FMSA Moving Forward

In the future, we might look back at 2013 as the year the Food Safety Modernization Act (FSMA) finally got some teeth.  In January, the Food & Drug Administration (FDA) released two long awaited proposed rules, one aimed at food manufacturers and the other at farmers. A third rule is still in the drafting process and will require food importers to comply with United States standards through a stringent verification process.

It has been two years since President Obama signed FSMA into law, but these new rules proposed in January would be the first which actually give the FDA enhanced authority in its efforts to prevent food-borne illness. A major motive behind FSMA and the new rules is to allow the FDA to be proactive, rather than reactive, which, in turn, should lead to a tangible decrease in the number of food-related illnesses.  Presently, one in every six Americans suffers from a food-borne illness annually, with 130,000 requiring hospitalization and 3,000 dying each year.  As a result of these eye popping numbers, and increased media coverage, outbreak awareness and food litigation have exploded in recent years.   From the perspective of attorneys involved in food litigation, there are likely several ways which these new rules will impact current and future client.  Let’s take a closer look:

Rule #1, Manufacturers:

This rule will require food manufacturers to formulate a plan to prevent its food products from causing food-borne illness, as well as a plan to deal with any contamination or outbreak.  The rule also requires that the plan include a detailed strategy related to recall procedures.  Manufacturers will be required to document the plan and keep records to verify that their preventive steps are working. Furthermore, each plan will be evaluated by the FDA, and it will use the plan as a key factor in determining “high risk” facilities, which will be subject to increased inspections.  The new rule also grants audit power to FDA inspectors to confirm compliance with safety standards established in a plan.  Additional scrutiny by the FDA means more opportunity for a problem to be found, which could lead to increased future litigation. As such, compliance with the new rule is of paramount importance to any of your clients who manufacture a food product (which includes products originally manufactured in a foreign country). Your clients must be advised that a well-crafted, detailed plan is essential to both minimize risk of a contamination event, and to reduce the possibility of FDA scrutiny through audits and inspections. 

Also, it may sound obvious, but your clients must be instructed that going forward, they must comply with the plan at all times.  Having a plan is the first step, but that plan must be followed.  It is almost worse for your client to have a plan, if they do not comply with it.  After the rule is formally enacted, it is easy to envision how a plaintiff could exploit any inconsistencies or failure to comply with the plan that your client puts in place.  The idea that a company could not even meet its own expectations and standards would likely have a devastating effect when demonstrated to a jury.

You should also comfort your client and let them know that a thorough plan is not just a way to keep the FDA out of their plants, and prevent unfavorable evidence in litigation, but also a way to protect their customers, their brand, and ultimately their bottom line.  A thorough plan will allow a client to take a close look at their current manufacturing practices and truly evaluate whether they are capable of meeting current demands in a safe manner. Food outbreaks can have devastating effects on a company’s brand name, and bottom line.  For example, during last year’s salmonella outbreak involving Trader Joe’s peanut butter, the FDA halted production at Sunland Inc.’s massive New Mexico plant.  Both the outbreak and the production stoppage was front page news across the country. 

For more information the requirements of this proposed rule, see the following sections of FSMA:  Section 418(b) for the hazard analysis plan requirements; Section 418(c) for the preventive controls requirements; Section 418(d) for monitoring procedures; Section 418(e) for corrective action requirements; Section 418(f) for verification requirements; and Section 418(o) for the recall plan.

Rule #2, Farmers:

This rule will address contaminations related to fruit and vegetables during harvesting.  Essentially, the rule will require increased worker hygiene; regulations for water used on the produce; improved techniques for processing and cleaning equipment; and rules which will ensure that animals are kept away from crops. These rules are clearly a direct result of high profile outbreaks, such as the 2011 Jensen Farms case, which involved listeria contamination in cantaloupes, and which claimed more than 30 lives. In that case, the FDA eventually determined that the listeria resulted from pools of dirty water on the floor at the facility and old, dirty processing equipment. Jensen Farms filed for bankruptcy in May, 2012 and a trust is being established to compensate victims of the outbreak.

The estimated additional costs associated with the implementation of this rule will be $13,000 each year for smaller farms and $30,000 each year for larger farms. Regardless, your clients should be aware that the costs of an outbreak can be much greater.  For example, in 2007 the spinach industry lost an estimated $350 million in sales as a result of an E. coli O157:H7 outbreak associated with bagged spinach traced to a single supplier.

The bottom line is that your agricultural clients must be advised concerning the new rule and you must work with them to create a plan which covers each subsection of the rule.  Any plan you devise with your clients should require comprehensive record keeping, which, if done correctly, will ultimately allow your client to demonstrate a pattern of compliance related to all aspects of the rule.  This will not only help them prevent contamination issues, but will also create a paper trail which will allow the client to better defend itself should a lawsuit arise.   

Wait and See:

Alas, though, we continue to wait.  The FDA originally proposed a comment period on these two rules with a closing date in February, 2013.  But on February 15, 2013, the FDA announced an extension for comments until May 19, 2013.  This has sparked intense criticism that special interest groups have pressured the FDA to delay these rules as long as possible.  Even with this delay, now is the time to prepare your clients for what is likely ahead.  Such preparation will improve their food safety practices and reduce the risk of an outbreak, thus protecting the client’s brand and ultimately its bottom line.