In a “Memorandum for the Heads of Executive Departments and Agencies,” dated May 20, President Obama directed the heads of his executive departments on how to deal, going forward and looking back 10 years, with the issue of federal preemption of state and local laws.  Producers have historically asked for a balance between the industry’s need for labeling uniformity and a state’s or locale’s rights to enact or promulgate their own regulations and interpretations on issues, like trans fat labeling, Prop 65, menu labeling and net-weight labeling due to moisture loss.

The tone of the Memorandum is posited in the inclusion of a quotation from former Justice of the Supreme Court, Louis Brandeis: “it is one of the happy incidents of the federal system that a single courageous state may...serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country.”*

The NLEA amended the FDCA and encouraged uniform labeling by preempting certain types of non-federal labeling requirements, such as nutritional labeling, health claims and food standards, among others. The NLEA did provide a process by which states could petition to enact laws not subject to preemption, when their particular concerns did not impact interstate commerce unreasonably; would not cause a food to be misbranded under federal law; and were necessary to meet a specified need of that state.

On the meat protein side, both the FMIA and the PPIA include provisions which explicitly provide that different or additional “marking, labeling, packaging or ingredient requirements” may not be imposed by a state.

The Memorandum expresses an additional concern that some federal agencies may not have properly interpreted a prior Executive Order on the same topic, which stated that preemption existed only where the federal statute contained an express preemption clause; or where there was pretty convincing evidence that the Congress intended to preempt state action; or where the statutory requirements were so different, preemption would have to be presumed.  (The specific reference is to Executive Order 13132, 08/04/99, issued by then President Clinton.).

The Obama administration’s approach “is to state the general policy of my Administration that preemption of State law by executive departments and agencies should be undertaken only with full consideration of the legitimate prerogatives of the States and with a sufficient legal basis for preemption.”

The Memorandum is to be effected in three ways: dicta in regulatory preambles and elsewhere should not hint or suggest that the regulation preempts state or local action, unless preemption is specifically included in the regulation; regulations should not include preemption provisions, unless consistent with the principles expressed in Executive Order 13132 (above); and, finally, a directive to review regulations going back 10 years to see if an assertion of preemption can be justified, and, if necessary, to amend any existing regulations as needed to retrofit those regulations into conformity with the Memorandum and Executive Order 13132.

Department heads are encouraged to consult with the Attorney General and the Office of Management and Budget in the interpretation of the “requirements” of the Memorandum.

The issuance of this Memorandum suggests that producers should be forewarned that states and locales have now been encouraged to “try novel social and economic experiments;” and the ability of producers to argue for the benefits of a national uniformity and federal preemption of state or local excursions into the regulation of food labeling and nutrition may be increasingly limited. In fact, in the absence of express preempting language in any new federal statute or regulations, the presumption may be that no preemption exists, and states and locales remain free to legislate on the same matter. Finally, producers should be watchful for the amending or “reinterpretation” of existing regulations, upon which producers have relied for 10 years, as no longer preemptive of state or local regulation. pf

*Author’s note: Frankly, the Brandeis quotation--some 70 years old--seems somewhat antiquated, in a time when producers cannot economically or practically meet a patchwork of regulations, even “experimental ones,” which vary state by state and locale by locale.

Mark Hostetler is an attorney at Husch Blackwell Sanders LLP. Experienced in advising consumer product companies and focusing primarily in the food industry, he has guided producers, advertisers and marketers through regulatory proceedings, product recalls, new product introductions, and new advertising and promotional campaigns. He can be reached at Mark.Hostetler@huschblackwell.com.