The Americans with Disabilities Act (ADA) was enacted in 1990 to prevent discrimination against individuals with disabilities in all aspects of life. The Act has been applied to a variety of segments of our society, including building entrance designs, website displays, and workplace accommodations. Recently, a new twist to the Act arose when a 12-year-old boy visited a Colonial Williamsburg restaurant with his classmates on a school field trip.

The case, J.D. v. Colonial Williamsburg Foundation, was originally filed in the U.S. District Court for the Eastern District of Virginia and later appealed to the 4th Cir Ct. App. No 18-1725. In J.D., a 12-year-old boy with severe Celiac disease visited a restaurant with his classmates on a school field trip to Colonial Williamsburg. J.D.’s condition was so severe that even the slightest ingestion of gluten-based foods caused severe illness. On prior occasions, other restaurants had offered J.D. gluten-free meals that accidentally or unknowingly contained trace amounts of gluten, which caused J.D.’s symptoms to flare up. Because of this, J.D.’s parents decided that when J.D. had to eat out, they would prepare J.D.’s food for him, so that he could safely and comfortably eat without incident or fear of incident. Knowing that the field trip would require J.D. to eat at a restaurant, J.D.’s father (who also attended the field trip) brought a home-prepared meal for J.D. to eat while the rest of the class ordered its meals from the restaurant menu.

When the time came for lunch, the restaurant staff notified J.D. and his father that he was not allowed to consume outside prepared foods in the restaurant due to Virginia’s Health Code. In fact, Virginia’s Health Code prohibits food prepared in a private home from being used or offered for human consumption in a food establishment unless the home kitchen is inspected and regulated by the Virginia Department of Agriculture and Consumer Services. 12 Va. Admin Code § 5-421-270(B). However, as an accommodation, the restaurant advised J.D. that its chef would prepare J.D. a gluten-free meal of baked chicken and potatoes to meet his specific needs. The father declined the offer, stating that they did not want to risk kitchen mistakes, and he preferred J.D. eat his home-prepared meal. Left with the options of eating the chef-prepared meal, not eating, or eating outside the restaurant, J.D. and his father left the restaurant and ate the home-prepared meal separate from his classmates.

J.D. filed suit under §504 of Title III of the ADA, claiming that Colonial Williamsburg discriminated against him by excluding him from the restaurant and failing to modify its policy against the consumption of outside food. Defendants moved for summary judgment, and while the magistrate found a genuine dispute of material fact as to whether J.D. was disabled under the ADA, he recommended dismissal because J.D. failed to establish that he was discriminated against because of his disability. The District Court Judge adopted the magistrate’s recommendations and dismissed the case. Plaintiff appealed to dismissal to the 4th Cir.

An ADA claim requires a plaintiff to prove three elements: 1) that plaintiff is disabled under the meaning of the Act; 2) that the defendant operates a place of public accommodation; and 3) the defendant discriminated against him because of that disability. See Ariz. ex rel. Goddard v. Harkins Amusement Enters., Inc., 603 F.3d 666, 670 (9th Cir. 2010); Camarillo v. Carrols Corp., 518 F.3d 153, 156 (2d Cir. 2008). In this case, there was no dispute on the second element, so the Court looked only at elements 1 and 3.

Under §12102(1)(A) of the ADA, a disability is defined as any “physical or mental impairment that substantially limits one or more major life activities.” This is different from an impairment, which the Act defines as any physiological disorder or condition that affects one or more body systems, including digestive. 28 CFR §36.105(b)(1). The 4th Cir. noted that “‘[N]ot every impairment will constitute a disability within the meaning of this section,’ but it will meet the definition if ‘it substantially limits the ability of an individual to perform a major life activity as compared to most people in the general population.” Id. § 36.105(d)(1)(v). Eating is a major life activity. Id. § 36.105(c)(1)(i).” J.D. at 10. The court then explained that when deciding if the Celiac disease created a disability, it had to interpret the ADA language “broadly in favor of expansive coverage.” Id. Even though J.D. had no symptoms when he avoided gluten, this was immaterial in determining if a disability existed, because the Court was required to look at his condition when he consumed gluten. Id. With the evidence showing that J.D. had serious consequences to his health when he ingested gluten and that he had an unusually small margin for error in his diet, the Court felt that there was a material question of fact as to whether J.D. had a disability within the meaning of the ADA. Thus, consistent with the District Court ruling, the court did not decide that J.D. had proven a disability, but rather, felt it was up to the jury to decide.

