context matters: “mineral-based” sunscreen with chemical-based active ingredients is plausibly deceptive

Prescott v. Bayer Healthcare LLC, 2020 WL 4430958, No.
20-cv-00102-NC (N.D. Cal. Jun. 31, 2020) (magistrate)

Plaintiffs alleged that defendants deceived consumers by
labeling their sunscreens as “mineral-based” when the sunscreens contain active
chemical ingredients. As the court explains,  

“Mineral-based” sunscreens are
distinguished from “chemical-based” sunscreens through the compounds used to
absorb or deflect ultraviolet (“UV”) radiation. Some compounds commonly used as
active ingredients in sunscreens, such as zinc oxide and titanium dioxide, are
considered inorganic minerals. Other common compounds commonly used as active
ingredients in sunscreens, such as octisalate and octocrylene, are considered
chemicals. Each of the four challenged products contain both mineral active
ingredients and chemical active ingredients.

Plaintiffs alleged that they were concerned about potential
adverse health effects of chemical active ingredients and thus sought out
“mineral-based” sunscreens. They brought the usual California claims.

The court rejected Bayer’s express FDCA preemption argument.
There are various FDA requirements for OTC sunscreens as well as a general prohibition
on “claims that would be false and/or misleading on sunscreen products.” But
the FDA neither specifically mandates nor prohibits the use of “mineral-based”
claims, and doesn’t preempt state law that allows consumers to sue for
violations of federal standards. If the suit ultimately requires the removal of
“mineral-based” from the labels, there’d be no conflict.

Primary jurisdiction arguments also failed. Turns out, there
was a directive to the FDA in the Coronavirus Aid, Relief, and Economic Security
Act (CARES Act), and the FDA is also supposedly considering further regulations
regarding ingredient disclosures. Nonetheless: “false advertising suits like
this one are squarely within the conventional experiences of judges and courts.”
And “this lawsuit does not involve technical or policy considerations within
the FDA’s field of expertise,” such as whether the active ingredients were
harmful or safe. Though the details of chemical active ingredients are part of
the suit, its crux is whether the label is misleading.  The parties even appeared to agree which
active ingredients are “minerals” or “chemicals.” (Citing POM Wonderful LLC v.
Coca-Cola Co., 573 U.S. 102 (2014) (noting that the FDA does not have the
expertise to evaluate nor authority to enforce false advertising claims).)

The FDA’s consideration of whether to introduce a labeling
requirement that all active ingredients be disclosed on a sunscreen product’s
principal display panel didn’t change anything. If plaintiffs were right about
the average consumer’s understanding of “mineral-based,” defendants’ use of the
phrase would be misleading or inaccurate regardless whether all active
ingredients were disclosed on the products’ principal display panel. Also, that
regulation was proposed in February 26, 2019, and the public comment period
concluded on May 28, 2019; its proposed effective date was originally November
26, 2019. Under the Ninth Circuit’s guidance that “[t]he deciding factor should
be efficiency,” “it makes little sense to halt this lawsuit because of a
proposed rule that was under consideration over a year ago.” So too for the
CARES Act, for which the FDA is required to propose an order by September 2021.
“Dismissing or staying this case for over a year is not efficient. This is
particularly true here, when the Act’s mandate is fairly vague and does not
require the FDA to regulate the specific issue in this case”—it just required
the FDA to “amend and revise the final administrative order concerning
nonprescription sunscreen.”

Plaintiffs also had standing for products they hadn’t
purchased that allegedly were misleadingly labeled in the same way. And, under
the Ninth Circuit standard, they had standing to sue for injunctive relief.
Defendants argued that from now on they could just look at the back labels. “But
it is not clear why the burden to avoid future misunderstanding lies with
Plaintiffs and not Defendants when it is Defendants’ actions that are allegedly
unlawful.” Also, even if they know now, “it is plausible that they would forget
to do so or instead choose to rely on Defendants’ principal representations.” And
as the Ninth Circuit has said, “the threat of future harm may be the consumer’s
plausible allegations that she will be unable to rely on the product’s
advertising or labeling in the future….” And even reviewing the label might
not help, since plaintiffs might not know which active ingredients are
“minerals” and which are “chemicals.” “[A]bsent an encyclopedic knowledge of
sunscreen active ingredients, Plaintiffs may not be able to truly know whether
a sunscreen is truly ‘mineral-based.’”

Misleadingness: Defendants argued that “mineral-based”
simply means that mineral active ingredients play the “supporting or carrying”
role or is “the fundamental part of something.” Plaintiffs argued that
reasonable consumers would interpret the phrase to mean that the product
contains no chemical active ingredients. Plaintiffs alleged that “nearly all
other sunscreens on the market (other than Defendants’) that are advertised as
mineral or mineral-based contain only mineral active ingredients.” On a motion
to dismiss, that was enough to create a question of fact.

The dictionary definition of “base” wasn’t sufficient to
protect defendants. “Base” can also mean “a main ingredient,” but in some of
the challenged products, chemical active ingredients made up a larger
percentage of the ingredients than mineral active ingredients. As the court perceptively
noted—and recognizing the reality missed by the “white”/chocolate cases—context
matters. “For example, a ‘plant-based meal’ is generally understood to contain
only plants and no meat.”

Defendants argued
that “mineral-based” was nevertheless not misleading because in each of their
products, the largest single active ingredient by percentage is a mineral
active ingredient. “But the challenged statement is ‘mineral-based’ not, for
example, ‘zinc oxide-based.’” A reasonable consumer could receive the message
that mineral active ingredients in the aggregate were the “main ingredients,” but
in the challenged products, mineral active ingredients made up a roughly equal
proportion of the active ingredients as chemical active ingredients (e.g, mineral
active ingredients constituted 9.7% of all ingredients and chemical active
ingredients constituted 12% of all ingredients in defendants’ Sports Lotion). And
the ingredients list didn’t fix the problem, under Ninth Circuit law, where the
list arguably contradicted rather than explaining the label. 

from Blogger

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