groups: those for which a definition and standard of identity has been created by federal regulation, and those not defined by federal regulation. Under the FDCA, regulations may be promulgated “fixing and establishing for any food, under its common or usual name so far as practicable, a reasonable definition and standard of identity....” (21 U.S.C. § 341.) Butter is expressly excepted from this: “No definition and standard of identity and no standard of quality shall be established for... butter....”[5] (21 U.S.C. § 341.)

We refer to the first group as “standardized foods” and the second as “nonstandardized foods.” The parties disagree as to whether the food products at issue here are standardized or nonstandardized foods. As we discuss, this categorization of foods impacts the preemption analysis.


“The FDCA prohibits the misbranding of any food. (§ 331(b).) A food ‘shall be deemed to be misbranded’ under the FDCA if ‘its labeling is false or misleading in any particular....’ (§ 343(a).)” (Farm Raised Salmon Cases, supra, 42 Cal.4th at p. 1085.) In 1990 the FDCA was amended by the Nutrition Labeling and Education Act of 1990 (NLEA) with the purpose of “creat[ing] uniform national standards regarding the labeling of food and to prevent states from adopting inconsistent requirements with respect to the labeling of nutrients. [Citation.]” (Id. at pp. 1085–1086.) “To that end, the NLEA included an explicit preemption provision in the form of section 343-1(a) [citation], which provides that ‘no State or political subdivision of a State may directly or indirectly establish under any authority or continue in effect as to any food in interstate commerce—[¶]... [¶] (3) any requirement for the labeling of food of the type required by section... 343(k) of this title that is not identical to the requirement of such section....’ (§ 343-1(a), italics added.)”[6] (Id. at p. 1086.)

There is no private right of action under the FDCA. (Merrell Dow Pharmaceuticals, Inc. v. Thompson (1986) 478 U.S. 804, 810–811.) Under section 343-1, states mayestablish their own requirements so long as they are identical to those in the FDCA. (Farm Raised Salmon Cases, supra, 42 Cal.4th at p. 1086, [quoting 60 Fed.Reg. 57120 (Nov. 13, 1995) “under FDA regulations, ‘if the State requirement is identical to Federal law, there is no issue of preemption’”].)

The FDCA defines “butter” to mean “the food product usually known as butter, and which is made exclusively from milk or cream, or both, with or without common salt, and with or without additional coloring matter, and containing not less than 80 percentum by weight of milk fat, all tolerances having been allowed for.” (§ 321a.) “Cream” is defined in the Code of Federal Regulations as “the liquid milk product high in fat separated from milk, which may have been adjusted by adding thereto: Milk, concentrated milk, dry whole milk, skim milk, concentrated skim milk, or nonfat dry milk. Cream contains not less than 18 percent milkfat.” (21C.F.R. § 131.3(a).) Specific definitions and standards of identity have been adopted for other milk and cream ...

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