In an important ruling dismissing a proposed class action, the US District Court for the Southern District of Florida ruled that the US Food and Drug Administration’s (FDA’s) generally recognized as safe (GRAS) regulation preempts a Florida statute that criminalized adding grains of paradise to liquor. More specifically, the Court in Marrache v. Bacardi USA, Inc., 2020 US Dist. LEXIS 13668 (January 28, 2020), ruled that the Florida statute was preempted because it conflicts with the Federal Food, Drug and Cosmetic Act (FFDCA) and the FDA’s regulations (21 C.F.R. § 182.10) which establish that grains of paradise are GRAS. 2020 US LEXIS 13668, at *4.
Sharp disagreements in the Second Circuit over whether a Connecticut liquor law runs afoul of antitrust law, recently exposed in a bitter dissent, highlight a circuit split that some experts predict will be taken up by the US Supreme Court.
A three-judge panel upheld the law in February by batting down a retailer’s challenge to three parts of Connecticut’s liquor sales law, including a controversial “post and hold” provision that lets wholesalers match each other’s prices. The panel rejected the retailers’ claim that the provision forced wholesalers into illegal price-fixing deals.
“There is a split, and it’s an important area,” said Raymond Jacobsen Jr., McDermott partner, backing the retailer’s view that the “post and hold” requirement creates a clear state-sanctioned violation of the Sherman Act. He said he believes it’s a question that will intrigue the justices.
Originally published on Law360, September 2019.