nice fodder and style i'm letters are three minute or so organic infant formula we alleged in our complaint that federal and federal law and the u s d a currently prohibit twenty six of abbott's ingredients from organic infant formulas and yet there are certified producers they are still labeling the product as organic i want to come back again to the word certified in just a moment and because and we allege that because federal law prohibits they organic label on these products and it is therefore false advertising under state law the district court granted its motion to dismiss on preemption grounds and again on a motion to dismiss the essentially reached a question of fact and decided on the merits it accepted at its factual claim that the product was certified as an organic product whereas we claimed that it was only the organic plant was certified at the dairy cows and the the agricultural bits not the ingredients now the last record determined that the whole product was certified it then decided that certification alone with sufficient under federal law to label it as organic and useless no it wouldn't the certification process looks only at the organic plant the agricultural plant it doesn't look at the ingredients and the products before they are sold label or represented as organic to ensure that the product composition meets the requirements for the proposed labeling category so they are looking at the ingredients right now they are not  if i can point to your honor to our reply brief i pages thirteen to fourteen that is where we show by the language in the rest of the handbook shows that sort of buyers are not required to look at the ingredients at all there's some language there that says that the certifier should look at the ingredients and also we had we had evidence that here the certifier told certified yes and if but not the product in is provided is under federal law it is the manufacturer allowed to put that label on the product no they are not and if it's guts to the second reversible error by the district court either federal law seven u s c sixty five zero four to be labeled as organic a product must comply with here relevant to requirements first ok we can see it we  cannot include banned synthetic ingredients and second it must comply with a certified organic plan but it's at but first of all one also says except as otherwise provided i gather there is some issue about infant formula and vitamins and so forth now putting aside whether he was right about that isn't the next step that's the compliance but then there's a certification process right that certification looks at the organic plan the sort of fire agrees to don't panic plan where they say that friends of the cows will be in this barn at eight am to five pm and  roam after the certification does not certify compliance with that plant and that is why this time we were in terms of compliance with the plan the plan doesn't have to say and we don't put in synthetic or you don't know they did both really i don't know if they certified the whole product as it claims that they did or if they only certified the plan which states very specifically certification is as to the process not the product right but my point was if you're certifying the process and you're doing what i see the regulations as requiring which is really inspecting it every step of the way it's almost better than certifying the product you're looking at everything that goes into the product at the at the certification it looks only at the barn it looks only at the farm it is not looking at the ingredients no i don't think it did that so let's not let's let's let's move on to something more serious do you think it would be useful for us to get the views of the department of agriculture about what the certification process is supposed to do i think that it be useful first for us to get some facts as to what was certify you think it would be useful for us in deciding this appeal to solicit the views of the department of agriculture with respect to the merits of the decision of the district  court my apologies sir no i don't because the u s d a has already stated that these ingredients are not protected they are not permitted in organic products well that's not the question is it the question is what or how does the certification program work are this the certifiers supposed to examine the ingredients and determine whether products whether inputs into processed foods comply with the requirements of the regulations and so forth it would be interesting to know would it not whether the department of agriculture agrees with you that the certification process is just posed to look at the barn i'm i i see your point and i think that review them and decide whether the things that are being put into the product at the plant are proper or not and this one didn't and then i believe your honor that a court should be able to review that that decision would it be a false good for the company to say we were certified it would be false advertising to put on a label that says we were certified organic by the u s d a well their claim is that they are organic not that they were certified but you didn't you can see certification no we did not we did not also cites parts in the record where we did not concede certification again and again we told the judge that the ingredients were not certified and we have evidence that they certify or told its clients these ingredients are prohibited and it certified organic plant it certified the farm where i am reading your evidence about what the certifier say was that gee we made a mistake and we shouldn't have done it not that not that we didn't do it i mean they in fact it certified so the question gets back to what do you do if it's the certifier the state of california is once or that goes with that if you have private remedy it does not give consumers a remedy against cer reminder this is a motion to dismiss this wasn't on summary judgment this wasn't a bench trial and where asking questions of us about preemption that's the that which is a question yes but there the judge's decision was based on first its factual finding that the whole product was certified and second it's erroneous interpretation of the law well that's the it's the latter that matters right i mean the question of whether the product is certified isn't the question really is the product supposed to be certified as a matter of law i think it's two questions because the product was not certified the plan certified vote do you know that because federal law allows exactly so it's a question of law it's not a question of fact for discovery it's a question of law as to whether the legal requirement for certification includes whether the inputs to the