Food: to be or not to be!

21 July 2010

Jarste Akkermann

The German Federal Court of Justice has passed a cornerstone decision by its judgment dated 14 January 2010, case I ZR 138/07, relating to the differentiation of foodstuff and medicines in borderline cases. The question was whether cinnamon capsules constitute a foodstuff having a nutritive effect or a medicinal product by function having a pharmacological effect. The judgment follows the “Garlic Capsules”- decision of the European Court of Justice (Case C-319/05).

“Diabetruw” contains a top quality, standardised cinnamon extract as a dietetic foodstuff indicated for the reduction of the blood glucose level and is produced and distributed by TRUW Arzneimittel GmbH. The recommended daily intake of three capsules resulted in an amount of 3.0 g cinnamon. “Diabetruw” is the leading product in the German market of foodstuff containing cinnamon and is used by many diabetics for the reduction of their blood glucose level. The German Association of Social Competition (“Verband Sozialer Wettbewerb e.V.”) had attacked the product arguing that the product status had to be considered as pharmaceutical and not as food. The case has been very special due to the fact that clinical studies had undisputedly proven the positive effect of “Diabetruw” on the reduction of the blood glucose level of diabetics.

The District Court in Bielefeld had decided in the first instance that “Diabetruw” showed nutritive and not pharmacological effects and therefore had to be considered as food. The District Court had based its decision on the evaluation of several university expert opinions and the taking of evidence. The Court of Appeals in Hamm had quashed the decision of the District Court in Bielefeld and argued that “Diabetruw” had to be considered as a pharmaceutical.

The German Federal Court of Justice held in its judgment that the “Diabetruw” is in line with European law and marketable as a foodstuff. The German Federal Court of Justice has picked up on the precedent set out by the “Garlic Capsules” judgment of the European Court of Justice (Case C-319/05) and has refined the reasons regarding borderline products. The European Court of Justice had reasoned that a product whose effect on physiological functions is no more than the effects of a foodstuff consumed in a reasonable quantity may have on those functions, does not have a significant effect on the metabolism and cannot, therefore, be classified as a product capable of restoring, correcting or modifying physiological functions within the meaning of the second subparagraph of Article 1(2) of Directive 2001/83/EC. In the “Garlic Capsules” case the physiological effects of the product could also be obtained by daily ingesting 7.4 g of garlic as a foodstuff.

The German Federal Court of Justice held that a product whose effects are achieved by a substance that can be ingested in a corresponding amount in an appropriate manner with the normal diet, may also not be considered as a medicinal product if the recommended frequency of intake (here daily) does not necessarily correspond to the usual diet given that the consumption of the product does not constitute any health risks for the consumers. The Court opined that “Diabetruw” – based on the shown scientific evidence - had a nutritive and not a pharmacological effect.

The reference to the review and evaluation of health innocuousness as additional criteria for differentiation is a very notable cornerstone in the general separation of food from medicinal products. The German Federal Court of Justice has reiterated its reasons in a parallel proceeding (judgment dated 14 January 2010, case I ZR 67/07) as well.

The judgment of the German Federal Court of Justice not only has an impact on other cases concerning products containing cinnamon, but it will have a tremendous influence on most of the running and future court cases in relation to foodstuff showing a physiological effect. The criteria for the differentiation of borderline products will be easier. It also is a further withdrawal from the former basic principle that products having a proven physiological effect had to be considered as medicinal products in cases of doubt. In the past, products having a physiological effect were mostly considered as medicinal products especially by authoritative bodies. Product categories like food supplements and dietetic foodstuff have been seriously backed up by decisions like “Garlic Capsules” and the cinnamon capsules. Therefore, the scope of food supplements and dietetic foodstuff has been amplified.

This development in case law is exceedingly welcome and should strengthen the food category not only in Germany but also in other European Member States. Depending on the specific national legal situation the judgment of the German Court of Justice might be useful for argumentation in borderline cases in other jurisdictions. The judgment of the German Federal Court of Justice not only sustains the decision of the European Court of Justice but refines the reasons regarding borderline products.