Litigation Now Driving the Non-GMO Labeling Discussion

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The executives at Barbara’s Bakery likely didn’t see it coming. After all, the brand has been a stalwart of the natural products industry for many, many years. But when a plaintiff decided to pursue damages against the company, claiming the "all-natural" designation on Barbara’s product labels was deceiving because the products contained ingredients sourced from genetically modified organisms (GMOs), the battle over GMO labeling got personal.

Never mind that "natural" hasn't been legally defined. Never mind that FDA has chosen, so far, to not address whether natural products can legally contain GMOs. Never mind that more than 80 percent of all commodity corn, soy and sugar beet crops grown in the United States are GMO-based.

Barbara’s, owned by Weetabix, settled out of court for USD $4 million in June rather than going through what would have likely been lengthy, expensive and brand-damaging litigation. It has also changed its packaging to remove the phrase all-natural and is moving quickly to remove GMO ingredients from its products, in addition to achieving certification from the Non-GMO Project Verified label.

“From a legal perspective, we weren’t doing anything wrong," noted Frederico Meade, vice president of marketing  at Barbara’s.

This is not an isolated incident. Naked Juice, owned by PepsiCo, settled a similar lawsuit for $9 million in July; Cargill’s Truvia stevia-based sweetener in September settled a “deceptive marketing" lawsuit for $5 million. At the time of this writing, other companies fighting all-natural lawsuits over GMO ingredients include Smuckers for its Crisco vegetable oil, PepsiCo for its Frito-Lay chips, and Gruma Corp. for its Mission corn chips.

GMOs aren't the only legal threat. California’s Proposition 65, enacted in 1986, requires specific labeling requirements on products sold in the state if the product contains chemicals listed by the state as carcinogens or reproductive toxicants, including lead, above specified limits. Failure to provide such warnings can result in action by the California attorney general or by “any person in the public interest."

Since 2010, around 300 Prop 65 notices on lead were filed, and settlement costs in 2012 totaled nearly $1 million by midyear, according to the American Herbal Products Association (AHPA). The average cost of each settlement amounted to about $48,000—not including legal expenses incurred by the companies receiving these notices.

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