The Court then looked at the third element; i.e., whether or not Colonial Williamsburg discriminated against J.D. According to 42 U.S.C. § 12182(b)(2)(A)(ii), discrimination is defined, “in part, as: a failure to make reasonable modifications in policies, practices, or procedures, when such modifications are necessary to afford such goods, services, facilities, privileges, advantages, or accommodations to individuals with disabilities, unless the entity can demonstrate that making such modifications would fundamentally alter the nature of such goods, services, [etc.].” Id. (emphasis in original)

The courts use a three-part test to determine if discrimination occurs. The three parts are: “(1) whether the requested modification is “necessary” for the disabled individual; (2) whether it is “reasonable”; and (3) whether it would “fundamentally alter the nature” of the public accommodation. Id., citing PGA Tour, Inc. v. Martin, 532 U.S. 661, 674 (2001), at 683 n.38.

The Court first looked at whether the modification [allowing him to eat his home-prepared meal] was necessary to provide J.D. with a “like experience” to non-disabled guests. This necessarily requires the court to make an individualized inquiry into the plaintiff’s specific circumstances and determine if the proposed accommodation addresses the disability, or if the accommodation creates a condition that extends beyond the person’s capacity. In this case, J.D.’s evidence showed that he repeatedly became ill when exposed to gluten from meals prepared at restaurants, even when they were purported to be gluten-fee. While the court did not make an ultimate decision on whether the modification of its rules was necessary, it did find that there was sufficient evidence presented to create a genuine dispute of fact on whether eating out is beyond J.D.’s capacity.

Second, where an accommodation is already in place, a plaintiff may still be entitled to something more if he can show that the accommodation does not account sufficiently for his disability.” J.D. at 16. In this case, the restaurant’s proposed accommodation was to prepare a gluten-free meal. Given J.D.’s history of illness from prior attempts at gluten-free restaurant meals, it became a question of fact as to whether or not the restaurant’s proposed accommodation was sufficient. “Indeed, a jury might well reject J.D.’s evidence about the severity of his gluten intolerance, and thus find that the protocols at [the restaurant] were sufficient to account for his disability. But in our view, J.D. has put forth enough evidence at this stage to raise a genuine dispute of material fact as to whether the proposed accommodation sufficiently accounts for his disability.” Id. at 17.

For the next step of its analysis, the 4th Cir. considered whether or not the restaurant’s proposed accommodation was reasonable or not. Indeed, “[f]acilities are not required to make any and all possible accommodations that would provide full and equal access to disabled patrons,” but “need only make accommodations that are reasonable.” Id. at 18. Citations omitted. Here, the court pointed out that the restaurant allowed guests to serve their own food if it is for babies or if they wanted to bring a cake in for large celebrations, provided the restaurant was given advance notice. The fact that J.D. may not have provided advance notice to the restaurant was dismissed as irrelevant to the court, because the lack of notice did not require additional staffing or create an unreasonable hardship in the restaurant’s operations. And when looking at the Health Code regulations the restaurant cited for its policy, the 4th Cir. noted that the prohibition on home-prepared foods was designed to prevent restaurants from serving food prepared in private homes. It did not prohibit customers from bringing in outside food. There was no evidence introduced that J.D.’s request would truly impose a safety concern or risk contamination of other foods. The court reasoned that if that were the case, the restaurant would not allow outside foods in other circumstances.

The Court ultimately ruled that decisions of reasonableness of accommodations are highly individualized, fact-specific for each case. As a result, they are decisions best left to a jury, who can judge the credibility of witnesses and weigh the importance of evidence.

Finally, the Court looked to the restaurant’s affirmative defense that allowing homemade meals fundamentally changes the restaurant experience. Under this defense, the defendant must prove that the Plaintiff’s request would fundamentally alter the nature of the program or services provided by the restaurant. Like the other issues, the court considered, this too was found to be a jury question. A jury “could reasonably find that accommodating the occasional request of someone with severe food sensitivities would not fundamentally alter the Tavern’s business model, especially if other family members purchase food or (as happened here) if the meals are already paid for as part of a group rate.” Id. at 23.

Impact of Ruling

Given the above, the 4th Cir. reversed the trial court’s dismissal and remanded it back to the District Court. The takeaways from the decision are striking.

First, it seems clear that the court is framing ADA cases such as this to be treated similarly to ordinary negligence cases. Those cases are almost always fact-specific and to be determined by a jury. If there is any credible evidence to support a claimant’s case, the court is likely to defer ruling to the jury.

Second, it is important to note that the Health Code Regulation relied upon by the restaurant does not expressly state that it is designed to prohibit the serving of food, rather than customers bringing in food. This ruling places restaurants in a difficult position of having to choose between enforcing written regulations and agreeing to proposed individual modifications as necessitated by the ADA. Restaurant staffers are not trained in legal analysis, and it seems untenable that a waiter or manager would have to interpret the intent of a health regulation. Forcing a restaurant to make such interpretation exposes a restaurant to more litigation because the parties cannot know if it is proper to violate the regulations based on its language. Indeed, the Dissent correctly notes that the de facto result of this ruling is that “Restaurants must either allow patrons to consume food prepared outside their premises or must justify their refusal at a costly trial.” J.D. at 32. Both the disabled parties and the restaurant industry would be better served if the Health Regulation was written clearly to prohibit serving versus bringing in outside foods, and the restaurant could rely upon the code as written.

