Court Opinion

ID: 4667787
Source: CourtListenerOpinion
Date Created: 2021-03-15 20:02:15.659359+00
Date Added: 2024-06-11T08:02:59.040789
License: Public Domain

Filed 3/15/21 (unmodified opinion attached)
                        CERTIFIED FOR PUBLICATION

     IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                         SECOND APPELLATE DISTRICT

                                     DIVISION FIVE

CAROL LEINING,                                       B291600

        Plaintiff and Appellant,                  (Los Angeles County
                                                 Super. Ct. No. BC588004)
        v.

FOSTER POULTRY FARMS, INC. et                   ORDER MODIFYING OPINION
al.,                                            [There is no change in judgment]

        Defendants and Respondents.

BY THE COURT:
      It is ordered that the opinion filed herein on February 23, 2021, is
modified as follows:

        1.       On page 1, delete counsel listings for Defendants and
                 Respondents and replace with:
                 Duane Morris, Michelle Pardo, Rebecca Bazan and Paul J.
                 Killion for Defendant and Respondent American Humane
                 Association.

                 Mayer Brown, Dale J. Giali, Elizabeth Crepps and Donald M.
                 Falk for Defendant and Respondent Foster Poultry Farms, Inc.
     2.    On page 16, last paragraph, first sentence that reads “Against
           this overwhelming weight of authority, Leining offers no
           authority that a labeling claim is was not preempted under the
           PPIA” should be deleted and replaced with:
           Against this overwhelming weight of authority, Leining offers
           no authority that a labeling claim is not preempted under the
           PPIA.

     There is no change in judgment.

____________________________________________________________
RUBIN, P. J.                BAKER, J.             KIM, J.

                                  2
Filed 2/23/21 (unmodified opinion)
                   CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
                    SECOND APPELLATE DISTRICT
                                DIVISION FIVE

CAROL LEINING,                              B291600

       Plaintiff and Appellant,             (Los Angeles County
                                            Super. Ct. No. BC588004)
       v.

FOSTER POULTRY FARMS, INC.
et al.,

       Defendants and Respondents.

     APPEAL from a judgment of the Superior Court of Los
Angeles County, John Shepard Wiley, Jr., Judge. Affirmed.

     Drinker Biddle & Reath, Sheldon Eisenberg, Ryan M.
Salzman and Mark E. Haddad for Plaintiff and Appellant.

      Duane Morris, Michaelle Pardo, Rebecca Bazan and Paul J.
Killion for Defendants and Respondents American Humane
Association.

     Mayer Brown, Dale J. Giali, Elizabeth Crepps and Donald
M. Falk for Defendants and Respondents Foster Poultry Farms,
Inc.

                        __________________________
       The American Humane Association has created a farm
animal welfare program, by which it certifies farm-based food
producers who comply with its animal welfare standards. If a
producer complies with American Humane’s standards, the
producer can use American Humane’s “American Humane
Certified” logo on its food, provided it also pays a licensing fee for
use of American Humane’s trademark.
       Foster Poultry Farms, Inc. participates in the American
Humane program and uses the American Humane Certified logo
on all its chicken products sold in California. Foster Farms must
obtain federal approval for the labels of its chicken products, and
has obtained that approval for the labels which include American
Humane’s logo.
       Foster Farms charges more for its chicken than other
producers whose chicken does not bear the American Humane
Certified logo. Plaintiff Carol Leining purchased some Foster
Farms chicken, in reliance on the American Humane Certified
logo on its label. She believed that the American Humane
certification meant that the chicken had been humanely treated;
but in this litigation, she alleges that the true facts are American
Humane certification means nothing, and Foster Farms’s chickens
were treated inhumanely.
       Leining brought suit against Foster Farms for its allegedly
misleading labels and against American Humane for its allegedly
negligent certification. After extensive litigation, both defendants
were granted summary judgment. We affirm, on the basis that
Leining has not pleaded a viable cause of action against either
defendant. The claims against Foster Farms are barred by federal

                                  2
preemption, and the negligent certification claim against
American Humane is not viable in the absence of physical injury. 1
       FACTUAL AND PROCEDURAL BACKGROUND 2
1.     Allegations of the Complaint
       American Humane is a non-profit organization. It operates
a program called American Humane Certified, which it represents
“ ‘provide[s] verifiable assurance to customers and retailers that
products carrying the American Humane Certified™ label have
met rigorous, science-based animal welfare standards and that
the animals in the program were humanely raised.’ ”
       Leining alleges as follows. Foster Farms paid American
Humane for the use of its certification. The certification “creates
a reasonable expectation among consumers that the chicken they
are purchasing is produced under circumstances that would be
understood to be humane.” This impression is untrue and Foster
Farms’s chickens are instead treated in a manner that “falls well
short of a reasonable consumer’s expectation for humane
treatment.” In fact, American Humane certifies chicken produced
under the industry’s standard operating procedures, and the birds

1     The two respondents, the American Humane Association
and Foster Farms Poultry, Inc., have filed joint briefs in this
appeal. Not all issues raised in the appeal apply to both
respondents. We generally use the parties’ names to identify
them and only use “respondents” or “defendants” when the
discussion applies to both parties.

