Well, the gloves are officially off, and the food fight is on. San Francisco City Attorney David Chiu has filed a lawsuit against ten of America’s biggest food companies—we’re talking Kraft Heinz, PepsiCo, Coca-Cola, Mondelez, Post, Kellogg/Kellanova, Mars, ConAgra, General Mills, and Nestlé. For the first time ever, a government body is dusting off the old Big Tobacco playbook and aiming it squarely at ultra-processed foods. The accusation is that these companies knowingly designed addictive, harmful products and then hid that truth from all of us.
Here’s the uncomfortable truth the food industry doesn’t want to talk about: This lawsuit isn't a joke. It's backed by a mountain of research linking these foods to obesity, diabetes, heart disease, and even cancer.
Processed Food Reckoning
Make no mistake; whether this lawsuit wins or loses in court doesn’t really matter. It has already won, because it’s forcing the conversation. For food brands, the choice is simple: Change on your own terms now or be forced to change later by regulators and angry customers. For retailers, the question is just as stark: Are you going to be part of the solution, or are you going to get lumped in with the problem? For decades, the food industry has optimized for taste, shelf life, and profit. The next decade will be all about optimizing for something much harder, but far more important: our health.
The Big Tobacco comparison isn’t just for show. When Chiu brings up tobacco, it’s a deliberate and legally powerful play. The lawsuits against tobacco companies set a clear precedent—a company can be held liable if it knows its products are harmful, engineers them to be more addictive, and then misleads or lies to the public about it. This San Francisco AG lawsuit asks a simple question: Have food manufacturers been doing just that?
The stakes here are massive, with huge implications for both the brands and grocery retailers. To be clear, this isn’t about a handful of junk foods. FDA researchers estimate that a staggering 73 percent of the U.S. food supply is ultra-processed. The effect could well be removing almost three-quarters of the products off the shelves in San Francisco and just imagine if other cities or states do the same thing. The reality is that for adults, UPF foods make up more than half of our daily calories. And for kids, it’s even worse, a frightening 62 percent.
What makes this interesting to me is the strange-bedfellows alliance. On the one hand, there is a progressive city like San Francisco suing food giants, on the other is Robert F. Kennedy Jr.’s Make America Healthy Again Commission calling out ultra-processed foods for driving chronic diseases in children. This is not simply politics; it’s pressure from both sides that should have every CPG and retail executive sweating.
Course Correction
What does this mean for food brands? The era of tiny, incremental changes to veil the problem is over. Reformulating to reduce a few grams of sugar or salt while keeping the basic, ultra-processed structure of a product isn’t going to work anymore.
The industry is facing three hard choices:
- First, they must get serious about radical reformulation. I’m not talking about removing a dye or preservative here or an additive there. It is time to go back to the drawing board and completely rethink how products are made. That means shorter ingredient lists with words shoppers can pronounce, and yes, it will mean higher costs and shorter shelf lives.
- Second is transparency. The old “we didn’t know” defense that tobacco companies tried won’t work in 2026. Companies need to get out in front of this. They need to talk openly about the trade-offs they make and their implications for taste, texture and potential allergens, about how they design for “palatability,” and what their own research says about health. Staying silent looks like an admission of guilt.
- Lastly, some products might just be indefensible. The smartest companies will start phasing out their most problematic foods now, before the government or the courts do it for them. They’ll get ahead of the story, control the narrative, and come out looking like heroes instead of victims. By-bye Twinkies.
Take Responsibility
The industry trade groups’ responses, which for years have been touting their “efforts to improve nutrition” while warning against “demonizing certain foods,” sound like they came from a corporate crisis playbook from 1965. It’s defensive, vague, and basically pats consumers and regulators on the head as if they’re just overreacting. We are just not going to accept that behavior anymore.
No question, grocers are caught in the middle of this, but they have a real chance to be leaders, not just sitting on the sidelines. Forward-thinking retailers need to take a hard look at center store. If in fact, 73 percent of our food supply is ultra-processed, that means your supermarket shelves are too. Figure out which products are the biggest liabilities. And when it comes to the fastest growing segment of your business, private label, you need to also be serious about expanding better-for-you options as well as reformulations. This lawsuit is going to make headlines and make shoppers more anxious and aware. Grocery stores that offer them affordable, less-processed alternatives will win their trust and their money. This isn’t about creating a tiny “health food” section; it’s about making better food the new normal throughout the entire store.
Smart retailers also know that more regulation is coming, whether it’s new warning labels or updated dietary guidelines. The ones who start adapting now will be miles ahead of those who wait.
Litigation Pressure
Here’s the uncomfortable truth the food industry doesn’t want to talk about: This lawsuit isn’t a joke. It’s backed by a mountain of research linking these foods to obesity, diabetes, heart disease, and even cancer; and has someone in the White House who (for better or worse) is unrelenting. The science may not be 100 percent settled, but the trend is pointing in a very clear, very scary direction.
Some nutritionists correctly point out that not every single ultra-processed food is evil—some breads or peanut butters, for example, have a place. That kind of nuance gets lost when you’re defending products that are basically just sugar, salt, and lab-made flavors. The industry’s argument can’t be “not all ultra-processed foods are bad.” That’s like saying “not all cigarettes will kill you.” It might be technically true, but it completely misses the point.
Even if this San Francisco lawsuit fails, the genie is out of the bottle, and as the saying goes, what starts in California spreads to the rest of the nation. Other cities and states are watching. Shoppers are getting smarter and more skeptical. And with RFK Jr. in the Trump administration, ultra-processed foods now have a target on their back at the federal level. CPG and retailers need to pay attention now more than ever.