Finally, it seems clear that the Courts are taking an expansive view of the ADA’s coverage. Rather than draw bright line tests that disabled persons and businesses can plan for, individualized assessments on a case-by-case basis must be made. This is likely to result in inconsistent applications where some modifications are allowed but possibly similar modifications are not allowed. As the dissent in J.D. notes, “[t]he majority’s rule means that a patron’s demand that he be allowed to eat outside food will sometimes be reasonable and other times not. This puts managers in the middle of a difficult line-drawing exercise: What criteria are they supposed to use in navigating the tension between the ADA’s requirements and public health law? Which privately prepared meals must they allow and which may they refuse? The majority wouldn’t even require advance notice from customers in J.D.’s position, meaning that managers will have to evaluate the disruption and the safety hazard of a customer’s outside meal on the fly, with the specter of litigation hanging overhead.” J.D. at 31.

If you have any questions about this ruling, its impact on restaurant operations, or how it may impact your business, the attorneys at KPM LAW are ready for your call.

The Centers for Disease Control and Prevention estimates that 48 million people or 1 in 6 Americans experience a foodborne illness every year as a result of consuming contaminated food or drink and roughly 128,000 people in the US are hospitalized due to foodborne illness. There are many different pathogens or disease causing microbes that can cause illness. Currently, there are 250 known pathogens that are responsible for 20% of the reported foodborne cases and the root cause of the remaining 80% of all cases are many unknown pathogens. Additionally, chemical contaminates such as pesticides can cause foodborne illness. In the US, the top five pathogens that cause foodborne illnesses are norovirus (58%), salmonella (10%), Clostridium perfringes (10%), and campylobacter (9%). However, salmonella infections are responsible for the most hospitalizations and for the most deaths out of any of the foodborne pathogens.

What is a Pathogen?

Foodborne pathogens can cause several different types of illness. Salmonella and noroviruses can cause illness by consumption of live pathogens that replicate and grow in the intestinal tracks which is called a foodborne infection. An organism like Bacillus cereus (a pathogen found in rice and grains) can cause illness through foodborne intoxication through the production of toxins and the live bacteria does not need to be consumed. These microorganisms typically do not make the food look, taste or smell bad so it impossible to determine if the food is contaminated.

For a pathogen to grow and proliferate, certain conditions must be met. The first one condition is that the pathogen or its toxin must be in the food. Many raw foods have naturally occurring background levels of pathogen contamination. These pathogens can thrive when the temperature and the nutrients are suitable for the pathogenic growth. Foods that are high in protein such as eggs, meat, fish, and milk can provide appropriate nutrient levels for pathogens. Additionally, foods that are slightly acidic (pH levels 4.6-7.6) also support microbiological growth. Additionally, foodborne pathogens grow best in foods that have a temperature of 70-104° F. It is essential that hot foods must be kept hot and cold foods must be kept cold to prevent growth. Common food service foods that have a higher risk of foodborne illness are rice, cooked or raw animal products, cooked or raw vegetables, raw seed sprouts, raw shell eggs or water cooled hard boiled eggs, cut melons, and garlic and oil mixtures.

Once a pathogen has been allowed to proliferate in a food, foodborne illness can set in following consumption of the contaminated food. Most foodborne illnesses can occur with 2-24 hours following consumption of the contaminated food but symptoms have been reported as far out as 30 days post-contaminated food consumption. The time of onset of foodborne illness symptoms can be pathogen dependent. The most common symptom is diarrhea but symptoms can include vomiting, cramping, fever, and flu like symptoms.

Prevent the problem before it happens

To avoid potential problems in foods, it is very important to control or eliminate pathogens in food products. HACCPS or hazard analysis and critical control points are your quality assurance and risk assessment steps. They include coming up with preventative measures; evaluating critical control points and preventing, eliminating or reducing risk; evaluating and establishing critical limits such as cooking temperatures; monitoring CCP’s with temperature measurements; corrective action; record keeping systems; and verification.

SOPs and employee education are essential in preventing foodborne illnesses. The SOPs should address everything from where the product can be ordered from to how it is received, how it is stored, how long it is stored, how it is prepared, where it is prepared, by whom it is prepared, how it is transported and how it is served. Comprehensive SOPs go a long way to not only preventing foodborne illness, but also defending claims. However, that is only if they are adhered to. Employee training should be conducted on a continuous basis and management should continually verify SOPs are being followed. There are also several training certifications in food handling such as those offered through ServSafe and Learn2Serve. These can be done online and provide management with valuable education in developing safe food handling protocols.