2      Because we conclude that, in effect, both defendants were
entitled to judgment on the pleadings, we limit our factual
discussion to the allegations of Leining’s operative complaint and
matters of which we can take judicial notice, such as guidelines
promulgated by federal agencies.

                                 3
it certifies are treated no better than any other chicken farmed for
food. Leining bought Foster Farms’s chicken in reliance on the
false representation, paying more than the price of other chicken
which did not carry the American Humane Certified label.
2.     Foster Farms’s Use of the American Humane Certified
       Logo for the Sale of Its Chicken is Federally Approved
       All poultry and poultry products sold in the United States
are subject to the Poultry and Poultry Products Inspection Act
(PPIA). (21 U.S.C. §§ 451 et seq.) Implementing regulations
require that no label may be used on poultry or a poultry product
unless it has been pre-approved by the Food Safety and Inspection
Service (FSIS). 3 (9 C.F.R. 412.1, subd. (a).)
       A label claim “regarding the raising of animals” is
considered a special statement or claim which requires submission
of a “sketch” label and approval of that sketch. (9 C.F.R. 412.1,
subds. (c)-(e).) Foster Farms submitted its labels for sketch
approval; in order to support its use of the American Humane
Certified logo, it submitted the certificates of approval it had
received from American Humane. The FSIS approved the labels
which included the American Humane Certified logo.
3.     FSIS Labeling Guidelines
       During the time Foster Farms was using the American
Humane certification on its label, and well into this appeal,
animal welfare advocates were challenging the standards used by

3     There is an exception for “generically approved labels,”
which are considered preauthorized. (9 C.F.R. 412.2.) The
exception does not apply in this case.

                                 4
FSIS in its approval of labels which claimed the humane
treatment of animals used for food. 4
       In December 2019, the FSIS updated its Labeling Guideline
on Documentation Needed to Substantiate Animal Raising Claims
for Label Submission. ( [as of Feb. 11, 2021], archived at
.) The guidelines do not include
substantive requirements for a claim of humane animal
treatment, but simply require that the label either describe what
it means by humane, or, if it uses a third-party certification,
contain the certifier’s name, logo, and website. (Id. at pp. 10-11,
15.)
       The FSIS responded, via the Federal Register, to a number
of the comments it had received on its prior guideline, which had
been published in 2016. (84 FR 71359; see 81 FR 68933.) Of

4     The issue was raised as early as May 2014, when the
Animal Welfare Institute submitted a petition for rulemaking,
asking the FSIS to create a rule mandating that any label claims
of humane animal treatment, and other animal raising claims, be
supported by third-party certification, from certifiers who audited
according to published standards which exceeded conventional
industry practices. ( [as of Feb. 11, 2021], archived at
.) The petition would ultimately be
denied in February 2019. ( [as of Feb. 11,
2021], archived at .)

                                 5
particular relevance, the FSIS had received comments from
animal welfare advocacy organizations and individuals who took
the position that FSIS “currently approves claims based on
standards that do not meet consumer expectations. To address
these concerns, the comments . . . stated that FSIS should only
approve animal welfare and environmental stewardship claims
that have been certified by an independent third-party certifying
organization that has established standards that exceed the
conventional industry standards defined by meat and poultry
trade associations.” (84 FR 71362.) FSIS disagreed, explaining,
“The issues raised in the comments . . . show that consumers,
producers, and certifying entities have different views on the
specific animal production practices that should be associated
with certain animal welfare or environmental stewardship claims.
Thus, because animal welfare or environmental stewardship
claims mean different things to different people, a claim that is
defined by a specific third-party certifying organization’s animal-
raising standards cannot reflect the diverse views associated with
these types of claims.” (84 FR 71362-71363.)
       With respect to third-party certification, FSIS explained, “If
the claim is certified by a third-party certifying organization, FSIS
will approve the label bearing the claim if it includes the
certifying entity’s name, website address, and logo, when the
organization has a logo, as described in the guideline. Under this
approach, the labeling of a meat or poultry product that bears an
animal welfare or environmental stewardship claim includes the
information that consumers need to determine whether the
animal-raising practices used to define a particular animal claim
meets their expectations for the claim.” (84 FR 71363, fn.
omitted.)

                                 6
       There is no dispute that FSIS approved Foster Farms’s
labels containing the American Humane logo. Leining does not
allege that Foster Farms was ever out of compliance with the
FSIS’s governing guidelines.
4.     Plaintiff’s Initial Complaint
       On July 13, 2015, Leining filed her class action complaint,
initially naming only Foster Farms as a defendant. She alleged
that Foster Farms’s use of the American Humane Certified logo
on its labels was deceptive and misleading because her
“objectively reasonable” understanding of the certification was
that the chickens used by Foster Farms “were afforded a
comfortable existence and a quick and painless death.” She would
not have purchased the chicken had she known that Foster
Farms’s chickens “were not in fact treated humanely, or even
significantly differently from most other chickens on the market.”
She alleged causes of action for unfair competition, negligent
misrepresentation, breach of express warranty, and breach of the
implied warranty of merchantability – all on the theory that the
label itself was deceptive because the chicken was not produced
under humane circumstances.
5.     Foster Farms’s Initial Demurrer
       Foster Farms demurred. The demurrer is not part of the
record on appeal, but we do have the court’s ruling sustaining the
demurrer with leave to amend. The trial court was concerned
that Leining was attempting to appoint herself arbiter of what is,
or is not, humane. It explained, “Leining’s complaint has no legal
basis. Leining cites no case in which a producer complied with
third party standards but was found guilty of misrepresentation
or breach of warranty because, in someone’s opinion, the third-
party standards were lax.” However, the court believed Leining

