Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 1 of 54

IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF ARKANSAS CENTRAL DIVISION

TURTLE ISLAND FOODS SPC PLAINTIFF d/b/a TOFURKY COMPANY

v. Case No. 4:19-cv-00514-KGB

NIKHIL SOMAN in his official capacity as Director of the Arkansas Bureau of Standards DEFENDANT

ORDER

Turtle Island Foods SPC, d/b/a The Tofurky Company (“Tofurky”) brings this action

seeking declaratory and injunctive relief under

to challenge the constitutionality

of Arkansas Act 501, Arkansas Code Annotated § 2-1-301, et seq. (“Act 501”) (Dkt. Nos. 31, ¶¶

1, 3; 43, at 1). Specifically, Tofurky challenges six provisions from Act 501, Arkansas Code

Annotated § 2-1-305(2), (5), (6), (8), (9), and (10) (Dkt. No. 44, at 1). Tofurky asserts that these

provisions represent a restriction on commercial speech that prevents companies from sharing

truthful and non-misleading information about their products, does nothing to protect the public

from potentially misleading information, and creates consumer confusion where none existed

before in order to impede competition (Dkt. No. 31, ¶ 2). As such, Tofurky claims that Act 501

violates the Free Speech Clause of the First Amendment and the Due Process Clause of the

Fourteenth Amendment (Id.).1

This Court previously entered a preliminary injunction Order determining that Tofurky has

Article III standing to bring this legal challenge (Dkt. No. 25, at 8–12); that this Court should not

abstain from addressing the constitutionality of Act 501 (Dkt. No. 25, at 12–15); and that Tofurky

1 In its original complaint, Tofurky asserted a dormant Commerce Clause claim (Dkt. No. 1). Tofurky removed the dormant Commerce Clause claim from its first amended complaint for declaratory and injunctive relief (Dkt. No. 31). Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 2 of 54

met its burden to justify the grant of a preliminary injunction enjoining the State from enforcing

the challenged provisions of Act 501 as applied to Tofurky: Arkansas Code Annotated § 2-1-

305(2), (5), (6), (8), (9), and (10) (Dkt. No. 25, at 16–34). Later, the parties jointly moved to

consolidate the preliminary injunction hearing with the trial on the merits (Dkt. No. 40). The Court

granted the parties’ joint motion, but because Tofurky asserted that it was entitled to all of the

relief identified in its amended complaint, including facial declaratory and injunctive relief, the

Court permitted both parties to address the request for additional relief in supplemental briefing

(Dkt. No. 42).

For the following reasons and for those reasons explained in its preliminary injunction

Order, the Court determines that Tofurky has Article III standing to bring this legal challenge (Dkt.

No. 25, at 8–12); that this Court should not abstain from addressing the constitutionality of Act

501 (Dkt. No. 25, at 12-15); and that Tofurky meets its burden to justify the grant of an injunction

consistent with the terms of this Order enjoining the State from enforcing the challenged provisions

of Act 501 as applied to Tofurky: Arkansas Code Annotated § 2-1-305(2), (5), (6), (8), (9), and

(10) (Dkt. No. 25, at 16–34). The Court grants, in part, and denies, in part, Tofurky’s request for

facial declaratory and injunctive relief consistent with the terms of this Order (Dkt. Nos. 31, 43).

I. Procedural Background

Tofurky filed its complaint on July 22, 2019 (Dkt. No. 1). Act 501 took effect on July 24,

2019. See

. The State filed its answer to Tofurky’s complaint (Dkt. No.

13). Though the complaint mentioned a motion for a preliminary injunction, Tofurky separately

moved for preliminary injunction (Dkt. No. 14). Along with its motion for preliminary injunction,

Tofurky included a declaration from Jamie Athos, President and Chief Executive Officer of

Tofurky; a declaration from Marcus Onley, Policy Coordinator at The Good Food Institute; a

2 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 3 of 54

declaration from Candice Misenheimer, a legal assistant at the law firm of James, Carter & Priebe,

LLP; and a brief in support of the motion (Dkt. Nos. 14-1, 14-2, 14-3, 15). The State filed a

response in opposition to Tofurky’s motion for preliminary injunction (Dkt. No. 17). Along with

its response in opposition, the State included a copy of Act 501 and a declaration from Mr. Soman

(Dkt. Nos. 17-1, 17-2). Although the Court conducted a hearing on the motion, the parties

presented only argument at that hearing, no additional evidence.

The Court entered an Order granting Tofurky’s motion for a preliminary injunction on its

as applied challenge on December 11, 2019 (Dkt. No. 25).

Tofurky filed an amended complaint for declaratory and injunctive relief (“the operative

complaint”) on April 15, 2020 (Dkt. No. 31). The operative complaint removed Tofurky’s

Dormant Commerce Clause claim and corrected a typographical error (Dkt. No. 29). The State

answered the operative complaint on April 16, 2020 (Dkt. No. 32).

On September 23, 2020, the parties filed a joint motion, pursuant to Federal Rule of Civil

Procedure 65(a)(2), asking the Court to consolidate the preliminary injunction proceedings with

the trial on the merits (Dkt. No. 40). The parties stipulated “that no discovery is necessary and

agreed that the record before the Court on Plaintiff’s motion for preliminary injunction is sufficient

for the entry of a final order and judgment related to the six provisions of Act 501 challenged by

Plaintiff here.” (Id., at 1). Tofurky acknowledged that the Court limited its preliminary injunction

analysis to its as-applied claim, but in the joint motion Tofurky requests all the relief identified in

the amended complaint including facial declaratory and injunctive relief (Id., at 2). The State

respectfully disagreed with the Court’s resolution of the preliminary injunction motion and

preserved its rights of appeal (Id., at 3). The Court granted the parties’ joint motion to consolidate

3 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 4 of 54

the preliminary injunction proceedings with the trial on the merits and set a schedule for the parties

to provide the Court with supplemental briefing (Dkt. No. 42).

Tofurky filed a supplemental memorandum in support of its request for facial declaratory

and injunctive relief (Dkt. No. 43). Tofurky asks the Court to: (1) declare that Arkansas Code

Annotated § 2-1-305(6), (8), (9), and (10) facially violate the First Amendment; (2) declare that

Arkansas Code Annotated § 2-1-305(10) facially violates the Fourteenth Amendment’s Due

Process Clause; (3) permanently enjoin the State from enforcing Arkansas Code Annotated § 2-1-

305(6), (8), (9), and (10); (4) declare that Arkansas Code Annotated § 2-1-305(2) and (5) violate

the First Amendment as applied to the labels in the record and similar materials; and (5)

permanently enjoin the State from enforcing Arkansas Code Annotated § 2-1-305(2) and (5) as

applied to the labels in the record and similar materials (Dkt. No. 43, at 15–16). The State

responded asking that the Court find that the challenged provisions of the Act do not violate the

First Amendment or the Fourteenth Amendment’s Due Process Clause and that the Court deny

Tofurky’s request for declaratory and injunctive relief (Dkt. No. 44, at 21).

II. Findings Of Fact

Tofurky is a social purpose corporation incorporated in the State of Washington and

headquartered in Hood River, Oregon (Dkt. No. 1, ¶ 7). Mr. Soman is the Director of the Arkansas

Bureau of Standards (“the Bureau”), a division of the Arkansas Department of Agriculture (Id., ¶

10).

Tofurky develops, produces, markets, and sells plant-based food products, including plant-

based meats (Id., ¶ 9; Dkt. No. 14-1, ¶ 3). All of Tofurky’s products are vegan (Dkt. No. 14-1, ¶

1). Plant-based meats are typically made from soy, tempeh, wheat, jackfruit, textured vegetable

protein, or other vegan ingredients (Id., ¶ 3). The texture, flavor, and appearance of plant-based

4 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 5 of 54

meats resembles meat products made from slaughtered animals (Id.). Unlike animal-based meats,

however, plant-based meats are made from vegan ingredients (Id.). The products are marketed

and sold nationwide, including throughout Arkansas (Id., ¶¶ 3, 9). Tofurky is one of many

companies selling plant-based food products in stores throughout the country, including Arkansas

(Dkt. Nos. 15, at 3; 14-1, ¶ 9).

The panel of seven Tofurky labels that are in the record before the Court “fairly and

accurately depicts the primary display panel of some of Tofurky’s plant-base meat products” (Dkt.

Nos. 14-1, ¶ 4; 14-1, at 6–7 (panel of seven Tofurky labels)).

Tofurky uses traditional meat-based terms like “chorizo,” “ham roast,” and “hot dogs,”

alongside qualifiers like “all vegan,” “plant based,” “vegetarian,” and “veggie,” to show that its

products are plant-based meats that can be served and consumed just like any other meats (Dkt.

Nos. 14-1, ¶ 5; 17, at 2). Tofurky believes that its current packaging and marketing materials

accurately convey the nature and contents of its plant-based meat products (Dkt. No. 14-1, ¶ 25).

Tofurky includes a list of ingredients and nutritional information on every product package (Id., ¶

8). The dispute regarding Act 501 notwithstanding, Tofurky’s products, including its plant-based

meat products, comply with federal food labeling regulations as well as numerous state and federal

laws that prohibit false and deceptive labeling and marketing for food products and consumer

products more generally (Id., ¶ 12). Tofurky has never been the subject of enforcement action by

any federal agency for marketing or labeling its products in a misleading manner (Id., ¶ 13).

Tofurkey is not aware of a single consumer communication sent to Tofurky or to any government

agency complaining that a consumer mistakenly believed Tofurky’s plant-based meat products

were, or contained meat, from slaughtered animals (Id., ¶ 10).

5 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 6 of 54

Tofurky has invested significant time and resources to develop packaging and marketing

materials that effectively, truthfully, and non-deceptively promote its plant-based meat products

(Id., ¶ 11). Each package design of Tofurky products is vetted internally and by third parties (Id.).

Tofurky asserts that it cannot accurately and effectively describe its products without

comparison to the conventional meat products with flavor profiles Tofurky’s products are designed

to invoke (Dkt. No. 31, ¶ 46). Tofurky distinguishes its plant-based meat products from animal-

based meat products through marketing and packaging (Dkt. No. 14-1, ¶ 6). Tofurky does not

want to deceive consumers into believing its plant-based meats are made from animals (Id., ¶ 7).

To the contrary, Tofurky’s packaging and marketing materials includes prominent qualifiers and

descriptors showing that its plant-based meat products are not made from animals (Id.). The value

proposition Tofurky offers consumers is that its products are plant based (Id.).

In 2019, the Arkansas General Assembly passed Act 501, which took effect on July 24,

2019. See

. In relevant part, Act 501 states:

A person shall not misbrand or misrepresent an agricultural product that is edible by humans, including without limitation, by:

...

(2) Selling the agricultural product under the name of another food;

...

(5) Representing the agricultural product as a food for which a definition and standard of identity has been provided by regulations under § 20-56-219 or by the Federal Food, Drug, and Cosmetic Act,

et seq., as it existed on January 1, 2019, unless:

(A) The agricultural product conforms to the definition and standard; and

(B) The label of the agricultural product bears the name of the food specified in the definition and standard and includes the common names of

6 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 7 of 54

optional ingredients other than spices, flavoring, and coloring present in the food as regulations require;

(6) Representing the agricultural product as meat or a meat product when the agricultural product is not derived from harvested livestock, poultry, or cervids;

...

(8) Representing the agricultural product as beef or a beef product when the agricultural product is not derived from a domesticated bovine;

(9) Representing the agricultural product as pork or a pork product when the agricultural product is not derived from a domesticated swine;

(10) Utilizing a term that is the same as or similar to a term that has been used or defined historically in reference to a specific agricultural product. . . .

Ark. Code. Ann. § 2-1-305.

The stated legislative purpose of the Act is to protect consumers from being misled or

confused by false or misleading labeling of agricultural products that are edible by humans. Id. §

2-1-301. Act 501 defines “agricultural product” as “a horticultural, viticultural, forestry, dairy,

livestock, poultry, or bee product or any other farm, ranch, plantation, or range product. . . .”