Summary

While a foodborne illness outbreak can be devastating to a restaurant there is no restaurant that in a single night can serve as many individuals as a hotel during a large conference banquet or buffet. Many foodborne illness claims originate from that exact setting. Often times there are numerous individuals who become ill. The assumption is that there must have been some adulterated food item they all consumed that made them sick. It could not possibly be a coincidence… but it could be something other than a foodborne illness! Reaction time and record keeping is crucial in defending these claims.

This article is part of our Conference Materials Library and has a PowerPoint counterpart that can be accessed in the Resource Libary.

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Authors

Allison Stock – Principal Consultant/Toxicologist & Epidemiologist, Rimkus Consulting Group
astock@rimkus.com
504-832-8999

Dr. Allison Stock is an internationally known toxicologist and epidemiologist with 25 years of toxicological, epidemiological, regulatory, and environmental experience. Her background is supported by experience in the federal and state government and industry (small and Fortune 500 companies).

Dr. Stock specializes in human health risk assessments combing both toxicological and epidemiological data. She has expertise in petrochemicals, oil and gas, environmental permitting, property transfer, environmental, social, and health impact assessments, inhalation toxicology, renal toxicology, toxicological and epidemiological risk assessment, communicable and foodborne illnesses such as Legionellosis, E. coli infections, and Salmonellosis, rapid needs assessments, emergency response, ambient and indoor air exposure assessments including mold, particulate matter, and asbestos, occupational health and safety plans, drug and alcohol intoxications, and stakeholder communications.

Kari Jacobson – Shareholder, La Cava & Jacobson
kjacobson@lacavajacobson.com
(813) 209-9611

Kari Katzman Jacobson is a shareholder of La Cava & Jacobson, P.A. Born in Miami, Florida in 1967 she graduated from the University of Florida with a B.A. in 1989 and from the University of Miami School of Law with a J.D. in 1992. Ms. Jacobson began her career as a prosecutor, and then went on to defend self-insured companies, insurance companies and those whom they insure.

Ms. Jacobson was admitted to The Florida Bar in 1992 and has been admitted to the U.S. District Court, Middle District of Florida since 1994. She is a member of The Florida Bar Association; American Bar Association, Hillsborough County Bar Association, Collier County Bar Association and the Claims and Litigation Management Alliance. She is also a member of The Federation of Defense & Corporate Counsel. She is A.V. Peer Review Rated by Martindale-Hubbell.

Ms. Jacobson is certified by the Florida Supreme Court as a Circuit Civil Mediator. Her practice is primarily concentrated in the areas of general liability, premises liability, negligent security, construction litigation, professional liability, trucking and commercial freight defense litigation claims.

The FDA has issued draft guidance regarding previously announced menu-labeling rules set to take effect on December 1, 2015. The scope of those rules, which require certain businesses to post nutrition information about food offered for sale, has raised questions for the hospitality industry.

The FDA’s draft guidance, issued on September 11, 2015, relates to last year’s nutrition labeling rules promulgated under the Patient Protection and Affordable Care Act, which requires certain “restaurants and similar retail food establishments” to disclose calorie information and provide a “succinct statement concerning suggested daily caloric intake” on or near menus and near self-service food and food on display. The rules, which apply only to restaurant-type establishments that are part of a chain with 20 or more locations doing business under the same name and which offer for sale “substantially the same menu items,” raised questions regarding their applicability to chain hotels that offer food in various capacities.

Four Key Takeaways

• First, the draft guidance clarifies that chain or franchise hotels offering complimentary breakfast would not, by virtue of that fact alone, be considered the sort of “covered establishments” that are subject to the rule: they are not “restaurant[s] or similar retail food establishment[s] that offer[ ] for sale standard menu items.”
• Second – in an important caveat– certain hotel restaurants that “offer for sale” restaurant-type food are covered by the new rules if they meet the criteria qualifying them as a chain. Those criteria include being part of a group of hotel restaurants with 20 or more fixed locations doing business under the same name, and offering for sale substantially the same menu items.  (It should be noted, however, that the nutrition labeling requirements apply only to food offered for sale, so even if a given hotel restaurant is a “covered establishment,” that hotel’s complimentary breakfast likely will not be subject to the new rules.)
• Third, the criteria qualifying the establishment as a chain apply regardless of the type of ownership of the locations – so individual franchises are covered to the same extent as multiple locations under common ownership – and the FDA warns that “persons exercising authority and supervisory responsibility over a restaurant or similar retail food establishment can be held responsible for violations,” suggesting that under some circumstances the FDA could, if it chose, impose vicarious liability on the franchisor or licensor of a restaurant for misbranded food at a franchise location.
• Fourth, the guidance makes clear that covered entities can comply with the labeling requirements by providing the required information via an app or internet link, but that the establishment must provide access to the information (e.g., at a kiosk or other electronic device available at the establishment), without the need for customers to supply their own electronic devices.

