Prop. 37 (The California Right to Know Genetically Engineered Food Act) is a November 2012 California ballot measure that requires clear labels informing consumers if foods are genetically engineered.

Under Prop. 37, retail food in California is misbranded if it has been entirely or partially produced with genetic engineering and that fact is not disclosed. There are different disclosure requirements for raw agricultural commodity and for processed food. In addition, if the food is “genetically engineered” or “processed food,” as those terms are defined under the statute, the food may not, on its label, accompanying signage, or in any advertising materials, state or imply that the food is “natural,” “naturally made,” “naturally grown,” “all natural,” or any words of similar import that would have any tendency to mislead any consumer. The application of this section with respect to “processed food” is subject to some ambiguity as the definition of that term seems overly broad. Under Prop. 37, “processed food” means “any food other than a raw agricultural commodity and includes any food produced from a raw agricultural commodity that has been subject to processing such as canning, smoking, pressing, cooking, freezing, dehydration, fermentation or milling.” The issue with this definition is that it is not limited to genetic engineering. The plaintiffs bar may try to capitalize on this ambiguity by bringing claims over foods that meet the plain language of the definition – even where no genetic engineering is involved – such as frozen vegetables, cooked foods, dried fruits, and fermented vegetables, just to name a few.

There is plenty of debate over Prop. 37 in California, with both opponents and proponents campaigning for support. Litigation in California has also been active in this area. Recently, a California woman brought a class action suit against General Mills Inc. for its representation that its Kix cereal is “all natural” even though it contains genetically modified corn. A similar suit was also brought in California against The Quaker Oats Company. California is not the only state proving to be a fertile battleground on this issue. Just last week, Frito-Lay was hit with a class action complaint in Florida district court, alleging that the company deceptively marketed its bean dip as “all natural” when it actually contained genetically modified organisms. Plaintiff contends that Frito-Lay’s failure to disclose the presence of genetically modified organisms amounts to a material misrepresentation, and that such misrepresentations violate Florida’s Deceptive and Unfair Trade Practices Act and result in unjust enrichment.

Marketing practices over natural foods is clearly a hotbed for litigation. Companies selling food products should make sure that they’re keeping close tabs on their marketing practices for any goods they may represent as being “natural.” Prop. 37, if passed, is sure to represent a sea-change for many of these companies. We will be monitoring this area closely for developments.