product are prohibited or not i see i see i see your point  but i mean that is a fact is q a we have no reason to believe that q a i certify the ingredients and we have no basis for much to believe this abbott made that claim required them they love requires them to certify the all kinds of ways that the inspector could foul up but if the inspector certifies what if the inspectors supposed to certify the ingredients and certifies the ingredients notwithstanding a mistake i'm having trouble why abbot is at fault if it's admits its products to the certification process and the certification process is supposed to cover these matters for example was not told to q a i the certifier here so we have to go back behind the certification and ok if certified some ingredients which ingredients did it certify that's the question of fact and we don't know that for you not know that it's made it is not in a document that's been made public it's nowhere in our allegations it is abbott's factual claim it's a defense and i look forward to breaching that argument on summary judgment but on a motion to dismiss it it's just too early to allow abbott to make factual claims and not allow plaintiffs to present evidence they are in control of the evidence that you see career that  correct that's correct but isn't that room it's that's incorrect it was correct lead decided that it should be a matter of conflict preemption here but can the federal government and the state government do what they want to do simultaneously though they may not is there anything in the state of an advertising that inhibits the federal government from doing its job of inspection and certification what this new law does plaintiff's claims in this case depend on a finding that the product should not have been certified that the u s d a symbol which appears on the products label should not have been there and what you sa the case and i started out asking because it's very that is it the case that a verdict in favor of the plaintiffs here necessarily moves the certification given by the u s d a it is absolutely the case and i would like to explain if i may the provisions of the act and the regulations that show that to be true this is an argument the judge chen in her opinion addressed she said plaintiffs contention that th do not look at what is going into the product do not look at the ingredients but instead only look at an organic plan is nonsense she said it would be a logical to think that cong intended for the word organic to have no meaning besides that the product might be organic or it might not be these are the provisions of the act that address this specific subject the first is seven u s c section sixty five ten paragraph a that's the section of the organic foods production act what that says is for a handling operation to be certified under this chapter so this is a provision about certification no person on the handling operation may and then paragraph one it says and any synthetic ingredient not appearing on the national list the certification is a finding that that has been complied with we know that from one of the regulations that is seven c f r section two hundred five point two that regulation by a states that certification means a determination i'm now quoting a determination made by a certifying agent that a production or handling operation is in compliance with the act and is in compliance with all of the regulations under the question that been puzzling over these various regulations that says that you terminations that a production or handling operation is in compliance it doesn't talk about products right i mean their complaint is that the formula not the the form the formula for the formula you concludes ingredients that shouldn't be there no you're talking about a production or handling operation you are a production or handling operation handling operation handling operation a production operation is something like a farm that grows organic crops and handling operation is something like abbott which assembles of organic process now they're allowed ingredients ok a food processor your honor and yet is complete we believe to be true at this stage of the proceeding claim that there are some that it chemical you know the all of the ingredients in the product that are not organically grown are approved for use in organic products by u s d a on what we call the national list what the act calls the national most chemicals that are in this nationally that's correct there is an entry  the national list called nutrient vitamins and minerals in accordance with section one hundred four point two zero of nutritional quality guidelines for foods that's that's the reading of that and that the district court did not reach the district court did not really need the district court recognized often preemption saying that in effect even if for some reason those items are not on the list the fact that the certifier approved it right or wrong is determinative right because what they are doing is going to go behind the certification so for purposes of this argument then you may have another argument that even if the preemption is wrong they still lose but for purposes of this argument don't we have to assume that it is correct that these ingredients are for whatever reason not on the list and not approved i suppose it's technically correct that for this argument it wouldn't matter one way or the other and the district court did not reach the issue of whether these ingredients are approved or not however u s d a has stated clearly it's you that these ingredients are all allowed in or but that's that's still a separate store it is a it is a separate story and story for the moment because that's what the district court went off on and it's more that you agree that it does not matter whether the ingredients are approved or not even if they are not approved on the national list you would still win on the preemption ground that the district court if we were in conflict if that that's correct your honor right so and your argument that the statutes are in conflict is that the certification what is what the label means is that we are certified as organic and they are certified as organic and the certification  incompetently competently rightly or wrongly corruptly not corruptly the certifier determined that this product and this process was in compliance that is correct that is half of how we demonstrate that there is a conflict here between the state law causes of action being asserted and the federal statute the other half comes back to the organic foods production act itself in section sixty five a one of the act the first section after the definitions congress stated its purposes in acting this particular statute those are to have