AJ, EA, Derek on board.
Just fyi: interesting:
Another CBD Suit Put On Hold While FDA Develops Rules
By Sam Reisman
Law360 (June 16, 2020, 10:10 PM EDT) -- A California federal judge has hit pause on a proposed class action alleging a Florida CBD company mislabeled its products, saying the suit can wait until the U.S. Food and Drug Administration releases long-awaited rules regulating the popular hemp-derived compound.
Monday's decision marks at least the third time this year a federal judge has stayed a consumer class action against a CBD company, pending anticipated FDA rulemaking, while citing the doctrine of primary jurisdiction, under which courts can defer matters where a regulator has primary oversight.
Following the analysis of similar decisions this year in California and Florida federal court, U.S. District Judge Morrison J. England wrote in his order that the FDA had full authority to regulate consumable CBD products and had made clear its intention to do so, making it imprudent for courts to rule on the matter and potentially produce inconsistent guidance.
The instant case was originally brought in September by Kenneth Glass against Global Widget LLC, which does business as Hemp Bombs, alleging that the CBD products he purchased from the company were labeled with incorrect dosage information and that he would not have purchased the products had he known they were not yet regulated.
It is one of several similar consumer class actions to hit the courts in recent months, following the broad legalization of hemp and the explosion of the hemp-derived CBD industry in 2019. The suits have generally alleged that the products were unlawfully marketed with unfounded claims about their curative properties and that the cannabinoid content of the products was misrepresented.
In the California case cited heavily by Judge England, which involved claims against CBD maker CV Sciences Inc., U.S. District Judge Virginia A. Phillips ruled in May that the dispute would benefit from regulatory clarity and issued a stay. Both Judge England's and Judge Phillips' decisions adopted the analysis of U.S. District Judge Ursula Ungaro's decision in January to apply the primary jurisdiction doctrine and stay a similar case in Florida federal court until the FDA issued its rules.
It did not take long for Judge England's decision to become, in turn, its own reference point in another CBD case. Global Widget, defending itself in another proposed consumer class action in Massachusetts federal court, filed a notice of supplemental authority on Tuesday, calling the court's attention to the recent order in the Glass case. The company had previously sought a stay of the case, pending the release of the FDA's rules.
The new California opinion was relevant to the Massachusetts case "because Global Widget is the sole defendant in both putative class actions, the Global Widget products at issue are identical or substantially similar in both actions, and the legal theories, claims, and necessary analysis are identical or substantially similar in both actions," the company said in its Tuesday brief.
The FDA has been warning CBD producers in recent months against making questionable or unfounded health claims about their products. More recently, the agency has particularly targeted CBD companies that have marketed their products as treatments or cures for COVID-19.
In November, the agency said it would not grant CBD a status of "generally recognized as safe." The agency's position since March is that "it is currently illegal to market CBD by adding it to a food or labeling it as a dietary supplement."
Counsel for Global Widget declined to comment. Counsel for Glass did not immediately respond to a request for comment.
Glass is represented by Neal J. Deckant, Frederick J. Klorczyk III and Brittany S. Scott of Bursor & Fisher PA.
Global Widget is represented by Sara M. Turner and Kyle A. Diamantas of Baker Donelson Bearman Caldwell & Berkowitz PC and Angel A. Garganta of Venable LLP.
The case is Glass v. Global Widget LLC, case number 2:19-cv-01906, in U.S. District Court for the Eastern District of California.
--Additional reporting by Jack Queen, Dave Simpson and Nathan Hale. Editing by Aaron Pelc.
For a reprint of this article, please contact reprints@law360.com.
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