Category: Food & Hospitality

How Many Calories is in that Burger? PPACA Makes Sure you know.

The National Law Review recently published an article by Molly Nicole Lewis of McBrayer, McGinnis, Leslie and Kirkland, PLLC regarding The Food Industry and The Patient Protection and Affordable Healthcare Act:

 

We all occasionally grab a quick bite on the go. With fall in full swing, and our schedules filling up, it is much more tempting to drive through and pick up dinner rather than slaving over the stove after a non-stop day. Consider this:  What if the menu was labeled with calorie information and you could see that the Hardee’s Thickburger you wanted to order contained 910 calories.  A healthy caloric intake for an average person is 2000 calories per day – that’s also stated on the menu.  The burger just became ½ of your daily allotment of calories. That information would definitely prompt anyone to reconsider their choices.

Menu labeling, as outlined in the Patient Protection and Affordable Health Care Act (PPACA), might actually change the way we eat, when we eat out!  That is exactly what the National Restaurant Association and the National Association of Convenience Stores is grappling with.  In the wake of the Supreme Court upholding the PPACA, it is not just the medical and insurance communities buzzing. The food industry is wadding through their own set of new rules regarding how they present their product and interact with consumers.

As outlined in Section 4205, nutritional menu labeling is required for chain restaurants across the country. The provisions include labeling requirements for restaurants and food vendors, with 20 or more outlets. Calories have to be posted on menus and menu boards, including drive-thru menus. Display tags with additional information, including fat, saturated fat, carbohydrates, sodium protein, and fiber must be available in writing, upon request. Vending machine companies that operate at least 20 machines are also subject to these requirements. For buffet-style or self-serve restaurants, a sign must be placed adjacent to each food and beverage item listing calories per item or serving.  There are some exceptions that will not require calorie disclosure. Items not listed on the menu such as condiments, daily specials or temporary offerings. If an item appears on the menu less than 60 days per calendar year, or a test market items appears on a menu for less than 90 days, they are both exempt.

The Food and Drug Administration (FDA) considered Section 4205 effective immediately. However, without detailed guidance from the FDA, these provisions cannot be required.  The final FDA regulations are expected by the end of 2012.  Industry implementation would become effective six months after publication, in early 2013.  If a restaurant that is not required to comply with Section 4205, voluntarily registers with the FDA and follows the federal disclosure guidelines, they are not subject to any state or local nutrition disclosure requirements.

There is more at stake here then complying with disclosure regulations. For owners and operators in the food industry there are real costs to be considered. The new menu requirements alone will demand printing new menus and menu boards. Nutritional analysis may have to be performed to accurately report the information to the consumer. All of these added expenses could mean thousands in unbudgeted expenditures, and will result in consumer behavioral changes where the full financial impact cannot be determined – until after the fact.

It is interesting to contemplate how each of us will react to menu labeling. Will it help change the health of our country? The jury’s still out, but we are eagerly anticipating the verdict.

© 2012 by McBrayer, McGinnis, Leslie & Kirkland, PLLC

New Safeguards to Protect Consumers from Foodborne Illness

The National Law Review recently published an article regarding Foodborne Illness by Aaron M. Phelps of Varnum LLP:

Varnum LLP

 

 

The U.S. Department of Agriculture has set new safeguards that will better protect consumers from foodborne illness in meat and poultry products. It will now be easier to trace contaminated food materials in the supply chain, to act against contaminated products sooner, and to establish the effectiveness of food safety systems.

Policy measures include the following:

  • New traceback measures to control pathogens earlier and prevent them from triggering foodborne illnesses and outbreaks.
  • Requiring establishments to prepare and maintain recall procedures, to notify the Food and Safety Inspection Service (FSIS) within 24 hours that a meat or poultry product that could harm consumers has been shipped into commerce, and to document each reassessment of their hazard control and critical control point (HACCP) system food safety plans.