(1). Act 501 prohibits misbranding or misrepresenting an agricultural product

edible by humans by, for example, representing the product as pork or a pork product when the

product is not derived from a domesticated swine (Dkt. No. 44, at 3). See

-

305(9). Act 501 includes similar prohibitions for products represented as beef (Id.). See

(8). Act 501 also prohibits a person from representing a food product “as

meat or a meat product” when the product is not derived from harvested livestock, poultry, or

cervids (Id.). See

(6). Finally, Act 501 provides that the Director of the

Bureau shall: (1) administer and enforce the Act; (2) promulgate rules to implement the purposes

and requirements of the Act; and (3) receive and investigate complaints regarding alleged

violations of the Act and the rules promulgated by the Director (Id.).

.

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According to Tofurky, as applied, Act 501 prohibits Tofurky from using words like “meat,” “beef,”

“chorizo,” “sausage,” and “roast” to describe its plant-based meat products (Dkt. No. 14-1, ¶ 14).

Tofurky asserts that Act 501 might even prohibit Tofurky from accurately depicting its products

in its marketing and on its packaging (Id.). The statute provides no exception for plant-based meat

producers that clearly identify their products as being vegetarian, vegan, or made from plants (Id.).

Each individual violation of Act 501 is punishable by a civil penalty of up to $1,000 (Id.,

¶ 15). See

. Given the volume of Tofurky’s business in Arkansas,

Tofurky fears that it is exposed to ruinous civil liability under Act 501 (Dkt. No. 14-1, ¶ 15).

Tofurky alleges that Act 501 leaves it with four choices: (1) risk massive civil penalties, along

with all of the harms that result from being penalized, by continuing its current marketing and

packaging practices; (2) create specialized marketing and packaging practices just for the state of

Arkansas, including attempting to police spillover from marketing in nearby states; (3) change its

marketing and packaging practices nationwide; or (4) refrain from marketing or selling its products

in Arkansas at all (Id., ¶ 16).

Tofurky estimates that the cost of changing its marketing and packaging practices

nationwide would verge on $1,000,000, and even still it might be impossible to ensure that no

nationwide marketing enters Arkansas (Id., ¶ 17). Further, Tofurky alleges that it is logistically

and financially impractical to create separate products to be sold within Arkansas alone (Id., ¶ 18).

Instead, Tofurky claims it would be forced to stop selling products in the entire region (Id.). Due

to the nature of distribution agreements, Tofurky states that it cannot ensure that Tofurky products

would not cross state lines into Arkansas (Id.). Tofurky represents that any of these options would

be a significant burden, cost a considerable amount of money, and cause tangible market

disadvantages (Id., ¶¶ 19–20). Additionally, Tofurky fears that it may be liable for media

8 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 9 of 54

advertising in other states that spills over into Arkansas markets, including regional and national

advertising that reaches Arkansas consumers through print, television, radio, and the internet (Id.,

¶ 21).

Finally, Tofurky believes that compliance with Act 501 may create bad will for Tofurky as

customers may be confused by the language required to comply with the statute (Id., ¶ 22). If

Tofurky is prohibited from using terms like “burger,” “chick’n,” and “sausage,” customers may

not understand what they are buying (Id.). Tofurky believes this might lead customers to be

frustrated with the unavailability of its plant-based meat products in Arkansas or puzzled about

why its products are called different names and packaged differently in Arkansas (Id., ¶ 23).

Tofurky alleges that the loss of goodwill from its customers would be a significant burden for

Tofurky (Id., ¶ 24).

According to Mr. Soman, because Tofurky challenged the constitutionality of specific

provisions of Act 501 before they became effective, the Bureau has not taken steps to enforce the

provisions of Act 501 challenged by Tofurky (Dkt. No. 17-2, ¶ 6). Mr. Soman represents that the

Bureau has also not begun the process of promulgating rules related to implementing the purposes

and requirements of the challenged portions of Act 501 (Id.). According to Mr. Soman, to avoid

unnecessarily expending departmental resources and the efforts of the Bureau’s staff, the Bureau

does not intend to begin enforcement of the subsections of Act 501 challenged by Tofurky in this

case until such time as Tofurky’s constitutional challenge to those provisions is resolved (Id., ¶ 7).

To that end, Tofurky has not been assessed a civil penalty or fined under Act 501, and the Bureau

has not taken steps to begin penalizing or fining Tofurky under Act 501 (Id., ¶ 8). Additionally,

according to Mr. Soman, it did not appear at the time the State responded to Tofurky’s motion for

9 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 10 of 54

preliminary injunction that Tofurky had removed any of its products from stores in Arkansas as a

result of Act 501 or changed its labeling or marketing practices within the State (Id., ¶ 9).

At the time the State filed its response to Tofurky’s motion for preliminary injunction,

according to Mr. Soman, and at the time the State filed its response to Tofurky’s supplemental

memorandum in support of its request for facial declaratory and injunctive relief, the Bureau had

not and still has not taken steps to enforce the provisions of Act 501 (Dkt. Nos. 44, at 3–4; 17-2,

¶¶ 6–7). Tofurky still has not been assessed a civil penalty or fined under the Act, and the Bureau

still has not taken steps to begin penalizing or fining Tofurky under the Act (Dkt. No. 44 at 4; 17-

2, ¶ 8). The Bureau had not and has not begun the process of promulgating rules related to

implementing the purposes and requirements of the challenged portions of Act 501 (Dkt. No. 44,

at 14–15; 17-2, ¶ 6).

As of the date the Court entered its preliminary injunction Order, the parties had not entered

into a non-prosecution agreement, and the State had not represented that Tofurky will not face

retroactive liability as a result of continued violations of Act 501 between its date of enactment

and the ultimate resolution of Tofurky’s constitutional challenge. At this time, the Court

understands this still to be the case.

III. Article III Standing

The State contends that Tofurky lacks standing to assert its claims (Dkt. No. 17, at 6–9).

For the foregoing reasons, the Court finds that Tofurky has proper standing to assert its claims.

A. Legal Standard

Under Article III of the Constitution of the United States, federal courts only have subject

matter jurisdiction over “cases” and “controversies.” U.S. Const., art. III, § 2; Steel Co. v. Citizens

for a Better Env’t,

(1998). If there is no case or controversy, then a court does

10 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 11 of 54

not have subject matter jurisdiction and must dismiss the action. To be a case or controversy, the

dispute must be “definite and concrete, touching the legal relations of parties having adverse legal

interests.” Aetna Life Ins. Co. v. Haworth,

, 240–241 (1937) (citations omitted).

Furthermore, the dispute must be “real and substantial” and request “specific relief through

a decree of a conclusive character, as distinguished from an opinion advising what the law would

be upon a hypothetical state of facts.”

(citations omitted).

To establish Article III standing, a plaintiff must satisfy three requirements: “First, the

plaintiff must have suffered an injury in fact—an invasion of a legally protected interest which is

(a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical.

Second, there must be a causal connection between the injury and the conduct complained of—the

injury has to be fairly . . . trace[able] to the challenged action of the defendant, and not . . . th[e]

result [of] the independent action of some third party not before the court. Third, it must be likely,

as opposed to merely speculative, that the injury will be redressed by a favorable decision.” Lujan

v. Defenders of Wildlife,

(1992) (internal quotes and citations omitted).

The injury-in-fact requirement helps to ensure that a plaintiff has a “personal stake in the

outcome of the controversy.” Susan B. Anthony List v. Driehaus,

, 158 (2014)

(quoting Warth v. Seldin,

(1975)). For an injury to be “particularized,” it must

affect the plaintiff in a personal and individual way. Spokeo, Inc. v. Robins,

(2016) (citations omitted). A “concrete” injury must be “de facto,” which means it cannot be

abstract but must actually exist. Spokeo, Inc.,

(citing Black’s Law Dictionary 479

(9th ed. 2009)). The party invoking federal jurisdiction bears the burden of establishing standing.

Lujan,

.

11 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 12 of 54

As relevant here, “[a] plaintiff who challenges a statute must demonstrate a realistic danger

of sustaining a direct injury as a result of the statute’s operation or enforcement.” Babbitt v. United

Farm Workers Nat’l Union,

(1979) (citing O’Shea v. Littleton,

(1974)). In making the required showing, however, a plaintiff “need not expose itself to arrest

or prosecution in order to challenge” a statute. St. Paul Area Chamber of Commerce v. Gaertner,

, 485 (8th Cir. 2006). Nor must a plaintiff “await the consummation of threatened

injury to obtain preventive relief.” Babbitt,

(quoting Pennsylvania v. West

Virginia,

(1923)). In particular, “[w]hen a statute is challenged by a party who

is a target or object of the statute’s prohibitions, ‘there is ordinarily little question that the [statute]

has caused him injury.’” Gaertner, 439 F.3d at 485 (quoting Minn. Citizens Concerned for Life v.

Fed. Election Comm’n,

(8th Cir. 1997)). Moreover, a sufficient injury “is

usually found if the regulation imposes costly, self-executing compliance burdens or if it chills

protected First Amendment activity.” Minn. Citizens Concerned for Life,

(citations omitted).

In Missourians for Fiscal Accountability v. Klahr,

(8th Cir. 2016), the Eighth

Circuit Court of Appeals examined standing in the context of a First Amendment challenge to a

Missouri law regulating the formation of campaign committees, punishable by the threat of civil

penalties. The Eighth Circuit explained that, in the First Amendment context, “two types of

injuries may confer Article III standing to seek prospective relief.” Klahr,

(quoting

Ward v. Utah,

(10th Cir. 2003) (citing Mangual v. Rotger–Sabat,

(1st Cir. 2003))). A party may establish standing by alleging “an intention to engage in a

course of conduct arguably affected with a constitutional interest, but proscribed by a statute, and

there exists a credible threat of prosecution thereunder.” Klahr,

(quoting Babbitt,

12 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 13 of 54

); see also Rodgers v. Bryant,

, 454–455 (8th Cir. 2019) (explaining

that a law’s “chilling effect” can create standing)). Second, a party can establish standing by

alleging that it self-censored. Klahr,

(citing 281 Care Comm. v. Arneson,

(8th Cir. 2011)). “[A] First Amendment plaintiff who faces a credible threat of

future prosecution suffers from an ongoing injury resulting from the statute’s chilling effect on his

desire to exercise his First Amendment rights.” Ward,

(internal quotations

omitted) (emphasis in original). Indeed, “when there is a danger of chilling free speech, the

concern that constitutional adjudication be avoided whenever possible may be outweighed by

society’s interest in having the statute challenged.” Klahr,

(quoting Secretary of

State of Md. v. Joseph H. Munson Co.,

(1984)). The Eighth Circuit applied

these same principles to evaluate standing in Turtle Island Foods, SPC v. Thompson,

, 699–700 (8th Cir. 2021).

B. Analysis Of Standing

The State argues that Tofurky has not met its threshold burden of establishing that it has

standing to challenge Act 501 (Dkt. No. 17, at 8). The State makes a multi-pronged argument,

asserting that: Tofurky has not been assessed a civil penalty or fine under Act 501; the Bureau has

not taken steps to begin penalizing or fining Tofurky under Act 501; Tofurky has not alleged that

it has taken any steps to remove its products from stores in Arkansas; Tofurky has not alleged that

it has taken any steps to change its marketing practice for fear of Act 501’s mandates; and Tofurky

does not appear to have removed any of its products or changed its labeling practices (Id., at 8–9).

In the State’s estimation, these combined factors prove that Tofurky is not faced with “a credible

threat of prosecution” that is sufficiently imminent under Act 501, robbing Tofurky of standing to

challenge Act 501 (Id., at 9). See Driehaus, 573 U.S. at 159.

13 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 14 of 54

The State’s arguments regarding standing misunderstand what Tofurky must show to

demonstrate appropriate standing. In a pre-enforcement suit, “a plaintiff satisfies the injury-in-

fact requirement,” and thus has standing, “where [it] alleges ‘an intention to engage in a course of

conduct arguably affected with a constitutional interest, but proscribed by a statute, and there exists

a credible threat of prosecution thereunder.” Driehaus, 573 U.S. at 159 (quoting Babbitt,

); see also

F.3d at 699–700.

