July 16, 2013

Energizing to Stop the Flow of Energy Drinks

Seller Beware: Consumer Protection Insights for Industry,

The makers of energy drinks and consumers alike should be on alert to potential new developments in the regulatory environment.

American Medical Association (AMA). While the Food and Drug Administration continues its investigation into the safety of energy drinks, the AMA—the largest association of physicians in the US— announced that it supports a ban on the marketing of energy drinks to children under 18 years of age. The AMA noted that these products have become increasingly popular in recent years, particularly with high school and college-aged youth. According to the American Academy of Pediatrics, more than one-third of teens consume energy drinks. On June 18, 2013, during its annual meeting, the AMA voted to adopt a new policy with regard to the marketing of energy drinks to individuals under the age of eighteen. The AMA has warned that with high levels of caffeine, sugar, and other stimulants and additives, energy drinks can cause heart attacks, convulsions, agitation, anxiety, and insomnia and can lead to obesity and diabetes. A recent survey by the U.S. Department of Health and Human Services found that between 2007 and 2011, emergency room visits related to energy drinks doubled.

Food and Drug Administration (FDA). The AMA's announcement follows a chain of events leading to increased pressure on energy drink manufacturers. The deaths of fourteen-year-old Anais Fournier in December 2011 and nineteen-year-old Alex Morris in July 2012 both led to lawsuits alleging that the deaths were caused by the consumption of energy drinks. In October 2012, the FDA announced it was investigating reports of five deaths that may be associated with Monster Beverage Corp's popular energy drink, Monster. The FDA has been conducting ongoing investigations into the role of energy drinks in reported cases of death or illness potentially related to energy drinks. Monster and Rockstar, Inc. (another maker of energy drinks) have decided in the past few months to market their products as beverages rather than as dietary supplements, as they had been doing previously. Among other regulatory impacts, the two companies will no longer be required to report adverse events, such as deaths and injuries, potentially linked to their products.

Federal Legislature. A number of lawmakers issued statements expressing hope that the AMA's decision would have some influence over energy drink manufacturer. Sens. Richard J. Durbin of Illinois and Richard Blumenthal of Connecticut, and Rep. Edward J. Markey of Massachusetts released a report, What's All the Buzz About?, after investigating 14 commonly-sold energy drink brands. The report criticizes the marketing practices of energy drink makers, accusing companies of using social media advertising, as well as the sponsorships of events and athletes that cater to teenagers, to appeal to children and teens. Some lawmakers in Washington, D.C., have spoken out in support of the AMA's decision to push for a ban on the marketing of energy drinks to minors.

Local Governments. Local governments have also been taking steps to limit the sale and marketing of energy drinks.

  • In Suffolk County, New York, lawmakers recently passed legislation limiting the marketing of energy drinks to minors, as well as prohibiting the sale of drinks in the county's parks. The new law bans certain marketing techniques including providing free drink samples to minors.
  • San Francisco's City Attorney, Dennis Herrera sent a letter to Monster late last year asking for evidence supporting its claim that the energy drinks are safe. On April 29, 2013, Monster filed a lawsuit against Mr. Herrera, alleging that his efforts to regulate the sale of energy drinks in the City of San Francisco were preempted by the federal Food, Drug and Cosmetic Act. Mr. Herrara responded with a lawsuit on behalf of the people of California, filed May 6, 2013, alleging that Monster had engaged in unfair, deceptive, and unlawful business practices.

The American Beverage Association, an industry trade group, opposes the AMA's decision. A spokesperson for the industry noted that many energy drink companies voluntarily post caffeine amounts on product labels and include packaging advisories, warning that energy drinks are not intended for children or pregnant women.

While the likelihood of significant federal legislation relating to the marketing of energy drinks passing both houses of Congress in the near future is low, the FDA could impose additional restrictions on energy drink makers without Congressional approval, which some law makers are urging. The April 2013 Congressional report emphasizes that energy drink makers adhere to different, sometimes inconsistent, marketing, labeling, and ingredient disclosure requirements, with some brands classifying their products as dietary supplements and others as conventional beverages. These two product types carry different federal requirements under the Federal Food, Drug, and Cosmetic Act. For example, according to the FDA, food additives cannot be used in conventional food and beverages without FDA approval, while dietary ingredients require no FDA approval for use in dietary supplements.

Energy drink makers and consumers should be attentive to the forthcoming conclusions from the FDA's energy drink investigation, as that inquiry may awaken a new regulatory focus on the industry.

© 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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