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Why spurning food biotech has become a liability

Henry I Miller, Gregory Conko & Drew L Kershe
By expunging gene-spliced ingredients from their products, some major food companies may be making foods that are less safe and wholesome for consumersand that expose them to litigation.

In the late 1990s, a singular phenomenon swept the world. One after another, food and beverage companies capitulated to strident xenogenophobic voices that called for eradication of gene-spliced ingredients from their product lines. In the United States, fast food giant McDonalds (Chicago) banned transgenic ingredients from its menu, food manufacturer Heinz (Pittsburgh) and Gerber (Fremont, MI, USA) dropped them from their baby food lines, and Frito-Lay (Atlanta) told its growers to stop planting corn containing Bacillus thuringiensis (Bt) toxin or risk exclusion from its snacks. Elsewhere, brewers Kirin (Shinkawa, Japan) and Carlsberg (Valby, Denmark) eliminated gene-spliced ingredients from their beers. These actions were rationalized variously as protecting stakeholder interests, ensuring human safety and safeguarding the environment. Ironically (and also surprisingly in these litigious times), in their eagerness to avoid biotech and the mainstream medias if it bleeds, it leads coverage of the outlandish accusations and speculations of anti-biotech activists, these companies have exposed themselves to richly deserved legal jeopardy.

Whats on the menu? Consumers could react litigiously if baby food giants like Gerber or Heinz continue to prioritize the perceived risks of gene-spliced foods over the clear and present dangers of food allergies and mycotoxins.

Henry I. Miller is a fellow at the Hoover Institution, Stanford University, Stanford, California 94305-6010, USA. Gregory Conko is at the Competitive Enterprise Institute, 1001 Connecticut Avenue NW, Washington, DC 20036, USA. Barron has named their book, The Frankenfood Myth: How Protest and Politics Threaten the Biotech Revolution, one of the 25 Best Books of 2004. Drew L. Kershen is at the University of Oklahoma College of Law, Norman, Oklahoma 73019-5081, USA. e-mail: miller@hoover.stanford.edu

Toxic food Every year, scores of packaged food products are recalled from the US market because of the presence of (all-natural) contaminants like insect parts, toxic molds, bacteria and viruses. Because farming takes place out of doors and in dirt, such contamination is a fact of life. Over the centuries, the main culprits in mass food poisoning have often been mycotoxins, such as ergotamine from ergot (Claviceps purpurea) or fumonisin from Fusarium spp., resulting from the fungal contamination of unprocessed crops. This process is exacerbated when insects attack food crops, opening wounds in the plant

cuticle and epidermis that provide an opportunity for pathogen invasion. Once the molds get a foothold, poor storage conditions also promote their post-harvest growth on grain. Fumonisin and some other mycotoxins are highly toxic, causing fatal diseases in livestock that eat infected corn and esophageal cancer in humans. Fumonisin also interferes with the cellular uptake of folic acid, a vitamin that is known to reduce the risk of neural tube defects in developing fetuses. Because fumonisin prevents the folic acid from being absorbed by cells, the toxin can, in effect, induce functional folic acid deficiencyand thereby cause neural