No party argues that Tofurky’s advertisements and labels do not fall within the scope of

Act 501. At no time has the State taken that position in this litigation. Act 501 refers to

“agricultural product” in the challenged sections, and that phrase is defined in Act 501 as “a

horticultural, viticultural, forestry, dairy, livestock, poultry, or bee product or any other farm,

ranch, plantation, or range product. . . .”

(1).

Tofurky challenges only six specific provisions of Act 501: Arkansas Code Annotated §

2-1-305(2), (5), (6), (8), (9), and (10) (Dkt. No. 14, at 1). The Court confines its analysis to those

six provisions and determines whether Tofurky has shown injury, causation, and redressability

with respect to each provision it challenges. See Advantage Media, L.L.C. v. City of Eden Prairie,

(8th Cir. 2006) (citing Lujan,

). Further, Tofurky brings this

pre-enforcement First Amendment challenge alleging fear of prosecution under Act 501 has

caused and will continue to cause a chilling effect, resulting in Tofurky self-censoring its labels

and marketing materials or experiencing other harms as outlined in the record evidence.

Mr. Soman has not yet promulgated regulations to implement Act 501,2 and the parties

have represented that the State does not intend to take any enforcement action against Tofurky

2 Nothing in this Court’s preliminary injunction Order prohibited Mr. Soman, or anyone acting in concert with him, from promulgating such regulations. The Court’s preliminary injunction was limited to enjoining the challenged provisions of Act 501 as to Tofurky only, and 14 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 15 of 54

during the pendency of this litigation (Dkt. No. 17-2, ¶ 7). The Court also notes that Tofurky has

not been assessed a civil penalty or fine under Act 501 and that the Bureau has not taken steps to

begin penalizing or fining Tofurky under Act 501 (Dkt. No. 17-2, ¶ 8).

The parties address these arguments with respect to injury-in-fact sufficient for standing,

but these arguments also relate to ripeness. Courts assess ripeness through a two-fold test,

“evaluat[ing] both the fitness of the issues for judicial decision and the hardship to the parties of

withholding court consideration.” Abbott Labs. v. Gardner,

(1967), abrogated

by Califano v. Sanders,

(1977). Although no regulations have been promulgated, the

inquiry raised by Tofurky’s challenge to Act 501 is fundamentally a question of law. See

Thompson,

(“[B]ecause Plaintiffs’ claim ‘is largely a legal question’ and involves

the chill of ‘allegedly protected First Amendment expression,’ it is ripe for adjudication.”); 281

Care Comm.,

(explaining the ripeness standard); see also Kimberly-Clark Corp.

v. Dist. of Columbia,

(D.D.C. 2017) (examining similar facts and

arguments in a First Amendment challenge to a municipal ordinance).

Moreover, upon conclusion of this litigation, the State could retroactively levy civil

penalties of up to $1,000 against Tofurky for each statutory violation that occurs between the

passage of Act 501 and this litigation’s resolution (Dkt. No. 15, at 3). See

-

306. Though the bill might not come due until the end, Tofurky faces the credible threat of running

up its tab in the meantime. Given the possible $1,000 penalty per item and the vast number of

Tofurky products in Arkansas currently out of compliance with Act 501, Tofurky convincingly

asserts that such liability exposure would be “ruinous” (Dkt. No. 15, at 4). The State “has not

the Court directed the parties to file a status report with the Court immediately if Mr. Soman, or anyone acting in concert with him, promulgated regulations pursuant to Act 501 (Dkt. No. 25, at 10 n.2). 15 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 16 of 54

argued to this Court that plaintiffs will not be prosecuted” if they continue to act in contravention

of Act 501. Holder v. Humanitarian Law Project,

(2010) (citations omitted). There

is nothing stopping the State from simply changing its mind and deciding to prosecute Tofurky

during the pendency of this litigation, despite its expressed intention thus far to postpone any

enforcement until the resolution of Tofurky’s constitutional challenge. See Rodgers,

(examining and rejecting similar arguments); Gaertner, 439 F.3d at 485 (stating that “fear of

prosecution is not imaginary or speculative” when the law, “on [its] face,” prohibits the plaintiffs’

conduct). Thus, the credible threat of incurring significant liability for continued actions in

violation of Act 501 demonstrates sufficient injury and ripeness to grant Tofurky standing.

The State’s arguments regarding Tofurky’s failure to remove its products from Arkansas

stores, change its marketing practices, or change its labeling practices fall flat, as well (Dkt. No.

17-2, ¶ 9). In essence, in order to show standing, the State would have Tofurky “design, produce,

and distribute different, specialized marketing and packaging for its products when they will be

sold in the state of Arkansas, creating a logistical nightmare in distribution channels that service

neighboring states,” “change the entirety of its marketing and packaging nationwide to comply

with the Act, at considerable expense,” or “refrain from marketing or selling its products in

Arkansas at all” (Dkt. Nos. 1, ¶ 54; 14-1, ¶¶ 15–25; 31, ¶ 54). Such drastic measures from Tofurky

would certainly represent adhering to a “regulation [that] imposes costly, self-executing

compliance burdens.” Minn. Citizens Concerned for Life,

(citations omitted).

Moreover, there is sufficient proof in the record before the Court that Tofurky has established

standing by alleging “an intention to engage in a course of conduct arguably affected with a

constitutional interest, but proscribed by a statute, and there exists a credible threat of prosecution

thereunder.” Klahr,

; Rodgers, 942 F.3d at 454–455.

16 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 17 of 54

For all of these reasons, the Court concludes that Tofurky has standing to pursue the relief

it seeks.

IV. Abstention

The State also contends that the Court should abstain from addressing the constitutionality

of Act 501 and defer to the authority of Arkansas’ state courts to interpret the law (Dkt. No. 17, at

9–10). For the following reasons, the Court finds that abstention would be improper in this case.

A. Legal Standard

“[F]ederal courts have a virtually unflagging obligation . . . to exercise the jurisdiction

given to them.” Colorado River Water Conservation Dist. v. United States,

(1976) (citations omitted). However, this obligation is not “absolute.” Quackenbush v. Allstate

Ins. Co.,

(1996) (citing Canada Malting Co. v. Paterson S.S., Ltd.,

(1932)). Abstention doctrine provides that “federal courts may decline to exercise their

jurisdiction, in otherwise ‘exceptional circumstances,’ where denying a federal forum would

clearly serve an important countervailing interest.”

(quoting Colorado River,

).

Notably, the Supreme Court has stated that abstention is “the exception and not the rule,” and the

Court “[has] been particularly reluctant to abstain in cases involving facial challenges based on the

First Amendment.” City of Houston, Tex. v. Hill,

(1987) (footnote and internal

citations omitted).

Rather than invoking any of the traditional abstention doctrines, the State summarily argues

that the Court should allow the Arkansas Supreme Court to have the first opportunity to consider

the constitutionality of Act 501 (Dkt. No. 17, at 10). This generalized argument seems to be an

unspecified request for Pullman abstention. Though there are several abstention doctrines, the

Pullman abstention doctrine covers actions to enjoin state or local officers from enforcing an

17 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 18 of 54

allegedly unconstitutional state law. See R.R. Comm’n of Tex. v. Pullman Co.,

(1941). “[T]he purpose of Pullman abstention in such cases is to avoid resolving the federal

question by encouraging a state-law determination that may moot the federal controversy.” San

Remo Hotel, L.P. v. City and Cnty. of San Francisco, Cal.,

(2005) (citing

England v. La. State Bd. of Med. Exam’rs.,

, 416–417 (1964)). Thus, in situations

“[w]here resolution of the federal constitutional question is dependent upon, or may be materially

altered by, the determination of an uncertain issue of state law, abstention may be proper in order

to avoid unnecessary friction in federal[-]state relations, interference with important state

functions, tentative decisions on questions of state law, and premature constitutional adjudication.”

Harman v. Forssenius,

(1965). However, “[t]he mere possibility that a state’s

interpretation of its law may avoid the necessity for an injunction does not preclude federal

review.” Middle S. Energy, Inc. v. Ark. Pub. Serv. Comm’n,

, 413 (8th Cir. 1985).

“The [Pullman] abstention doctrine is not an automatic rule applied whenever a federal court is

faced with a doubtful issue of state law; it rather involves a discretionary exercise of a court’s

equity powers.” Baggett v. Bullitt,

(1964). Importantly, this “abstention rule

only applies where ‘the issue of state law is uncertain.’” Wisconsin v. Constantineau,

(1971) (quoting Harman,

). “Where there is no ambiguity in the state

statute, the federal court should not abstain but should proceed to decide the federal constitutional

claim.”

(citing Zwickler v. Koota,

(1967)).

B. Analysis Of Abstention

In support of its abstention argument that the Court should allow the Arkansas Supreme

Court to have the first opportunity to consider the constitutionality of Act 501, the State cites three

cases: Virginia v. American Booksellers Association, Inc.,

(1988), Erznoznik v. City

18 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 19 of 54

of Jacksonville,

(1975), and United Food and Commercial Workers International

Union, AFL-CIO, CLC v. IBP, Inc.,

(8th Cir. 1988) (Dkt. No. 17, at 9–10). The State

cites these three cases for the proposition that, if a facially-challenged statute is “‘readily

susceptible’ to a narrowing construction that would make it constitutional, it will be upheld.” Am.

Booksellers Ass’n,

(citing Erznoznik,

; Broadrick v. Oklahoma,

(1973)); see also Erznoznik,

(“[T]he Court has held that a state statute

should not be deemed facially invalid unless it is not readily subject to a narrowing construction

by the state courts.” (citing Dombrowski v. Pfister,

(1965))); IBP,

(same). These cases also posit that state courts are more appropriately situated than federal

courts to fashion these narrowing constructions. Am. Booksellers Ass’n,

(certifying

construction of contested state statutes to the Virginia Supreme Court); Erznoznik,

(stating that a narrowing construction by the state courts can rescue a state statute from facial

invalidation); IBP,

(stating that federal courts “may not impose [their] own

narrowing construction . . . if the state courts have not already done so” (internal quotations and

citation omitted)).

However, the State proffers no narrowed construction of Act 501 that would avoid the

constitutional questions plaguing the law. The Court does not see how Act 501, straightforward

as it is, could be “readily susceptible” to a narrowed construction that skirts the constitutional

questions in this case. See Erznoznik, 422 U.S. at 216–217 (“In the present case the possibility of

a limiting construction appears remote . . . . Moreover, the [law] by its plain terms is not easily

susceptible of a narrowing construction . . . . In these circumstances, . . . there is no reason to

assume that the [law] can or will be decisively narrowed.”). Here, “the naked question,

uncomplicated by an unresolved state law, is whether the Act on its face is unconstitutional.”

19 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 20 of 54

Constantineau,

. Given the lack of ambiguity in Act 501, the Court declines to

apply abstention and proceeds to examine the constitutional claims.

V. Challenges To Act 501

A. Legal Standard For Relief

The Declaratory Judgment Act provides that, “[i]n a case of actual controversy within its

jurisdiction,” subject to some exceptions not at issue here, “any court of the United States, upon

the filing of an appropriate pleading, may declare the rights and other legal relations of any

interested party seeking such declaration, whether or not further relief is or could be sought.”

(a).

“There is no clear-cut standard to use in determining whether a court should exercise its

discretion to grant declaratory relief.” Bd. of Regents for Northwest Mo. State Univ. v. MSE Corp.,

Case No. 90-0125-cv-W-9,

, *2 (W.D. Mo. Nov. 20, 1990). “Basically, the

question in each case is whether the facts alleged, under all the circumstances, show that there is a

substantial controversy between parties having adverse legal interests of sufficient immediacy and

reality to warrant the issuance of a declaratory judgment.” Maryland Cas. Co. v. Pac. Coal & Oil

Co.,

(1941). In general, courts should exercise their discretion in such a way as

“to strike a proper balance between the needs of the plaintiff and the consequences of giving the

desired relief. . . . The actuality of the plaintiff’s need for a declaration of his rights is therefore of

decisive importance.” Eccles v. Peoples Bank of Lakewood Vill., Cal.,

, 431–432

(1948).