Conclusion

The FDA’s food labeling rules are complex and could impact the hospitality industry in a variety of ways. Licensors and franchisors that retain power over hotel restaurants’ menus and menu boards are not insulated from liability for missteps, and all hospitality chain executives, general counsel and franchisees should prioritize getting into compliance with the rules prior to the go live date of December 1, 2015.

Disclaimer: this E-Flash does not offer specific legal advice, nor does it create an attorney-client relationship. You should not reach any legal conclusions based on the information contained in this E-Flash without first seeking the advice of counsel.

View the original article here.

PREVALENCE 

Approximately 1,600 illnesses and 260 deaths are attributed to listeriosis, from Listeria Monocytogenes (LM), in the United States each year. A large outbreak linked to cantaloupes occurred in the United States in 2011, causing 147 illnesses, 33 deaths, and 1 miscarriage (CDC, 2015).

RELEVANT FOODS 

Food products commonly associated with Listeria bacteria include:

• Hot dogs
• Luncheon meats
• Smoked seafood
• Soft cheeses
• Meats & poultry
• Vegetables & fruits

SYMPTOMS

Symptoms of Listeriosis include:

• Fever
• Stiff neck
• Weakness
• Vomiting
• Confusion

Source: Listeria, 2015

In invasive listeriosis, the elderly, persons with weakened immune systems and unborn children (exposed after the mother is infected with LM) have a higher risk of death.

FOOD SERVICE

Food service establishments must have effective sanitation and personal hygiene programs. Drains should be an area of focus, particularly floor and condensate drains. Cleaning with the proper chemicals is important as LM can form biofilms that act as protective barriers (PSU, 2006). Spray sanitizer alone is not effective on biofilms.

Listeria Monocytogenes (LM) is ubiquitous, it can be found in the air, soil, water, and fecal material. LM is robust, it can grow in refrigerated temperatures (Psychrophilic) and survive freezing temperatures (PSU, 2006).

Retailers and processors should emphasize personal hygiene and eliminate pests to control cross-contamination. They should also clean air vents and follow validated Standard Sanitation Operating Procedures for refrigeration cases, slicers, meat saws, cutting boards and any other equipment that comes into contact with food

Investigatory Questions:

1. Have food safety plans been validated: Why are identified hazards significant? Are control measures effective? What is the basis for critical limits?
2. Have food safety plans been verified: Are control measures, testing, and monitoring working as intended? Are plans being carried out properly?

The Safe and Accurate Food Labeling Act (“SAFLA”) serves largely to prohibit state and local governments from enacting laws requiring food products containing GMOs to be labeled as such.  It also addresses “natural” labeling claims, which have been a hotly litigated issue in recent years.

SAFLA is premised on the notion that the presence of GMOs in a food product is not information that is material for distinguishing between such a food and a comparable food product not produced from or containing GMOs. Therefore, labeling is not necessary.

SAFLA does provide consumers, the food industry, trading partners, and other interested parties with a clear affirmation of safety for foods produced from, containing, or consisting of genetically engineered plants.

The bill now moves along to the Senate.  If the Senate passes the legislation in identical form, it will be final once signed into law by the President.

There are two notable subjects addressed under SAFLA.  First, no state or political subdivision of any state may directly or indirectly establish under any authority or continue in effect as to any food in interstate commerce any requirement regarding use of genetically engineered plants for use in a food product that is not identical to the notification program established under SAFLA.  Second, SAFLA directs FDA to formally address “natural” claims on food product labels.

SAFLA Provides Guidelines for Voluntary GMO-Labeling

Title II of the Act addresses Genetic Engineering Certification.  SAFLA establishes a voluntary genetically engineered food certification program under USDA.  This certification program governs label claims regarding use or non-use of genetic engineering in food products.

The Secretary of Agriculture is responsible for establishing the voluntary genetically engineered food certification program which will govern labeling with respect to use of genetic engineering in food production.  The program will establish standards for selling or labeling a covered product as being GMO-free, or produced without use of genetic engineering.  This will ensure a nationally-uniform manner of labeling.

SAFLA Directs FDA to Define and Regulate “Natural” Claims

Title III addresses “Natural” food labels.  Under SAFLA, a food is deemed misbranded if its labeling contains an express or implied claim that the food is “natural” unless the claim uses the terms that have been defined by, and the food meets the requirements established in, FDA promulgated regulations.  Natural claims include the following: “natural,” “100% natural,” “naturally grown,” “all natural,” “made with natural ingredients” and any other terms specified by Secretary.

What can we expect if SAFLA is enacted?

If the legislation passes the Senate and is signed into law by the President, states will be prohibited from issuing mandatory laws for foods containing certain GMO and states will be prohibited from requiring foods containing GMOs to be labeled as such.  Further, the legislation will prohibit state and local governments from regulating GMO plants.