                                7
might be able to state a claim under a different theory, and drew
the parties’ attention to Hanberry v. Hearst Corp. (1969)
276 Cal.App.2d 680 (Hanberry), a case which held that, under
certain circumstances, a plaintiff physically injured by a product
may be able to state a claim in negligent misrepresentation
against a third party who had endorsed the product.
6.    Leining’s Operative Complaint
      The operative complaint is Leining’s first amended
complaint. Leining re-alleged her causes of action against Foster
Farms for unfair competition, negligent misrepresentation, breach
of express warranty, and breach of the implied warranty of
merchantability. She reasserted her original theory of relief
supporting each of these causes of action—that her objectively
reasonable understanding of the American Humane Certified logo
on the label was that Foster Farms’s chickens had been afforded a
comfortable existence and a quick and painless death, but this
was untrue.
      In accordance with the trial court’s suggestion, Leining also
added American Humane as a defendant, and alleged against it a
cause of action for negligent misrepresentation. Leining
specifically alleged that American Humane either made no
examination of whether Foster Farms’s chickens were humanely
raised according to science-based standards or, if any examination
had been performed, it was careless and negligent.
7.    Demurrers to the Operative Complaint
      Both Foster Farms and American Humane demurred.
Foster Farms argued, among other things, federal preemption, in
that all of the causes of action against it were based on its labels,
which had been approved by the FSIS. American Humane
demurred as well, arguing that Hanberry was inapplicable in the

                                  8
absence of physical injury, and that, in any event, its certification
was not false.
       The trial court overruled both demurrers. The court
continued to believe that Leining had not properly alleged a cause
of action for direct liability on the merits against Foster Farms.
However, it concluded that Leining could pursue her cause of
action for negligent misrepresentation against American Humane,
due to her allegation that American Humane issued its
certification based on a careless or negligent investigation. It
reasoned that this theory could also support relief against Foster
Farms.
       Because the court believed the only validly pleaded theory
was what it deemed “fraudulent licensing,” the court suggested
American Humane and Foster Farms move for summary
judgment, by presenting evidence that American Humane’s
certification was actually based on a reasonable investigation and
legitimate standards.
       After answering the complaint, Foster Farms and American
Humane together moved for summary judgment on the grounds
suggested by the trial court.
8.     Defendants’ Motion for Summary Judgment
       Defendants directed their summary judgment motion to the
fraudulent licensing theory the trial court concluded had defeated
their demurrers. Defendants presented the details of American
Humane’s certification program, including that its standards were
established by its Scientific Advisory Board, and that its audit
process objectively determined compliance.
       Defendants also argued that Leining’s entire complaint was
barred by express preemption under the PPIA.

                                 9
9.     Leining’s Opposition
       Leining opposed summary judgment on the merits, raising a
number of issues with American Humane’s standards, its
relationship with Foster Farms, and the procedure by which it
conducted its audits.
       As to federal preemption, Leining argued that label pre-
approval is not sufficient to trigger preemption.
10. Trial Court’s Ruling
       The court concluded defendants had met their initial burden
of establishing that American Humane’s certification was
independent, reasonable, and involved some level of expertise.
The court then considered, and rejected, each of plaintiff’s
counter-arguments which purportedly raised a triable issue of
fact. Judgment was entered for defendants. Leining filed a timely
notice of appeal.
       On appeal, the parties briefed the merits of the trial court’s
summary judgment ruling. In the combined respondents’ brief,
Foster Farms argued that summary judgment in its favor could be
affirmed on the basis of federal preemption. We sought additional
briefing on the issue which had been raised by American
Humane’s demurrer – whether a cause of action could be asserted
against it under Hanberry in the absence of physical injury.
                           DISCUSSION
       We conclude we need not decide whether there are triable
issues of fact that would defeat summary judgment. Instead, we
first address Foster Farms’s federal preemption argument, and
conclude the complaint against it, based on its purportedly
misleading labels, is barred by federal law. Next, we consider
whether a Hanberry cause of action for negligent
misrepresentation can be asserted against a certifier of a product

