The Alternative Protein Litigation Trap: How Regulatory Ambiguity Created a Shakedown Industry

This isn't a compliance crisis. It's a business model. And unless you understand how it works, your company is next.

The narrative emerging from these cases positions this as corporate negligence: companies cutting corners, ignoring regulations, misleading consumers. But that narrative misses the fundamental truth. This is regulatory ambiguity being weaponized by plaintiff attorneys who found a lucrative gap between what FDA requires and what courts will certify as a class action.

I've spent 35 years working across conventional, plant-based and emerging protein technologies as a formulator and regulatory expert. What I'm witnessing isn't isolated bad actors making careless mistakes. It's systematic exploitation of unclear regulatory triggers, where good-faith compliance efforts become litigation targets because companies and plaintiff attorneys interpret the same regulations differently.

In August 2023, the Ninth Circuit issued what should have been a clarifying decision in Nacarino v. Kashi. The court ruled that manufacturers can use the nitrogen method (Kjeldahl method) to calculate protein content and can make quantitative protein claims on front-of-pack labeling. The regulations explicitly permit this under 21 CFR 101.9(c)(7).

But there's a critical trigger provision in 21 CFR 101.9(c)(7)(i): "if a protein claim is made on the label or in labeling of a food...the percent of the Daily Reference Value for protein must be declared." And that Daily Value must be calculated using PDCAAS (Protein Digestibility-Corrected Amino Acid Score), which accounts for both amino acid profile and digestibility.

The Ninth Circuit held that compliant labels can show protein quantity on the front (using nitrogen method) as long as the Nutrition Facts Panel includes PDCAAS-corrected percent Daily Value when a "protein claim" is made.

Here's where the trap opens: what exactly constitutes "a protein claim" that triggers the PDCAAS %DV requirement?

Under 21 CFR 101.13, nutrient content claims include statements like "Good Source of Protein" (10–19% DV), "High in Protein" (20%+ DV), or "Excellent Source of Protein" (20%+ DV). These clearly trigger the PDCAAS %DV requirement.

But what about a simple quantitative statement like "15g Protein" on the front of a plant-based protein bar?

Company interpretation: This is informational content about the actual amount of protein present, measured by the nitrogen method as explicitly permitted by FDA. It's not a nutrient content "claim" under 21 CFR 101.13. Therefore, PDCAAS %DV disclosure is not required.

Plaintiff attorney interpretation: Any prominent protein statement on front-of-pack is "a protein claim" that triggers 21 CFR 101.9(c)(7)(i) requirements. By including "15g Protein" prominently, you're making a claim about protein that requires PDCAAS-corrected %DV disclosure in the Nutrition Facts Panel.

This is not a simple matter of companies ignoring clear regulations. This is genuine ambiguity about regulatory triggers, where reasonable professionals disagree about interpretation.

And plaintiff attorneys have discovered that courts will certify class actions based on their interpretation, regardless of whether companies followed what they believed FDA permitted.

Dave's Killer Bread demonstrates why Nacarino didn't solve the problem. Despite the Ninth Circuit's clarification, multiple class actions were filed against Dave's Killer Bread alleging that their products display protein content on front-of-pack labels ("5g Protein") without corresponding PDCAAS-corrected percent Daily Values in the Nutrition Facts Panel.

In September 2024, a California federal judge granted class certification, ruling that these claims could proceed as a class action. The case remains active litigation.

The company's position: they were making informational content statements about protein quantity, not nutrient content claims that trigger PDCAAS disclosure requirements. The plaintiff attorney position: any front-pack protein statement constitutes "a protein claim" requiring PDCAAS %DV.

The court sided with plaintiff attorneys on the question of whether a class action could proceed.

This pattern is playing out across the alternative protein sector, particularly hitting plant-based protein companies where PDCAAS scores are inherently lower than animal proteins (typically 0.3–0.7 for plant protein isolates and concentrates vs. 1.0 for whey).

For founders and executives: if your labels show protein content prominently but your Nutrition Facts Panel doesn't include PDCAAS-corrected %DV, assess your exposure now. Schedule a regulatory risk assessment to understand whether your current labeling creates litigation vulnerability.