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tube defects such as spina bifidaeven when the diet contains what otherwise would be sufficient amounts of folic acid. Regulatory agencies, such as the US Food and Drug Administration and UK Food Safety Agency are acutely aware of the danger of mycotoxins. They have established recommended maximum fumonisin levels in food and feed products made from corn. Although highly processed cornstarch and corn oil are unlikely to be contaminated with fumonisin, unprocessed corn or lightly processed corn (e.g., corn meal) can have fumonisin levels that exceed recommended levels. In 2003, the UK Food Safety Agency tested six organic corn meal products and 20 conventional corn meal products for fumonisin contamination. All six organic corn meals had elevated levelsfrom nine to forty times greater than the recommended levels for human healthand they were voluntarily withdrawn from grocery stores. A role for biotech The conventional way to combat mycotoxins is simply to test unprocessed and processed grains and throw out those found to be contaminatedan approach that is both wasteful and dubious. But modern technologyspecifically, products derived from recombinant DNA technology (also known as food biotech, gene-splicing or genetic modification)offers a way to prevent the problem. Contrary to the claims of biotech critics, who single out such crops as posing the risk of new allergens, toxins or other nasty substances if introduced into the food supply (none of which has been proven), such products would offer the food industry a proven and practical means of tackling the fungal contamination at its source. An excellent example is corn crafted by splicing into commercial corn varieties of a gene (or genes) encoding natural toxins from the bacterium B. thuringiensis. The Bt gene expresses a protein that is toxic to corn-boring insects but is perfectly harmless to birds, fish and mammals, including humans. As the Bt corn fends off insect pests, it also reduces the levels of the mold Fusarium, thereby reducing the levels of fumonisin. Thus, switching to the gene-spliced, insect-resistant corn for food processing would lower the levels of fumonisinas well as the concentration of insect partslikely to be found in the final product. Indeed, researchers at Iowa State University in Ames and the US Department of Agriculture found that in Bt corn the level of fumonisin is reduced by as much as 80% compared to conventional corn1,2. [AU: OK?] Thus, on the basis of both theory and empirical knowledge, there should be potent incentiveslegal, commercial and ethicalto use such gene-spliced grains more widely. One would expect public and private sector advocates of public health to demand that such improved varieties be cultivated and used for foodnot unlike requirements for drinking water to be chlorinated and fluoridated. Food producers who wish to offer the safest and best products to their customersto say nothing of being offered the opportunity to advertise new and improved!should be competing to get gene-spliced products into the marketplace. Alas, none of this has come to pass. Activists have mounted vocal and intractable opposition to food biotech, in spite of demonstrated, significant benefits, including reduced use of chemical pesticides, less runoff of chemicals into waterways, greater use of farming practices that prevent soil erosion, higher profits for farmers and less fungal contamination. Inexplicably, government oversight has also been an obstacle, by subjecting the testing and commercialization of gene-spliced crops to unscientific and draconian regulations that have vastly increased testing and development costs and limited the use and diffusion of food biotech. The result is jeopardy for everyone involved in food production and consumption: consumers are subjected to avoidable, and often undetected, health risks, and food producers have placed themselves in legal jeopardy. The first point is obvious, the latter less so, but it makes a fascinating story: agricultural processors and food companies may face at least two kinds of civil liability for their refusal to purchase and use fungus-resistant, gene-spliced plant varieties, as well as other superior products. (Baby) food for thought In 1999, the Gerber foods company succumbed to activists pressure, announcing that its baby food products would no longer contain any gene-spliced ingredients. Indeed, Gerber went farther and promised it would attempt to shift to organic ingredients that are grown without synthetic pesticides or fertilizers. Because corn starch and corn sweeteners are often used in a range of foods, this meant wholesale changes to Gerbers entire product line. As noted above, not only is gene-spliced corn likely to have lower levels of fumonisin than conventional, but organic is likely to have the highest levels because it suffers greater insect predation due to less effective pest controls. If a mother some day discovers that her Gerber baby has developed liver or esophageal cancer, or a neural tube defect such as spina bifida, she might have a valid legal claim against Gerber3. On the childs behalf, a plaintiff s lawyer can allege strict products liability based on mycotoxin contamination in the baby food as the causal agent of the cancer or neural tube defects. The contamination would be considered a manufacturing defect under products liability law because the baby food did not meet its intended product specifications or level of safety. Gerber could be found liable even though all possible care was exercised in the preparation and marketing of the product, simply because the contamination occurred. The plaintiff s lawyer could also allege a design defect in the baby food, because Gerber knew of the existence of a less risky design namely, the use of gene-spliced varieties that are less prone to Fusarium and fumonisin contaminationbut deliberately chose not to use it. Instead, Gerber chose to use non-gene-spliced, organic food ingredients, knowing that the foreseeable risks of harm posed by them could have been reduced or avoided by adopting a reasonable alternative designthat is, by using gene-spliced Bt corn, which is known to have a lower risk of mycotoxin contamination. Gerber might answer this design defect claim by contending that it was only responding to consumer demand, but that alone would not be persuasive. Products liability law subjects defenses in design defect cases to a risk-utility balancing in which consumer expectations are only one of several factors used to determine whether the product design (e.g., the use of only non-gene-spliced ingredients) is reasonably safe. A jury might conclude that whatever consumer demand there may be for nonbiotech ingredients does not outweigh Gerbers failure to use a technology that is known to lower the health risks to consumers. Even if Gerber were able to defend itself from the design defect claim, the company might still be liable because it failed to provide adequate instructions or warnings about the potential risks of non-gene-spliced ingredients. For example, Gerber could have labeled its non-gene-spliced baby food with a statement such as: This product does not contain genespliced ingredients. Consequently, this product has a very slight additional risk of mycotoxin contamination. Mycotoxins can cause serious diseases, such as liver and esophageal cancer and birth defects. Hypoallergenic foods Whatever the risk of toxic or carcinogenic fumonisin levels in nonbiotech corn may be (probably low in industrialized countries, where food producers generally are cautious about such contamination), a more likely scenario is potential legal liability when a food product causes an allergic reaction4. Between 6% and 8% of children and between 1% and 2% of adults are allergic to one or another food ingredient, and an estimated