                                 10
in the absence of physical injury. We conclude that it cannot.
Therefore, we affirm the judgment in favor of defendants.
1.    Standard of Review
      Although this case proceeded to summary judgment, we find
it unnecessary to review the trial court’s ruling on the substantial
factual record presented by the parties. When a motion for
summary judgment presents the argument that the plaintiff
cannot state a cause of action, we review the issue as a matter of
law de novo. (Aetna Health Plans of Cal., v. Yucaipa-Calimesa
Joint Unified Sch. Dist. (1999) 72 Cal.App.4th 1175, 1186-1187.)
We review the sufficiency of Leining’s complaint, as we would on
demurrer or judgment on the pleadings. “ ‘We treat the demurrer
as admitting all material facts properly pleaded, but not
contentions, deductions or conclusions of fact or law. [Citation.]
We also consider matters which may be judicially noticed.’
[Citation.]” (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.)
2.    Federal Preemption Bars the Claims Against Foster
      Farms
      Each of Leining’s direct causes of action against Foster
Farms is based on the premise that its labels’ inclusion of the
American Humane Certified logo was itself misleading, because
the chicken was not treated in a manner that an objectively
reasonable consumer would consider humane.
      We conclude that these causes of action are barred by the
doctrine of federal preemption, based on the express preemption
clause of the PPIA. The Foster Farms labels, inclusive of the
American Humane Certified logo which Leining alleges is
misleading, were pre-approved by the FSIS, in accordance with
the PPIA.

                                11
       Federal preemption principles derive ultimately from our
national Constitution. “ ‘The supremacy clause of the United
States Constitution establishes a constitutional choice-of-law rule,
makes federal law paramount, and vests Congress with the power
to preempt state law.’ [Citations.] Similarly, federal agencies,
acting pursuant to authorization from Congress, can issue
regulations that override state requirements. [Citations.]
Preemption is foremost a question of congressional intent: did
Congress, expressly or implicitly, seek to displace state law?
[Citation.] [¶] We have identified several species of preemption.
Congress may expressly preempt state law through an explicit
preemption clause, or courts may imply preemption under the
field, conflict, or obstacle preemption doctrines. [Citations.]”
(Quesada v. Herb Thyme Farms, Inc. (2015) 62 Cal.4th 298, 307-
308.)
       We are here concerned with express preemption. “Where
the federal statute contains an express preemption clause, we
must determine the substance and scope of the clause. [Citation.]
In so doing, we assume ‘that the historic police powers of the
States were not to be superseded by the Federal Act unless that
was the clear and manifest purpose of Congress.’ [Citation.] And
finally, ‘when the text of a pre-emption clause is susceptible of
more than one plausible reading, courts ordinarily “accept the
reading that disfavors preemption.” ’ [Citation.]” (Ass’n des
Eleveurs de Canards et d’Oies du Quebec v. Becerra (9th Cir. 2017)
870 F.3d 1140, 1146.)
       Our preemption inquiry starts with the applicable federal
law. The PPIA forbids the sale, or the offering for sale, of any
poultry or poultry product “under any name or other marking or
labeling which is false or misleading . . . .” (21 U.S.C. § 457(c).) If

                                  12
the Secretary of the USDA has “reason to believe” any labeling is
false or misleading, the Secretary may direct that it not be used.
The poultry producer may request a hearing to challenge the
determination, which is conclusive absent a direct appeal to the
federal Court of Appeals. (21 U.S.C. § 457(d).) Similarly, a
poultry product is considered “misbranded” if its labeling “is false
or misleading in any particular.” (21 U.S.C. § 453(h)(1).) Sale of
misbranded poultry is punishable by fine or imprisonment.
(21 U.S.C. § 461.) District courts are vested with jurisdiction to
enforce and restrain violations of the PPIA. (21 U.S.C. § 467c.)
All proceedings “for the enforcement or to restrain violations of
this chapter shall be by and in the name of the United States.”
(Ibid.)
       The preemption clause is contained in 21 United States
Code section 467e. That section provides, in pertinent part,
“Marking, labeling, packaging, or ingredient requirements . . . in
addition to, or different than, those made under this [chapter]
may not be imposed by any State or Territory or the District of
Columbia with respect to articles prepared at any official
establishment[ 5] in accordance with the requirements under this
[chapter], but any State or Territory or the District of Columbia
may, consistent with the requirements under this [chapter]
exercise concurrent jurisdiction with the Secretary over articles
required to be inspected under this [chapter] for the purpose of

5     An “official establishment” is “any establishment
determined by the Secretary at which inspection of the slaughter
of poultry, or the processing of poultry products, is maintained
under the authority of this [chapter].” (21 U.S.C. § 453(p).) The
parties do not raise any legal issues related to “official
establishment.”

                                 13
preventing the distribution for human food purposes of any such
articles which are adulterated or misbranded and are outside of
such an establishment, or, in the case of imported articles which
are not at such an establishment, after their entry into the United
States.”
       Foster Farms argues that Leining’s complaint against it is
preempted under the first clause as imposing a labeling
requirement in addition to, or different than, those required under
the PPIA. Leining responds that, in challenging the label as
misleading, she is not seeking to impose a different requirement
than the PPIA, and therefore falls under the second, concurrent
jurisdiction, clause.
       Foster Farms has the better argument. Because the labels
were pre-approved by the FSIS, the federal government has
determined that the labels, which include American Humane
certification, are not misleading under the PPIA. If Leining were
to prevail on her tort claims that the labels were nonetheless
misleading, California courts would be imposing an additional
requirement to those imposed by the PPIA. Numerous courts
addressing similar contentions under the PPIA have reached this
conclusion. (Kuenzig v. Hormel Foods Corp. (11th Cir. 2013)
505 Fed.Appx. 937, 938 [plaintiffs’ claim that defendant misled
consumers by listing caloric amounts and fat-free percentages
adjacent to each other on lunch meats was preempted as imposing
an additional requirement on labels already approved under the
PPIA]; 6 Nat’l Broiler Council v. Voss (9th Cir. 1994) 44 F.3d 740,

6      Federal nonpublished opinions, such as Kuenzig v. Hormel
Foods Corp., supra, 505 Fed.Appx. at page 938, may be cited by
California state courts. (City of Hawthorne ex rel. Wohlner v.