“The standard for issuing a preliminary or permanent injunction is essentially the same,

excepting one key difference. A permanent injunction requires the moving party to show actual

success on the merits, rather than the fair chance of prevailing on the merits required for a standard

20 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 21 of 54

preliminary injunction.” Oglala Sioux Tribe v. C & W Enter., Inc.,

(8th Cir.

2008). “A court must consider the following factors in determining whether to issue a permanent

injunction: (1) the threat of irreparable harm to the movant; (2) the state of balance between this

harm and the injury that granting the injunction will inflict on other parties; (3) whether the movant

proves actual success on the merits; and (4) the public interest.” Lowry ex rel. Crow v. Watson

Chapel Sch. Dist.,

(8th Cir. 2008) (quoting Forest Park II v. Hadley,

, 731 (8th Cir. 2003) (citing Bank One, Utah v. Guttau,

(8th Cir. 1999)

(adapting the preliminary injunction factors announced in Dataphase Sys., Inc. v. C.L. Sys., Inc.,

(8th Cir. 1981), to a review of a permanent injunction)).

In its motion for preliminary injunction, Tofurky challenged six provisions from Act 501,

Arkansas Code Annotated § 2-1-305(2), (5), (6), (8), (9), and (10), as violating the Free Speech

Clause of the First Amendment and the Due Process Clause of the Fourteenth Amendment (Dkt.

No. 1, ¶ 2). The Court considered Tofurky’s likelihood of success on the merits of its First

Amendment claim, determined that Tofurky had demonstrated that it was likely to prevail on the

merits of its First Amendment claim as applied, and therefore declined to reach the merits of

Tofurky’s Fourteenth Amendment claim (Dkt. No. 25). The Court now determines whether

Tofurky is entitled to the relief it seeks at this stage of the proceeding.

B. Overview Of First Amendment Challenges

Tofurky brings both an as-applied and facial First Amendment challenge to Act 501 (Dkt.

No. 31, ¶ 63). In its most recent filing, Tofurky seeks a declaration that Arkansas Code Annotated

§ 2-1-305(6), (8), (9), and (10) are facially unconstitutional and, therefore, asks the Court to enjoin

permanently the State from enforcing the challenged provisions, not restricting this relief to

Tofurky.

21 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 22 of 54

In regard to facial challenges in general, the majority of courts have adopted a definition

of facial challenges as those seeking to have a statute declared unconstitutional in all possible

applications. See, e.g., Sabri v. United States,

(2004); United States v. Salerno,

(1987); Steffel v. Thompson,

(1974). As-applied challenges

are construed as an argument that the statute is unconstitutional as applied to precise plaintiffs.

“Each holding carries an important difference in terms of outcome: If a statute is unconstitutional

as applied, the State may continue to enforce the statute in different circumstances where it is not

unconstitutional, but if a statute is unconstitutional on its face, the State may not enforce the statute

under any circumstances.” See Women’s Med. Prof’l Corp. v. Voinovich,

, 193–194

(6th Cir. 1997), cert. denied,

(1998), abrogated by Dobbs v. Jackson Women’s

Health Organization,

(June 24, 2022).

The Supreme Court has made clear that as-applied challenges are preferred. See Wash.

State Grange v. Wash. State Republican Party,

, 448–451 (2008) (discussing the

preference for as-applied challenges as opposed to facial challenges). In Salerno, the Supreme

Court stated that a “facial challenge to a legislative Act is, of course, the most difficult challenge

to mount successfully” and will only succeed if a litigant can “establish that no set of circumstances

exists under which the Act would be valid.”

; United States v. Hall,

(8th Cir. 2022). The Court begins its analysis by examining Tofurky’s as-applied First

Amendment challenges to Act 501 and then turns to examine its facial challenges.

C. First Amendment: As Applied Challenge To Arkansas Code Annotated § 2-1-305(6), (8), and (9)

“An as-applied challenge consists of a challenge to the statute’s application only as-applied

to the party before the court.” Thompson,

(quoting Republican Party of Minn. v.

Klobuchar,

(8th Cir. 2004)). In the operative complaint, Tofurky asserts that

22 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 23 of 54

the Act violates the First Amendment as applied to Tofurky (Dkt. No. 31, ¶ 63). Tofurky seeks a

declaration that the Act’s provisions are unconstitutional as applied to Tofurky and requests that

the Court grant a permanent injunction preventing the enforcement of the Act’s challenged

provisions as applied to Tofurky (Dkt. No. 31, at 15). Accordingly, the Court will consider

whether Arkansas Code Annotated § 2-1-305(6), (8), and (9) are unconstitutional as applied to

Tofurky based on the operative complaint and the parties’ briefing.

1. Success On The Merits: Legal Standard

Commercial speech is generally defined in one of two ways: “expression related solely to

the economic interests of the speaker and its audience,” or “speech proposing a commercial

transaction.” Cent. Hudson, 447 U.S. at 561-62. “The First Amendment, as applied to the States

through the Fourteenth Amendment, protects commercial speech from unwanted governmental

regulation.” Id. at 561 (citing Va. Pharmacy Bd. v. Va. Citizens Consumer Council,

(1976)). In analyzing restrictions on commercial speech, the Supreme Court articulated an

intermediate scrutiny framework for commercial speech in Central Hudson resulting in a four-part

test.3 447 U.S. at 765. Under the Central Hudson test, courts “test the constitutionality of laws

3 The Court notes that the Central Hudson test is sometimes referred to as a four-part test and sometimes referred to as a three-part test with a threshold question. Compare City of Cincinnati v. Discovery Network, Inc.,

(1993) (Blackmun, J., concurring) (“Under the analysis adopted by the Central Hudson majority, misleading and coercive commercial speech and commercial speech proposing illegal activities are addressed in the first prong of the four-part test.”) with Fla. Bar v. Went For It, Inc.,

(1995) (“Commercial speech that falls into neither of those categories, like the advertising at issue here, may be regulated if the government satisfies a test consisting of three related prongs . . . .”). Since the Eighth Circuit appears to consider Central Hudson a four-part test, this Court follows the Eighth Circuit’s lead in that respect. See, e.g., Mo. Broadcasters Ass’n v. Lacy,

(8th Cir. 2017) (“In Central Hudson, the Supreme Court identified four considerations to determine the constitutionality of laws burdening commercial speech . . . .”); Otto, 744 F.3d at 1055 (“The well-known Central Hudson inquiry, in turn, employs a four-part standard to test the constitutionality of laws burdening commercial speech . . . .”). 23 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 24 of 54

burdening commercial speech” by considering: “(1) whether the commercial speech at issue

concerns unlawful activity or is misleading; (2) whether the governmental interest is substantial;

(3) whether the challenged regulation directly advances the government’s asserted interest; and (4)

whether the regulation is no more extensive than necessary to further the government’s interest.”

1-800-411-Pain Referral Serv., LLC v. Otto,

(8th Cir. 2014) (citing Cent.

Hudson, 447 U.S. at 566). Provided that the speech is not false or inherently misleading, “[e]ach

of these latter three inquiries must be answered in the affirmative for the regulation to be found

constitutional.” Thompson v. W. States Med. Ctr.,

(2002); see also Mo. ex rel.

Nixon v. Am. Blast Fax, Inc.,

(8th Cir. 2003) (same).

The first prong of the Central Hudson test “ask[s] as a threshold matter whether the

commercial speech concerns unlawful activity or is misleading.” Thompson,

. If

the speech concerns unlawful activity or is misleading, “then the speech is not protected by the

First Amendment.”

“[W]hen the particular content or method of the advertising suggests that

it is inherently misleading . . . the States may impose appropriate restrictions,” without violating

the First Amendment. In re. R. M. J.,

(1982). “‘Inherently misleading’ speech

is speech that ‘inevitably will be misleading’ to consumers.” Otto,

(quoting Bates

v. State Bar of Ariz.,

, 372 (1977)). “The ‘inherently misleading’ character of speech

may be inferred from ‘the particular content or method of the advertising’ as well as from

‘experience [that] has proved that in fact such advertising is subject to abuse.’” Id. (quoting R. M.

J.,

). “Misleading advertising may be prohibited entirely.” R. M. J.,

; see also Zauderer v. Office of Disciplinary Counsel,

(1985) (“The States

and the Federal Government are free to prevent the dissemination of commercial speech that is

false, deceptive, or misleading . . . .” (citations omitted)). However, “[i]f the communication is

24 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 25 of 54

neither misleading nor related to unlawful activity, the government’s power is more

circumscribed,” and courts proceed with the remainder of the Central Hudson analysis. Cent.

Hudson, 447 U.S. at 564.

The second prong of the Central Hudson test requires the State to “assert a substantial

interest to be achieved by restrictions on commercial speech.” Cent. Hudson, 447 U.S. at 564.

The State may “show the significance of the harm it seeks to remedy” and “demonstrate the

substantiality of the interests with anecdotes, history, consensus, and simple common sense.” Am.

Blast Fax,

(internal quotations and citations omitted). “[E]mpirical studies” are

permitted but not required.

In considering the State’s interest, the Court “must identify with

care the interests the State itself asserts.” Edenfield v. Fane,

(1993). “Unlike

rational-basis review, the Central Hudson standard does not permit [the Court] to supplant the

precise interests put forward by the State with other suppositions.”

(citing Bd. of Trs. of State

Univ. of N.Y. v. Fox,

(1989)). The Court will also consider whether “it appears

that the stated interests are not the actual interests served by the restriction.”

(citing Miss. Univ.

for Women v. Hogan,

(1982)).

The third prong of the Central Hudson test requires that:

[T]he speech restriction directly and materially advanc[e] the asserted governmental interest. “This burden is not satisfied by mere speculation or conjecture; rather, a governmental body seeking to sustain a restriction on commercial speech must demonstrate that the harms it recites are real and that its restriction will in fact alleviate them to a material degree.”

Greater New Orleans Broad. Ass’n v. United States,

(1999) (quoting Edenfield,

507 U.S. at 770–771); see also Went For It,

(“Under Central Hudson’s [third]

prong, the State must demonstrate that the challenged regulation advances the Government’s

interest in a direct and material way.” (internal quotations and citations omitted)). “[T]he

25 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 26 of 54

regulation may not be sustained if it provides only ineffective or remote support for the

government’s purpose.” Cent. Hudson, 447 U.S. at 564.

The fourth prong of the Central Hudson test “complements the direct-advancement inquiry

of the third, asking whether the speech restriction is not more extensive than necessary to serve

the interests that support it.” Greater New Orleans,

. The Supreme Court has

“made clear that ‘the least restrictive means’ is not the standard; instead, the case law requires a

reasonable ‘fit between the legislature’s ends and the means chosen to accomplish those ends, . . .

a means narrowly tailored to achieve the desired objective.’” Lorillard Tobacco Co. v. Reilly,

(2001) (quoting Went For It, Inc.,

). This prong “is not satisfied if

there are alternatives to the regulation[] that directly advance[] the asserted interest in a manner

less intrusive to plaintiffs’ First Amendment rights.” Mo. Broad. Ass’n v. Lacy,

,

302–303 (8th Cir. 2017) (citing Rubin v. Coors Brewing Co.,

, 490–491 (1995)).

However, the State is “not required to show ‘the manner of restriction is absolutely the least severe

that will achieve the desired end.’”

at 303 (quoting Fox,

).

2. Success On The Merits: Analysis

Both parties agree that the information on Tofurky’s packaging, labeling, and marketing

materials represents commercial speech. The parties disagree as to whether that commercial

speech merits First Amendment protection. Tofurky asserts that Act 501 unconstitutionally

restricts protected commercial speech (Dkt. No. 15, at 6–7). Tofurky further argues that Act 501

does not advance a substantial government interest and is not appropriately tailored to any

government interest (Id., at 7–13). The State argues that Tofurky’s commercial speech is

“inherently misleading” and thus outside the First Amendment’s protections (Dkt. No. 17, at 13–

17). Additionally, the State argues that, even if Tofurky’s commercial speech warrants First

26 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 27 of 54

Amendment protection, Act 501 should stand because the State has a substantial interest in

regulating the speech, Act 501 directly and materially advances the State’s interest, and Act 501’s

restriction is no more extensive than necessary to advance the State’s interest (Id., at 18–23).

