Here Be Dragons: The Regulatory Landscape Just Shifted
Imagine your town has a speed limit of fifty-five miles per hour. The law says fifty-five. The signs say fifty-five.
Then the police chief announces that, while the city studies whether the limit should be raised, officers will not ticket anyone driving under sixty-five.
Nothing about the law has changed. Only the way the law is being enforced.
If you drive that road every day, you begin traveling sixty-two. So does everyone else. Trucking companies schedule deliveries around it. Insurance companies adjust their assumptions. Businesses make investments. Over time, the practical reality of the road changes even though the written rule never did.
Last week, a federal appeals court reminded the food industry what happens when someone finally asks what the sign says.
The Difference Between a Rule and a Hall Pass
Every profession has its own version of “everyone knows.”
Sometimes those things are true. Sometimes they are simply ideas that have been repeated so often that they become indistinguishable from fact.
A federal appeals court revived a consumer lawsuit against Chobani over the labeling of its Zero Sugar yogurt. If you only read the headlines, you might think the story is about allulose. It isn’t. Allulose is simply today’s case study. The real lesson reaches much farther than a single ingredient or a single lawsuit. It concerns a concept most consumers have never heard of but that quietly shapes thousands of decisions inside food companies every year: FDA enforcement discretion.
The speed limit is enforcement discretion. It sounds technical, but the idea is surprisingly human.
It is one of the least understood ideas in food regulation, and one of the most important.
Why Enforcement Discretion Exists
Science moves quickly. Regulations do not.
A genuinely new ingredient may emerge in a matter of months, while changing a federal regulation can take years. Agencies are often forced to live in that uncomfortable gap. Sometimes the science has moved far enough that regulators no longer believe the existing rule reflects the best available understanding, but the machinery of government cannot turn quickly enough to rewrite it.
So… they issue guidance.
Not a new regulation. Not a new law. Guidance.
In effect, they say, while we continue evaluating the science, this is how we intend to enforce the existing rules.
It is an imperfect solution, but often the only practical one.
The food industry has learned to live inside that imperfect space because it has no real alternative. Businesses cannot put product development on hold for six years while Washington finishes thinking. Packaging must be ordered, equipment must be purchased, investors expect progress, retail buyers expect launch dates, and factories have payroll every Friday whether rulemaking is complete or not. Innovation simply does not have the luxury of waiting for certainty.
Why Allulose Changed the Market
Allulose is a perfect example.
Chemically, allulose is a sugar. More specifically, a monosaccharide. But unlike traditional sugars, it contributes very few calories and has minimal impact on blood glucose. From a formulation standpoint, it is an extraordinary ingredient. It browns like sugar, contributes bulk and texture, depresses freezing point, and behaves in ways that many high-intensity sweeteners simply cannot. Food scientists were understandably excited.
FDA took the question seriously. The agency received citizen petitions, published draft guidance, took public comment, conducted its own review of the science on metabolism, caloric value, glycemic response, and dental effects, and then finalized its guidance in 2020. It announced that it intended to exercise enforcement discretion allowing allulose to be excluded from both the Total Sugars and the Added Sugars declarations on the Nutrition Facts panel and allowing a calorie factor of 0.4 per gram rather than the 4 the rule required.
What it did not do was change the rule.
Under the 2016 Nutrition Facts regulation, allulose was required to be counted in Total Carbohydrate, in Total Sugars, and in Added Sugars, at four calories per gram. That requirement was never amended. It is still there today.
When Temporary Guidance Starts to Feel Permanent
The industry did what industries always do.
It moved.
Factories were built. Supply chains were established. Brands launched. Investors funded companies. Millions of products found their way onto grocery shelves.
After six years, something subtle happened. The temporary bridge began to feel permanent.
What makes that worth sitting with is that the expiration date was printed on the bridge. The guidance said, in writing, that FDA’s position applied pending review of the issues in a rulemaking. The contingency was never hidden. It was on the face of the document the entire time.
The industry did not misread it. The industry stopped reading it.
Many people, and I mean smart people, thoughtful people, experienced people, quietly stopped distinguishing between FDA’s decision not to enforce a rule and FDA actually changing the rule itself.
Those are not the same thing.
Then Someone Read the Rule
Then Jason and Abigail Franco bought a yogurt. They purchased Chobani Zero Sugar yogurt containing approximately four grams of allulose per serving. Believing that “Zero Sugar” meant exactly what it sounded like, they sued.
