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What you need to know about Prop 37 now

October 4, 2012
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As California goes, so goes the nation. No, this expression doesn’t apply to California being a swing state. But it may well apply if California’s Proposition 37, passes and becomes law. Prop 37 requires foods that are genetically engineered (GE) or contain GE ingredients to have this information on the label. (The FDA only provides guidance on voluntary labeling for bioengineered food.) 
 
With Prop 37, a “YES” vote will make it law, and it will require that “Genetically Engineered” or “Partially Produced with Generic Engineering” goes on the label of processed foods containing GE ingredients. More specifically, Proposition 37
 
• “Requires labeling on raw or processed food offered for sale to consumers if made from plants or animals with genetic material changed in specified ways
• “Prohibits labeling or advertising such food, or other processed food, as ‘natural’
• “Exempts foods that are: certified organic; unintentionally produced with genetically engineered material; made from animals fed or injected with genetically engineered material but not genetically engineered themselves; processed with or containing only small amounts of genetically engineered ingredients; administered for treatment of medical conditions; sold for immediate consumption such as in a restaurant; or alcoholic beverages.”
 
Further, Prop 37 adds some extra clout to California state law to require the regulation of GE foods. Specifically, it:

1. Requires most GE foods sold be properly labeled
2. Requires California’s Department of Public Health to regulate the labeling of such foods
3. Allows individuals to sue food manufacturers that violate the measure’s labeling provisions.

 
While several large corporations have been pouring money into ads to defeat it, Prop 37 still has a chance of succeeding because Californians typically favor laws that protect consumers, according to Joshua A. Bloom, partner with San Francisco-based Barg Coffin Lewis & Trapp, LLP.  
 
If the measure wins in November, it won’t go into effect until July 1, 2014, according to Bloom. “Assuming it does pass, the industry will have over a year and a half to ramp up. Then, you’ll probably see a year and a half of lawsuits.” There will be many lawsuits challenging the law, and there will be many unwarranted private plaintiff suits, which, just like Prop 65, will be questionable actions just to recover attorneys' fees, according to Bloom.
 
Proponents of Prop 37, according to a document from the California Legislative Analyst’s Office, say consumers have the right to know what’s in their food and have their food labeled accurately, both of which will make it easier to protect a family’s health. Opponents say Prop 37 is driven by special interest groups; exempts milk, cheese and meat from its labeling requirements; doesn’t include beer, wine, liquor and restaurant foods; actually exempts two-thirds of the foods Californians consume; and creates a category of shakedown lawsuits, allowing lawyers to sue farmers, grocers and food companies—without any proof of violation or damage. 
 
While Bloom laughingly says this is a great opportunity for trial lawyers, the vagaries of the proposition make it a challenge for food processors. It goes beyond the adding of some text to a label, which in itself doesn’t cost a lot to do. But two requirements in the measure are a can of worms. 
 
Prop 37 text: “There are two main ways in which a retailer could document that a product is exempt: (1) by obtaining a sworn statement from the provider of the product (such as a wholesaler) indicating that the product has not been intentionally or knowingly genetically engineered or (2) by receiving independent certification that the product does not contain GE ingredients.”
 
“Knowing and unintentional is a loaded gun,” says Bloom. Retailers will need statements from their suppliers verifying their products have not been genetically modified or commingled with other products that have been modified. Once a single retailer makes this demand, all the other large retailers will, too, says Bloom. Second, can a certification from a Chinese supplier be trusted? When a processor does its own testing and finds the Chinese certification was a fake, how does the processor handle it?
 
The other practical issue, according to Bloom, is to imagine a single category of foods on the grocery shelf where one product contains labeling stating it includes GE ingredients, and the competing products next to it don’t have the same text, because these foods use ingredients whose suppliers provided sworn statements they “did not intentionally or knowingly use GE products” when this might not be true. Which product will the consumer purchase? Of course, it will be the one that doesn’t use GE ingredients, asserts Bloom.
 
If Prop 37 passes, will processors need one set of labels for California and another for the rest of the US? “That’s a problem,” says Bloom. “A processor can’t necessarily label for California and expect those labeled items to get to California when they go through a distribution center in Arizona that serves five different states.” Therefore, the new GE label would probably be used everywhere. But while a new GE label may not disturb Californians who are informed and OK with GE food, it begs a question: How, for example, would Iowans respond to a label they haven’t seen before, especially if they haven’t researched the implications of GE food?

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