Regulatory Compliance – Conkle, Kremer & Engel, PLC

CK&E Attorneys to be Featured Speakers at Upcoming Beauty Industry Presentation on Legal Regulatory Issues

Conkle, Kremer & Engel attorneys will be featured speakers at the Beauty Industry West presentation “Navigating in Challenging Regulatory Waters: Updates on California and Federal Compliance.” The presentation will take place on October 15, 2013 at the Crowne Plaza Hotel LAX in Los Angeles.

CK&E will be speaking on legal regulatory issues for personal care product companies doing business in California, including California Organic Products Act (COPA), Proposition 65 (California’s Safe Drinking Water and Toxic Enforcement Act) and California’s Green Chemistry Initiative.

Co-presenter Donald Frey is an industry veteran and a product development and innovation consultant of Frey Consulting. Mr. Frey will present on key regulatory issues from the business perspective, including how to effectively deal with regulators.

Beauty Industry West is a non-profit industry trade organization that educates and provides resources and a networking platform for companies and entrepreneurs who want to develop their own personal care and beauty brands.

Conkle, Kremer & Engel has decades of experience in the personal care industry. Our attorneys are pleased to participate in trade organizations like Beauty Industry West and to share their experience with members of the industry.

10
OCT

California Organic Products Act, Green Chemistry Initiative, Proposition 65, Safer Consumer Products Regulations, Unfair Competition

Beauty Industry, Beauty Industry West, BIW, COPA, personal care products, Prop 65

A Proposition 65 Reform Bill Becomes Law: California Health & Safety Code Section 25249.7 Amended by AB 227

Posted by: H. Kim Sim

On October 5, 2013, Governor Brown signed into law a bill that makes immediate changes to Proposition 65. The amendments, which passed the California Legislature last month, impose a number of restrictions on private enforcers seeking to enforce Prop 65 against businesses that allegedly fail to provide a warning as required by Prop 65. The bill that became law is Assembly Bill 227 (AB 227), introduced by Assemblymember Mike Gatto (Forty-Third District of California) in February 2013, and discussed in our March 13, 2013 blog post.

However, as AB 227 was enacted, only limited types of businesses are likely to benefit. The amendments are very narrow, covering only certain exposures to alcohol or food-related chemicals, vehicle exhaust and tobacco smoke. Thus, the only businesses that are likely to benefit from the amendments are bars, restaurants, parking garages, and those who own or operate premises where smoking is permitted.

In general, the amendments establish a new “safe harbor”: AB 227 prohibits a Prop 65 lawsuit from being filed by a private enforcer over an alleged failure to provide a warning concerning one of the specified exposures, if the business takes specified action within 14 days of receipt of the notice of violation. The targeted business can escape a Prop 65 action if, within 14 days, the business: (1) actually corrects the alleged violation; (2) agrees to pay a civil penalty of $500 per facility or premises within 30 days; and (3) submits a “Proof of Compliance” notifying the private enforcer that the violation has been corrected. If the business takes the so-called “safe harbor” action in response to the notice of violation alleging failure to warn about exposure to alcohol or food-related chemicals, vehicle exhaust or tobacco smoke, the private enforcer is precluded from filing a lawsuit or collect additional civil penalties or attorneys’ fees from the business.

These types of piecemeal amendments to Prop 65 may increase public demand and political pressure for additional reform. In May 2013, Governor Brown proposed sweeping, substantive reform to Prop 65, intended to end decades of “frivolous ‘shake-down’ lawsuits” by Prop 65 bounty hunters and their lawyers. But by September 2013, those efforts stalled as stakeholders involved in the reform effort were unable to reach the consensus needed to generate the two-thirds majority approval that is required for any amendment of Prop 65 in the Legislature.

Conkle, Kremer & Engel constantly tracks the latest developments in Prop 65 in order to provide expert guidance and counseling to clients. This latest amendment is a demonstration that businesses who receive a Prop 65 warning should immediately seek qualified legal counsel to help them avoid liability and unnecessary payments to Prop 65 claimants and their lawyers. In fact, businesses are well advised to consult qualified legal counsel to review their compliance with Prop 65 before an immediate response becomes necessary.

6
OCT

Beauty Industry, Food, Craft Beer and Nutrition, Manufacturing, Proposition 65, Regulatory Compliance, Technology, Unfair Competition

AB 227, Assembly Member Mike Gatto, Bars, Notice of Violation, Parking Garages, Prop 65, Prop 65 Reform, Proposition 65, Proposition 65 Reform, Restaurants, Safe Harbor, Smoking, UCL, Unfair Business Practices, Warning Letter

California Green Chemistry Initiative: Are You Manufacturing or Selling a “Priority Product”?

Posted by: H. Kim Sim

The new Safer Consumer Products (SCP) regulations require the California Department of Toxic Substances Control (DTSC) to initially identify up to five proposed “Priority Products” or categories of products containing what DTSC regards as “Chemicals of Concern.” By April 1, 2014, DTSC will publish a list of Priority Products selected because of their use of one or more of 164 “Priority Chemicals” listed on the “Initial Candidate Chemicals” list. Scroll to the bottom of this post for the full list of the 164 Priority Chemicals.