Notice what they did not ask. They did not ask whether allulose was metabolically healthier than sucrose. They did not ask whether it raised blood glucose. They did not ask whether FDA should modernize its regulations. They asked a far simpler question:
What does the regulation actually say?
Chobani’s answer was the one any responsible company would have given. It had relied on published federal guidance. It had, by its own account to the court, secured a marketing permit from FDA after the agency reviewed its zero sugar labeling.
That is close to the most regulatory comfort an American food company can obtain short of a completed rulemaking.
It did not save them.
The Shield Became the Sword
The Seventh Circuit’s reasoning was straightforward.
The regulation defines sugars as all free mono- and disaccharides, followed by a list of examples. Allulose is a monosaccharide. The list was illustrative, not exhaustive. Therefore, allulose is a sugar under the rule.
FDA’s guidance changed the agency’s enforcement priorities. It did not change the regulation itself.
And here is the part that deserves more attention than it has received.
Chobani’s actual defense was federal preemption. States are not permitted to impose food labeling requirements that differ from federal ones. So Chobani argued, sensibly, that if FDA permits this label, then a state consumer-protection lawsuit attacking it is demanding something federal law does not require, and the claim is barred. A district court agreed and dismissed the case.
The appeals court inverted it.
Because the regulation still counts allulose as a sugar, and because the guidance never touched the regulation, the state law claims were not demanding something different from federal law. They were enforcing it. Preemption did not apply.
The regulation that the guidance left standing became the plaintiffs’ cause of action.
The shield was the sword the entire time.
What the Chobani Decision Actually Means
That distinction carries consequences well beyond one yogurt brand.
For years, companies understandably treated published FDA enforcement discretion as about as close to a regulatory hall pass as government could provide without completing formal rulemaking. Not because anyone believed guidance had magically become law, but because businesses must make decisions in the real world. A published agency position, even if technically nonbinding, became the operating reality for entire industries.
The Chobani decision does not say that guidance is meaningless. It does not suddenly make allulose a bad ingredient. It does not invalidate years of scientific work.
What it does is remind us that operating reality and legal reality are not always identical.
Everyone Was Acting Rationally
Which is why I find it difficult to assign villains to this story.
FDA behaved rationally. Faced with a genuinely novel ingredient, it attempted to accommodate evolving science without pretending the rulemaking process could happen overnight.
Industry behaved rationally. Companies cannot build businesses on indefinite pauses. They acted on the best guidance available from the agency responsible for regulating them.
Consumers behaved rationally. They interpreted the words on the front of a package according to their ordinary meaning.
The court behaved rationally. It read the regulation as it was written.
Everyone was answering a different question.
To me, that is the most interesting part of the entire case.
Three Regulators, Three Answers
It has become fashionable to compare the American and European approaches to food regulation as though one must be obviously superior to the other. Allulose makes an unusually clean test, because the same ingredient, with the same underlying science, has produced three different answers in three jurisdictions.
In the European Union, allulose is a novel food and requires authorization before it can be sold at all. It is still not authorized. In June of last year, the European Food Safety Authority concluded that it could not establish the safety of D-allulose. It is worth reading that conclusion carefully: EFSA did not find harm. It found that it had repeatedly requested additional data from the applicant and the applicant had stopped responding. The dossier stalled. That is a procedural outcome, not a scientific verdict, and a new industry consortium is preparing to try again.
In Australia and New Zealand, regulators took a third path. In August 2024, Food Standards Australia New Zealand approved allulose, but conditionally: maximum permitted levels set food category by food category, an energy factor written into the code, and a required advisory statement on the label about the possibility of a laxative effect at high intakes.
In the United States, allulose went to market more than a decade ago, and the labeling question was managed through enforcement discretion rather than through rulemaking.
Three regulators. Three answers. None of them eliminates uncertainty. They simply choose where to put it.
Europe puts the uncertainty before the market and slows innovation in exchange for greater confidence at launch. Australia and New Zealand put the uncertainty on the label and let the consumer carry the residual risk knowingly. The United States puts the uncertainty after the market and accepts more ambiguity up front while relying on ongoing science, regulatory oversight, market experience, and, occasionally, litigation to correct course.
The allulose story is not evidence that one system succeeded and another failed.