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150 US citizens die each year from exposure to food allergens5. Allergies to proteins from peanuts, soybeans and wheat, for example, are quite common and can be severe. Although only about 1% of the population is allergic to peanuts, some individuals are so highly sensitive that exposure causes anaphylactic shock, killing dozens of people every year in North America6. Protecting those with true food allergies is a daunting task. Farmers, food shippers and processors, wholesalers and retailers, and even restaurants must maintain meticulous records and labels and ensure against cross-contamination. Still, in a country where about a billion meals are eaten every day, missteps are inevitable. Dozens of processed food items must be recalled every year due to accidental contamination or inaccurate labeling. Fortunately, biotech researchers are well along in the development of crops in which the genes encoding allergenic proteins have been silenced or removed. According to University of California, Berkeley, biochemist Bob Buchanan, hypoallergenic varieties of wheat could be ready for commercialization within a decade, and nuts soon thereafter (R. Buchanan, personal communication; ref. 7). Once these products are commercially available, agricultural processors and food companies that refuse to use these safer food sources will open themselves to products-liability, design-defect lawsuits4. Property damages and personal injury Potato farming is a growth industry, primarily due to the vast consumption of french fries at fast-food restaurants. However, growing potatoes is not easy because they are preyed upon by a wide range of voracious and difficult-tocontrol pests, such as the Colorado potato beetle, virus-spreading aphids, nematodes, potato blight and others. To combat these pests and diseases, potato growers use an assortment of fungicides (to control blight), insecticides (to kill aphids and the Colorado potato beetle) and fumigants (to control soil nematodes). Although some of these chemicals are quite hazardous to farm workers, forgoing them could jeopardize the sustainability and profitability of the entire potato industry. Standard application of synthetic pesticides enhances yields more than 50% over organic potato production, which prohibits most synthetic inputs. Consider a specific example. Many growers use methamidophos, a toxic organophosphate nerve poison, for aphid control. Although methamidophos is a US Environmental Protection Agencyapproved pesticide, the agency is currently reevaluating the use of organophosphates and could ultimately prohibit or greatly restrict the use of this entire class of pesticides. As an alternative to these chemicals, Monsanto (St. Louis) developed a potato dubbed NewLeaf that contains a Bt gene to control the Colorado potato beetle. The ORF-1 (open reading frame 1) and ORF-2 regions from potato leafroll luteovirus (PLRV) were later added to confer resistance to PLRV infection spread by the aphids. The resulting NewLeaf-Plus potato, which received US regulatory approval for food/feed use and environmental release in 1998, is resistant to these two scourges of potato plants and allows growers who adopt it to reduce their use of chemical controls and increase yields. Farmers who planted NewLeaf and NewLeafPlus became convinced that they were the most environmentally sound and economically efficient way to grow potatoes, but after five years of excellent results it encountered an unexpected snag. Under pressure from anti-biotech organizations, McDonalds, Burger King (Miami) and other restaurant chains informed their potato suppliers that they would no longer accept gene-spliced potato varieties for their french fries. As a result, potato processors such as J.R. Simplot (Boise, ID, USA) inserted a nonbiotech potato clause into their farmerprocessor contracts and informed farmers that they would no longer buy gene-spliced potatoes. In spite