Ag and Food Law Daily Update: September 22, 2022

A comprehensive summary of today’s judicial, legislative, and regulatory developments in agriculture and food. Email important additions HERE.

JUDICIAL: Includes bankruptcy, food labeling

In Milk Industry Regulatory Office of Puerto Rico v. Ruiz-Ruiz, — F.Supp.3d—, 22-cv-1005, 2022 WL 4354322 (DPR 2022), the United States District Court for Puerto Rico upheld the bankruptcy court’s decision to grant the plaintiff/appellee’s (Ruiz’s) motion for summary judgment. The Milk Industry Regulatory Office of Puerto Rico (ORIL) is responsible for regulating Puerto Rico’s milk quota system, under which only licensed dairy farmers are permitted to produce milk for public consumption. Ruiz used his milk quota as collateral from a bank loan, and in 2015 Ruiz filed for Chapter 12 bankruptcy. In 2018 ORIL revoked Ruiz’s dairy license, but the bankruptcy court granted Ruiz’s motion for a temporary restraining order which prevented ORIL from selling Ruiz’s milk quota. Ruiz then moved for summary judgment arguing that ORIL violated the automatic stay by attempting to sell bankruptcy estate property. The bankruptcy court granted the motion and held ORIL violated 11 USC § 362. ORIL appealed the bankruptcy court’s decision arguing that the policy power exception in 11 USC § 362(b)(4) applied. The District Court of Puerto Rico disagreed with ORIL, and upheld the bankruptcy court’s order granting Ruiz’s motion for summary judgment.

In Schneider v. Mott’s LLP, 3:21-cv-1251, 2022 WL 4314207 (SD Ill. 2022), the Plaintiff sued Mott’s claiming Mott’s applesauce label, which states “Made From 100% Real Fruit”, is deceptive. Mott’s filed a motion to dismiss arguing that no reasonable consumer would believe its applesauce is made only from apples and that injunctive relief is unavailable to the plaintiff. In addition to apples, Mott’s applesauce also contains high fructose corn syrup and ascorbic acid. The Southern District of Illinois found that a reasonable consumer could be misled by Mott’s label and denied Mott’s motion to dismiss on these grounds. However, the court found that injunctive relief was not available to the plaintiff and granted Mott’s motion to dismiss as to these grounds.

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