The State argues that Tofurky’s labels for its plant-based products are inherently

misleading because they use the names and descriptors of traditional meat items but do not actually

include the product they invoke, including terms like “chorizo,” “hot dogs,” “sausage,” and “ham

roast” (Dkt. No. 17, at 15). Additionally, the State points out that Tofurky designs its food products

to approximate the texture, flavor, and appearance of meat derived from slaughtered animals (Id.).

The State believes these factors make Tofurky’s speech inherently misleading (Id.).

Tofurky counters that the State’s argument is not plausible as words such as “meat,”

“burger,” and “steak” have been used for decades—and in some cases centuries—to describe foods

that are not made from slaughtered animals (Dkt. No. 15, at 7). Further, Tofurky contends that its

labels and marketing materials prominently identify its products variously as “all vegan,” “plant

based,” “vegetarian,” “veggie,” and “made with pasture raised plants” on the front of the packages

of it products (Id.).

The parties have chosen not to supplement the record since the preliminary injunction

hearing (Dkt. No. 40). The Court has seven labels before it in the record (Dkt. No. 14-1, at 6–7).

These labels are for products the Court will refer to as “Veggie Burger,” “Deli Slices,” “Chorizo

Style Sausage,” “Slow Roasted Chick’n,” “Original Sausage Kielbasa,” “Hot Dogs,” and

“Vegetarian Ham Roast” (Id.). The panel of seven Tofurky labels that are in the record before the

Court “fairly and accurately depicts the primary display panel of some of Tofurky’s plant-base

meat products” (Dkt. Nos. 14-1, ¶ 4). There is no evidence in the record challenging these

assertions.

27 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 28 of 54

Tofurky uses traditional meat-based terms like “chorizo,” “ham roast,” and “hot dogs,”

alongside qualifiers like “all vegan,” “plant based,” “vegetarian,” and “veggie,” to show that its

products are plant-based meats that can be served and consumed just like any other meats (Dkt.

Nos. 14-1, ¶ 5; 17, at 2). Tofurky believes that its current packaging and marketing materials

accurately convey the nature and contents of its plant-based meat products (Dkt. No. 14-1, ¶ 25).

Tofurky includes a list of ingredients and nutritional information on every product package (Id., ¶

8).

Tofurky asserts that it cannot accurately and effectively describe its products without

comparison to the conventional meat products with flavor profiles Tofurky’s products are designed

to invoke (Dkt. No. 31, ¶ 46). Tofurky distinguishes its plant-based meat products from animal-

based meat products through marketing and packaging (Dkt. No. 14-1, ¶ 6). Tofurky does not

want to deceive consumers into believing its plant-based meats are made from animals (Id., ¶ 7).

To the contrary, Tofurky’s packaging and marketing materials includes prominent qualifiers and

descriptors showing that its plant-based meat products are not made from animals (Id.). The value

proposition Tofurky offers consumers is that its products are plant based (Id.).

The “Veggie Burger” label has the word “veggie” modifying the word “burger” and

includes the words “all vegan” in the middle of the package (Dkt. No. 14-1, at 6). Further, the

“Veggie Burger” label features the words “white quinoa” next to a picture of the burger (Id.). The

“Deli Slices” label also includes the words “all vegan” in the middle of the label, features the words

“plant-based” next to a picture of the product, and describes the product as “smoked ham style”

(Id.) (emphasis added). The “Chorizo Style Sausage” label includes the words “all vegan” and

states that the product was “made with pasture raised plants” (Id.). The “Slow Roasted Chick’n”

label has the words “all vegan” right next to the product’s name and describes the product as

28 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 29 of 54

“plant-based” in the bottom left corner (Id.). The “Original Sausage Kielbasa” label includes the

words “all vegan” next to the word “sausage” and identifies the product as “Polish-style wheat

gluten and tofu sausages” (Id., at 7). The “Hot Dogs” label has the words “all vegan” next to the

word “dogs” and “plant-based” under the word “dogs” (Id.). The “Vegetarian Ham Roast” has the

word “vegetarian” modifying the words “ham roast (Id.). Each of these labels also feature the

letter “V” in a circle on the front of the packaging, a common indicator that a food product is vegan

or vegetarian (Id., at 6-7). Finally, each of these labels feature the company name “Tofurky,”

which clearly contains the word “tofu” in a play on the word “turkey” (Id.).

In “considering the label as a whole,” the Court contemplates whether “an ordinary

consumer would [ ] be deceived” as to the nature of the product. Howard v. Bayer Corp., Case

No. 4:10-cv-1662-DPM,

, at *2 (E.D. Ark. July 22, 2011); see also Ocheesee

Creamery LLC v. Putnam,

(11th Cir. 2017) (reviewing the creamery’s

label as a whole to conclude that the words “skim milk” on the label were not inherently misleading

under Central Hudson). Here, the Court concludes that Tofurky prevails on the merits of its

argument that that the speech it not inherently misleading. The labels’ use of the words Act 501

prohibits permits Tofurky to convey meaningful, helpful information to consumers about the

products they are purchasing, and Tofurky’s repeated indications that the food products contained

in these packages contain no animal-based meat dispel consumer confusion. “[T]his is not a case

of key information in minuscule type buried deep among many ingredients.” Howard,

, at *1 (citation omitted); see Miyoko’s Kitchen v. Ross, Case No. 20-CV-00893-RS,

, at *6 (N.D. Cal. Aug. 10, 2021) (concluding Miyoko’s use of “butter,” “lactose

free,” “cruelty free,” and “revolutionizing dairy with plants” on the company’s “vegan butter”

product labeling is not misleading to consumers); Ocheesee Creamery LLC,

29 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 30 of 54

(holding that restricting truthful use of the words “skim milk” on the label of milk bottles sold in

stores could not withstand First Amendment scrutiny); see also Painter v. Blue Diamond Growers,

757 F.App’x 517 (9th Cir. 2018) (examining similar issues and rejecting claims for purportedly

deceptively labeled almond milk); Ang v. Whitewave Foods Co., Case No. 13-cv-1953,

(N.D. Cal. Dec. 10, 2013) (observing, when examining claims for allegedly misbranded

products, that “adopting Plaintiffs’ position [to remove animal-based names] might lead to more

confusion, not less.”).

The State appears to believe that the simple use of the word “burger,” “ham,” or “sausage”

leaves the typical consumer confused, but such a position requires the assumption that a reasonable

consumer will disregard all other words found on the label. See, e.g., Ang,

, at

*4 (“Under Plaintiffs’ logic, a reasonable consumer might also believe that veggie bacon contains

pork, that flourless chocolate cake contains flour, or that e-books are made out of paper.”). That

assumption is unsupported by the record. The labels in the record evidence before the Court

include ample terminology to indicate the vegan or vegetarian nature of the products.

Additionally, the State has not come forward with evidence of any broad marketplace confusion

around plant-based meat alternatives to bolster its claim. See Miyoko’s Kitchen,

, at *4-5. Here, “[t]here is no contention that any [consumer or potential consumer] was

actually misled or deceived by” Tofurky’s packaging, labeling, or marketing. Peel v. Attorney

Registration & Disciplinary Comm’n of Ill.,

(1990). Thus, the Court

concludes that “considering the label as a whole, an ordinary consumer would not be deceived

about” whether Tofurky’s products contain animal-based meat. Howard,

, at

*2.

30 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 31 of 54

In support of its argument the State points to Upton’s Naturals Co. v. Stitt, Case No. CIV-

20-938-F,

, *3 n.8 (W.D. Okla. Nov. 19, 2020), a case where the United States

District Court for the Western District of Oklahoma considered the challenge mounted by Upton’s

Naturals Co. and Plant Based Foods Association to an Oklahoma Act that prohibits sellers of plant-

based meats from using meat terms to describe their foods unless they have a disclaimer—in the

same “size and prominence” as their product names—that their products are plant-based (Dkt. No.

44, at 15). Plaintiffs argued their use of terms like bacon, chorizo, hot dog, jerky, meatballs, and

steak were not deceptive because their food labels clearly marked their foods as “meatless,” “plant-

based,” or “vegan” to let consumers know their foods do not contain meat.

. The district

court concluded, based on the product labels of Upton’s Naturals Co. the court reviewed, that the

“VEGAN” term or the “100% VEGAN” term did not make the packaging non-misleading, and

“the packaging remains potentially misleading to the reasonable consumer.”

Based on this

conclusion, the district court applied the Zauderer level of scrutiny to analyze the Oklahoma Act

and denied plaintiffs’ motion for preliminary injunction.

at *4–5. Plaintiffs appealed but later

voluntarily dismissed their appeal. Upton’s Naturals Co. v. Stitt, Case No. 20-6184,

(June 3, 2021).

The instant case is distinguishable from Upton’s Naturals Co. In that case, the district

court was considering Upton’s Naturals Co.’s packaging and labels and considering an Act that

required mandated disclosures when using meat-related terms. The district court was not, as the

Court is in this case, addressing the constitutionality of a speech restriction under Central Hudson.

For these reasons and for reasons set forth in this Order, the Court rejects the analysis in Upton’s

Naturals Co.

31 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 32 of 54

The State also contends here that Act 501 also includes a detailed “Definitions” section

that helps to define Act 501’s prohibitions. See

; 305. Tofurky’s plant-

based products are not beef, beef product, livestock, meat, meat product, pork, pork product, or

poultry within Act 501’s definition of those terms. See

. No party

argues that Tofurky’s advertisements and labels do not fall within the scope of Act 501. At no

time has the State taken that position in this litigation.

Further, even though the State has defined certain terms in Act 501, those definitions do

not serve as trademarks on these terms. The Court concludes that the simple use of a word

frequently used in relation to animal-based meats does not make use of that word in a different

context inherently misleading. See Miyoko’s Kitchen,

, at *6 (concluding

Miyoko’s use of “butter,” “lactose free,” “cruelty free,” and “revolutionizing dairy with plants” on

the company’s “vegan butter” product labeling is not misleading to consumers). In this regard,

the facts of this case seem analogous to those of Ocheesee Creamery LLC v. Putnam,

(11th Cir. 2017).

In Ocheesee, the Eleventh Circuit considered whether the plaintiffs’ use of the term skim

milk “was inherently misleading because it conflicted with the State’s definition of ‘skim milk,’

according to which the product would include replenished vitamin A.”

. The Eleventh

Circuit noted that “[i]t is undoubtedly true that a state can propose a definition for a given term.

However, it does not follow that once a state has done so, any use of the term inconsistent with the

state’s preferred definition is inherently misleading.”

As in Ocheesee, Tofurky’s use of the

contested terms deviates from the State’s definitions of those terms in Act 501. Those deviations,

though, do not render Tofurky’s speech inherently misleading based on the labels in the record

before the Court.

32 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 33 of 54

As a result, Tofurky’s labeling is neither unlawful nor inherently misleading, and Tofurky’s

commercial speech warrants First Amendment protection. Accordingly, “the State’s speech

restriction is subject to intermediate scrutiny under the remainder of the Central Hudson test.”

Ocheesee Creamery,

.

As to Central Hudson’s second prong, the Court notes that combatting deceptive,

misleading, or false advertising is a legitimate and substantial interest recognized by both the

Supreme Court and the Eighth Circuit. See Zauderer,

(holding that “preventing

deception of customers” is a substantial interest); Otto,

(noting the State of

Minnesota’s “substantial interest in protecting the public from misleading and false advertising”).

Given this precedent, the Court assumes, without deciding, that the State has a substantial interest

in “protect[ing] consumers from being misled or confused by false or misleading labeling of

agricultural products that are edible by humans.”

.

