If you are a manufacturer, importer or seller of products, including food and beverages, you need to be familiar with the two California laws discussed below, regardless of where your company is located.

In mid-September, I traveled from Tampa to San Francisco to attend the annual conference organized by Proposition 65 and Green Chemistry Clearinghouses. The conference is unique in that it brings business and defense lawyers, plaintiff lawyers, government regulators, NGOs, scientists, trade associations and test laboratories together in a collegial atmosphere to discuss the latest developments in California law (and in Congress, other states, and the European Union) related to chemical safety in products.

Because of California’s laws and regulations; product designers, manufacturers and the global supply chain are reformulating products to de-select toxic chemicals. The impact of these laws and regulations is felt far beyond the boundaries of the state. In my view, consumers in other states and Canada have been “free-riders” benefiting from California’s leadership in product safety but, unlike California taxpayers, not paying the cost of administering the state’s regulatory system.

Except for a 2008 law restricting lead and phthalates in children’s products as a reaction to recalls of imported toys; Congress has not acted in an effective way on safety issues related to chemicals in products. Even when Congress passed the federal Toxic Control Substances Act in 1976; it failed to require that all chemicals be tested for their health impact before their application in consumer products.

California stepped up and filled the regulatory vacuum. In addition, other states like Illinois, Maine and Washington State have enacted new laws. This growing patchwork of different requirements poses a significant challenge for the smooth flow of interstate commerce.  The focus of this article is on California because it is the most significant player.

California Proposition 65

Since World War II, over 80,000 new synthetic chemicals have been introduced into the American marketplace. As stated above, the federal government has not required sufficient precautionary testing of the health effects of all chemicals, food additives and pesticides before they are used or applied. (Of course, there are companies who are committed to product safety without regard to government regulation.)

For decades, citizens in California have been very concerned about their personal exposure to toxic chemicals in products. Californians have the ability to take direct action through their referendum initiative process. Unlike citizens in most other states, they are not dependant on their state legislatures to respond (or not) to their concerns.

In 1986, California citizens voted to enact into law the “Safe Drinking Water and Toxic Enforcement Act” aka “Proposition 65” or “Prop 65.”It was the first and only law of its kind in America. Nearly three decades later, it stands alone.

Prop 65 does not ban chemicals in products – it simply requires a warning label if the product contains a natural or synthetic chemical known to the State of California to cause cancer, birth defects or other reproductive harm and persons are knowingly or intentionally exposed to the chemical (above safe harbor levels) when using or consuming the product . Several hundred chemicals are listed by the California Office of Environmental Health Hazard Assessment (OEHHA) and the list is updated quarterly. Chemicals are added and in some cases removed. Currently, there are pending legislative proposals which would require the manufacturer to name the specific chemical in the warning label.

Proposition 65 has been harshly criticized by business groups because of its unique provision which allows citizen enforcers to file notices of violation and lawsuits against companies alleging their products (including foods and beverages such as candies, chocolate, fish, nutritional supplements, and bottled water) violate the warning requirement. Business groups call the plaintiff lawyers who file Proposition 65 lawsuits “bounty hunters.” This is because the law allows them to collect not only penalties payable to the State of California but also retain a portion of the penalties and re-coup their attorneys’ fees.

Furthermore, because the burden of proof is on the manufacturer and conducting a scientific analysis of consumers’ actual exposure to a chemical contained in a product and the ensuing litigation is very expensive; some companies, especially smaller ones, quickly settle with Prop 65 plaintiffs to avoid the time and expense of even trying to defend their products. Some companies have had no defense.

Determining exposure is more difficult for companies to manage rather than meeting a chemical content standard, such as 100 PPM of lead.  This is why many companies have agreed in consent judgments and private settlements to reformulate their products to not exceed a chemical content number. Reformulation occurs because affixing the Prop 65 warning label, especially on children’s products, is the proverbial “kiss of death.”

Many test labs apply these prior judgments and settlements when testing similar products which may or may not pose any real exposure risk.

Consumer and environmental groups praise Prop 65 because it has caused so many products to be reformulated under judgments and settlements – especially, products containing lead, cadmium, phthalates, flame retardants, and certain food additives.

Unlike tort lawsuits which require people or property to be injured before a lawsuit can be filed; Prop 65 has had a preventive impact. It has been a middle ground between the “precautionary principle” and traditional tort law.

California Safer Consumer Products/ Green Chemistry Initiative

Recognizing that despite its successes, Proposition 65 is not a comprehensive solution; the California legislature enacted the Safer Consumer Products/Green Chemistry Initiative in 2008.

Rather than merely warn consumers about the presence of chemicals in products; Green Chemistry seeks to determine if a particular chemical is even necessary and if a safer alternative can be formulated.

In March 2014, the California Department of Toxic Substances Control (“DTSC”) identified its first three “Priority Products” which are product-chemical combinations for which safer alternatives must be evaluated. The three Priority Products and their “Chemicals of Concern” are:

  • Spray polyurethane foam (SPF) systems containing Diisocyanates
  • Children’s foam padded sleeping products containing Tris (1,3 – dichloro-2-propyl) phosphate or TDCPP
  • Paint and varnish strippers with methylene chloride

The DTSC has just issued its “DRAFT Priority Product Work Plan” (“Work Plan”) for the next three years to:

“provide a level of predictability to potential manufacturers, importers, retailers, and other stakeholders regarding the types of products that can be considered for evaluation over the next three years.”

The Work Plan describes product categories and potential candidate chemicals that TSCB, working with stakeholders, may identify as product-chemical combinations for which safer alternatives must be evaluated.

The Product Categories of Interest are very broad and there are seven described in the Work Plan. Potential candidate chemicals within each category are listed as well. Here are the seven Categories:

  • Beauty, Personal Care and Hygiene Products
  • Building Products
  • Household, Office Furniture and Furnishings (with limitations)
  • Cleaning Products
  • Clothing
  • Fishing and Angling Equipment
  • Office Machinery (Consumable Products)

Guidance for Companies

It is important not to look at the Work Plan and panic because the categories are so huge.

Companies need to identify what chemicals are in their products and review them in light of the DTSC’s Work Plan and future communications from DTSC. This will be a work in progress over several years. But it is important to engage with the DTSC’s process early on.

The BoM and the BoS requirement should be flowed down to all the material suppliers in your domestic or global supply chain.

Don’t just ask for these documents one time and file them away. Otherwise, your company might fall victim to suppliers who substitute materials without notifying you.  As president Ronald Reagan famously said “Trust but Verify.”

Product and food safety, especially when it comes to avoiding toxic chemicals, is what consumers want. Not just in California.

There is no doubt that competitive advantage accrues to those quality-driven companies committed to providing safer products through the use of chemical safety assessment best practices, innovation and continuous improvement.

September 27, 2014. Attorney Advertising. Copyright ©2014 Susie L. Hoeller. All Rights Reserved. (www.hoellerlaw.com or Susie@hoellerlaw.com)