national standards for ga products a consistent standard for consumers in organic foods and to facilitate interstate commerce and organic products what is there about the new york statute in force labeling that any of those purposes because what it would allow if plaintiffs may proceed with a claim like this and if plaintiffs in other cases may proceed with claims like this is for different juries in different states applying different state laws to come to different decisions about what ingredients are may be used in organic infant formula and the act says that the secretary is the one who determines that and the mechanism that congress put in place to make sure that there was uniformity on a national basis is his authorized agents are the ones who certify the operations and make the mechanism is what's critical right not the ingredients themselves because here again we're not talking about we haven't heard reaching the defense that all the ingredients or prudent greedy and we're assuming that maybe they aren't and the question is you're see in that institutionally the goal of a national label that means something under this act is a statement about certification and that's inconsistent with allowing individual juries to go behind the certification and say oh this certification shouldn't be on there substantively even though the certification happened that's that's entirely correct and so i think what judge hogan and i were and skin your adversary about was trying to get at what is it that the certification actually means do a take it that your best statutory language anyway is what you cited earlier sixty five ten a if a handling operation which is what you are is going to be certified the certifier has to establish that no person has added any synthetic ingredients is there anything else  is there any is that the key that you have the other language we should look at it that way you have your give me your best five i will give you i will give you the the greatest hits your honor ok first a sixty five ten paragraph a which i've discussed another is sixty five zero three paragraph a which is the statutory section that directs the secretary of agriculture to establish an organic certification program and what the statute says in paragraph a is that the organic certification program is for producers and handlers of agricultural products that have been produced using organic methods it does not say that have a plan to be produced using organic methods so that is one i've already talked about seven c f r section two a five point two councils argument that sixty five prohibits the use of chemicals in the district certifier daws has certified organic plan and it said i think it's a quote it said that's nonsense or it makes little sense because that would mean if that's correct that the word organic does not have any meaning when you buy an organic product according to plaintiffs all you know is that it's producer had an organic plan you don't have any idea if they put non organic ingredients in there or not and that is absolutely not be the point  that that's exactly right and that's the question the district courthouse might be that lobbyists or food producers managed to get a get through congress something that as a new keep and no content or industry benefit that would not be unknown to  her in the world but all i can say about that your honor is what no sign it happened here of course judge judge chin though is saying this would make little sense that's a little different than saying as you've been saying today that there is pacifica language in the statute and in the regulations that refute any claim that all that's supposed to happen is looking at a plan and that's what i'm looking for and because i agree it would be a sort of toothless and strange statutory process but that's different than saying that's what the process actually is that congress created when i think in her opinion she was referring to the all of the statute as a whole she did not single out let me single out one final provision that i think is important that is seven c f r section two zero five point four zero four paragraph that is the regulation that tells a certifying agent when to grant certification and the language here is extremely important it says that certification certification has to be granted quote if the certifying agent determines that the organic system plan and all procedures and activities of the applicant's operation are in compliance with the regulation the certifying agent is directed specifically to make sure not only is there an organic plan which of course there must be but also that all of the x requirements are complied with the act has that same requirement in it  establishes synthetic chemicals that can be used that is how the statute works it as a general prohibition on the use of most synthetic chemicals and it directs the secretary to establish what they call the national list and the national list has a list of allowable synthetic chemicals and the ingredients in this case are all covered by an entry on the national list as u s d a itself is recognized for example excuse me in its proposed rule in two thousand and twelve which we talk about it great length in our brief the u s d a said it recognized that today organic infant formula producers and other producers of organic foods are using these ingredients in their products under this specific entry on the national list so these are yes synthetic but o and the product was certified this may be a winning argument for you ultimately the national list but it's not conflict preamps and for new york state's mislabeling law to be  to allow it to proceed to discovery it is your honor and this is why because it just doing more in foresman than the u s d a which looks like a paper tiger here so they want to give some teeth as judge would suggest it doesn't have to the u s d a is rules no your honor that's not correct what the plaintiffs are seeking to do here is they are seeking to overturn the federal finding the federal certification that abbott is in complete compliance with the act and it's regulations and all parts of the act in its regulations one of which of course is the provision on which synthetic ingredients may be used by women and that is if this goes back to the just accord but i do not believe this is conflict pre amps here's the way it's that is the only issue the a district court opined on but here is how it is conflict preemption two reasons first in order to prevail the plaintiffs in this case must necessarily overturn the federal certification they must use state law to have a finding that the federal agency is wrong about federal law that obstructs federal law because the organic foods production act gave to the