However, as to Central Hudson’s third prong, the Court determines that Tofurky prevails

on its argument that Act 501 does not “directly and materially” advance the State’s asserted interest

in “protect[ing] consumers from being misled or confused by false or misleading labeling of

agricultural products that are edible by humans,” given that the Court concludes Tofurky prevails

on its argument that its speech is neither false nor misleading. See Greater New Orleans,

;

.

Similarly, as to Central Hudson’s fourth prong, the Court finds that Tofurky prevails on its

argument that Act 501 is likely “more extensive than necessary to serve the State’s interest.” Cent.

Hudson, 447 U.S. at 566. Here, the State’s sole asserted interest is preventing consumer confusion

(Dkt. No. 44, at 17). In the narrow context of an as-applied constitutional challenge, the State

“must demonstrate that the harms it recites are real and that its restrictions will in fact alleviate

33 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 34 of 54

them to a material degree.” Miyoko’s Kitchen,

, at *5 (quoting Edenfield, 507

U.S. at 770–71).

Here, the State has not made an adequate showing that the challenged provisions of Act

501 are a “reasonable fit,” because the challenged provisions, which are predicated upon

preventing misleading commercial speech, are outright bans on what the Court has concluded on

the record before it is non-misleading commercial speech. See e.g. Miyoko’s Kitchen,

, at *6 (granting Miyoko’s cross-motion for summary judgment enjoining the State from

restricting its use of the terms “butter” “lactose free,” “cruelty free,” and “revolutionizing dairy

with plants” on the company’s “vegan butter” product labeling because the State failed to produce

evidence of consumer confusion). As opposed to the prohibition in Act 501, the State could require

more prominent disclosures of the vegan nature of plant-based products, create a symbol to go on

the labeling and packaging of plant-based products indicating their vegan composition, or require

a disclaimer that the products do not contain meat if further laws are deemed necessary to advance

its stated purpose. See Pearson v. Shalala,

(D.C. Cir. 1999) (“[T]he Court has

. . . repeatedly point[ed] to disclaimers as constitutionally preferable to outright suppression.”

(citing Peel,

; R. M. J.,

n.20; Shapero, 486 U.S. at 478)).

As a final matter regarding the Central Hudson test, the Court restates that it typically will

consider whether “it appears that the stated interests are not the actual interests served by the

restriction.” Edenfield,

(citing Hogan,

). Here, Tofurky alleges

and includes some record evidence to support that Act 501’s “true purpose is not to protect

consumers, but to stoke confusion in order to benefit the economic interests of the meat industry,”

while the State argues to the contrary (Dkt Nos. 15, at 9–10; 17, at 18–19). Because the Court

finds that Tofurky demonstrates that Act 501 does not advance the stated governmental interest of

34 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 35 of 54

protecting consumers from being misled or confused, the Court deems it unnecessary at this time

to assess whether the stated interests the Court identifies are not the actual interests served by Act

501.

For the foregoing reasons, the Court finds that Tofurky prevails on the merits of its First

Amendment claim as to Arkansas Code Annotated § 2-1-305(6), (8), and (9) as applied to Tofurky.

3. Other Factors

Because the Court has concluded that Tofurky has met its burden of showing actual success

on the merits of its claim that Arkansas Code Annotated § 2-1-305(6), (8), and (9) are

unconstitutional as-applied to Tofurky, the Court will consider the other factors for granting

injunctive relief. As noted above, the likely absence of money damages available should the State

enforce Act 501, given that the State is subject to Eleventh Amendment’s sovereign immunity bar,

weighs in favor of irreparable harm. See Entergy, Ark., Inc., 210 F.3d at 899 (citing Idaho v. Coeur

d’Alene Tribe of Idaho, 521 U.S. at 269)).

“The third Dataphase factor requires a district court to consider the balance between the

harm to the movant and the injury that granting the injunction will inflict on other interested

parties.” Sanborn Mfg. Co., Inc., 997 F.2d at 489 (citing Dataphase,

(footnote

omitted)). Tofurky faces substantial detrimental impact in complying with Act 501 in that it has

invested significant resources in marketing and packaging its products (Dkt. No. 14-1, ¶ 11).

Tofurky risks civil penalties by continuing its current marketing and packaging practices or

substantial expenses to create specialized marketing and packaging practices for Arkansas,

including attempting to police spillover from marketing in nearby states (Id., ¶ 16). Alternatively,

Tofurky risks suffering damage from changing its marketing and packaging nationwide or

refraining from marketing or selling its products in Arkansas (Id.). The State, on the other hand,

35 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 36 of 54

has not come forward with any compelling harm that it will suffer if it is denied the ability to

enforce the challenged provision of Act 501 (Dkt. No. 17, at 27). The equities favor Tofurky.

The final factor is whether granting declaratory relief serves the public interest. As

discussed above, given that the Court has concluded that Tofurky has met its burden of showing

actual success on the merits of its as-applied First Amendment challenge to Arkansas Code

Annotated § 2-1-305(6), (8), and (9), the Court finds that the public interest factor weighs in favor

of Tofurky.

4. Permanent Injunction

Tofurky asks the Court to enjoin permanently the State from enforcing Arkansas Code

Annotated § 2-1-305(6), (8), and (9) against Tofurky (Dkt. No. 31, at 15). For the reasons set forth

above, the Court grants Tofurky’s request for permanent injunctive relief as to these provisions of

Act 501 as applied to Tofurky (Id.).

D. First Amendment: As Applied Challenge To Arkansas Code Annotated § 2-1-305(2) and (5)

Tofurky asserts that Arkansas Code Annotate § 2-1-305(2) and (5) are unconstitutional as

applied to it because these provisions of the Act replicate provisions of the Federal Food, Drug,

and Cosmetic Act,

(b), (g) and its state analogue Arkansas Code Annotated § 20-

56-209(2), (7) (Dkt. No. 43, at 15). The State acknowledges that the Court has already

preliminarily enjoined these provisions from being applied against Tofurky (Dkt. No. 44, at 20).

1. Success On The Merits

The Federal Food, Drug, and Cosmetic Act,

provides:

A food shall be deemed to be misbranded–

...

(b) If it is offered for sale under the name of another food.

36 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 37 of 54

...

(g) If it purports to be or is represented as a food for which a definition and standard of identity has been prescribed by regulations as provided by section 341 of this title, unless (1) it conforms to such definition and standard, and (2) its label bears the name of the food specified in the definition and standard, and, insofar as may be required by such regulations, the common names of optional ingredients (other than spices, flavoring, and coloring) present in such food.

(b) and (g).

The State analogue to the federal statute, Arkansas Code Annotated § 20-56-209, provides:

A food shall be deemed to be misbranded:

...

(2) If it is offered for sale under the name of another food;

...

(7) If it purports to be or is represented as a food for which a definition and standard of identity has been prescribed by rules or regulations as provided by § 20-56-219 or by the Federal Food, Drug, and Cosmetic Act,1 unless:

(A) It conforms to the definition and standard; and

(B) Its label bears the name of the food specified in the definition and standard, and, insofar as may be required by rules or regulations, the common names of optional ingredients other than spices, flavoring, and coloring present in the food. . ..

(2), (7).

Arkansas Code Annotated § 2-1-305(2) and (5), at issue in this case, provide:

A person shall not misbrand or misrepresent an agricultural product that is edible by humans, including without limitation by:

...

(2) Selling the agricultural product under the name of another food;

...

37 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 38 of 54

(5) Representing the agricultural product as a food for which a definition and standard of identity has been provided by regulations under § 20-56-219 or by the Federal Food, Drug, and Cosmetic Act,

et seq., as it existed on January 1, 2019, unless:

(A) The agricultural product conforms to the definition and standard; and

(B) The label of the agricultural product bears the name of the food specified in the definition and standard and includes the common names of optional ingredients other than spices, flavoring, and coloring present in the food as regulations require. . . .

(2), (5).

The existing in-effect federal and state laws identified by Tofurky that prohibit deceptive

labeling and marketing of food products and consumer products more generally are nearly identical

to two of the challenged provisions of the Act at issue, Arkansas Code Annotated § 2-1-305(2) and

(5). As set forth above, based on the record before it, the Court concludes that Tofurky’s labels

are not deceptive or misleading. Further, the in effect federal and state laws identified by Tofurky

have not been enforced against Tofurky’s labels based on the record evidence before the Court

(Dkt. Nos. 31, ¶¶ 21–33; 15, at 11–12). Consequently, the Court concludes, based on the record

before it, that Tofurky has met its burden of establishing that Arkansas Code Annotated § 2-1-

305(2) and (5) are unconstitutional as applied to Tofurky’s labels. See Miyoko’s Kitchen,

, at *1, *7 (granting Miyoko’s cross-motion for summary judgment enjoining the

State from restricting its use of the terms “butter,” “lactose free,” “cruelty free,” and

“revolutionizing dairy with plants” on its product labeling under

and its state

analogue).

2. Other Factors

Because the Court has concluded that Tofurky has met its burden of showing actual success

on the merits of it claim that Arkansas Code Annotated § 2-1-305(2) and (5) are unconstitutional

38 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 39 of 54

as-applied to Tofurky, the Court will consider the other factors for granting injunctive relief. As

noted above, the likely absence of money damages available should the State enforce Act 501

given that the State is subject to Eleventh Amendment’s sovereign immunity bar weighs in favor

of irreparable harm. See Entergy, Ark., Inc., 210 F.3d at 899 (citing Idaho v. Coeur d’Alene Tribe

of Idaho, 521 U.S. at 269 (1997)).

“The third Dataphase factor requires a district court to consider the balance between the

harm to the movant and the injury that granting the injunction will inflict on other interested

parties.” Sanborn Mfg. Co., Inc., 997 F.2d at 489 (citing Dataphase,

(footnote

omitted)). Tofurky faces substantial detrimental impact in complying with Act 501 in that it has

invested significant resources in marketing and packaging its products (Dkt. No. 14-1, ¶ 11).

Tofurky risks civil penalties by continuing its current marketing and packaging practices or

substantial expenses to create specialized marketing and packaging practices for Arkansas,

including attempting to police spillover from marketing in nearby states (Id., ¶ 16). Alternatively,

Tofurky also risks suffering damages if it changes its marketing and packaging nationwide or

refrains from marketing or selling its products in Arkansas (Id.). The State, on the other hand, has

not come forward with any compelling harm that it will suffer if it is denied the ability to enforce

the challenged provision of Act 501 (Dkt. No. 17, at 27). The equities favor Tofurky.

The final factor is whether granting declaratory relief serves the public interest. As

discussed above, given that the Court has concluded that Tofurky has met its burden of showing

actual success on the merits of its as-applied First Amendment challenge to Arkansas Code

Annotated § 2-1-305(2) and (5), the Court finds that the public interest factor weighs in favor of

Tofurky.

39 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 40 of 54

3. Permanent Injunction

Tofurky asks the Court to enjoin permanently the State from enforcing Arkansas Code

Annotated § 2-1-305(2) and (5) against Tofurky with respect to the labels in the record and similar

materials (Dkt. No. 43, at 15). For the reasons set forth above, the Court grants Tofurky’s request

for permanent injunctive relief as to these provisions of Act 501 as applied to the labels in the

record and similar materials of Tofurky.

E. First Amendment: Facial Challenge

1. Success On The Merits: Standard

Tofurky brings a facial First Amendment challenge as to Arkansas Code Annotated § 2-1-

305(6), (8), (9), and (10) (Dkt. No. 43, at 4–10). The State contends that the bulk of Tofurky’s

argument is that Arkansas Code Annotated § 2-1-305(6), (8), (9), and (10) are overbroad

encompassing protected commercial speech of other individuals or entities not parties to this action

(Dkt. No. 44, at 11). The State urges the Court to reject Tofurky’s facial overbreadth challenge.