                                14
745-746 [California statute defining when wholesalers can use the
word “fresh” on poultry imposes a requirement in addition to the
USDA’s definition of “fresh” and is therefore preempted]; Webb v.
Trader Joe’s Co. (S.D. Cal. 2019) 418 F.Supp.3d 524, 529, app.
pending [plaintiff’s claim that defendant’s poultry products are
mislabeled to the extent they claim “up to 5% retained water”
would impose a requirement in addition to the PPIA on pre-
approved labels and is therefore preempted]; La Vigne v. Costco
Wholesale Corp. (S.D.N.Y. 2018) 284 F.Supp.3d 496, 508-511
[plaintiffs’ claim that Costco canned chicken is mislabeled because
it fails to disclose the proper percentage of broth would impose a
requirement in addition to the PPIA-pre-approved label and is
therefore preempted]; Shin v. Campbell Soup Company (C.D. Cal.
2018) 2018 WL 6164264, *3 [plaintiff’s claims that the labels of
defendant’s chicken soups are misleading when they assert “25%
less sodium” or “98% fat free” are preempted because they seek to
impose labeling requirements different than those mandated by
the PPIA]; Phelps v. Hormel Foods Corp. (S.D. Fla. 2017)
244 F.Supp.3d 1312, 1314-1317 [plaintiff’s claim that “100%
Natural” and “No Preservatives” statements on labels are
misleading would impose an additional requirement when the
labels had been pre-approved by the FSIS]; Brower v. Campbell
Soup Co. (S.D. Cal. 2017) 243 F.Supp.3d 1124, 1126-1127
[plaintiff’s claim that defendant’s soup was misleadingly labeled
as “healthy” and indicated it was certified by the American Heart
Association without explaining that defendant had paid for that
certification was preempted because it sought to impose additional

H&C Disposal Co. (2003) 109 Cal.App.4th 1668, 1678, fn. 5; see
Cal. Rules of Court, rule 8.1115.)

                                15
labeling requirements to a label pre-approved by the FSIS];
Grocery Mfrs. Ass’n v. Sorrell (D.Vt. 2015) 102 F.Supp.3d 583, 620
[Vermont statute which prohibits labeling genetically engineered
foods as “natural” imposes a different requirement and is
therefore preempted to the extent it applies to food subject to the
PPIA; related factual issues preclude dismissal]; Meaunrit v.
ConAgra Foods Inc. (N.D. Cal. 2010) 2010 WL 2867393, *7
[plaintiff’s claim that preparation directions on chicken pot pie
label are inaccurate is preempted as imposing an additional claim
on a label pre-approved by the FSIS]).
       Of particular significance is Arnold v. Kroger (Ohio App.
2016) 45 N.E.3d 1092, in which the plaintiffs alleged that the
defendant’s “Simple Truth” brand chicken had labels which falsely
and misleadingly claimed the “chicken was ‘raised in a humane
environment’ and/or ‘humanely raised.’ ” (Id. at pp. 1092-1093.)
The plaintiffs alleged, much as Leining does here, that the labels
were misleading, because the chickens were “raised no differently
than any other chicken mass produced by its supplier, Perdue.”
(Id. at p. 1093.) The trial court dismissed the plaintiffs’ causes of
action alleged under state consumer protection laws and common
law torts because they were preempted by the PPIA. (Ibid.) The
plaintiffs appealed, arguing that the FSIS does not “review the
meaning of claims regarding the humane treatment of animals.”
(Ibid.) The appellate court affirmed. The FSIS had approved the
labels and determined that they were not false or misleading.
Therefore, any liability the plaintiffs sought to impose based on
their state law claims would in essence attach additional or
different terms to the defendant’s labeling. (Id. at p. 1094.)
       Against this overwhelming weight of authority, Leining
offers no authority that a labeling claim is was not preempted

                                 16
under the PPIA. Instead, she argues that her claim falls under
the concurrent jurisdiction provision of the PPIA’s preemption
clause, by citing to cases discussing concurrent jurisdiction under
other statutes. 7 (See, e.g., Bates v. Dow Agrosciences LLC (2005)
544 U.S. 431, 434 [the Federal Insecticide, Fungicide, and
Rodenticide Act [FIFRA] did not preempt equivalent state labeling
laws; only state laws that were “in addition to or different from”
the federal labeling and packaging rules were preempted];
Medtronic, Inc. v. Lohr (1996) 518 U.S. 470 [same test under the
Medical Device Amendments of 1976]; Quesada v. Herb Thyme
Farms, Inc., supra, 62 Cal.4th at pp. 308-310 [the Organic Foods
Production Act of 1990 ‘‘permits states to adopt more stringent
standards governing organic production”].) Yet these cases
recognize that while state law remedies to enforce the federal
standards are not preempted, additional labeling requirements
are. “In sum, under our interpretation, [the preemption clause of