agency the sole power to make that determination that's first that's the first way it conflicts with federal law the second way it conflicts with federal law is that it allows different courts around the country there are right now cases pending in the district of columbia in new york in two different districts in los angeles county superior court and elsewhere that make exactly the same arguments these cases have been filed around the country and they each seek to enforce through a jury verdict some different interpretation of what the nationalist means and what ingredients are allowed and so it is if they leave your goods around the country  that it is not complying with their statute now your honor that's not correct what it will mean is that the jury has disagreed with u s d a and the findings of its u s d a authorised certifier really the institutional argument isn't it that is it's not about whether you're argue about conflict is not about what ingredients can go in and can't go in that's on the list it's whatever it says under the  regulations your argument is about certification which is the mechanism what congress said was we want a national system of labeling and we want it all to be consistent and the way we going to enforce that is to have certifiers come in and say at least according to you whether all of these requirements including sub one are satisfied and that's how it's going to be done not through individual lawsuits that's what's in conflict it's not about the everybody agrees it seems to me on sixty five zero four parameters one everybody agrees that organic that the state law does you do the plaintiffs do that an organic product can have synthetic materials that are not on the national list every entirely correct you know in no inconsistency in anybody's view of the substance the question is is does the certification certify that there is full compliance and if so is that conclusive not with respect to some other kind of claim perhaps but at least with respect to a claim that it's misleading to put us da organic on the product i think that's entirely right your honor the part of the point that i was making about the inconsistency of verdicts is that juries if if these cases are allowed to proceed would be allowed to use state law to have their own findings about whether a product is organic or not and a single product could be found that ultimately be applying federal law they may get it wrong and a does have does have all of this does have all these regulations under the organic food production act one of which says that if you want to challenge something that a certifier has done there's a procedure under the organic food production act to do that and the procedure is to appeal the certifiers decision say here q ai's decision that abbott qualifies as an organic handler the act says if you want to challenge that you must go to the secretary of u s d a and present your challenge to him he has the final word and in that way then you could see issues get resolved on a national basis then sue a district court if you disagree with the secretary's decision yes you may you may sue if you disagree with the secretary's decision but then it is a suit against the secretary and it is a suit to try to overturn agency action which proceeds under highly deferential standard that's correct that's correct your honor and just again the terminology always bothers me maybe it shouldn't when you say that the certification is that is an organic handler evan makes non organic products to right isn't there a non organic similac or is that the only similac the organic one you know there is there's both ok so it's not an organic of the end it's not that you are an organic handler and therefore you can use this label on anything it's that this product is certified as organic we are with the way the act works is producers and handlers receive the certification but they receive it for a specific purpose in accordance with their organic plan we are a certified organic handler for similac organic of course not for other products and do you agree that it would be useful do you think it wouldn't be useful for us to get the views of the department of agriculture as to how this program works and whether they think that preempt the lawsuit what i would say about their owners i don't think it's necessary i think the statute is extremely clear in the provisions i've cited and in the regulatory statutes cites that i've given however we would welcome u s d a weighing in on the merits of this case and on whether this case should be in federal court or whether it infringes on the secretary's right and the certifiers right to say which products get the organic label or don't and in all of these other cases all around the country no one's ever asked or the department of agriculture has not weighed in that that brief doesn't exist somewhere in one of i don't believe that the department of agriculture has has ever weighed in and the only appellate decision on the point as i'm sure you know is the eight circuits decision you know were dairy where all of these claims were found to be preempted but i don't believe u s d a has separately and brought into one of these cases california supreme court decision decided to write right the california supreme court decision in case saga that was a decision where a particular grower of herbs was certified organic for one of its farm and grew conventional herbs on other routes far and what the california supreme court said is the allegation in this case is that you've taken the organic label that could properly be used on your organic herbs and you've just stuck it on the conventional herbs that claim that's not preempted that is a substitution fraud that's not an authorized use of the certification here we are authorized to use the label for this product to carve out in a row was similar right rural out some claims to survive that would not be granted but it was also a misuse of believable rather than that on the sort of process so yeah so what are worst said is there are some claims that were sort of that could proceed some that were preempted the ones that were preempted were the ones challenging whether the formula could bear the word organic or the u s d a organic seal anything challenging the certifiers decision was held preempted but just because the product was organic doesn't mean it could have other misrepresentations unrelated to organic in that case one of the allegations was that or a dairy the the producer had non or me had  a representation on its label that cows could roam free and it's pastures and the eighth circuit said if you allege that to be false and you were injured by it that claim could proceed but not a claim that the product is not organic