Dairy Challenge to Artificial Hormone-Free Labeling, Plus Criminal & Bankruptcy Matters - U.S. Sixth Circuit
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Dairy Challenge to Artificial Hormone-Free Labeling, Plus Criminal & Bankruptcy Matters

Int'l Dairy Foods Ass'n v. Boggs, 09-3515, concerned a challenge to the district court's grant of summary judgment in favor of the state of Ohio on all but one of plaintiffs' claims, in a suit brought by two separate dairy-processor trade organizations, challenging a regulation adopted by the Ohio Department of Agriculture (ODA), designed to regulate labeling of dairy products that reflect the nonuse of artificial hormones.

 

In reversing in part, the court held that the regulation's prophylactic ban of composition claims such as "rbST free" is more extensive than necessary to serve the state's interest in preventing consumer deception.  ALso, although the regulation's disclosure requirement is reasonably related to the state's interest in preventing consumer deception, there is no rational basis between this concern and the "contiguous" requirement of such a disclosure.  In affirming in part, the court held that the regulation is constitutional under Pike, as it does not have an impermissible extraterritorial effect, it is not protectionist, and there is a rational basis to believe that the regulation's benefit outweighs any burden that it imposes.

In re: NM Holdings Co., LLC, 09-1870, involved a bankruptcy trustee's suit against debtor-company's former auditor, claiming that the auditor negligently performed its audits by failing to uncover and report unsound related-party transactions entered into by the company's sole shareholder and CEO, as well as aided and abetted the CEO's breach of his fiduciary duty to the company.  In affirming the district court's grant of the auditor's motion for summary judgment, the court held that the trustee's amended complaint does not allege reliance by the company or by the company's fairness committee, and the alleged reliance by the company's creditors cannot support a claim brought by the trustee on behalf of the company.  Also, the district court did not err in holding that the residual statute of limitations applied to the trustee's aiding-and-abetting claim.

Adams v. US, 09-1176, concerned a challenge to the district court's imposition of an increased statutory minimum sentence from 60 months to 120-months' incarceration, based upon an acknowledgment that defendant had previously pleaded guilty to the felony of attempting to possess less than 50 grams of a controlled substance, in a prosecution of defendant for conspiracy to distribute cocaine base.  In affirming, the court held that, given the conclusion that the district court properly considered defendant's Youthful Trainee Act adjudication in calculating his federal sentence, it follows that defendant has not shown that he was prejudiced by counsel's failure to challenge the prior conviction as "final," and furthermore, counsel's performance did not fall below an objective standard of reasonableness.

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