7     The one PPIA case on which she relies is Association des
Eleveurs de Canards et d’Oies du Quebec v. Becerra, supra,
870 F.3d at page 1143, which held that the PPIA did not preempt
a California statute banning the making of foie gras by force-
feeding poultry. Because the California statute addressed the
making and sale of foie gras, but not its labeling, PPIA label
preemption was not at issue. In finding the California law was
not preempted, the Ninth Circuit held that nothing in the
challenged state statute “interferes with the USDA’s ‘authority to
inspect poultry producers for compliance with health and sanitary
requirements, require[ ] inspection of poultry after slaughter,
establish[ ] labeling requirements for poultry products, [or] allow[ ]
for withdrawal of inspections for noncompliance and the
imposition of civil and criminal penalties for the sale of
adulterated products.’ [Citation.]” (Id. at p. 1153.)

                                 17
FIFRA] retains a narrow, but still important, role. In the main, it
pre-empts competing state labeling standards—imagine 50
different labeling regimes prescribing the color, font size, and
wording of warnings—that would create significant inefficiencies
for manufacturers. The provision also pre-empts any statutory or
common-law rule that would impose a labeling requirement that
diverges from those set out in FIFRA and its implementing
regulations. It does not, however, pre-empt any state rules that
are fully consistent with federal requirements.” 8 (Bates v. Dow
Agrosciences LLC, supra, 544 U.S. at p. 452, fn. omitted.)
       Cases interpreting the PPIA have acknowledged the
identical distinction. While additional labeling claims are
preempted, concurrent jurisdiction permits States to impose
additional remedies for violations of the PPIA. (E.g., La Vigne v.
Costco Wholesale Corp., supra, 284 F.Supp.3d at pp. 508-510; Shin
v. Campbell Soup Company, supra, 2018 WL 6164264 at *4.)
       According to its legislative history, one of the key purposes
of the PPIA preemption clause “was to ensure national uniformity
in labeling.” (Nat’l Broiler Council v. Voss, supra, 44 F.3d at
p. 744.) This purpose would be defeated if states could, via tort
law or otherwise, impose additional labeling requirements on

8      That is so because “a state cause of action that seeks to
enforce a federal requirement ‘does not impose a requirement that
is “different from, or in addition to,” requirements under federal
law. To be sure, the threat of a damages remedy will give
manufacturers an additional cause to comply, but the
requirements imposed on them under state and federal law do not
differ. [The preemption clause] does not preclude States from
imposing different or additional remedies, but only different or
additional requirements.’ [Citation.]” (Bates v. Dow Agrosciences
LLC, supra, 544 U.S. at p. 448, bracketed modification ours.)

                                18
labels already approved under the PPIA. Leining’s causes of
action against Foster Farms challenge Foster Farms’s federally-
approved labels and effectively seek to impose additional labeling
requirements. Those claims are preempted by the PPIA.
       Our conclusion is confirmed by the FSIS’s discussion of
public comments in the evolution of its Labeling Guideline on
Documentation Needed to Substantiate Animal Raising Claims
for Label Submission. Animal welfare advocates had specifically
requested the FSIS only approve third-party certifications from
entities with stricter standards than conventional industry
practices. FSIS refused. It concluded that different claims meant
different things to different people, and that it would approve a
label containing a third-party certification as long as consumers
could learn from the third-party’s website the standards the
certifier used – thereby enabling each consumer to make an
informed decision as to whether a particular certification met the
consumer’s expectations for the language used. Leining’s causes
of action based on Foster Farms’s allegedly misleading use of the
word “humane” on its labels would have us impose a particular
meaning on “humane” when used on a label, in direct
contravention of the FSIS’s determination that the meaning of the
word should be left to the certifier. (84 FR 71362-71363.)
       We conclude the causes of action against Foster Farms are
federally preempted.
3.     Leining Does Not State a Negligent Misrepresentation
       Cause of Action Against American Humane
       Leining alleged a single cause of action, for negligent
misrepresentation, against American Humane. Although she
argued it under the authority of Hanberry, supra, 276 Cal.App.2d
680, the parties recognize two potentially applicable theories.

