Only Actions Specifically Permitted by Nonenumerated Regulators Qualify for Washington’s CPA Safe Harbor

Hall v. Walgreens Boots Alliance, Inc., No. 102829-6 (Wash. Mar. 20, 2025) (en banc)

Introduction

This en banc decision from the Washington Supreme Court clarifies the scope of the Washington Consumer Protection Act’s “statutory safe harbor,” RCW 19.86.170, in the setting of federally regulated products. The case arises from a certified question posed by the United States District Court for the Northern District of Illinois, where plaintiff Tracy Hall brought a putative class action alleging that Walgreens deceptively labeled over‑the‑counter antitussive medicines containing dextromethorphan hydrobromide (DXM) as “nondrowsy.” The U.S. Food and Drug Administration (FDA) regulates OTC drug labeling and, for DXM antitussives, has not required a drowsiness warning; it has also not promulgated a rule affirmatively authorizing “nondrowsy” claims.

The core statutory issue: When RCW 19.86.170 says the CPA does not apply to “actions or transactions permitted by any other regulatory body or officer acting under statutory authority of this state or the United States,” does “permitted” include conduct merely not forbidden by the regulator, or does it require conduct that the regulator has specifically and actively authorized? The Washington Supreme Court answers decisively: for nonenumerated regulatory bodies such as the FDA, the safe harbor applies only if the regulator has specifically and affirmatively permitted the practice. Because FDA has not specifically permitted “nondrowsy” labeling for DXM antitussives, the safe harbor does not apply.

Summary of the Opinion

• The Court adopts a narrow construction of RCW 19.86.170 consistent with the CPA’s consumer-protective purpose and the rule that exceptions are construed narrowly.
• The statute distinguishes between:
  • Actions “otherwise permitted, prohibited, or regulated” by three enumerated agencies (the insurance commissioner, Washington utilities and transportation commission, and federal power commission), and
  • Actions “permitted” by “any other” regulatory body or officer.
• For nonenumerated agencies (such as the FDA), “permitted” means the agency has taken overt, affirmative action specifically authorizing the practice. Mere absence of prohibition or general regulatory oversight is insufficient.
• Applying that rule, “nondrowsy” labeling for DXM antitussives is not within the safe harbor because the FDA has not specifically permitted such a claim—even though FDA does not require a drowsiness warning for DXM.
• The Court expressly does not decide federal preemption; that question remains for the certifying federal court.

Justice Madsen concurs in the result but disagrees with the majority’s requirement that nonenumerated agencies must “specifically” or “expressly” permit the conduct. She argues that the statute’s text does not include that qualifier for nonenumerated agencies and that FDA’s monograph framework often implies permission for labeling not expressly listed. She nonetheless agrees the safe harbor does not apply here because the FDA record indicates insufficient data to support sleep‑related claims and cannot fairly be read to permit “nondrowsy” labeling.

Analysis

Precedents Cited and Their Role

• In re Real Estate Brokerage Antitrust Litigation, 95 Wn.2d 297, 622 P.2d 1185 (1980)
  • The Court relied on this case’s articulation that an agency must take “overt affirmative actions specifically to permit” the challenged practice for the safe harbor to apply.
  • Real Estate Brokerage thus anchors the majority’s requirement that “permitted” means affirmative, specific authorization, not mere regulatory silence.
• Vogt v. Seattle-First National Bank, 117 Wn.2d 541, 817 P.2d 1364 (1991)
  • Vogt held CPA exemptions must be construed narrowly and suggested the safe harbor applies only if the particular practice is “specifically permitted, prohibited or regulated.”
  • The Hall majority treats Vogt’s phrasing as dicta insofar as it blurred the statutory distinction between enumerated and nonenumerated agencies, but it embraces Vogt’s ultimate conclusion rejecting safe harbor in that case and its broader interpretive posture (liberal construction of the CPA; narrow construction of exceptions).
• Walker v. Wenatchee Valley Truck & Auto Outlet, Inc., 155 Wn. App. 199, 229 P.3d 871 (2010)
  • The Court of Appeals explained the safe harbor requires that the agency “expressly” permit the practice; merely avoiding violation of general prohibitions is insufficient.
  • Hall characterizes Walker as directly aligned with the “express permission” standard adopted for nonenumerated agencies.
• Panag v. Farmers Ins. Co. of Washington, 166 Wn.2d 27, 204 P.3d 885 (2009)
  • Cited to affirm the consumer-protective orientation of the CPA and construal of exceptions.
• Miller v. U.S. Bank of Washington, NA, 72 Wn. App. 416, 865 P.2d 536 (1994), and Kaiser v. CSL Plasma Inc., 240 F. Supp. 3d 1129 (W.D. Wash. 2017)
  • Hall explains these decisions used language suggesting the safe harbor applies if the practice is “specifically permitted, prohibited, or regulated” by “any other” regulator—an imprecision the Court attributes to the dense drafting of RCW 19.86.170.
  • Hall clarifies those extra words were dicta and that the correct standard for nonenumerated agencies is “specifically permitted.”
• Statutory interpretation cases: Campbell & Gwinn, Lake v. Woodcreek, Restaurant Development v. Cananwill
  • The opinion uses standard canons: ascertain plain meaning from text and context; do not add words to statutes; read in light of the statutory scheme; construe the CPA liberally and its exemptions narrowly.
• FDA regulatory background: 21 C.F.R. parts 330 and 341; Natural Resources Defense Council, Inc. v. FDA, 710 F.3d 71 (2d Cir. 2013)
  • These authorities frame how OTC monographs function—specifying required conditions and warnings but not necessarily identifying every permissible marketing claim.

