RALEIGH, N.C. (Legal Newsline) - North Carolina's General Assembly passed its farm bill last week, but a late amendment means there will no enforcement of a ban on labeling plant-based products as "milk" until more than 10 other states pass similar legislation.
The amendment was inserted into the Senate version of the North Carolina Farm Bill on June 14 following pressure from retailers and others that argued the state cannot go it alone on labeling.
Eleven other states from the Southern Dairy Compact must "adopt similar policies to address mislabeling of plant-based products as 'milk' before the Department is directed to implement its enforcement plan," the amendment states.
This provision on labeling was one of two hotly debated measures within the farm bill ahead of its passage. The other related to severely limiting future nuisance lawsuits against the hog-producing industry, which provoked sometimes stormy debate before it passed with the bill.
Andy Ellen, president of the North Carolina Retail Merchants Association, welcomed the amendment on milk-labeling, arguing that introducing it now in the state without any others on board would have been a "headache" for store owners.
"I think that this was a compromise to try and balance, (to) support dairy farmers... but did not put retailers out on an island by themselves," Ellen told Legal Newsline.
Ellen cited two federal cases, both in California, in which plaintiffs failed in their actions against plant-based milk makers.
Judge Stephen V. Wilson, writing the opinion in a case in the Central District of California against the makers of Almond Breeze, said "no reasonable consumer could be misled" by "almond milk" labels. He described the allegation of consumer confusion as "patently implausible."
He added: "By using the term almond milk, even the least sophisticated consumer would know instantly the type of product they are purchasing."
In a second case, against the makers of Silk almond milk, the judge stayed the action on jurisdictional grounds and suggested it was up to the Food and Drug Administration (FDA) to come up with rules.
Ellen, of the retail association, believes it will be up to the FDA to take the lead and believes the provisions passed in North Carolina will send a signal to the agency.
"I think it also sends a signal to the FDA nationwide that guidance is needed and cannot be done piecemeal," Ellen said. "The bill can start a conversation, but (legislators) did not want North Carolina to be an outlier beside Virginia, South Carolina and Tennessee..."
Ellen said he understands the dairy farming community and recalled a meeting attended by hundreds, with many speaking in favor of the bill's provisions on milk-labeling.
Indeed, the FDA may be forced to take a close look at labeling as the Good Food Institute has filed a petition asking for approval to allow manufacturers to use the words milk, yogurt and cheese on a range of plant-based products.
The National Milk Producers Federation [NMPF] weighed in with a response, pointing out that FDA regulations already state that milk must come from an animal with hooves.
North Carolina Agriculture Commissioner Steve Troxler supports this position, and also believes the amendment on labeling - that many other states must pass legislation - does not necessarily it won't be enforced for some time, if ever.
"It is important to note that milk has been defined as 'from a hooved mammal' for more than 30 years," Troxler told Legal Newsline. "The FDA has not taken aggressive action in ensuring the term 'milk', as a standardized food, has been properly used on food labels. "
It remains to be seen whether his office will be in a position to enforce the labeling provision, Troxler said.
"Fifteen State Departments of Agriculture, including NC, currently support truth in labeling for the use of the term 'milk,'" Troxler noted. These include Tennessee, West Virginia, and South Carolina.
It has been argued the debate over labeling sucked much oxygen out of the argument over whether to severely limit suits against hog producers and processors.
"These were two separate issues, both were heard by members of the legislature and both were vigorously debated," said Troxler, who is supportive of the hog-farming measure.
"I am pleased this measure passed because I believe it will give farmers some protections for their farming operations."
It was passed after food processing giant, Smithfield Foods, was successfully sued for nuisance and ordered to pay $51 million in damages, later reduced to $3 million under a cap introduced just last year.
Some 26 other lawsuits are pending, each alleging the company has failed to invest in upgrades that would better manage waste and smell on more than 1,000 farms in the eastern part of the state. Smithfield Foods is owned by Hong Kong-headquartered WH Group, which generated $22 billion in revenues last year.
If signed by Gov. Roy Cooper, only those living within a half-mile of a hog farm will be able to file suit. Further, they must file within a year of an operation going live or when it is fundamentally changed.
No one will be able to pursue punitive damages unless a farm is found guilty of criminal offenses or found to have broken government guidelines.
Opponents of the bill claim it essentially bars all future legal actions against hog farmers, or other processors, because the last hog farm to open in North Carolina was in 1997.
There is potential for a lawsuit - one of the points raised during the debates in the legislature - on constitutional grounds, either over violation of personal property rights or that one industry was singled out for protection.
"This bill is about all of agriculture, and not just the hog industry," Commissioner Troxler said. "As to the issue of constitutionality, I cannot comment on that because I do not have a law degree, but I would note that attorneys drew up the law."
One opponent of the bill, Rep. John Blust (R-Greensboro), speaking during the floor debate, said the legislature was taking a side in a dispute.
“We’re going to protect one litigant, and we’re going to say to the other: ‘You don’t matter. You don’t count," he said, according to a report in North Carolina Health News.