March 12, 2013

Fishy Labeling

Consumer Advertising Law Blog

Customers buying seafood at restaurants and grocery stores frequently may not be getting what they order. A recent study conducted by the group Oceana, found that 27 percent of grocery stores, 52 percent of non-sushi restaurants, and 95 percent of sushi restaurants surveyed sold mislabeled seafood. The group describes itself as the "largest international organization focused solely on ocean conservation."

The Oceana study, conducted from 2010 to 2012, is one of the largest reported seafood fraud investigations to date. The group collected 1,247 samples from 674 retail outlets in 21 states. Genetic identity was determined for 1,215 of the samples, and of those, it was found that approximately one-third were mislabeled. Mislabeling rates varied greatly among the types of seafood involved, with fish sold as "tuna" and "snapper" having the highest mislabeling rates.

In describing the methods used for the study, Oceana stated that it considered a fish sample to be mislabeled if "seafood substitution occurred or if retailers were not following the [FDA] Seafood list." The FDA's Guide to Acceptable Market Names for Seafood Sold in Interstate Commerce provides guidance to the seafood industry on the labeling of different species. The FDA makes it clear that its Seafood List does not establish legally enforceable responsibilities per se in labeling. However, seafood mislabeling can be actionable under the MisbrandingSection of the Federal Food, Drug, and Cosmetic Act, and under state statutory and regulatory provisions, as well as the common law.

Some critics of the study have suggested that Oceana overstatesthe mislabeling issue, noting that different vernacular names are used for the same type of fish in different regions of the country. In fact, this illustrates the pitfalls that even well-meaning retailers may face in attempting to label their seafood so as not to mislead. Thus, the FDA itself comments that a vernacular name, even if common in a particular region, may not be acceptable as a market name for use in interstate commerce. When it comes to seafood, it's not only the quarry, but the name of the quarry that can be elusive.

The obvious injury from seafood mislabeling is that customers will be duped into paying more than they should for what they are actually getting. But depending on the particular species involved, mislabeling can also defeat customer attempts to choose sustainable seafood options. Fishery sustainability is a growing concern of many conservation-minded consumers. In response, conservation organizations have published pocket guidelines for consumers to use in making their seafood choices; and some grocery stores and restaurant groups have taken to promoting their seafood sourcing policies to attract environmentally-conscious customers. In a prior post, we discussed how seafood sustainability certifications themselves may be misleading consumers in this regard. Inasmuch as any certification process necessarily depends on accurate labeling of the product being sold, seafood mislabeling has the potential to exacerbate the problem.

There is potential legal exposure for seafood businesses at every step in the supply chain here-- from fishermen to brokers to retailers and restaurants. Certainly, those who intentionally mislabel seafood for sale are subject to liability for fraud and unfair business practices. Less clear is the degree of exposure for retailers and middlemen who inadvertently sell mislabeled fish. Following a similar seafood investigation conducted by the Boston Globe, several restaurants blamed suppliers for providing them with incorrectly labeled fish, which they in turn innocently served to customers. Given the apparent frequency and risks of such mislabeling, blind reliance on the integrity and competence of one's suppliers may not be enough. Prudent retailers will consider measured steps to better ensure that they are serving what they claim and to demonstrate their own due diligence in that regard. Like chum in the water, Oceana's study may begin drawing the interest of state attorneys general and the plaintiff's bar.

© Arnold & Porter Kaye Scholer LLP 2013 All Rights Reserved. This blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.

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