Legal Reasoning

The Court’s analysis unfolds through standard statutory interpretation steps, sharpened by the CPA’s pro-consumer orientation:

1. Text and structure of RCW 19.86.170
   • The safe harbor’s first clause exempts actions “otherwise permitted, prohibited or regulated” when they fall under laws administered by three specified agencies.
   • The immediately following clause exempts “actions or transactions permitted by any other regulatory body or officer” acting under state or federal authority.
   • Because the Legislature used a broader phrase (“permitted, prohibited or regulated”) for the three enumerated agencies but a narrower single term (“permitted”) for all other regulators, the difference must carry meaning. The natural inference: for nonenumerated regulators, the safe harbor covers only actions the agency has permitted—not all actions it merely regulates or fails to forbid.
2. Ordinary meaning and prior Washington authority
   • While “permit” could be read broadly as “not prohibited,” Washington precedent—especially Real Estate Brokerage—requires “overt affirmative actions specifically to permit the actions or transactions.”
   • This aligns with the CPA’s directive of liberal construction to protect consumers and narrow construction of exceptions (Vogt; Panag).
3. Application to the FDA and OTC monographs
   • FDA’s monograph for antitussives requires drowsiness warnings for some ingredients but not DXM (21 C.F.R. § 341.74(c)(4)).
   • FDA commentary acknowledged a potential secondary sedative effect but concluded the effect did not warrant a drowsiness warning, and sleep‑aid claims remained in a category needing more data (48 Fed. Reg. 48,576, 48,589 (Oct. 19, 1983)).
   • Crucially, nothing in FDA regulations or orders specifically authorizes “nondrowsy” claims for DXM antitussives. FDA’s silence—or its decision not to require a warning—does not amount to specific permission for the affirmative “nondrowsy” label.
4. Clarifying prior imprecisions
   • Some decisions (e.g., Miller, Kaiser) recited the safe harbor standard with extra words (“prohibited, or regulated”) in the nonenumerated-agency clause. Hall treats that language as dicta and emphasizes fidelity to the statute as written.
5. Scope limitation and preemption
   • The Court confines itself to interpreting RCW 19.86.170 and disclaims any view on federal preemption—a separate question to be decided by the federal court.

The Concurrence (Madsen, J.): Agreement on Outcome, Disagreement on the “Specific Permission” Standard

• Textual distinction: Justice Madsen argues the Legislature used the word “specifically” only in the clause exempting “actions or transactions specifically permitted” by regulatory boards or commissions under Title 18 RCW. By contrast, for “any other regulatory body or officer,” the statute uses only “permitted,” not “specifically permitted.” Adding “specifically” for the FDA and other nonenumerated regulators, she contends, impermissibly rewrites the statute.
• Regulatory reality: FDA’s monograph regime lists required ingredients, conditions, and warnings, but not a comprehensive list of all permissible advertising claims. Therefore, permission may often be implicit. If the FDA had determined DXM does not cause drowsiness (and said so after review), one might reasonably infer that “nondrowsy” is permitted—even absent an express authorization.
• Outcome here: The concurrence still finds no safe harbor because the FDA record signaled insufficient data to justify drowsiness-related claims for DXM. There is no sound basis to infer that the label “nondrowsy” is permitted.

Impact and Forward-Looking Implications

Hall meaningfully narrows the availability of the CPA safe harbor for conduct governed by nonenumerated regulators (a category that includes the FDA, FTC, SEC, and many others). Key consequences:

• “Silence is not safe harbor” for nonenumerated regulators
  • Absent an affirmative regulatory permission, defendants cannot defeat CPA claims by pointing to agency silence, general regulations, or the mere absence of a prohibition.
  • For FDA-regulated labeling, the absence of a required warning is not the same as authorization to make the opposite affirmative claim. The burden shifts toward demonstrating a clear, specific permission.
• What counts as “specifically and actively permitted”?
  • Formal rule or order expressly allowing the practice (e.g., a monograph provision or administrative order stating that “Non-Drowsy” is an acceptable labeling statement for a specified class of products).
  • Binding agency action that affirmatively authorizes the precise labeling practice (e.g., a regulation or final guidance that is framed as authorization and is clearly on point). Mere guidance that restates general standards without blessing the claim likely will not suffice.
  • Product-specific approvals are typically not available for OTC monograph drugs, so for OTC labeling claims, affirmative permission will often have to appear in class-wide labeling provisions.
• Increased exposure for marketing claims in Washington
  • Companies relying on federal regulatory silence (or on the absence of a contrary warning requirement) will have a harder time invoking the CPA safe harbor in Washington.
  • Marketing descriptors such as “non-drowsy,” “natural,” “hypoallergenic,” or “clinically proven” may face increased scrutiny unless specifically authorized by an applicable federal scheme.
• Preemption remains a live defense, but not resolved here
  • The federal court must still decide whether the FDCA (including OTC drug express preemption provisions) preempts state-law claims attacking “nondrowsy” labeling. Hall neither validates nor forecloses preemption defenses.
  • Practically, plaintiffs can proceed past the safe harbor and litigate preemption and merits in federal court.
• Doctrinal cleanup
  • Hall clarifies that earlier references to “permitted, prohibited, or regulated” in the nonenumerated-agency clause were dicta. This harmonizes lower-court practice with the statute’s text and the CPA’s consumer-protective approach.
• Different treatment for enumerated agencies
  • For actions under the insurance commissioner, WUTC, or federal power commission regimes, the safe harbor remains broader—covering practices “permitted, prohibited or regulated.” That textual asymmetry, reaffirmed here, reflects a deliberate legislative calibration.

Complex Concepts Simplified

• Washington Consumer Protection Act (CPA): A state law that prohibits unfair or deceptive acts or practices in trade or commerce (RCW 19.86.020). It is construed liberally to protect consumers.
• RCW 19.86.170 “Statutory safe harbor”: An exception that insulates certain conduct from CPA liability if it falls within categories tied to specific regulators and circumstances. It is construed narrowly.
• Enumerated vs. nonenumerated regulators:
  • Enumerated: Insurance commissioner, WUTC, federal power commission. For these, the CPA does not apply to actions “permitted, prohibited or regulated.”
  • Nonenumerated: All other regulators (e.g., FDA). For these, the CPA does not apply only to actions “permitted” by the regulator; after Hall, that means specifically and affirmatively permitted (per the majority).
• “Specifically and actively permitted”: The regulator has taken an overt affirmative step authorizing the precise practice at issue (e.g., a rule, order, or binding authorization). Mere absence of prohibition does not qualify.
• FDA OTC “monographs”/administrative orders: FDA sets class-wide conditions (ingredients, doses, and required “Drug Facts” warnings) under which OTC drugs are “generally recognized as safe and effective” and not misbranded. Monographs typically prescribe required warnings but are not catalogues of every permissible marketing claim.
• DXM (dextromethorphan hydrobromide): A common OTC cough suppressant (antitussive). The applicable FDA regulation requires drowsiness warnings for certain antitussives but not for DXM; FDA commentary has been cautious about drawing sleep-related conclusions.
• Preemption: A doctrine where federal law displaces state law. In OTC drug labeling, federal statutes may expressly or impliedly preempt state requirements that are not “identical” to federal requirements. Hall does not decide preemption; it simply construes a state-law exception.

Practical Guidance for Litigants and Regulators

• For defendants asserting the safe harbor:
  • Identify a concrete, affirmative regulatory authorization for the exact practice challenged. Pointing to general regulatory oversight or the absence of a prohibition will not suffice in Washington for nonenumerated agencies.
  • For FDA contexts, look for explicit labeling permissions within the governing monograph or administrative order, or formal rulemaking or guidance that unmistakably authorizes the claim.
• For plaintiffs:
  • Challenge invocations of the safe harbor by demanding specific authorizations and highlighting agency silence or ambiguity.
  • Prepare to litigate preemption separately; success on the safe harbor does not resolve federal preemption defenses.
• For regulators:
  • Where policy favors allowing a marketing claim, clarity matters. Expressly addressing permissibility in binding instruments can decisively shape downstream consumer protection litigation.

Conclusion

Hall v. Walgreens Boots Alliance announces a clear and consequential rule for Washington’s CPA safe harbor: for nonenumerated regulators such as the FDA, the exception applies only to actions that the agency has specifically and actively permitted. The Court grounds its holding in the statute’s text and structure, the CPA’s consumer-protective orientation, and long-standing Washington authority requiring “overt affirmative actions” by the regulator. It also tidies up prior imprecise formulations that had blurred the statutory distinction between enumerated and other regulatory bodies.

On these facts, FDA’s decision not to require a drowsiness warning for DXM does not amount to specific permission to market the drug as “nondrowsy.” The plaintiff’s CPA claim is therefore not barred by RCW 19.86.170. Whether federal law preempts the claim remains for the federal court. Looking forward, Hall will likely narrow safe-harbor defenses in Washington for federally regulated industries, particularly with respect to affirmative marketing claims not expressly authorized by the governing regulatory scheme. The decision thus strengthens the CPA’s consumer-protection reach while signaling to agencies and regulated entities alike that explicit permissions—and not mere regulatory silence—are the coin of the realm when invoking Washington’s statutory safe harbor.