The State points to the Court’s preliminary injunction Order wherein the Court cited

Central Hudson and stated, “whether Act 501 has an overbroad scope encompassing protected

commercial speech of other persons is irrelevant because the overbreadth doctrine does not apply

to commercial speech.” (Dkt. No. 25, at 16 (citing

, 565 n.8 (1980))). The State

argues, based on this statement in the Court’s preliminary injunction Order, that the Court should

reject Tofurky’s argument that commercial speech restrictions can be facially invalidated based on

the overbreadth doctrine here because this is commercial speech (Dkt. No. 44, at 11–12 (citing

Vill. of Hoffman Estates, 455 U.S. at 496–497 (1982))). After reviewing further Central Hudson,

reviewing the caselaw cited by Tofurky in its supplemental brief, reviewing all parties’ filings, and

reviewing the record before the Court, the Court rejects the State’s argument.

40 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 41 of 54

Tofurky acknowledges that the United States Supreme Court has held that the overbreadth

doctrine does not generally apply to claims of commercial speech (Dkt. No. 43, at 4). See Cent.

Hudson,

n.8. However, Tofurky asserts that “[t]his means that a plaintiff who has

‘engaged in no constitutionally protected activity’ may not invoke the First Amendment interests

of third parties ‘not before the court’ in order to challenge the statute’s facial validity.” (Dkt. No.

43, at 4 (quoting Cent. Hudson,

n.8)). Tofurky contends that under controlling

law restrictions on commercial speech may be challenged facially by a plaintiff whose own

constitutionally protected speech is prohibited (Id. (citing Cent. Hudson, 477 U.S. at 565 n.8)).

As set forth in the Court’s preliminary injunction Order, the United States Supreme Court

has held generally that the overbreadth doctrine does not apply to commercial speech. Cent.

Hudson Gas & Elec. Corp. v. Pub. Serv. Comm’n,

, 565 n.8 (1980). The Supreme

Court has explained, however, that a plaintiff who has “engaged in no constitutionally protected

activity” may not invoke the First Amendment interests of third parties “not before the court” in

order to challenge a statute’s facial validity. Id.; see, e.g., Bates v. State Bar of Ariz.,

, 380 (1970) (“The First Amendment overbreadth doctrine, however, represents a departure

from the traditional rule that a person may not challenge a statute on the ground that it might be

applied unconstitutionally in circumstances other than those before the court.”). The Supreme

Court has, however, permitted facial challenges to restrictions on commercial speech by a plaintiff

whose own constitutionally protected speech is prohibited. See Cent. Hudson,

n.8

(“In this case, the Commission’s prohibition acts directly against the promotional activities of

Central Hudson, and to the extent the limitations are unnecessary to serve the State’s interest, they

are invalid.”). Here, the facial challenge to restrictions on commercial speech arises from Tofurky,

41 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 42 of 54

who has engaged in speech that is restricted by the challenged provisions of Act 501 for the reasons

the Court explains in analyzing Tofurky’s as-applied challenges.

Additionally, as Tofurky notes, the United States Supreme Court, the Eighth Circuit, and

other circuits have applied Central Hudson in circumstances involving facial challenges to

commercial speech restrictions like the challenge Tofurky brings here. For example, in Thompson

v. Western States Medical Center, the Supreme Court noted that the parties agreed to the

application of Central Hudson, and the Court applied Central Hudson to uphold the Ninth Circuit’s

decision to strike down provisions of the Food and Drug Administration Modernization Act that

prohibited advertising and promoting particular compounded drugs.

(2002)

In Lorillard Tobacco Co. v. Reilly, the petitioners, manufacturers, and sellers of cigarettes,

smokeless tobacco products, and cigars urged the Supreme Court to reject the Central Hudson

analysis and apply strict scrutiny.

, 554–555 (2001). The Supreme Court rejected

the invitation to break new ground and instead applied the Central Hudson analysis to strike down

a regulation restricting outdoor and point-of-sale advertising for smokeless tobacco and cigars

under Central Hudson’s third and fourth prong. Lorillard, 533 U.S. at 554–555, 561–562, 565–

567.

In Missouri Broadcasters Association v. Lacy, the Eighth Circuit Court of Appeals applied

Central Hudson to reverse a district court’s grant of a motion to dismiss in a case where an

association of broadcasters, a corporate operator of radio stations, a winery, and a commercial food

and drink establishment licensed to sell alcohol brought a facial challenge under the First

Amendment to a statute and two regulations of the State of Missouri that detailed the information

alcohol manufacturers, wholesalers, distributers, and retailers could include in their

advertisements.

, 300–303 (8th Cir. 2017).

42 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 43 of 54

The State does not address Tofurky’s argument that restrictions on commercial speech may

be challenged facially by a plaintiff whose own constitutionally protected speech is prohibited.

Moreover, the State does not address the cases cited by Tofurky where the Supreme Court, the

Eighth Circuit, and other circuits have applied Central Hudson in cases presenting facial

challenges to commercial speech restrictions. Accordingly, the Court concludes that Tofurky may

pursue a facial, First Amendment overbreadth challenge to Act 501. The Court also concludes

that the Central Hudson test applies.

2. Success On The Merits: Analysis

As the Court previously explained, both parties agree that the speech restricted by the

challenged provisions is commercial speech, but the parties disagree as to whether that commercial

speech is inherently misleading. Tofurky argues that the State may not place an absolute

prohibition on speech that is potentially misleading if the information may also be presented in a

way that is not deceptive (Dkt. No. 43, at 6). Tofurky points to the Court’s finding in the

preliminary injunction Order that, “the simple use of a word frequently used in relation to animal-

based meats does not make use of that word in a different context inherently misleading” especially

when the labels and advertisements include appropriate “disclosures to inform consumers as to the

plant-based nature of the products contained therein.” (Dkt. Nos. 43, at 7; 25, at 23). Tofurky

argues that because the information may be presented in a way that is not misleading, like the

Tofurky labels reviewed by the Court, it is not inherently misleading and may not be categorically

proscribed (Dkt. No. 43, at 7 (citing Allstate Ins. Co.,

, 166–168 (5th Cir. 2007)).

The State argues that Act 501 restricts inherently misleading speech. The State contends

that marketing plant-based products designed to feel, taste, and look like traditional meat products

is inherently confusing. Further, the State contends that Tofurky’s facial challenge relies too much

43 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 44 of 54

on its own labeling practices (Dkt. No. 44, at 13). In this regard, the State argues that “not all

purveyors of plant-based products will include those identifying terms [such as ‘all vegan’] to

differentiate their products from traditional meat-based products” on their labels (Dkt. No. 44, at

14).

The State also argues that issues related to labeling, including excluding products from the

Act’s coverage that include identifying terms on labels such as “plant-based” and otherwise, could

be accomplished through the promulgation of regulations and that facially invalidating the statute

deprives the State of the opportunity to assuage many of these concerns (Dkt. No. 44, at 14-15).

The State points to Turtle Island Foods, SPC v. Richardson,

(W.D. Mo.

2019), aff’d sub nom. Turtle Island Foods SPC v. Thompson,

(8th Cir. 2021). In

Richardson, the United States District Court for the Western District of Missouri considered a case

brought by Tofurky and the Good Food Institute challenging a Missouri statute the State claims is

similar, but the record indicates is not identical, to the one at issue in this case that prohibits a

person from “misrepresenting a product as meat that is not derived from harvested production

livestock or poultry.” 425 F. Supp. 3d at 1134. The term “misrepresent” in the Missouri statute

is defined as “the use of any untrue, misleading or deceptive oral or written statement,

advertisement, label, display, picture, illustration or sample.” Id. Pursuant to the Missouri statute,

any person who violates any portion of the statute is guilty of a class A misdemeanor. Id.

Punishment for a class A misdemeanor in Missouri is subject to imprisonment for up to one year

and a fine of up to $1,000. Id.

The packaging and labels at issue in Richardson are similar to the Tofurky labels presented

in this case and involve use of the terms “slow-roasted chick’n,” “smoked ham style deli slices,”

“veggie burger,” “hot dogs,” “sausage,” “DIY chorizo,” and “ham roast.” Id. at 1135. Missouri

44 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 45 of 54

did not argue, in Richardson, that plaintiffs “misrepresent” their products as meat. In Missouri,

two days after the statute at issue took effect, the Missouri Department of Agriculture issued

guidance on the statute. Thompson,

. The guidance explained that the Missouri

Department of Agriculture “would not refer for prosecution products in packaging fulfilling two

conditions: (1) prominent statements on the front of the package implying the product is ‘plant-

based,’ ‘veggie,’ ‘lab-grown,’ ‘lab-created,’ or employing a similar qualifier; and (2) a prominent

statement anywhere on the package that the product is ‘made from plants,’ ‘grown in a lab,’ or a

comparable disclosure.”

at 697–98. Missouri argued that the use of the word “meat” on a

plant-based or lab-grown product would only violate the statute if it lacked an appropriate qualifier

“plant-based,” “veggie,” “lab-grown,” “lab-created.” Richardson, 425 F. Supp. 3d at 1139. The

district court granted plaintiffs’ motion to certify a class and denied plaintiffs’ motion for

preliminary injunction concluding that plaintiffs had not shown a substantial likelihood of success

on the merits of their First Amendment claim because the plaintiffs had not shown that the statute

prohibited their commercial speech. Id. at 1140. In dicta, the district court appeared to agree with

the state’s argument that, if a company’s label did not identify that the product was plant-based or

lab-grown when it in fact was, “the statute would unquestionably be valid,” and plaintiffs would

be “unlikely to succeed on a facial challenge to the statute.” Id.

The Court of Appeals for the Eighth Circuit affirmed the district court’s denial of

preliminary injunctive relief. Thompson,

. Applying the test set forth in Central

Hudson, the Court of Appeals concluded that, on the record before the district court, plaintiffs

were not likely to prevail on the merits of their as-applied First Amendment challenge because

their intended speech was not likely to be seen as “‘misrepresenting a product as meat’ and

therefore did not fall within the scope of the Statute.”

. The Court of Appeals stated,

45 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 46 of 54

“Plaintiffs’ as-applied challenge is impeded by the fact that there is a significant doubt surrounding

whether the Statute would ever, or could ever, be applied to their speech. The burden is on

Plaintiffs to demonstrate they are likely to succeed on the merits of their as-applied First

Amendment claim, which includes explaining how the Statue applies to their current and intended

commercial speech.”

The State’s reliance on the Missouri case seems misplaced. Having studied the Missouri

case, this Court observes that this statement by the Court of Appeals may derive from the

regulations, Missouri’s position in the litigation, or from the language of the Missouri statute itself,

which as the dissent noted likely did not apply to plaintiffs.

(Colloton, J., dissenting)

(concluding “the challenged Missouri statute applies only to a ‘person advertising, offering for

sale or selling all or part of a carcass or food plan.’

. Neither plaintiff is

such a person, so the statute does not apply.”). All of these facts are absent from the current

litigation. The State has promulgated no regulations during the three years this dispute has been

pending. The State has not taken the position in this litigation that Act 501 does not apply to

Tofurky. The State has not taken the position in this litigation that Tofurky’s speech is not

misleading, and the State offers no explanation for how the plain language of Act 501 could be

read to exclude Tofurky.

While here the Court found at the preliminary injunction stage that Tofurky’s labels were

not misleading, that finding resulted from a review of the labels as a whole applying a reasonable

consumer standing and derived in part from qualifiers such as “all vegan,” “veggie,” and

“vegetarian” on Tofurky’s packaging. The Court determines that Tofurky cannot rely on its labels

to establish that no set of circumstances exists under which Act 501 would be valid in the context

of a facial challenge. See Salerno,

. The Court can envision plant-based products

46 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 47 of 54

offered by other purveyors in Arkansas with labels subject to Act 501 and without qualifiers on

their packaging identifying the products as “plant-based” or “vegan.” The Court cannot find on

the record before it that such speech in every case would not inevitably be misleading to

consumers. Otto,

. In such a case, the provisions of Act 501 Tofurky facially

challenges might be valid. The Court concludes that Tofurky has failed to establish that it will be

successful in establishing that Arkansas Code Annotated § 2-1-305(6), (8), (9), and (10) concerns

speech that is not misleading in all cases. Tofurky has not established the first prong of the Central

Hudson test with respect to all cases. Accordingly, the Court concludes that Tofurky has not met

its burden to establish success on the merits of its facial First Amendment challenge to Arkansas

Code Annotated § 2-1-305(6), (8), (9), and (10).

