The Learned Concierge – February 2025, Vol. 16 | Clark Hill PLC

The Learned Concierge

Welcome to your monthly legal insights on the trends impacting the Retail, Hospitality, and Food & Beverage Industries.

Upcoming Webinars

Washington’s Toxic-Free Cosmetics Act: What to Know

Wednesday, March 5, 2025
10:00am (PT) | 12:00 PM (CT) | 1:00 PM (ET)

As of January 1, 2025, Washington State’s new Toxic-Free Cosmetics Act (TFCA) restricts nine chemicals and chemical classes from being used in cosmetic products made, distributed, or sold within the state. This law applies to all businesses that manufacture, distribute, sell, or use cosmetic products in Washington, including national retail chains to individually owned salons that provide cosmetology services.

Need to know how the new TFCA might impact your business? Join us for this webinar where legal and scientific perspectives on these changes will be shared on March 5th and visit the Washington TFCA page now to learn more. If interested in attending, register here.

Alcohol Law

TTB Adds 28 New Standards of Fill for Wine and Distilled Spirits

Michael Laszlo authored an article, “TTB Adds 28 New Standards of Fill for Wine and Distilled Spirits.”

Long-awaited changes have come to the alcohol industry this year. On Jan. 10, the Alcohol and Tobacco Tax and Trade Bureau (“TTB”) implemented a final rule that expands the “standards of fill” for wine and distilled spirits.

TTB’s new rule changes introduce 28 new container sizes (13 for wine and 15 for distilled spirits) and provide significant flexibility for wine and spirits producers.

The new rule addresses the evolving needs of the alcohol industry and will allow wine and spirits suppliers to provide consumers with a wider variety of purchasing options.

Surgeon General Warns Alcohol Increases Cancer Risk, Urges New Warning Labels

U.S. Surgeon General Dr. Vivek Murthy has issued an advisory linking alcohol consumption to an increased risk of cancer and is calling for updated warning labels on alcoholic beverages to inform consumers.

The surgeon general noted that cancer risk increases with higher alcohol consumption but added that even low levels of drinking are not without risk. Health officials have noted that there is no safe limit for alcohol consumption, which aligns with the World Health Organization’s findings. Click here to learn more.

Civil Monetary Penalty Inflation Adjustment-Alcoholic Beverage Labeling Act

This document informs the public that the maximum penalty for violations of the Alcoholic Beverage Labeling Act (ABLA) is being adjusted in accordance with the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended. Prior to the publication of this document, any person who violated the provisions of the ABLA was subject to a civil penalty of not more than $25,561, with each day constituting a separate offense. This document announces that this maximum penalty is being increased to $26,225. Click here to learn more.

Cybersecurity & Privacy

The Monthly Rundown of All Things Cyber, Privacy, and Technology

Click here to read the Right to Know – January 2025, Volume 25

The Monthly Rundown of All Things Cyber, Privacy, and Technology

Click here to read the Right to Know – December 2024, Volume 24

It’s a New Year and a Good Time for a Cybersecurity Checkup

David Ries and Melissa Ventrone authored an article, “It’s a New Year and a Good Time for a Cybersecurity Checkup.”

2024 was another active year in cybersecurity, with high-profile vulnerabilities and data breaches, and government and private sector responses to them. As we move into 2025, it is a good time for businesses and organizations of all sizes to review their cybersecurity postures in light of these events and developments, the resulting lessons learned, and any new cybersecurity requirements that may apply. For those that have established cybersecurity programs, it is a good time to review and update them. For those that don’t have programs, it is a good time to start the process and follow through to implement a comprehensive cybersecurity program.

North Korea Appears to Be Using Open-Source Software to Hack Entities

Cyber security professionals have found that North Korea has been embedding malware in trusted open-source software in order to penetrate supply chain operations. Cybersecurity researchers at SecurityScorecard have found that the Lazarus group (an entity tied to North Korea) has been attacking a variety of industries including cryptocurrency developers, tech companies, and individuals working on open-source projects. Lazarus has been able to infiltrate open source software found on the reputable open source repository Gitlab and embed malware into generally trusted software unknowingly. The nature of open source, a variety of software rooted in distributed development without traditional “owners,” lends itself to constant modification by users of the software—access which appears to have been exploited here. It serves as a reminder that code needs to be carefully inspected prior to use, even if obtained from supposedly trusted sources.

Food & Beverage

Red Dye No 3: Old Data Induces New Ban

Michael Walsh authored an article, “Red Dye No 3: Old Data Induces New Ban.”

On January 16, 2025, the federal Food and Drug Administration (FDA) issued a notice requiring manufacturers to reformulate their products, removing Red Dye No. 3 by January 15, 2027, for food (21 CFR §74.303) and January 18, 2028, for drugs (21 CFR §1303).

FTC Issues Final Rule on Junk Fees

Earsa Jackson authored an article, “FTC Issues Final Rule on Junk Fees.”

On Dec. 17, the Federal Trade Commission issued its final rule on junk fees entitled “Rule on Unfair or Deceptive Fees” which will become effective 120 days after publication in the Federal Register.

