Natural Grocers v. Rollins 

MITAL PATEL & KATHERINE LUO *

Why It Made the List

The law governing the disclosure of bioengineered food has continued to develop since the U.S. Department of Agriculture (USDA) established national uniform regulations under the National Bioengineered Food Disclosure Standard in 2018. The standard became fully mandatory in 2022, and three years later, the Ninth Circuit’s decision in Natural Grocers v. Rollins[1] stands as one of the most consequential appellate rulings interpreting the new framework. While the court upheld the status quo as to the required use of the statutory term “bioengineered,” it reversed the district court on the scope of bioengineered ingredients that must be disclosed and the methods by which those disclosures may be made.

The decision is already prompting labeling changes for consumer products on shelves, and the remand for the Agricultural Marketing Service (AMS) to revisit the proper detectability standard signals that the disclosure law will continue to be refined in the years ahead. For consumers, manufacturers, and retailers alike, Natural Grocers reflects courts’ willingness to scrutinize these standards in their early years—both to sharpen their present clarity and to anticipate more advanced technology for processing and detecting bioengineered ingredients in the future.

Decision and Background

In 2016, Congress enacted Public Law No. 114-216, which amended the Agricultural Marketing Act of 1946 (AMA) and directed the USDA to establish a “national mandatory bioengineered food disclosure standard.” The Secretary of Agriculture delegated that authority to AMS, which promulgated its final regulations in 2018 under the National Bioengineered Food Disclosure Standard. The standard became fully mandatory on January 1, 2022, and generally requires covered foods to disclose whether they are “bioengineered” or contain a “bioengineered” ingredient. While the statute does not define “bioengineered” itself, it defines “bioengineering” with respect to a food as referring to a food that (1) “contains genetic material that has been modified through in vitro recombinant deoxyribonucleic acid (DNA) techniques,” and (2) for which “the modification could not otherwise be obtained through conventional breeding or found in nature.”

In July 2020, a group of grocery retailers and public interest organizations sued AMS in the Northern District of California, alleging under the Administrative Procedure Act (APA) that three aspects of the disclosure standard were unlawful or arbitrary and capricious. First, plaintiffs challenged the regulation’s exclusion from the disclosure requirements of foods containing bioengineered material that was “not detectable” under the agency’s detectability standards. Plaintiffs argued that this exemption was improper and that AMS was required to mandate disclosure for all foods—including highly refined foods—that might contain “undetectable” bioengineered ingredients. Second, plaintiffs asserted that AMS should have permitted the use of more familiar terms in disclosures, such as “GMO” or “genetically engineered,” rather than mandating the term “bioengineered.” Third, plaintiffs challenged the regulatory provisions allowing manufacturers to satisfy their disclosure obligations through QR codes or text messaging, rather than through more conventional on-package statements or symbols.

In September 2022, the district court granted summary judgment to plaintiffs on the third claim concerning disclosure methods, but denied summary judgment on the other two claims. The court remanded the two challenged disclosure-format provisions to AMS without vacating them, effectively leaving the allegedly deficient provisions in place. Plaintiffs appealed, and on October 31, 2025, a unanimous Ninth Circuit panel reversed in part, affirmed in part, and remanded. The court held that AMS had committed legal error in excluding from the disclosure requirement foods with “undetectable” bioengineered material; that the agency’s mandated use of the term “bioengineered” in disclosures was reasonable and lawful; and that the district court abused its discretion by declining to vacate the unlawful QR-code and text-message disclosure provisions.

The Detectability Standard for Highly Refined Foods

The central issue in the case was whether AMS could properly exempt from disclosure certain highly processed foods that may contain “undetectable” bioengineered ingredients. In many of these products—such as refined oils, sugars, and corn syrup—bioengineered ingredients undergo such substantial processing that any modified genetic material is rendered “undetectable” under the regulation’s standards. Specifically, the regulation provides that a food does not “contain” modified genetic material if that material is “not detectable,” and that material is “not detectable” if either “the food had been subjected to a refinement process validated to make the modified genetic material in the food undetectable” or “analysis or testing appropriate to the specific food confirms the absence of modified genetic material.” A manufacturer who could establish either condition was, therefore, exempt from the disclosure requirement.

The Ninth Circuit held that AMS committed legal error in categorically excluding highly refined foods from the definition of “bioengineered foods.” The court reasoned that whether a food actually contains bioengineered material is conceptually distinct from whether such material can be detected using a particular method. It accordingly rejected AMS’s position that non-detectability under the regulation’s described methods was legally equivalent to non-presence. AMS’s own regulations, the court observed, undermined that premise. The regulation itself acknowledged that a particular detection technique might not be “sufficiently sensitive” to identify modified genetic material that is, in fact, present, and AMS expressly recognized in its analysis accompanying the final rule that future detection methods may be more accurate than earlier ones, such that foods presently exempt from disclosure could later fall within the standard. Yet, the regulation simultaneously permitted manufacturers to continue relying on previously “validated” refining processes without further testing, even if subsequently developed tests could detect modified genetic material in the resulting product.

AMS sought to defend the regulation on the alternative ground that § 293(b)(2)(B) of the AMA granted it discretion to set “amounts” of bioengineered substances below which their potential presence could be disregarded. The court rejected this argument under SEC v. Chenery Corp., which permits a reviewing court to uphold an exercise of agency discretion only on the same basis articulated by the agency itself. AMS, the court observed, had never invoked this discretionary authority in justifying its detectability standard. Instead, the agency had rested entirely on what the court characterized as its “flawed legal premise” that non-detectability was equivalent to non-presence.