3. The Other Factors

Having found that Tofurky has not met its burden of showing success on the merits of its

facial First Amendment challenge to Arkansas Code Annotated § 2-1-305 (6), (8), (9), and (10),

the Court finds it unnecessary to assess the remaining factors required to grant Tofurky permanent

injunctive relief as to these specific provisions on Tofurky’s facial First Amendment claim. See

Oglala Sioux Tribe,

(citing Planned Parenthood Minn., N.D., S.D. v. Rounds,

(8th Cir. 2008) (en banc)). The Court denies Tofurky’s request for statewide

permanent injunctive relief on its facial First Amendment claim.

F. Due Process: Void-For-Vagueness

Tofurky asks the Court to declare that Arkansas Code Annotated § 2-1-305(10) facially

violates the Fourteenth Amendment’s Due Process Clause, and Tofurky requests that the Court

permanently enjoin the State from enforcing the provision. The Court will consider whether

Tofurky is successful on its facial Due Process claim.

47 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 48 of 54

1. Success On The Merits: Legal Standard

“The void-for-vagueness doctrine is embodied in the due process clauses of the fifth and

fourteenth amendments.” D.C. v. City of St. Louis,

, 653 (8th Cir. 1986) (citing

Postscript Enters., Inc. v. Whaley,

(8th Cir. 1981)). “It is a basic principle of due

process that an enactment is void for vagueness if its prohibitions are not clearly defined.”

Grayned v. City of Rockford,

(1972). Under the vagueness doctrine, “a law is

unconstitutional if it ‘fails to provide a person of ordinary intelligence fair notice of what is

prohibited, or is so standardless that it authorizes or encourages seriously discriminatory

enforcement.’” Musser v. Mapes,

(8th Cir. 2013) (quoting United States v.

Williams,

(2008)). A law can also be impermissibly vague “if it authorizes or

even encourages arbitrary and discriminatory enforcement.” Hill v. Colorado,

(2000) (citing City of Chicago v. Morales,

, 56–67 (1999)). To overcome a vagueness

challenge, a court should find it “clear what the ordinance as a whole prohibits.” Grayned,

.

“The degree of vagueness that the Constitution tolerates—as well as the relative

importance of fair notice and fair enforcement—depends in part on the nature of the enactment.

Thus, economic regulation is subject to a less strict vagueness test because its subject matter is

often more narrow, and because businesses, which face economic demands to plan behavior

carefully, can be expected to consult relevant legislation in advance of action.” Vill. of Hoffman

Estates,

. Additionally, courts have “expressed greater tolerance of enactments

with civil rather than criminal penalties because the consequences of imprecision are qualitatively

less severe.”

at 498–499. “[A] scienter requirement may mitigate a law’s vagueness, especially

with respect to the adequacy of notice to the complainant that his conduct is proscribed.”

at

48 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 49 of 54

499. “[P]erhaps the most important factor affecting the clarity that the Constitution demands of a

law is whether it threatens to inhibit the exercise of constitutionally protected rights. If, for

example, the law interferes with the right of free speech or of association, a more stringent

vagueness test should apply.” Id.

2. Success On The Merits: Analysis

Tofurky asserts that Arkansas Code Annotated § 2-1-305(10) facially violates the Due

Process clause. Tofurky contends that Act 501’s civil penalties are “quasi-criminal in nature”

given the “devastating reputational and financial consequences they threaten to impose against

offending entities.” (Dkt. No. 43, at 11 (citing Vill. of Hoffman Estates,

and n.16

(stating that “prohibitory and stigmatizing effect” of civil penalties is “quasi-criminal” in nature

and “may warrant a relatively strict test”))). Tofurky also argues that, although the State is

authorized to waive civil penalties if it concludes that the violation was “accidental, erroneous, or

unintentional,” scienter is not a necessary element of the offense.

Finally, Tofurky asserts that

the Act restricts constitutionally protected commercial speech, so the Court should apply a stricter

vagueness test.

The provision at issue provides that “[a] person shall not misbrand or misrepresent an

agricultural product that is edible by humans, including without limitation, by . . . (10) Utilizing a

term that is the same as or similar to a term that has been used or defined historically in reference

to a specific agricultural product.”

(10). Tofurky argues that many

food-related terms have long applied to a wide variety of agricultural products, including products

made from slaughtered animals and products made from plants. Tofurky points out that the Act

defines “meat” as “a portion of livestock, poultry, or cervid carcass that is edible by humans,”

Arkansas Code Annotated § 2-1-302(7)(A), but in other sources, including the King James Bible

49 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 50 of 54

and the Federal Drug Administration’s guidance documents, the word “meat” is also used to refer

to the flesh of fruits or nuts (Dkt. No. 15, at 13–14). Tofurky maintains that the word “burger”

traditionally referred to a sandwich made from a patty of ground beef, but since the 1930s, “burger”

has been used to describe all sorts of sandwiches, including nut burgers, fish burgers, turkey

burgers, and veggie burgers (Id., at 14). Additionally, Tofurky asserts that the word “steak” can

refer to a slice of meat cut from a beef carcass or to edible portions of other animals or non-animal

food (Id.). Tofurky questions whether this provision would regulate terms such as peanut butter,

oat milk, buffalo wings, and beetballs (Dkt. No. 43, at 12). Tofurky contends that, regardless of

the level of scrutiny applied, it is not clear to a manufacturer or distributor of ordinary intelligence

what the statute prohibits (Id.).

The State argues that considering the Act as a whole, it is “plain what Act 501 regulates.”

(Dkt. No. 44, at 19). The State asserts that the Act defines and provides examples of what

constitutes “beef,” “beef product,” livestock,” “pork,” “pork product,” “poultry,” and other key

provisions.

. The State also contends that the Act identifies the specific

activities regulated by the Act.

. The State maintains that Tofurky’s

focus on a single provision of the Act ignores the specific, plain provisions set forth in the

remainder of the Act that establish what the Act prohibits. The State argues that, if the Court finds

this provision of the Act unconstitutionally vague, however, that it should not enjoin the entire

statute because the Act provides for severability of any provision of the Act deemed invalid (Dkt.

Nos. 44, at 19-20; 17-1, at 5).

The State has not come forward with arguments that address what is meant by “same as or

similar to a term that has been used or defined historically in reference to a specific agricultural

product.”

(10). While the State is correct that the Act in general has

50 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 51 of 54

defined some terms, as Tofurky points out there are many other terms for “agricultural product[s]”

left undefined by the statute which have been used or defined historically in multiple ways

including, but not limited to, meat, milk, patty, buffalo, steak, and butter. The Court concludes

that Tofurky succeeds on the merits of its claim that Arkansas Code Annotated § 2-1-305(10) is

facially void for vagueness. See Grocery Mfrs. Ass’n v. Sorrell,

, 644–645 (D.

Vt. 2015) (concluding that plaintiffs were likely to succeed on their facial challenge to Vermont

statue’s restriction of the word “natural” and “any words of similar import” because the statute

“fails to provide ‘fair notice of what is prohibited’” and “[i]t will therefore permit arbitrary and

irrational enforcement as it provides no meaningful standard for determining which words will

trigger liability.”) (quoting United States v. Williams,

(2008)) (citing

Humanitarian Law Project,

, 18 (2015)) (other citations omitted)), appeal dismissed per

stipulation,

, *1 (2d Cir. Aug. 5, 2016).

3. Other Factors

Because the Court has concluded that Tofurky has met its burden of showing actual success

on the merits of it claim that Arkansas Code Annotated § 2-1-305(10) is facially void for

vagueness, the Court will consider the other factors for granting injunctive relief. As noted above,

the likely absence of money damages available should the State enforce Act 501, given that the

State is subject to Eleventh Amendment’s sovereign immunity bar, weighs in favor of irreparable

harm. See Entergy, Ark., Inc., 210 F.3d at 899 (citing Idaho v. Coeur d’Alene Tribe of Idaho, 521

U.S. at 269)).

“The third Dataphase factor requires a district court to consider the balance between the

harm to the movant and the injury that granting the injunction will inflict on other interested

parties.” Sanborn Mfg. Co., Inc., 997 F.2d at 489 (citing Dataphase,

(footnote

51 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 52 of 54

omitted)). Tofurky faces substantial detrimental impact in complying with Act 501 in that it has

invested significant resources in marketing and packaging its products (Dkt. No. 14-1, ¶ 11).

Tofurky risks civil penalties by continuing its current marketing and packaging practices or

substantial expenses to create specialized marketing and packaging practices for Arkansas,

including attempting to police spillover from marketing in nearby states (Id., ¶ 16). Alternatively,

Tofurky risks suffering damage from changing its marketing and packaging nationwide or

refraining from marketing or selling its products in Arkansas (Id.). The State, on the other hand,

has not come forward with any compelling harm that it will suffer if it is denied the ability to

enforce the challenged provision of Act 501 (Dkt. No. 17, at 27). The equities favor Tofurky.

The final factor is whether granting declaratory relief serves the public interest. As

discussed above, given that the Court has concluded that Tofurky has met its burden of showing

actual success on the merits of it claim that Arkansas Code Annotated § 2-1-305(10) is facially

void for vagueness, the Court finds that the public interest factor weighs in favor of Tofurky.

4. Permanent Injunction

Tofurky seeks permanent injunctive relief (Dkt. No. 43, at 12-14). Tofurky argues that,

“[b]ecause the challenged provision [is] facially unconstitutional, [it] should be enjoined

statewide.” (Id., at 14). The Act provides that, “[i]f any provision of this act or the application of

this act to any person or circumstance is held invalid, the invalidity shall not affect the other

provisions or application of this act which can be given effect without the invalid provision or

application, and to this end, the provisions of this act are declared severable.” (Dkt. No. 17-1, at

5). When confronting a constitutional flaw in a statute, a federal court must “try not to nullify

more of a legislature's work than is necessary.” Ayotte v. Planned Parenthood of N. New England,

(2006). It is preferable “to enjoin only the unconstitutional applications of a

52 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 53 of 54

statute while leaving other applications in force, or to sever its problematic portions while leaving

the remainder intact.”

(citations omitted).

Severability is a matter of state law. See Russell v. Burris,

, 573 (8th Cir.

1998). Under Arkansas law, “an act may be unconstitutional in part and yet be valid as to the

remainder.” Ex Parte Levy,

(Ark. 1942). In determining whether a

constitutionally invalid portion of a legislative enactment is fatal to the entire legislation, the

Supreme Court of Arkansas looks to: “(1) whether a single purpose is meant to be accomplished

by the act; and (2) whether the sections of the act are interrelated and dependent upon each other.”

U.S. Term Limits, Inc. v. Hill,

(Ark. 1994). Applying this standard, the Court

satisfies itself that voiding for vagueness one provision of Act 501 is acceptable.

Because the Court has concluded that only one of the challenged provisions is facially

unconstitutional and because the Court has concluded that it is severable, the Court grants

permanent statewide injunctive relief as to Arkansas Code Annotated § 2-1-305(10), which the

Court has found facially void for vagueness under the Due Process Clause of the Fourteenth

Amendment.

VI. Conclusion

For the foregoing reasons, the Court hereby orders that defendant Nikhil Soman, in his

official capacity as Director of the Arkansas Bureau of Standards, and all those acting in concert

with him, including employees, agents, and successors in office, are permanently enjoined:

(1) From enforcing Arkansas Code Annotated § 2-1-305(10) statewide. The Court

declares that Arkansas Code Annotated § 2-1-305(10) is facially unconstitutional.

(2) From enforcing Arkansas Code Annotated § 2-1-305(6), (8), and (9) against Tofurky.

53 Case 4:19-cv-00514-KGB Document 50 Filed 09/30/22 Page 54 of 54

(3) From enforcing Arkansas Code Annotated § 2-1-305(2) and (5) against Tofurky’s

labels in the record and similar materials of Tofurky.

It is so ordered this 30th day of September, 2022.

Kristine G. Baker United States District Judge

54