Businesses must now consider all fees charged to consumers and ensure that the total price for the goods or services is the most conspicuous of dollar figures displayed and not hidden. “Total Price” means the maximum total of all fees or charges a consumer must pay for any goods or services and any mandatory ancillary goods or services, except that government charges, shipping charges, and fees or charges for any optional ancillary goods or services may be excluded. In any advertisement, the total price must be the most prominent and include all mandatory fees.

9 Food Trend Predictions for 2025

Food forecasters see a year of offbeat choices: savory coffees, great convenience-store cuisine, and sauces on everything. Click here to learn more about some of the predictions most likely to influence how we will eat in the coming year.

Food Companies Want to Confuse Consumers. The FDA Must Push Back.

The “Make America Healthy Again” agenda has catapulted nutrition issues to the forefront of conversations about Americans’ health. The policy proposals range from getting junk foods out of schools to preventing the government from subsidizing candy through programs like SNAP.

To advance these policies, we need a clear system of labeling unhealthy junk foods in the food supply. The Food and Drug Administration is considering implementing this type of labeling system, but the food industry is trying to interfere. Click here to learn more.

FDA Releases Allergen, Food Safety, and Plant-Based Alternative Labeling Guidance

The U.S. Food and Drug Administration (FDA) released four guidance documents to help industry and other interest holders understand and comply with FDA regulations concerning food allergens, low-moisture ready-to-eat human foods and labeling of plant-based alternatives to animal-derived foods. Click here to read through the guidance documents.

The FDA’s Healthy Claim Rule is Final

Here’s what the FDA says about Use of the Term Healthy on Food Labeling. And the FDA is still working on the symbol.

To meet the updated criteria for the claim, a food product needs to:

1. Contain a certain amount of food from at least one of the food groups or subgroups (such as fruit, vegetables, grains, fat-free and low-fat dairy, and protein foods) recommended by the Dietary Guidelines for Americans, and
2. Meet specific limits for added sugars, saturated fat, and sodium.

International Trade

Cargill Files New Trade Case Against Imports of Erythritol from the People’s Republic of China

Mark Luwikowski, R. Kevin Williams, Aristeo Lopez, Sally Alghazali and Kelsey Christiansen authored an article, “Cargill Files New Trade Case Against Imports of Erythritol From the People’s Republic of China.”

U.S. producer Cargill Incorporated (“Cargill” or “Petitioner”) filed a new petition against imports of erythritol from China, alleging that the imports are dumped and unfairly subsidized. Cargill’s petition asks the U.S. government to impose antidumping (“AD”) and countervailing duties (“CVD”) on these imports from China.

Erythritol is a natural zero-calorie bulk sweetener with a look and taste like sugar. It typically appears as a white crystalline, odorless product that rapidly dissolves in water. Erythritol is most commonly used as a clean-tasting natural alternative to sugar, but can also be used as a flavor modifier, formulation aid, humectant, stabilizer, thickener, sequestrant, texturizer, and pharmaceutical excipient.

Mexico Increases Import Duties for Textile and Apparel Imports and Amends the IMMEX Program

Mark Luwikowski, R. Kevin Williams, Aristeo Lopez, Sally Alghazali and Kelsey Christiansen authored an article, “Mexico Increases Import Duties for Textile and Apparel Imports and Amends the IMMEX Program.”

On Dec. 19, Mexico announced an increase in tariffs on textiles and apparel imports up to 35%, effective from Dec. 20, 2024, until April 23, 2026, and amends the IMMEX program. The official publication states that the primary objective is to tackle the unfair competition affecting Mexico’s textile and apparel industry. This sector has recently suffered due to the influx of low-priced apparel imports from countries with which Mexico has not signed a Free Trade Agreement.

The measure expands the 35% import duty rates to 138 tariff lines for garment products and 15% import duty rates to 17 tariff lines for textile products. Such increments do not affect products originating from countries with which Mexico has signed a Free Trade Agreement, such as the USMCA. The measure follows Mexico’s tariff increase on multiple imported products adopted on April 22, 2024, which covered  544 tariff lines with duties ranging between 5% and 50%.

Labor & Employment

Washington Supreme Court Says Employers May Not Unreasonably Restrain Employees from Working for Competitors

Michael Laszlo authored an article, “Washington Supreme Court Says Employers May Not Unreasonably Restrain Employees From Working for Competitors.”

In a case of first impression, the Washington Supreme Court interpreted Washington law regarding noncompete agreements to broadly protect employees who earn less than twice the state minimum wage from unreasonable restrictions on obtaining supplemental employment and to narrowly permit employers to impose restrictions consistent with the common law duty of loyalty.

Supreme Court Clarifies Burden of Proof in FLSA Exemption Cases, Leaves Key Questions Unanswered

Rafael Nendel-Flores authored an article, “Supreme Court Clarifies Burden of Proof in FLSA Exemption Cases, Leaves Key Questions Unanswered.”

On Jan. 15, the United States Supreme Court issued its decision in E.M.D. Sales, Inc. v. Carrera, which clarified that employers need only prove that an employee is exempt from the Fair Labor Standards Act (“FLSA”) by a preponderance of the evidence. This was a good decision for employers and reversed a Fourth Circuit Court of Appeals decision finding that an exemption must be proven by clear and convincing evidence. This article addresses the reasoning behind the Supreme Court’s decision, the uncertainty posed by questions left unanswered by the Supreme Court, and what employers should do to protect themselves considering this uncertainty.