Ninth Circuit Strikes Down Key Provisions of USDA’s Bioengineered Food Disclosure Rule

In a major decision for food manufacturers and retailers, the Ninth Circuit recently struck down the U.S. Department of Agriculture (USDA) exemption for highly refined foods under the National Bioengineered Food Disclosure Standard (NBFDS). The court also returned the rule’s QR-code and text-message disclosure provisions for further review, directing the district court to determine the next steps after hearing from the parties.

Importantly, the decision does not change current labeling obligations. The federal bioengineered (BE) disclosure framework remains in effect while the case returns to the district court for entry of judgment and remand to the USDA Agricultural Marketing Service (AMS). Companies should maintain existing compliance programs but begin assessing potential exposure if AMS expands the rule to cover highly refined foods. Any future change will depend on AMS’s actions on remand, including through new rulemaking or early steps such as a Request for Information (RFI).

Background

The National Bioengineered Food Disclosure Standard (NBFDS) was signed into law in 2016 to create a single federal framework to provide for disclosure of information to consumers about the bioengineered (BE) status of foods, i.e., whether a food is BE or contains BE ingredients. USDA AMS finalized the BE rule in 2018, with mandatory compliance beginning on January 1, 2022.

Under the NBFDS and final rule, certain foods made from bioengineered sources must include a disclosure using one of several approved methods:

• A text statement such as “Bioengineered Food” or “Contains a Bioengineered Food Ingredient”;
• The USDA-approved BE symbol;
• An electronic or digital link (QR code) accompanied by on-package text; or
• A text message disclosure.

AMS also maintains a List of Bioengineered Foods—including corn, soybeans, canola, cotton, sugar beet, and certain varieties of papaya, potatoes, apples, and other listed commodities. Foods derived from these sources are presumed to be bioengineered unless the manufacturer maintains records demonstrating otherwise. One of the rule’s most debated provisions concerns highly refined ingredients—such as sugars, starches, and oils derived from bioengineered crops—that typically contain no detectable genetic material after processing. AMS concluded that if modified genetic material cannot be detected, disclosure is not required. That interpretation prompted litigation.

In 2020, a coalition of retailers and consumer advocacy groups filed suit in the U.S. District Court for the Northern District of California in Natural Grocers v. Rollins, alleging that USDA’s rule unlawfully excluded highly refined foods and limited consumer access to BE disclosures. The district court largely upheld the rule but found USDA’s text-message disclosure option deficient, remanding that provision to the agency without vacatur. Both sides appealed. The plaintiffs appealed the court’s rejection of their main claims—specifically USDA’s exclusion of highly refined foods and approval of QR-code disclosures—and USDA cross-appealed the ruling that the text-message disclosure option was unlawful. Both appeals led to the Ninth Circuit’s recent decision on October 31, 2025.

The Court’s Decision

The Ninth Circuit’s opinion addressed three major issues: the treatment of highly refined foods, the required labeling terminology, and the validity of the electronic- and text- disclosure rules.

1. Highly Refined Foods (Detectability Standard)

The Court held that the USDA Agricultural Marketing Service (AMS) erred by excluding highly refined foods from the definition of “bioengineered” merely because modified genetic material is undetectable after processing. The panel found that this interpretation—treating “not detectable” as equivalent to “not contained”—conflicts with the statute’s plain text, which requires USDA to determine whether a food contains modified genetic material, not whether existing testing methods can detect it. The court concluded that the agency’s approach to highly refined ingredients rested on a faulty assumption: that the inability to detect modified DNA means none is present. In the court’s view, that reading conflicts with the statute’s plain text, which requires USDA to determine whether a food actually contains modified genetic material—not whether testing methods can detect it.

At the same time, the court confirmed that USDA may set a detection or quantitative threshold under 7 U.S.C. § 1639b(b)(2)(B), defining how much modified material must be present for a food to qualify as “bioengineered.” Any such standard, however, must rest on clear statutory authority and reasoned, evidence-based analysis. The panel reversed the district court’s contrary ruling and remanded for it to determine whether any portion of the regulation should be vacated pending AMS’s reconsideration.

2. Labeling Terminology

The Ninth Circuit upheld AMS’s requirement that disclosures use the term “bioengineered.” The agency reasonably concluded that uniform use of “bioengineered” — as provided for in the statute — promotes nationwide consistency and avoids consumer confusion.

3. QR-Code and Text-Message Disclosures

The panel reversed the district court’s decision to leave the electronic disclosure provisions in effect while remanding them.

Why It Matters

This decision rejects USDA’s detectability approach to highly refined foods but preserves the broader BE disclosure framework, subject to reconsideration by AMS on remand with respect to detectability and electronic-disclosure provisions. The immediate effect is continuity: companies should maintain current BE disclosure practices, as the rule remains enforceable, but expect potential rulemaking that could expand coverage to highly refined ingredients or change authorized electronic disclosure formats. Over the longer term, AMS’s response could reshape how refined ingredients are treated and how electronic disclosures are presented to consumers.

For food manufacturers and retailers, the decision underscores that the treatment of highly refined sugars, oils, starches, and other foods remains unsettled. Firms relying on the current exemption should be prepared to document non-detect positions and monitor AMS’s next steps, including any RFI or proposed rulemaking.

From a regulatory standpoint, the decision reopens questions about how AMS defines and substantiates “non-detect” positions and could lead to new analytical or recordkeeping standards. Any shift toward a quantitative threshold or broader detectability standard could materially expand the scope of products subject to BE labeling. Companies should be prepared to engage in the rulemaking process, as AMS is likely to seek public comment and technical data to inform its next steps.

Practical Takeaways

• Continue current compliance with the existing BE disclosure rule until AMS completes its review; no immediate changes are required.
• Audit recordkeeping for refined-ingredient disclosures (sugars, oils, starches) and maintain documentation supporting “non-detect” positions in case detection thresholds change.
• Monitor AMS for forthcoming guidance or proposed updates to the BE rule, particularly on detectability and electronic-disclosure formats.
• Review supplier certifications and traceability documentation for refined ingredients derived from bioengineered crops to anticipate potential labeling changes.

If you have any questions regarding this alert, please contact the authors.