The Supreme Court ruled 8-0 against Coca-Cola in favor of POM Wonderful. This is an important decision and the Supremes made the right choice. Here’s why:
As I said in my post on the FDA’s war on cheese (they’ve backed off, thankfully), food safety standards should develop through market preferences and court cases. Giving all food authority to an omnipotent bureaucracy can’t end well.
POM Wonderful sought redress in the courts. But Coca-Cola claimed that, because they were within FDA regulations, they could not be sued for anything they were doing. According to CBS News:
At the heart of the legal battle is a drink from Coke’s Minute Maid unit described as a “Pomegranate-Blueberry” juice, although it only included 0.3 percent of pomegranate juice. POM argued that it violated the Lanham Act, which prohibits false and misleading statements about a product, while Coca-Cola argued that it was allowed by the Food and Drug Administration.
In the ruling, Supreme Court justice Anthony Kennedy wrote that the two regulations “complement each other” and that FDA regulations don’t preclude Lanham Act claims.
“It was really was a complete victory for POM,” David Ter Molen, a partner at law firm Freeborn & Peters, told CBS MoneyWatch. “The key ruling is that if you have a Lanham Act claim, it can proceed against another company with respect to food labeling” even if the labeling is allowed by the FDA.
The Supreme Court’s decision means POM may proceed with claims that Coca-Cola’s labeling misleads consumers. Coca-Cola, in a statement emailed to CBS MoneyWatch, said it intends to fight POM’s claims.
While the Supreme Court was right to rule that POM could take Coca-Cola to court, I wish they had not put such weight on the Lanham Act. Fraud should be a matter for the courts to address as part of the Biblical and common law. It doesn’t require an act of Congress to say that fraud is wrong.
Still it was a good ruling that limited the power of bureaucrats to make all our decisions for us.