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Media Coverage

Cereal killers

29 August 2011
National Law Journal

by Jenna Greene

Too many American kids are overweight. That's about the only point of agreement in a bitter food fight that's broken out in Washington, pitting the full might of the food industry against four federal agencies and public health advocates.

The agencies have come up with a plan calling for companies to voluntarily cease all marketing efforts directed at children for "unhealthy" food and drinks, with the goal of reducing childhood obesity. It's not just candy and soda in the cross hairs. Products like whole wheat bread, 2% milk and pasta — 88 of the top 100 foods Americans most often eat, according to one analysis — wouldn't be considered healthy under plan guidelines.

Advocates say the proposal would work both because kids would clamor less for foods like Cheetos and Froot Loops if they weren't advertised, and because it would encourage food makers to reformulate their products with less sugar, salt and fat.

The plan "could have huge benefits in reduced health care costs down the line," said Georgetown University Law Center professor Angela Campbell, who as co-director of the Institute for Public Representation penned comments on behalf of more than 25 nonprofits in support of the proposal. "Almost all major diseases have important dietary components."

The four agencies — the Federal Trade Commission (FTC), the U.S. Food and Drug Administration, the Department of Agriculture and the Centers for Disease Control and Prevention (dubbed the "Interagency Working Group") — stress that the guidelines, which have not yet been finalized, are voluntary and won't force food makers to do anything. "This is a report to Congress, not a rulemaking proceeding, so there's no proposed government regulation," wrote David Vladeck, director of the FTC's Bureau of Consumer Protection in a blog last month. "A report is not a law, a regulation or an order, and it can't be enforced."

Food marketers don't buy it. "This is a classic case of backdoor regulation," said Dan Jaffe, executive vice president of the Association of National Advertisers. "These four agencies have almost plenary oversight [over the food industry]. I'm amazed, frankly, when high-ranking people in government try to tell the world, 'We don't have any power and this is strictly voluntary.' No one on our side takes that seriously."

The food industry argues that the plan would be unworkable and costly, and would run afoul of First Amendment protections for commercial speech. And they question its underlying premise that a marketing ban on unhealthy food would result in thinner children. More than 150 trade groups have registered their opposition — joined by broadcasters, toymakers, video game designers and even the Minnesota Timberwolves basketball team — in calling for the plan to be scrapped.

Members of Congress from both sides of the aisle have weighed in as well — 117 members of the House and 25 senators have written to the agencies criticizing the plan and requesting additional studies before any action is taken.

"The overarching concern is that this proposal won't work, as the evidence does not show that such marketing restrictions curb childhood obesity," said Miriam Guggenheim, a partner at Covington & Burling in Washington who represents food companies. "It really only allows marketing to children of things like raw agricultural products. Most food products could never qualify, and thus it could undermine manufacturers' incentives to improve the nutritional profile of their products because they still would not be able to advertise them." She added, "It's a government restriction on speech without a countervailing public benefit. It may be nominally voluntary, but it's not voluntary in effect."


This is not a new fight. Its roots go back to one of the lowest points in FTC history — the agency's ill-fated "Kid Vid" rule in 1978 that would have banned all television ads directed at young children, and ads for older kids touting sugary foods that cause tooth decay.

To say it didn't go over well is an understatement — The Washington Post called the FTC the "National Nanny," and Congress took away a wide swath of the FTC's jurisdiction, passed a law allowing it to veto agency acts and cut off all funding before the FTC killed the rule.

The issue resurfaced before the Federal Communications Commission in 2006, which convened an industry task force on media and childhood obesity, focusing on unhealthy food marketing. The task force "failed gloriously. It was amazing just how bad it was," said Jeff McIntyre, director of national policy for Children Now, who chaired the task force's public health committee and said the two sides were unable to reach any consensus.

The cause was picked up by Sen. Tom Harkin (D-Iowa) and then-Sen. Sam Brownback (R-Kan.), whose 2009 appropriations bill directed the four agencies to develop recommendations for the nutritional quality of foods marketed to kids ages 2 to 17.

The agencies in late April released a draft plan that sets out two basic principles. First, advertising and marketing should encourage children to choose foods that make "meaningful contributions to a healthful diet" like fruit and vegetables. Second, products being marketed to children should contain limited amounts of ingredients that have a negative effect on health or weight — namely saturated fat, trans fat, added sugars and sodium.

The marketing restrictions go far beyond television and, indeed, are intended to cover every promotion imaginable, from company Web sites to celebrity endorsements to event sponsorships.

The sheer breadth meant some food makers that weren't initially concerned came to realize they'd be directly affected as well. For example, most frozen vegetables pass muster under the guidelines, but some with added sauces or seasonings would be deemed too salty. "You don't see a lot of commercials on Saturday morning cartoons promoting Cajun-seasoned green beans, that's true," said Corey Henry, vice president of communications for the American Frozen Food Institute. But, he pointed out, "This is not limited to ads directly targeted to children, but to anything children are exposed to, like a point-of-sale display at a grocery store."