On remand, however, the court left the proper detectability standard to AMS’s further consideration. Contrary to plaintiffs’ position, AMS was not required to impose a universal disclosure requirement on every highly processed food. Rather, the agency’s authority under § 293(b)(2)(B) to set “amounts” of bioengineered substances directly empowered it to establish the threshold levels at which a food would qualify as “bioengineered.” Although the particular detectability standard adopted by AMS was contrary to law, the court emphasized that “it remains open to the agency to address the subject of detectability by a proper exercise of that authority on remand.”

“Bioengineered” Terminology

In contrast, the court ruled in favor of AMS on the use of the term “bioengineered,” as opposed to purportedly more familiar alternatives such as “genetically modified” or “GMO.” Affirming the district court, the Ninth Circuit held that the agency’s terminology choice was neither arbitrary nor capricious. AMS had reasonably concluded that a single, uniform term would “ensur[e] disclosure consistency and minimiz[e] marketplace confusion.” Moreover, “bioengineered” was the very term Congress had used in the AMA, and broader alternatives such as “genetically engineered” could capture more than Congress intended. The court observed, for example, that the AMA’s disclosure provision uses the term “bioengineered,” while its preemption provision uses the broader phrase “genetically engineered”—a textual distinction supporting the agency’s conclusion that the two terms have different scopes. Finally, the court accepted AMS’s view that any consumer unfamiliarity with the term “bioengineered” could be addressed through outreach and education rather than through the wholesale adoption of additional and potentially conflicting terminology.

Disclosure Via QR Codes and Text Messaging

Finally, the Ninth Circuit held that the district court abused its discretion by declining to vacate the regulatory provisions governing QR-code and text-message disclosures after concluding that those provisions violated the AMA. Although the district court had granted summary judgment to plaintiffs on this claim, it remanded the two provisions to AMS without vacatur, effectively leaving the unlawful disclosure options in place. The Ninth Circuit emphasized that vacatur is the “default remedy” under the APA when agency action is found unlawful, subject only to limited exceptions. The district court had been concerned that vacatur would “disrupt consumer access to bioengineering disclosures,” but the panel was unpersuaded—precisely because the disclosure options at issue had already been deemed inadequate. As the court explained, “[a]llowing an inadequate disclosure option to continue throughout the entirety of the administrative process for amending the regulations would itself perpetuate a disruption.” While industry reliance on existing labels was a legitimate concern, the court concluded that any transitional disruption could be addressed through prospective vacatur with appropriate transition periods, rather than by leaving unlawful disclosure methods in effect indefinitely.

Implications and Impact

Natural Grocers will require AMS to undertake significant revisions of the National Bioengineered Food Disclosure Standard on remand. First, and most significantly, the decision reopens the question of which highly refined foods must bear bioengineering disclosures—now and in the future. Although a revised detectability standard could ultimately produce results similar to those under the current rule, AMS must arrive at any such standard through evidence-based analysis and the express exercise of its discretionary authority under § 293(b)(2)(B), rather than through the flawed legal premise that non-detectability equals non-presence.

The timing of any such revisions will be shaped in the first instance by proceedings in the Northern District of California, to which the Ninth Circuit remanded the case.

If, by contrast, the revised standard moves toward stricter detection thresholds, the universe of foods subject to bioengineering disclosure could materially expand. Manufacturers that currently market products without disclosures in reliance on the “undetectable” exemption should monitor these developments closely, as more demanding detection standards could substantially alter their labeling obligations.

Regarding terminology, the court’s affirmance of AMS’s choice of “bioengineered” as the uniform disclosure term anchors the statutory vocabulary around a single phrase, reducing uncertainty as to how labeling claims should be framed. The decision’s issue-by-issue approach reflects a judicial goal of long-term clarity. Against the backdrop of varied food claims and labeling requirements, the move toward a single statutory term offers a welcome point of consensus that will help consumers and producers align in their understanding of when bioengineered materials are present in food.

Food manufacturers currently relying on QR codes or text messaging as their primary method of bioengineered food disclosure face the most immediate practical uncertainty. Although the prospective vacatur contemplated by the court will afford some runway, manufacturers should anticipate that these methods will eventually be prohibited. Companies that depend solely on QR codes or text messaging should accordingly begin transitioning to traditional on-package disclosures, and should evaluate any alternative disclosure methods that AMS may develop in the interim. Notably, AMS solicited public comment on these disclosure options in April 2024, following the district court’s ruling, suggesting that the agency was already alert to the need for regulatory revision well before the Ninth Circuit’s opinion issued.

Beyond its immediate effects on the bioengineered food disclosure framework, Natural Grocers is significant for its rigorous application of the Chenery doctrine in the food regulation context. The court’s refusal to uphold AMS’s detectability standard reinforces the principle that courts may sustain agency action only on the same basis articulated in the agency’s order itself. The holding discourages reliance on post hoc rationales to defend regulations and may embolden future plaintiffs to pursue APA challenges in this space. The decision also underscores the Ninth Circuit’s commitment to vacatur as the default APA remedy—a position that gives district courts a firmer directive to vacate inadequate provisions and that may make agencies more cautious in exercising their delegated authority.

Taken as a whole, Natural Grocers is a timely and deliberate ruling aimed at clarifying the law in the consumer food space during these formative years for bioengineered food disclosure. The framework remains in flux, and companies across the food supply chain—from ingredient suppliers to manufacturers to retailers—should watch developments carefully as compliance standards continue to be reshaped in the years to come.

*   Mital Patel is an associate in the New York office of Foley Hoag LLP, where she focuses her practice on intellectual property matters including false advertising and marketing. Katherine Luo is an associate in Foley Hoag LLP’s Trademark, Copyright & Unfair Competition Litigation Practice. Her practice focuses on trademark, copyright, and false advertising.

[1]   Nat. Grocers v. Rollins, 157 F.4th 1143 (9th Cir. 2025).