and it's important to note this about a word dairy that case arose it was actually in m t l and all of those cases in it arose because u s d a itself was alleging aurora dairy was in violation of the regulations or dairy and u s d a came to a consent agreement for example or a dairy was alleged to be using non organic cows to produce organic milk or to sell as labeled organic milk and they came to a consent agreement where they agreed to resolve the use of those practices so were a dairy retired it's not organic house so after the consent agreement with a then consumer sued and said see they're not complying with the regulations and the eighth circuit said no that claim is preempted that determination was made by an authorized certifier and the representation on a product that it has been certified as organic and that it has the u s d a symbol on that the u s d a were gannett seal those are representations ingredients that we challenge and abbott's products are not on the nationalist abbott makes the argument that the nationalist allows all nutrients first it has to make a factual showing that that the district court did not reach correct correct told the certifier these are the things we put into the product and we put them in because we think they are nutrients within the meaning of the provision of the national list and the services yeah i think that's right so you're certified do you use still would you be able to maintain your view a lawsuit saying that because you think the certifier was wrong about that understanding or interpretation of the statute that avid is misrepresenting itself when it puts the u s d a organic label on the product yes in that case let's take an analogy of judicial review of administrative findings q a i would be making an error of law eroni asli interpreting the law as allowing these ingredients because it is a consumer fraud because they labeled it as organic and federal law prohibits that product being labeled as organ they said go ahead you can look into this deal with this is if you think the certifier made a mistake you go to the department and say hey the certifier made a mistake and then if the department says no we agree with the interpretation then you get your judicial review of the administrative action you don't get the judicial review of the administrative action by suing under state law and saying that the company is misrepresenting that it is organic even though it was certified as such by the department of agriculture's agent  that our adoption at the statute does not give consumers the ability to appeal a determination that a product is certified there is no such procedure whatsoever and also keep in mind that the u s d a did not approve this this product the u s d a did not certify this product it was a private party that it hires that's what because that's the way congress set this thing up right that they they instructed the department of agriculture not to hire their own inspectors but to certify certifiers and operate the plan through them absolutely and also congress set this up so that products that have banned synthetic ingredients would not be that's a serious that is a serious that is a serious charge and that is the district court misunderstood your complaint when it said that you do not allege substitution that you do not allege that there was a fraud on the just saying that they said in general we have nutrients we know for a fact that the ingredients used were not disclosed i don't know if abbott decided to wait a minute there on the label the disclose to your clients they're right there but they were not disclosed to cuba i before the certification certified it without knowing these ingredients i don't know if you i was ever informed but what we can allege on so what you're suggesting is if we find that the district court was right on preemption we still ought to reverse for abuse of discretion and not allowing an amended complaint i'm sorry could you repeat the question yes i'm saying if we find that the district court was right on preemption as you have currently written your complaint then the issue before us would be did the district court abuse its discretion in that granting you leave to amend to state a different claim that you now s found you didn't have in your original yes because the district court determination of preemption was based on its assumption that we can see that certification that this product that was actually sold was approved by well way way way way way way way one thing i suppose we might find out from the department of agriculture or we might find out by reading those regulations is that i was supposed to in issuing a certification look at what the ingredients were so that's a different if what you're saying i don't know what you mean by conceding certification what are you what are you conceding or not conceding it's the language of the district court used the district court thought that there was no dispute here the district court noted in the hearing just court we tried that you can actually make it clear to me i want to understand are you alleging fraud is what you're going to amend your complaint to say is fraudulent certification that is if the product was certified it is because a proposed amended complaint that was submitted to the district court we submitted a proposed amended complaint and also at the hearing we we should look to the proposed amended complaint in assessing whether you should be allowed to amend your complaint or are you now saying you have another amended amended complaint up your sleeve that you're telling us about that we should allow we should not limit ourselves to looking at the proposed amended complaint that was complaint is free and you are saying and asking us to rule that the district court erred in not giving you leave to amend the complaint and what i am asking you is is that e they that the district court did not allow you to file the amended complaint that was mitigated or are you also saying there is some other version of an amended complaint that it was error for the district court not to allow and where in the record will we look to see what that might look like some day i understand yes it's the latter we asked the court for leave to make those allegations if you give me a moment i can point you to the record hundred fourteen and twenty ok and so if we look at those places we will find references to the record that will allow us to determine what the amended complaint that you would like leave to file might say preempted the other point is with respect to the allegations in this call law is now describing the district court found those could not be stated consistent with rule eleven that was for finding you will see it in the transcript on the