                               19
“California courts have recognized a cause of action for negligent
misrepresentation, i.e., a duty to communicate accurate
information, in two circumstances. The first situation arises
where providing false information poses a risk of and results in
physical harm to person or property. The second situation arises
where information is conveyed in a commercial setting for a
business purpose.” (Friedman v. Merck & Co. (2003)
107 Cal.App.4th 454, 477 (Friedman).) The first is the Hanberry
cause of action which Leining initially pursued. (Ibid.) The
second, which we will discuss below, was raised by Leining in
letter briefing on appeal, after she conceded Hanberry itself does
not apply.
       A.     Hanberry Does Not Apply In the Absence of Physical
              Injury
       Hanberry recognized a cause of action against the allegedly
negligent certifier of a pair of shoes, after the plaintiff slipped and
fell, suffering serious injuries. (Hanberry, supra, 276 Cal.App.2d
at pp. 682-683.) Hanberry had alleged that defendant published
“a monthly magazine known as Good Housekeeping in which
products, including the shoes she purchased, were advertised as
meeting the ‘Good Housekeeping’s Consumers’ Guaranty Seal.’
With respect to this seal the magazine stated: ‘This is Good
Housekeeping’s Consumers’ Guaranty’ and ‘We satisfy ourselves
that products advertised in Good Housekeeping are good ones and
that the advertising claims made for them in our magazine are
truthful.’ ” (Id. at p. 682.) The plaintiff further alleged that,
despite the magazine’s representation to the contrary, it had made
“no examination, test or investigation of the shoes, or a sample
thereof, or if such tests were made they were done in a careless
and negligent manner and that [the publisher’s] issuance of its

                                  20
seal and certification as to the shoes was not warranted by the
information it possessed.” (Id. at p. 683.) On appeal from the
sustaining of the publisher’s demurrer, the Court of Appeal
concluded this was sufficient to state a cause of action. (Ibid.)
       Leining and the trial court in this case focused on
Hanberry’s language allowing a cause of action when a certifier
has conducted no tests, or conducted tests negligently, before
certifying the product. But Hanberry arose in a case of physical
injury, and relied on a provision of the Restatement Second of
Torts, section 311, which was limited to those circumstances.
(Hanberry, supra, 276 Cal.App.2d at p. 685, fn. 1.) That section
provides, “One who negligently gives false information to another
is subject to liability for physical harm caused by action taken by
the other in reasonable reliance upon such information . . . .”
(Rest.2d Torts, § 311, italics added.)
       Cases subsequent to Hanberry have confirmed that this
cause of action, based on section 311 of the Restatement, requires
physical injury. (T.H. v. Novartis Pharmaceuticals Corp. (2017)
4 Cal.5th 145, 162-163, 190; Garcia v. Superior Court (1990)
50 Cal.3d 728, 734-736.) Particularly relevant here is Friedman,
supra, 107 Cal.App.4th 454, decided by a prior panel of this court.
There, plaintiff, a strict vegan, alleged he suffered emotional
distress when he discovered a tuberculosis test to which he had
submitted contained animal products. He brought suit against
the distributors of the test, who had negligently represented, upon
inquiry, that the test did not contain animal products. (Id. at
p. 461.) The panel concluded the Hanberry cause of action for
negligent misrepresentation was not available, on the basis that it
requires physical harm to person or property, and plaintiff alleged
only emotional distress. (Id. at pp. 477, 480-481.)

                                21
      Just like the plaintiff in Friedman, Leining asserts no
physical injury – only the economic harm involved in the
increased cost of the chicken she had been led to believe had been
humanely raised. The Hanberry cause of action is not available to
her.
      B.     A Cause of Action for Negligent Misrepresentation in a
             Commercial Setting is Inapplicable to Misrepresentations
             Made to the General Public, as Was the Case Here
      When we sought additional briefing on the elements of a
negligent misrepresentation claim as alleged here, Leining
recognized that she had not alleged physical injury, and
represented that she was no longer seeking to pursue her
negligent misrepresentation cause of action under Hanberry and
section 311 of the Restatement.
      Instead, Leining argues that she can pursue her negligent
misrepresentation cause of action under the alternative theory
discussed in Friedman – “where information is conveyed in a
commercial setting for a business purpose.” (Friedman, supra,
107 Cal.App.4th at p. 477.) This is a cause of action under Bily v.
Arthur Young & Co. (1992) 3 Cal.4th 370 (Bily) and section 552 of
the Restatement. 9
      Unlike the negligent misrepresentation cause of action
recognized by Hanberry and section 311 of the Restatement, the

9      American Humane argues that Leining has waived this
argument because of her failure to raise it before the trial court.
Whether Leining can state a cause of action under this theory was
fully briefed in response to our request for additional briefing, and
can be resolved as an issue of law on undisputed facts. We have
discretion to address such issues (In re Marriage of Oliverez (2019)
33 Cal.App.5th 298, 316) and exercise our discretion to do so here.

                                 22
cause of action under Bily and section 552 does not require
physical injury. Perhaps for this reason, its contours are
narrower in other respects. (See Rest.2d Torts, § 311, com. a.)
Section 552 provides, in pertinent part, that “[o]ne who, in the
course of his business, profession or employment, or in any other
transaction in which he has a pecuniary interest, supplies false
information for the guidance of others in their business
transactions, is subject to liability for pecuniary loss caused to
them by their justifiable reliance upon the information, if he fails
to exercise reasonable care or competence in obtaining or
communicating the information.”
       Although facially the statement might appear to govern
Leining’s claims, the section comes with an important limitation.
It is restricted to a loss suffered “by the person or a limited group
of persons for whose benefit and guidance he intends to supply the
information or knows that the recipient intends to supply it.”
(Rest.2d Torts, 552(2)(a).) When the California Supreme Court
adopted the Restatement rule in Bily, it was careful to restrict the
class of potential plaintiffs to “those to whom or for whom the
representations were made.” 10 (Bily, supra, 3 Cal.4th at p. 408

10     Liability for negligence for purely economic losses is “ ‘the
exception, not the rule,’ ” in California. (Southern California Gas
Leak Cases (2019) 7 Cal.5th 391, 400, 403 [holding that purely
economic business losses sustained as a result of a natural gas
leak were not recoverable in part because of “concerns about
limitless liability and unending litigation”].) The primary
exception is where the plaintiff and defendant have a special
relationship. (Ibid.) The Bily rule is an application of this
principle to the tort of negligent misrepresentation. (Id. at
pp. 401-402.)

