Prevent Citric Acid Lawsuits with a General Counsel
This series has presented two bad options for food-business executives facing citric acid litigation: spend tens of thousands on litigation, or write settlement checks to plaintiffs’ firms. There is another way to mitigate this risk. It is not exciting or expensive, but it is extremely effective. A food business can prevent citric acid lawsuits with a general counsel.
The math: a service plan vs. defending one case
The case for prevention is mostly arithmetic. Defending a single citric acid matter runs anywhere from $10,000–$25,000 to settle a low-volume product, up to $150,000–$500,000+ to fight a high-volume one through trial readiness. A Fractional General Counsel plan is one predictable, flat monthly fee that folds label review, supplier-spec warranties, indemnification drafting, and ongoing reg-change monitoring into one flat fee — across your entire portfolio, not one product. For a food business selling more than $10M/yr, a single label review is usually a symptom of a recurring need. The plan is how you stop paying per crisis. See Service Plans →A General Counsel Mitigates Everyday Risks
A general-counsel mentality manages risks before a complaint ever lands. Instead of reacting to litigation, a general counsel can structure commercial relationships to eliminate the probability of litigation. General counsel can use basic, sturdy commercial agreements to identify risks and mitigate probabilities. Below are three key areas that deserve a general counsel’s attention in any food business.
For Buyers of Raw Materials
Review supplier contracts and specifications for anything containing citric acid. The specification is a binding contract exhibit, not a brochure. You can use the specification as a warranty if the supplier will claim it is “all natural.” At minimum, tie an explicit statement of origin and character for the citric acid (e.g., fermentation-derived/non-synthetic) directly to the spec. Backstop those warranties with comprehensive indemnification covering mislabeling/deceptive-practices claims, and attorneys’ fees when caused by supplier breach. Scrutinize flavor houses: citric acid often hides inside flavor systems. Require sub-ingredient disclosures and stipulate change-control notice obligations. Warranties and indemnification are about spreading the cost of a citric acid lawsuit among the suppliers that sold the product to the manufacturer.
For Sellers of Raw Materials and Finished Products
When selling food products, flip that playbook 180°. Review every product spec and flag anything containing citric acid — whether selling bulk ingredients, wholesaling finished goods, or copacking and private labeling for customers. For any product that contains citric acid, undertake these steps:
- Disclose and disclaim. In any master services agreement, the purchase-order terms, and on the product specification itself, clearly state that the product contains citric acid. Include an explicit disclaimer that the presence of citric acid does not support “natural flavor” claims and does not eliminate any disclosure obligations under Title 21 of the Code of Federal Regulations section 101.22. State in plain language that the customer is responsible for label compliance.
- Warranty carve-out. Maintain core quality warranties on identity, purity, and food safety, but exclude any warranty related to labeling or the “characterizing flavor” rule when the customer controls the label. State that any claims related to citric acid or characterizing flavor are outside the warranty unless expressly covered in a separate, written product specification.
- Indemnity allocation. Copack customers usually generate their own labeling. Require the customer to indemnify the seller for unfair-and-deceptive-practices and false-advertising claims that arise from the customer’s labeling. Limit the seller’s indemnity to breaches of the seller’s own product specifications. Make clear that the seller does not indemnify the customer for the customer’s marketing statements.
Label Audit
The product label is the first line of defense. For every product in the lineup that contains citric acid, conduct a label audit. Consider whether it is practical to substitute a “naturally sourced” citric acid for a current ingredient. Also weigh the cost/benefit of labeling the product “artificially flavored.” This is exactly the kind of recurring, portfolio-wide sweep a Fractional General Counsel plan performs on a standing basis.
Win the Business, Not Just the Lawsuit
When selling food products, it is exceptionally important to be explicit and thorough. Strong documents do more than mitigate legal liability — they protect something that may be even more important: the relationship with the customer. Big customers (especially big customers) will exploit any half-hearted or poorly drafted warranty. They will use their commercial leverage to get any ambiguity about citric acid resolved in their favor. A crisp, comprehensive, explicit disclaimer is about the only way to overcome the imbalance. Only a resounding “we told you so” can prevent big customers from leveraging their bad decisions onto a seller, who would otherwise be pressured to indemnify the customer just to preserve the business. To take a deeper dive into how to prevent citric acid lawsuits with a General Counsel, request a brief assessment from one of our attorneys and get a practical, product-specific plan — or compare service plans now.
Jason Foscolo
Founder of The Food Law Firm — fractional general counsel for food & beverage businesses nationwide.