This ambiguity didn't just create compliance confusion. It created a lucrative business model for plaintiff attorneys:

The economics are brutal. For a venture-backed alternative protein company, spending $1.5 million on legal defense (even if your interpretation is reasonable) can be existentially threatening. Settlement becomes the rational choice.

The plaintiff attorneys know this. They're pursuing these cases because regulatory ambiguity creates enough uncertainty that companies will pay to avoid the risk.

This is a shakedown enabled by ambiguous regulatory triggers that plaintiff attorneys exploit systematically.

Some argue that any front-pack protein claim without digestibility context misleads consumers. This argument misunderstands how food labeling works and why the regulatory framework was designed the way it is.

FDA separates informational content from nutritional context deliberately:

Front-of-pack: quick reference (grams of protein, calories, serving size)
Nutrition Facts Panel: full context (%DV, digestibility, amino acid profile)

When a label states “20g Protein” on the front and includes “14% DV (PDCAAS-corrected)” in the Nutrition Facts Panel, consumers receive complete, accurate information. Both statements are scientifically valid and complementary.

The claim that front-pack statements mislead even when full information exists assumes consumers do not read the Nutrition Facts Panel. But FDA’s entire framework is built on that expectation. Overloading front labels would confuse, not clarify.

You can make yourself lawsuit-proof. It’s not by removing claims or adding disclaimers. It’s by including PDCAAS-corrected Daily Values proactively.

When you do, the plaintiff attorney’s theory collapses:

“They claim 20g protein but don’t disclose PDCAAS values or %DV.”
“Actually, the Nutrition Facts Panel shows both.”
“…we’re not filing this case.”

You don’t beat them by playing defense. You beat them with scientific transparency. Sophisticated compliance infrastructure doesn’t limit marketing power—it amplifies it.

Traditional PDCAAS testing is expensive and slow. AI changes that by performing real-time composite amino acid analysis and digestibility modeling based on your exact formulation, ingredient database, and processing parameters.

AI platforms:

The result: instant, accurate PDCAAS calculations during formulation—before packaging design, not after litigation.

PDCAAS is archaic but remains the FDA standard under 21 CFR 101.9(c)(7)(ii). Despite its flaws, companies must comply until FDA transitions to DIAAS or another method.

AI platforms bridge the gap—modeling digestibility and amino acid profiles without expensive rat studies—producing more consistent, scientifically defensible results in minutes instead of weeks.

Two scenarios define the market:

Scenario A: Traditional path. You market “15g Protein,” get sued, spend $1.5M defending or settle.
Scenario B: Infrastructure path. You disclose PDCAAS-corrected %DV, make stronger, defensible claims, and build consumer trust.

The difference isn’t luck. It’s infrastructure.

Hiring consultants for every iteration doesn’t work. Expertise is scarce and costly. AI-powered infrastructure scales that expertise—just as LexisNexis did for law or TurboTax did for accounting.

This isn’t about replacing experts. It’s about scaling their knowledge.

Formulation innovation is becoming commoditized. Compliance velocity—how fast you can make defensible claims—is now the differentiator. AI-powered infrastructure turns compliance into competitive advantage.

Regulatory strength becomes the moat when product quality becomes table stakes.

Alternative protein companies face a choice:
Keep gambling on ambiguity, retreat and weaken claims, or build infrastructure that makes labels litigation-proof.

Only one path scales with confidence and speed.

Mark Haas is the founder and CEO of RegulateCPG, an AI-powered compliance infrastructure platform designed to democratize regulatory expertise for food and beverage companies. With 35 years of experience navigating food safety regulation, manufacturing operations and multi-jurisdiction compliance, Mark has formulated over 200 brands representing more than $2 billion in market value. His work spans conventional, plant-based and emerging protein technologies across FDA, USDA, CFIA and EU regulatory frameworks, with deep expertise in using sophisticated amino acid analysis and PDCAAS methodology to create litigation-proof label claims for alternative protein companies.

For more insights on using regulatory compliance as competitive advantage, visit regulatecpg.com or connect with Mark on LinkedIn.

Legal Disclaimer:
This article discusses regulatory strategy and compliance approaches but does not constitute legal advice. Companies should consult qualified food law attorneys and regulatory counsel for guidance on specific labeling decisions and regulatory interpretations applicable to their products.