of its substantial environmental, occupational and economic benefits, NewLeaf became a sort of contractual poison pill and is no longer grown commercially. Now, assume that a farmer who is required by contractual arrangement to plant nonbiotech potatoes sprays his potato crop with methamidophos (the organophosphate nerve poison) and that the pesticide drifts into a nearby stream and onto nearby farm laborers. As a result, thousands of fish die in the stream and the laborers report to hospital emergency rooms complaining of neurological symptoms. [AU: Changes OK?] This hypothetical scenario is, in fact, not at all far fetched. Fish kills attributed to pesticide runoff from potato fields are commonplace. In the potato-growing region of Prince Edward Island, Canada, for example, a dozen such incidents occurred in one thirteen-month period alone, between July 1999 and August 2000 (ref. 8). According to the United Nations Food and Agriculture Organization (Rome), normal use of the pesticides parathion and methamidophos is responsible for some 7,500 pesticide poisoning cases in China each year. In our hypothetical scenario, the state environmental agency might bring an administrative action for civil damages to recover the cost of the fish kill, and a plaintiffs lawyer could file a class-action suit on behalf of the farm laborers for personal injury damages. Whos legally responsible? Several possible circumstances could enable the farmers defense lawyer to shift culpability for the alleged damages to the contracting processor and the fast-food restaurants that are the ultimate purchasers of the potatoes4. These circumstances include: the farmers having planted Bt potatoes for the previous several years; his contractual obligation to the potato processor and its fast-food retail buyers to provide only nonbiotech varieties; and his demonstrated preference for planting gene-spliced, Bt potatoes, were it not for the contractual proscription. If these conditions could be proven, the lawyer defending the farmer could name the contracting processor and the fast-food restaurants as cross-defendants, claiming either contribution in tort law or indemnification in contract law for any damages legally imposed upon the farmer client. The farmers defense could be that those companies bear the ultimate responsibility for the damages because they compelled the farmer to engage in higher-risk production practices than he would otherwise have chosen. The companies chose to impose cultivation of a non-gene-spliced variety upon the farmer although they knew that to avoid severe yield losses, he would need to use organophosphate pesticides. Thus, the defense could argue that the farmer should have a legal right to pass any damages (arising from contractually imposed production practices) back to the processor and the fast-food chains. Food giantswatch out! Companies that insist upon farmers using production techniques that involve foreseeable harms to the environment and humans may be held legally accountable for that decision. If agricultural processors and food companies manage to avoid legal liability for their insistence on nonbiotech crops, they will be guilty at least of externalizing their environmental costs onto the farmers, the environment and society at large.
1. Munkvold, G.P., Hellmich, R.L. & Rice, L.G. Plant Dis. 83, 130138 (1999). 2. Dowd, P. J. Econ. Entomol. 93, 16691679 (2000). 3. Kershen, D.L. Food Drug Law J. 61, 197236 (2006). 4. Kershen, D.L. Oklahoma Law Rev. 53, 631652 (2000). 5. Sicherer, S., Munoz-Furlong, A., Wesley Burks, A. & Sampson, H. J. Allergy Clin. Immunol. 103, 559562 (1999). 6. Bock, S.A., Munoz-Furlong, A. & Sampson, H.A. J. Allergy Clin. Immunol. 107, 191193 (2001). 7. Weise, E. Biotechnology appears to be withering as a food source. USA Today February 2 (2005), p. 8D. 8. Nickerson, C. Potatoes, pesticides divide island. The Boston Globe August 30, (2000), p.A1

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