States will also be prohibited from making it unlawful for companies to label products containing GMOs as “natural.”  In place of state by state laws regarding “natural” labeling, FDA would be required to set formal requirements for “natural” labeling, something it has steadfastly avoided doing for years.  Specifically, the legislation directs FDA to establish rules formally defining how “natural” labeling can and should be used on food products. FDA currently has only an informal policy stating that foods labeled as “natural” cannot contain any added colors, artificial colors, artificial flavors, or synthetic ingredients.

Companies would be permitted to voluntarily label foods that do or do not contain GMO ingredients, but they would not be required to do so. The legislation directs the Department of Agriculture to establish a voluntary nongenetically engineered food certification program that would govern labeling of non-GMO food products in a uniform manner across the country. This is modeled after the largely successful USDA Organics program. A program like this would relieve companies in the food industry from any obligation to disclose use of GMOs in their product.

Companies voluntarily labeling products as GMO-free would need to follow a standard established under the legislation.  The legislation directs creation and implementation of a process to certify GMO-free food; therefore, a company labeling product as GMO-free may do so through the USDA-accredited certification process.

FDA would also be responsible for publishing and maintaining an online registry listing all genetically engineered plants intended to be used in food products.  If a producer intends to use a non-regulated genetically-engineered plant in its food products, it would first have to receive FDA approval that the food is as safe as comparable foods.

What are SAFLA’s proponents saying?

Proponents of the bipartisan legislation argue that GMOs have been deemed safe by FDA and science has repeatedly found that they are not harmful or unsafe.  Advocates stand behind findings of numerous renowned, well-respected groups that have all found GMOs to be safe.  Such groups include FDA, World Health Organization, American Medical Association, National Academy of Sciences, and American Association for the Advancement of Science.  Because GMOs have been found not to be harmful or unsafe, proponents argue that requiring products to be labeled as containing GMOs would cause undue alarm to consumers.

Without national legislation, a “patchwork” of state laws would increase prices, drive up food costs, and continue the rash of class action lawsuits currently bombarding food manufacturers.  Variations in state laws also disrupts the free flow of goods across our nation and threatens interstate commerce.  Consumers’ interests are also negatively affected by varying laws because the inevitable result is that product labels are inconsistent and present confusing information for consumers.  The absence of a national standard risks spreading misinformation.

But, for now…

While it is unknown how long it will be before SAFLA is voted on in the Senate, members of the food industry should not be sitting back waiting and watching.  Companies facing litigation involving “natural” or GMO-related labeling claims should certainly attempt to use this legislative action in defending (or at least staying) litigation against them.  Stay tuned. Time will tell how both the judicial branch and legislative branch will react to last week’s passage in the House.

Click here to view original posting.

California Supreme Court’s Decision

On May 20, 2015, the California Supreme Court denied Windsor Food Quality Company Ltd.’s petition for review of the decision of the Court of Appeal for the Fourth Appellate District of California that denied coverage under a PCI policy related to a ground beef recall. See Windsor Food Quality Co. Ltd. v. The Underwriters of Lloyds of London et al., No. S225719, California Supreme Court. California’s highest court denied Windsor’s petition for review without explanation. In February 2015, in a 2–1 decision, California’s Fourth Appellate District affirmed a trial court’s decision in favor of QBE Insurance(Europe) Limited and the Underwriters of Lloyd’s of London. The intermediate appellate decision addressed Windsor’s claim for insurance coverage under a PCI policy, which included coverage for “accidental product contamination” and “malicious product tampering.”

Trial Court Decision

Windsor’s claim for insurance coverage arose out of a ground beef recall by Westland/Hallmark Meat Company. Windsor used Westland’s ground beef as an ingredient in its Jose Ole frozen food products. The ground beef was recalled based on potential risks related to the company’s use of disabled cattle that may have been infected with mad cow disease or other maladies. As a result of the issues with Westland’s product, Windsor recalled its own products that incorporated Westland beef, incurring approximately $3 million in costs.

Underwriters denied Windsor’s claim for coverage because they determined the recall did not constitute an “accidental product contamination insured event” as such term was defined in the policy. Windsor subsequently filed a declaratory judgment action against the insurers in California Superior Court of San Bernardino County, entitled Windsor Food Quality Company Ltd. v. The Underwriters of Lloyds London, CA Super. Ct. No. CIVRS905013 (Feb. 6, 2015).

On summary judgment, the trial court found no disputed issues of fact and no evidence of a public health risk or of product tampering. The trial court also found that the recalled products were not an “insured product” under the PCI policy.

Fourth Appellate District of California Decision

On appeal, the Court of Appeal for the Fourth Appellate District of California found the term “insured product” unambiguous, which resulted in favorable rulings for the insurers. See Windsor Food Quality Co. Ltd. v. Underwriters of Lloyds of London, 234 Cal. App. 4th 1178 (Feb. 6, 2015). The court ruled that any contamination or tampering must take place during or after manufacture but not before Windsor’s production processes. In support of this ruling, the court cited to the decision rendered in Caudill Seed & Warehouse Co. Inc. v. Houston Cas. Co., 835 F.Supp.2d 329 (W.D. Ky. 2011).