© 2012 Varnum LLP

Impact of Agriculture Reform, Food and Jobs Act of 2012 on Dairy Farmers

The National Law Review recently published an article regarding Agriculture Reform written by Kristiana M. Coutu of Varnum LLP:

Varnum LLP

This summer, the U.S. Senate voted to proceed to consideration of theAgriculture Reform, Food and Jobs Act of 2012 (2012 Farm Bill). The proposed bill can be accessed on the Senate Agriculture Committee’s website, however, be warned, it will take time and perseverance to wade through the 1010 pages of text.  While a complete study of the 2012 Farm Bill may be fascinating for some of us, the practical concern is how it will affect specific industries within agriculture and individual farms. Because Michigan dairy farms are a vital component of our state’s economy, it seems appropriate to consider how this proposed legislation will affect dairy farmers.

Two new programs will replace the current Dairy Product Price Support Payment and the Milk Income Loss Contract Program (MILC).  The new programs are the Dairy Production Margin Protection Program (“Margin Protection Program”) and the Dairy Market Stabilization Program (“Stabilization Program”) which have the stated purpose of guaranteeing dairy farmers a certain margin of milk price over feed costs and assisting in balancing the supply of milk with demand when participating dairy farms are experiencing low or negative operating margins by encouraging dairy farmers to produce less milk.  The two programs must be looked at together since any dairy operation that participates in the voluntary Margin Production Program must also participate in the Stabilization Program.

In its most basic terms, the Margin Protection Program insures farmers a minimum $4.00 margin of average national milk price, termed the “all milk price” over the national average feed price based on the price of corn, soybean meal and alfalfa.   A margin of less than $4.00 for two consecutive months triggers a government payment based 80% of historical milk production. Dairy farmers may also purchase supplemental margin protection to insure up to an $8.00 margin on 90% of historical production.  Although these programs are sometimes referred to as insurance, they are not associated with the federal crop insurance program and no insurance agents are involved.

The Stabilization Program encourages farmers to produce less milk by ordering handlers not to pay farmers for a percentage of milk shipped during any month the Stabilization Program is “in effect” based on low national margins.   Handlers must reduce the producer’s milk check when milk shipped exceeds what is called the “dairy operation’s stabilization base.”  The money that would have gone to the producer is instead paid to the Secretary of Agriculture to use for building demand for dairy products and purchasing dairy products for donation.

These new programs provide a good deal of food for thought, including questions about the effectiveness in various geographic regions of the U.S., considering the difference in milk price and input costs; the effect on various farms based on size; and whether forcing handlers to submit milk proceeds to the government is essentially a tax on dairy farmers.  Dairy farmers should evaluate these programs in light of their individual farm’s circumstances to determine the impact should these programs be included in the final Farm Bill.

It is estimated that debate on the Senate floor will be ongoing for at least the next two weeks and that several amendments to the bill will be proposed and debated.  We will continue to monitor the progress of the Farm Bill in general and also specific dairy provisions.

© 2012 Varnum LLP

FDA Discloses Method for Classifying Food Facilities as "High Risk" Under FSMA

The National Law Review published an article regarding FDA High Risk Food Facilities Classification Methods written by Lynn C. Tyler, M.S., Nicolette R. Hudson and Hae Park-Suk of Barnes & Thornburg LLP:

The Food Safety Modernization Act (FSMA), signed by President Obama in January 2011, requires FDA to inspect food facilities on different time tables depending on whether a facility is classified as “high risk” or not. High-risk facilities must be inspected at least once within the first five years after the enactment of the FSMA and once every three years thereafter. Non-high risk facilities must be inspected at least once within the first seven years after the enactment of the FSMA and once every five years thereafter.

The U.S. Food and Drug Administration (FDA) recently disclosed the method it intends to follow to classify food facilities as high risk or non-high risk under the FSMA. The agency first noted that the FSMA set forth six risk factors to be considered in making this determination:

  • The known safety risks of the food manufactured, processed, packed or held at the facility
  • The compliance history of the facility
  • The facility’s hazard analysis and risk-based preventive controls (HARBPC)
  • Whether the food at the facility meets the criteria for priority to detect intentional adulteration in imported food
  • Whether the food at the facility has received certain certifications
  • Other criteria identified by Health and Human Services

FDA then noted that for FY 2011-13 the classification decision will be based primarily on the first two factors and according to the following algorithms:

  • If a facility manufactures food categories associated with foodborne outbreaks AND class I recalls (reasonable probability of serious adverse health consequences or death), it is high risk
  • If a facility manufactures food categories associated with foodborne outbreaks OR class I recalls AND it has not been inspected within the last five years, it is high risk
  • Facilities with a checkered compliance history (three or more inspections resulting in Voluntary Action Indicated findings or one or more resulting in Official Action Indicated findings within the last five years) are high risk

FDA stated that it plans to modify and adjust these criteria in the future as it develops data on some of the FSMA criteria and for other reasons. It also reserved the right to inspect a facility more frequently when necessary in its judgment.

© 2012 BARNES & THORNBURG LLP

“Pascalization” Provides a New Alternative for Food Preservation

Recently in The National Law Review an article regarding Food Preservation by Matthew B. Eugster of Varnum LLP:

Varnum LLP

 

Pascalatization, also known as high-pressure processing (HPP), is a procedure for subjecting food to extreme water pressure (typically 40,000 to 80,000 PS) inside pressure chambers.  The extreme pressures used in the Pascalization process kills dangerous bacteria, molds and viruses without crushing or destroying the food.  Because no heat or chemical use is required, food can be preserved without cooking or altering the texture or flavor of foods.  With increasing “pressure” (pun intended) on the food industry to comply with increasing food safety standards and reduce chemical use, pascalization may provide a viable alternative for preserving foods.  The food processing industry has begun to take notice, and use of this technology is expected to increase.

© 2012 Varnum LLP

The "Safer Products" Database: Reports of Harm Made Public on March 11, 2011

Posted last week at the National Law Review by Mary C. Turke of Michael Best & Friedrich LLP – updated information on the U.S. Consumer Product Safety Commission’s Publicly Available Consumer Product Safety Information Database which is set to officially launch March 11, 2011: 

The U.S. Consumer Product Safety Commission’s Publicly Available Consumer Product Safety Information Database (the “Database”) (found atwww.saferproducts.gov) will be launched officially on March 11, 2011. Mandated by the Consumer Product Safety Improvement Act of 2008 (the “Act”), the Database includes a new mechanism for consumers to report harm, or merely a risk of harm, involving consumer products (excluding food and drugs). The Database makes qualified reports of harm available to the public, in an online, searchable format. Prior to publication of any report, the Commission will allow manufacturers to comment and/or challenge reports containing materially inaccurate or confidential information. In certain cases, manufacturers’ comments may be published as well. Previously, reports of harm and responsive comments were not available to the public unless published in a Commission report or obtained through a Freedom of Information Act request.

The Database is currently in “soft-launch” i.e., the Commission and stakeholders are testing the new reporting and response system with the knowledge that until March 11, 2011, nothing will be made publicly available in the Database. Indeed, consumer reports are being accepted through the website and any report meeting minimum requirements for publication are transmitted to registered manufacturers, importers and private labelers. These companies are able to provide comments online and challenge reports as containing inaccurate or confidential information.

This practice time is valuable, particularly because the faster a company is able to respond to a negative consumer report, the better. Companies should use the soft-launch to establish protocols for dealing with reports of harm involving their products, including designating persons within the company to be notified of reports via email and identifying the single account holder who is allowed to submit comments. The Act does not require that reports be based on first-hand knowledge or that they be made within a certain time following the alleged harm. Thus, companies should carefully review all reports in which they are named and consider monitoring reports in the Database by industry — where no manufacturer is named. Perhaps most importantly, companies should develop procedures for responding to reports that contain materially inaccurate or confidential information. The Act requires that any request to remove information from a report be “timely” and accompanied by a certification to defend the Commission if the removal is later challenged. Thus, companies must be prepared to act quickly and accurately in responding to reports of harm. Practice and preparation during soft-launch will help in that endeavor.

To succeed in an increasingly competitive business environment, manufacturing companies need to seize every available advantage. Whether negotiating a contract, moving an idea through the patent process or dealing with customers, getting your manufactured products to market requires expertly-coordinated efforts. Any delay can have a significant impact on your business. 

© MICHAEL BEST & FRIEDRICH LLP