In a significant victory for food transparency advocates, a federal appeals court ruled on January 6, 2026, in favor of Natural Grocers (NASDAQ:NGVC), the Center for Food Safety, and a coalition of plaintiffs.
The ruling strikes down several "loopholes" in the USDA’s National Bioengineered Food Disclosure Standard, mandating a more accessible and inclusive labeling system for genetically modified organisms (GMOs).
The court’s decision targets three primary areas where the USDA’s current rules were found to be unlawful or discriminatory.
The court overturned the exemption for highly processed ingredients like beet sugar and corn oil.
Previously, the USDA allowed these to go unlabeled if the modified genetic material was "undetectable" after processing.
The court ruled that even if the DNA is stripped away, the origin of the ingredient matters to consumers.
The ruling invalidated the provision allowing companies to disclose GMO status only via digital links (QR codes) or text messages.
Citing a USDA study that found nearly 100 million Americans lack reliable smartphone or internet access in grocery stores, the court ordered that clear, on-package text or symbols must be used.
While the court upheld "bioengineered" as a legal term, it clarified that retailers and brands cannot be barred from using the more familiar terms "GMO" or "genetically engineered" in their disclosures.