Another sore spot is packaging. The plan as written nixes the use of cartoon characters on unhealthy foods. Say goodbye to Tony the Tiger and Ernie the Keebler Elf — characters that the Kellogg Co. in comments filed with the FTC claimed "are just as beloved by adults as they are by children." (Far more adults than children eat Frosted Flakes, the company said.)

The guidelines would also bar holiday and seasonal promotions — a major hit to candy makers that turn out items like chocolate Santas and candy hearts, or in The Hershey Co.'s case, the Reese's Reester Bunny. "Seasonal shapes and seasonal packaging are fun and happy traditions currently enjoyed by the entire family, not just children," Hershey general counsel Burton Snyder wrote in FTC comments.

Hershey raised another issue showing just how broad the restrictions could be. The company shares its name with the town in Pennsylvania where it's headquartered — a town that has streetlights shaped like Hershey's Kisses chocolates. Are the agencies "seriously suggesting with [their] proposal that the town of Hershey, Pa., its many sites, and even its lamp posts are prohibited forms of marketing due to their possible influence on children?" Snyder wrote.

The key legal question is whether the proposal, if adopted, would violate the free speech rights of food makers to convey truthful information about lawful products.

Vladeck of the FTC says no. "A report to Congress containing recommended nutrition principles can't violate the Constitution," he wrote in the Bureau of Consumer Protection blog on July 1. "While we hope companies voluntarily choose to adopt the principles (when finalized), there's no legal consequence if they don't."

Campbell of Georgetown Law shares his assessment. "If companies do nothing at all, there's nothing the government can do. There's no fines, no enforcement," she said. "If they do [follow the guidelines], they'll get praise from public health and advocacy groups."

But Northwestern University School of Law professor Martin Redish, a First Amendment expert who has been retained as a consultant by the food industry, sees a chilling effect nonetheless. "I've never heard of anything quite like this, with the four most powerful agencies in a field getting together and promulgating supposedly voluntary regulations," he said. "There's enormous pressure being brought here."

The U.S. Supreme Court in recent years has "bent over backwards" to protect commercial speech, Redish said. In late June, he said, the Court made clear that children have First Amendment rights in a case challenging a ban on sales of violent video games to minors, Brown v. Entertainment Merchants Association.

Nor, 10 years ago, did the Court approve a bid to restrict outdoor advertising of tobacco to protect minors, finding that tobacco companies "have an interest in conveying truthful information about their products to adults, and adults have a corresponding interest in receiving truthful information."

The agencies' plan "sweeps in adults with children," Redish said — not to mention the actual food purchase is usually made by an adult. (If a parent can't say no, he joked, "You've got bigger problems than buying a box of sugar cereal.")

Free speech may not be the only legal issue. The American Bar Association's Section of Antitrust Law filed comments expressing concern if companies all agree not to advertise foods that don't pass nutritional muster. "We recognize that advertising can sometimes be a form of competition itself," said Richard Steuer, chair of the antitrust section and a partner in Mayer Brown's New York office. "If there's an agreement among competitors not to advertise, that could reduce competition."


The answer, according to industry, is self regulation. Elaine Kolish, who spent 25 years at the FTC where she came to head the division of enforcement in the Bureau of Consumer Protection, is now the director of the Children's Food and Beverage Advertising Initiative at the Better Business Bureau.

Since 2006, major companies including Kraft Foods Inc., McDonald's Corp., Nestlé USA Inc., PepsiCo Inc., The Coca-Cola Co., Hershey and Mars Inc. have committed to devote at least half their advertising to children under 12 to promote healthier dietary choices, lifestyles and good nutrition. "Our criteria is challenging but realistic," Kolish said. "Self regulation is working."

Kolish called the government plan "unworkable" and noted in some cases it would be difficult if not impossible to revamp recipes to meet the salt, sugar and fat targets. "Sugar and sodium are not just flavoring. They have a functional role," she said.

Reformulating recipes would be expensive as well — about $1 million per product, she estimated. But because the proposal is not a regulation, there's no cost-benefit analysis by the Office of Management and Budget.

"Experts haven't given us a reason to expect any gain from the economic pain" of the proposal, said William MacLeod, a partner in Kelley Drye & Warren's Washington office who advises food companies on advertising laws and previously served as head of the FTC's Bureau of Consumer Protection. "Recently, the Institute of Medicine said it could not attribute obesity in kids or teens to the ads they see."

But McIntyre of Children Now says that the foods being promoted voluntarily by industry as "healthier diet choices" aren't so healthy, and that most fall short of Health and Human Services standards. "We calculated that a child would have to watch TV for 10 hours," he said, "before seeing one ad for a healthy food product."

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