Industry Settles NYC Menu-Labeling Lawsuit

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Industry Settles NYC Menu-Labeling Lawsuit

By Jim Dudlicek - 08/25/2017
The Food Marketing Institute (FMI), National Association of Convenience Stores (NACS) and their business partners across grocery, convenience and restaurant operators have settled their lawsuit against New York City, which the groups sued after the city sought to enforce federal menu-labeling guidelines despite the FDA’s delay in enforcing the rules nationwide.
 
In Friday’s settlement in the U.S. District Court for the Southern District of New York, New York City agreed not to fine or sanction businesses for alleged non-compliance with calorie and nutrient information menu-labeling requirements prior to a May 2018 compliance date established by the FDA.
 
“The Food Marketing Institute is pleased we were able to reach a settlement with the city, which both protects our members from fines prior to the federal compliance date and also serves as a strong deterrent for other states and localities from prematurely enforcing the federal menu-labeling rule prior to the federal compliance date,” said FMI Chief Public Policy Officer Jennifer Hatcher.
 

Federal Compliance Encouraged

The agreement, along with the United States’ statement of interest filed in the case, are “further testament to our position that a municipality’s premature enforcement is preempted by federal law,” Hatcher said. “We encourage our members that are currently attempting to comply with the menu-labeling rule to continue to comply with the rule, subject to any future modifications or clarifications of the federal regulation. At the same time, we will continue our work with FDA and Congress to address the substantive implementation problems with the final rule.”
 
Lyle Beckwith, SVP of government affairs for NACS, said, “This settlement with New York City is a clear victory for common sense. States and cities cannot enforce menu-labeling rules until Food and Drug Administration (FDA) rules are enforced. We’re pleased that New York City has agreed not to jump the gun.”
 
Just a day before the settlement was announced, FDA Commissioner Scott Gottlieb said that “additional, practical guidance on the menu-labeling requirements” would be available by the end of the year.
 
“There are good reasons for everyone to wait,” Beckwith said. “It is increasingly clear that the federal regulations have real problems that must be fixed before they go into effect. A recent economic study confirmed that total costs for the industry under the rule will be more than triple the FDA estimate, reaching more than $300 million per year—and seven times the estimate for convenience stores.”
 
And, according to Beckwith, routine calorie count variations would result in 93 percent of prepared foods being in violation of the rules, regardless of how much business spent to achieve compliance.