The court found that the U.S. Department of Agriculture’s recall was based on Westland’s failure to notify the USDA about its use of disabled cows, not because there had been contamination or tampering. Therefore, the court ruled that there was no contamination or tampering of Westland’s or Windsor’s products and, consequently, no malicious product contamination.

In addition, the court held that there had not been an “accidental product contamination insured event.” As the court found no coverage under the PCI policy, it also dismissed the bad faith causes of action.

The court found the PCI policy’s wording unambiguous and held that the PCI policy is not a recall insurance policy, citing a number of decisions in support of this holding.

The dissent asserted the language in the policy was ambiguous and therefore should be construed against the insurer.

Far-Reaching Implications

The California Supreme Court’s refusal to review the appellate court’s decision merely adds the Windsor Food decision to an increasing line of decisions finding no coverage under PCI policies for incidents involving only potential and not actual contamination. However, at this critical time, the decision has far-reaching implications for food companies, experienced PCI brokers and PCI insurers.

The U.S. Food and Drug Administration Food Safety Modernization Act critically impacts the supply chains that provide 80 percent of the food consumed in the United States. The first and most significant regulations addressing Preventive Controls for Human Food and Animal Food will be issued on Aug. 30, 2015. Additional regulations addressing all aspects of the food industry under the U.S. Food and Drug Administration’s jurisdiction will be issued over the course of the following months. The companies that provide the vast majority of food to U.S. consumers will have one year to implement and complete overhauls to their operations so they are in line with the new regulations. The issuance and enforcement of these regulations will be a watershed event not only for the food industry but also for PCI brokers and insurers.

PCI was initially developed to fill the gaps in the standard insurance portfolio with respect to product contamination and recall crisis events. General liability and property policies, the policies usually found in a company’s standard portfolio, either do not provide coverage or provide minimal coverage for costs involved with a product recall crisis event and the economic costs and loss of profit involved can be catastrophic.

Many companies are unprepared and unable to survive product contamination crisis events and the number of companies involved in these events will increase significantly once the new regulations come online.

More importantly and critical to the majority of food companies, PCI policies offer a panel of experts to midand small-cap companies, which could not otherwise afford the expertise necessary to survive a recall crisis event. PCI policies provide an insured with a hotline number to a panel of experts, including public relations, government agency relations, marketing specialists, scientists, supply chain specialists and lawyers, who can parachute in and provide critical assistance during a crisis event. Additionally and significantly in regard to the issuance of the new regulations, the panel of experts can be used before a crisis occurs to assist companies with the overhaul of their operations. Under most PCI policies, these expert or crisis consultant costs are offered outside of the policy’s limits.

Conclusion

The Windsor Food decisions come as food companies and PCI brokers and insurers prepare for the regulatory watershed event and PCI wordings are being reviewed in the context of potential contamination claims. While government recall and adverse publicity coverages are listed among the coverages that have expanded standard PCI offerings, wordings are also being examined to clarify what events are covered under PCI policies. Food companies must discuss with experienced PCI brokers and underwriters which wordings and coverage offerings best suit their operations based on their position in the industry and their place on respective supply chains.

Ultimately, the most important question a risk manager will ask is, why does my company, which excels at quality assurance, need PCI? The answer is simple. The food regulatory environment is literally going through a climate change the like of which has not been seen for nearly a century. We have already witnessed increased regulatory activity as the number of recalls announced on governmental food agencies’ websites has significantly grown since FSMA’s passage and many of the listed companies are the best in the business.

On Aug. 30, 2015, new regulations will commence the overhaul of the food industry and, more importantly, the operations of every affected company. In preparation for this hostile regulatory environment, companies up and down supply chains will seek additional assurances in the event of a product contamination or recall crisis event. Standard insurance portfolios will provide neither sufficient protection nor the necessary expertise to assure survival in a crisis event.

Under the new regulations, food companies will find an increasingly hostile regulatory environment and will need to enhance standard insurance portfolios. Based on the size of the company, the area of the industry in which it operates and its place on the supply chain, each company will need to consider different PCI policy wordings and coverages. They should engage PCI-experienced brokers and underwriters to assist with the emerging regulatory risks.

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—By Joseph F. Bermudez and Jessica C. Collier, Wilson Elser Moskowitz Edelman & Dicker LLP

Joe Bermudez is regional managing partner of Wilson Elser’s Denver office.

Jessica Collier is an associate in Wilson Elser’s Denver office.

This article is for general information purposes and is not intended to be and should not be taken as legal advice.

Indeed, whether a restaurant is seeking to increase table turnover, retain patrons by fostering a soothing ambiance, or liven a festive gathering, music plays a crucial role. No resource has greater value when it comes to establishing a desired mood for a particular restaurant setting. Perhaps the most obvious examples are sports bars, where music from TVs highlighting action in the game provides a fitting soundtrack to the hustle and bustle of a lively crowd.