It is evidence that all of them make deliberate tradeoffs, and that every tradeoff eventually presents its bill.
Litigation as a Regulatory Backstop
Seen through that lens, the Chobani decision does not reveal a broken regulatory system.
It reveals a regulatory system doing something difficult: allowing innovation to move before every question has been answered, while preserving mechanisms to revisit those decisions as understanding evolves.
And notice which mechanism engaged, and why.
The court permitted the lawsuit precisely because the plaintiffs were enforcing the federal standard rather than displacing it. At the moment the agency had chosen not to enforce its own rule, private citizens became the layer that did. That is uncomfortable if you are the company on the receiving end of it. It is also, in the American system, exactly how the correction was designed to arrive.
We tend to describe litigation as a failure of regulation.
Sometimes it is the part of regulation that was still working.
Innovation Requires Intellectual Humility
The better-for-you movement lives at the edge of established knowledge. Every meaningful innovation asks us to reconsider something we thought we understood, whether it is sugar, fat, fiber, fermentation, proteins, emulsifiers, or ingredients that did not exist in commercial form a generation ago.
Sometimes we discover something genuinely transformative. Sometimes we discover that biology is more complicated than we imagined. Sometimes the law reminds us that yesterday’s map still governs today’s journey.
None of that should discourage innovation.
It should encourage humility.
Not skepticism. Not fear. Intellectual humility.
The farther we move from familiar ingredients and familiar technologies, the more important it becomes to distinguish between what we know, what we believe, and what we have simply been permitted to do while everyone else catches up.
That distinction is not a weakness of innovation. It is the price of exploring new territory.
Drawing Better Maps
Medieval cartographers sometimes marked the unexplored edges of their maps with a simple warning. Hic sunt dracones. Here be dragons.
It was never really about dragons.
It was an admission that the map had ended before the world did.
Food innovation has always lived beyond that line. Sometimes the science arrives first. Sometimes regulation. Sometimes the courts. Sometimes consumers. They almost never arrive together.
Our responsibility is not to pretend the dragons are gone.
It is to keep drawing better maps.
Frequently Asked Questions
What is the Chobani allulose lawsuit about?
The lawsuit challenges whether Chobani’s Zero Sugar yogurt can legally make that claim while containing allulose. The plaintiffs argue that allulose remains a sugar under the FDA’s Nutrition Facts regulations, despite the FDA’s decision to exercise enforcement discretion allowing manufacturers to exclude allulose from the Total Sugars and Added Sugars declarations. The Seventh Circuit Court of Appeals revived the lawsuit, allowing those claims to proceed.
Is allulose considered a sugar by the FDA?
Chemically, yes. Allulose is a monosaccharide—a simple sugar. Under the FDA’s existing Nutrition Facts regulations, it is still classified as a sugar. However, in 2020 the FDA finalized guidance stating that it intends to exercise enforcement discretion, allowing manufacturers to exclude allulose from the Total Sugars and Added Sugars declarations because of its unique metabolic properties. That guidance did not amend the underlying regulation.
What is FDA enforcement discretion?
FDA enforcement discretion is the agency’s decision not to enforce certain regulatory requirements under specific circumstances. It allows the FDA to adapt to evolving science without immediately changing federal regulations through the formal rulemaking process. While guidance can influence how the FDA enforces existing rules, it does not have the force of law or replace the underlying regulation.
Why is the Chobani lawsuit important to food manufacturers?
The case highlights the distinction between regulatory guidance and binding regulations. Many companies have relied on FDA guidance when developing and labeling products containing allulose. The Seventh Circuit’s decision demonstrates that guidance may not shield companies from private litigation when the underlying regulation still says something different.
Does this lawsuit mean companies can no longer market products containing allulose as “zero sugar”?
Not necessarily. The court did not establish a nationwide labeling rule or prohibit zero-sugar claims. Instead, it held that the plaintiffs’ claims could proceed because they were based on the language of the existing federal regulation. The ultimate legal and regulatory implications will depend on how this case and any future FDA rulemaking unfold.
What is the biggest takeaway from this case?
The most important lesson extends far beyond allulose. FDA guidance, enforcement discretion, and formal regulations are not interchangeable. Companies operating at the forefront of food innovation should recognize that regulatory guidance can shape enforcement priorities without changing the law itself. Understanding that distinction is essential when evaluating legal, regulatory, and commercial risk.