                                 23
[independent auditor may be liable to persons who rely on an
audit in a transaction which the auditor intended to influence].)
Bily favorably described the Restatement rule as one that
“attempts to define a narrow and circumscribed class of persons to
whom or for whom representations are made. In this way, it
recognizes commercial realities by avoiding both unlimited and
uncertain liability for economic losses in cases of professional
mistake and exoneration of the auditor in situations where it
clearly intended to undertake the responsibility of influencing
particular business transactions involving third persons. The
Restatement rule thus appears to be a sensible and moderate
approach to the potential consequences of imposing unlimited
negligence liability which we have identified.” 11 (Ibid.)
       Even assuming that Leining can satisfy the other elements
of this cause of action for professional negligence in business
advice, she cannot establish that she is a member of a “limited
group of persons for whose benefit and guidance” (Rest.2d Torts,
552(2)(a)) American Humane supplied its certification. Put
simply, American Humane anticipated Foster Farms would place
its certification on all of its chicken products in California, to
influence any potential chicken-buyers in the general public. That
is the opposite of a limited group of persons.
       This distinction is illustrated by a pair of cases against
investment ratings agencies. In the first, the plaintiff investors
sued rating agencies for over-rating bonds which had since become
worthless. The ratings had been made available to the general

11    Indeed, the Bily court cautioned that it did not necessarily
endorse any other provisions of section 552 of Restatement beyond
its narrow description of the potential plaintiffs. (Bily, supra,
3 Cal.4th at p. 414.)

                               24
public and any person could have invested in the bonds plaintiffs
purchased. (Grassi v. Moody’s Investor’s Services (E.D. Cal. 2011)
2011 WL 3439184, *13, recommendations adopted (E.D. Cal.
2011) 2011 WL 13371091, aff’d (9th Cir. 2013) 540 Fed.Appx.737
(Grassi).) The district court concluded the plaintiffs could not
prevail under California law, as they could not establish
membership in a limited group of intended beneficiaries. (Ibid.)
In the second case, the plaintiff investor sued the rating agencies
for giving unjustified favorable credit ratings to structured
investment vehicles that subsequently collapsed. The structured
investment vehicles could not be sold to the general public, but
only through private placements to two limited categories of
investors (qualified institutional investors and qualified
purchasers), which included the plaintiff. (Public Employees’
Retirement System v. Moody’s Investors Service, Inc. (2014)
226 Cal.App.4th 643, 653.) The Court of Appeal concluded that
the plaintiff investor could establish that the ratings agencies
supplied their ratings “with knowledge of the existence of a well-
defined type of transaction which the ratings were intended to
influence.” (Id. at p. 669.)
       Other cases agree that recommendations made to the
general public are not actionable. (See Amann v. Clear Channel
Communications Inc. (Ohio App. 2006) 846 N.E.2d 95, 100-101
[misrepresentations about an investment in ads broadcast to a
radio station’s general audience are not actionable]; Ginsburg v.
Agora, Inc. (D. Md. 1995) 915 F.Supp. 733, 739
[misrepresentations about an investment in a general circulation
newsletter are not actionable]; In re Delmarva Sec. Litigation (D.
Del. 1992) 794 F.Supp.1293, 1310 [misrepresentations about an

                                25
investment in documents released to the public at large are not
actionable].)
       Leining attempts to manufacture a narrow segment of the
public as the target of American Humane’s certification by
claiming it intended to guide “customers who, like Ms. Leining,
care about animal welfare when purchasing retail goods.” The
plaintiffs in Grassi made an analogous attempt, arguing that the
ratings agencies had directed their ratings toward “a specific and
limited class of investors consisting of those investors looking for
safe investment grade corporate bonds issued from investment
banks not likely to fail . . . .” (Grassi, supra, 2011 WL 3439184, at
p. *3.) The district court rejected this attempt, concluding the
challenged bond ratings were not limited in distribution but
“available to the general public,” and any person could invest in
the bonds. (Id. at p. *13.) The same is true here. American
Humane’s certification was made available by Foster Farms to the
general public, and anyone could purchase Foster Farms’s
chicken. If a cause of action under Bily could be stated against
American Humane for certifying chicken Leining purchased in a
standard grocery-buying transaction, Bily would swallow
Hanberry whole, rendering the latter’s limitation to physical
injury meaningless.
                             DISPOSITION
       The judgment is affirmed. Foster Farms and American
Humane shall recover their costs on appeal.

                                      RUBIN, P. J.
WE CONCUR:

                     BAKER, J.                          KIM, J.

                                 26