At the other extreme are steak houses and fine dining establishments. Here, the desired sonic mood is one that establishes a sense of calm and relaxation, one befitting a larger proportion of mature patrons. Falling between sports bars and steak houses is the neighborhood pub, which varies in nature and where the demographic is more mixed. Examples include college bars and restaurants, where indie pop or alternative music ratchets up the energized ambiance.

No matter the desired mood, numerous studies have established that music is central to creating the proper atmosphere – and driving profits. To cite a sampling:

• • A recent CNN article showed that people chewed food nearly a third faster when listening to high-volume, fast-tempo music, potentially increasing table turnover. Also according to CNN, a French study observed that as decibel levels increased, men not only consumed more drinks but also finished each drink in less time.
• • A study published by the Journal of Culinary Science & Technology determined that food tastes best to diners when 1) classical music is softly played, and 2) there’s the presence of subtle background “chatter.” The same study showed that the absence of music detracted significantly from the dining experience, with patrons describing something as innocuous as the “clink” of cutlery as unacceptably noisy. Music, of course, serves to mask such noise.
• • A Scottish study published by the Association for Consumer Research found that diners increased their expenditures by 23% when slow-tempo music was played. Most of the additional spending went toward the drink bill, which grew 51%. Because drinks are typically a high-margin item, the increase in profits was especially significant. Of course, it’s up to individual proprietors to determine whether profits are enhanced by fast table turns or by encouraging patrons to remain for long periods of time. Music can be a powerful tool in achieving either goal.

To facilitate such uses of music, Broadcast Music, Inc. (BMI), provides the necessary licensing to comply with copyright statutes for the use of more than 7.5 million musical works. Operating on a non-profit-making basis, BMI distributes approximately 84 cents of every dollar it collects to its roster of songwriters, composers and publishers. In essence, the organization serves as a “middleman” between restaurants and owners of intellectual property. “Organizations like BMI — performing rights organizations — are advocates of a system whereby people are compensated for their work,” says Casey Monahan, Director of the Texas Music Office, an adjunct to the Texas State government. “It’s extremely important, not only for restaurants but really for everybody in the country, to understand the value of, and the significance of, intellectual property.”

Originally published on Tuesday, December 17, 2013
3793 views at time of republishing

Originally published on Tuesday, October 14,2014
1723 views at time of republishing

Objective: To describe recordkeeping practices of beef grinding activities in retail establishments.

Study Results: We surveyed 125 establishments and where available, reviewed grinding records. We found that less than half of establishments kept grinding records. Only 22% of records had all data needed for effective traceback (e.g., grind date and time, lot number of the source beef).

Chicken Handling Practices Study

Objective: To describe restaurant chicken preparation and cooking practices and kitchen managers’ food safety knowledge concerning chicken.

Study Results: We interviewed managers of 448 restaurants; inadequate chicken preparation and cooking practices were commonly reported. Forty percent of managers said that they did not always assign certain cutting boards for raw meat (including chicken) only, 29% said that they did not wash and rinse surfaces before sanitizing them, and over 50% said that thermometers were not used to determine the final cook temperature of chicken. Only 43% of managers knew the temperature raw chicken needed to be cooked to.

Egg-Handling Practices Study

Objective: To identify the prevalence of high-risk egg-handling practices and establishment policies in restaurants that serve breakfast all day.

Study Results: We interviewed kitchen managers and observed egg handling practices in 153 restaurants and found that risky egg handling practices were common. Fifty-four percent of restaurants pooled raw shell eggs not intended for immediate service, a practice not recommended by FDA. Some of these pooled eggs were held for 6 hours (the FDA-recommendation is 4 hours). Nearly 26% of restaurants reported storing eggs at room temperature. However, eggs were generally cooked to a temperature above the FDA-recommended final cook temperature of 63ºC.

READ MORE CASE STUDIES HERE

Originally published on Wednesday, June 17, 2015
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FaegreBD partner and leader of the firm’s food litigation and regulatory practice Sarah Brew, and associate Courtney Lawrence authored an article for Food & Drink explaining the new rules and what will be required to be in compliance.

Read Full Article Here

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Authors:

Sarah L. Brew: Sarah Brew leads the firm’s food litigation and regulatory practice, which is nationally ranked byChambers USA, and is a leader of the firm’s food and agriculture industry group. Sarah has a national reputation for effectively defending food industry clients against labeling and class action consumer fraud claims and representing food processors, distributors and retailers in foodborne illness and contamination cases and supply chain disputes.

Courtney A. Lawrence : Courtney Lawrence is a member of the nationally ranked food litigation and regulatory practice and the national food and agriculture industry team. Her diverse practice encompasses litigation, regulatory and transactional matters for food and agribusiness clients.
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