There will be a public review and comment period following publication of the Priority Products list. It has been widely speculated that nail polish, formaldehyde-based hair straighteners, carpet adhesives and furniture seating foam are among the possible Priority Products that may be identified first by DTSC.

Once a product is identified as a Priority Product, manufacturers or other responsible entities (including importers, assemblers and even retailers) will be required to notify DTSC that their product is a priority product. The manufacturer or other responsible entity then has some unpleasant options: It can remove the product from sale, reformulate to remove or replace the chemical of concern in the product, or perform a complex “Alternatives Analysis” to retain the chemical in the product. The Alternatives Analysis report must be submitted to DTCS for evaluation to determine if there are adverse environmental or public health impacts associated with the product that can be remedied by regulatory responses. The regulatory responses could require product warnings to consumers, restrictions on the use of the chemical during manufacture, place of sale restrictions, administrative controls, further research regarding alternative ingredients, end-of-life disposal requirements, or even a ban on sales of the product in California.

Manufacturers, retailers, importers and assemblers of consumer products for sale or distribution in California should diligently keep informed about developments in the DTSC’s “Candidate Chemicals” list (currently 1,060 chemicals), as well as the development of the Priority Products list. Manufacturers should also consider whether reformulation of their products to exclude the priority chemicals from the “Initial Candidate Chemicals” list is possible. In addition, it is important that businesses establish clear agreements among manufacturers, importers, distributors, retailers and others in the supply chain specifying who will be responsible for complying with California’s tough new regulatory program, including responding to DTSC if a product is identified as a priority product. Conkle, Kremer & Engel’s lawyers stay current on the latest developments, and guide the firm’s clients through the thicket of expanding regulatory issues affecting their businesses.

The 164 chemicals found on the “Initial Candidate Chemicals” list, from which the Priority Products will be identified by DTSC, are:

1,1,1,2-Tetrachloroethane		1,1,1-Trichloroethane; Methyl chloroform
1,1,2,2-Tetrachloroethane		1,1,2-Trichloroethane
1,1-Dichloroethane		1,2,3-Trichloropropane
1,2-Diphenylhydrazine; Hydrazobenzene		1,2-Epoxybutane
1,3-Butadiene		1,3-Propane sultone; 1,2-Oxathiolane 2,2-dioxide
1,4-Dioxane		2,2-Bis(bromomethyl)propane-1,3-diol
2,4,6-Trinitro-1,3-dimethyl-5-tert-butylbenzene; musk xylene		2,4,6-Tri-tert-butylphenol
2,4.6-Trinitrotoluene (TNT)		2?Acetylaminofluorene
2-Methylaziridine (Propyleneimine)		2-Methylphenol, o-Cresol
2-Nitropropane		3-Methylphenol; m-Cresol
4,4′-Methylenedianiline; 4,4’-Diaminodiphenylmethane (MDA)		4-Bromophenyl phenyl ether, Bromophenyl Phenyl Ether
4-Nitrobiphenyl		4-Tert-Octylphenol; 1,1,3,3-Tetramethyl-4-butylphenol
Acetaldehyde		Acetamide
Acrylamide		Acrylonitrile
Allyl chloride		Aluminum
Aniline		Aromatic amines
Aromatic Azo Compounds		Arsenic and inorganic arsenic compounds
Asbestos (all forms, including actinolite, amosite, anthophyllite, chrysotile, crocidolite, tremolite)		Benzene
Benzene, Halogenated derivatives		Benzotrichloride
Benzyl chloride		Beryllium and Beryllium compounds
Biphenyl-3,3′,4,4′-tetrayltetraamine; Diaminobenzidine		Bisphenol A
Bisphenol A diglycidyl ether polymer; [2,2′-bis(2-(2,3-epoxypropoxy)phenyl)-propane]		Bisphenol B; (2,2-Bis(4-hydroxyphenyl)-n-butan)
Bromate		Butylbenzyl phthalate and metabolite
Cadmium and cadmium compounds		Captan
Carbon monoxide		Carbon tetrachloride; CCl4
Catechol		Chlorendic acid
Chlorinated Paraffins		Chlorine dioxide
Chlorite		Chloroalkyl ethers
Chloroethane; ethyl chloride		Chloroprene; 2-chlorobuta-1,3-diene
Chromium hexavalent compounds (Cr (VI)		Chromium trioxide
Cobalt metal without tungsten carbide (including dust and cobalt compounds)		Cresols, Cresol mixtures
Cumene, [ isopropylbenzene]		Cyanide and Cyanide compounds
Cyclotetrasiloxane; Octamethylcyclotetrasiloxane (D4)		Diazomethane
Dibromoacetic acid		Dibutyl phthalate and metabolites
Dichloroacetic acid		Dichloroethylenes
Dichloromethane; methylene chloride		Dicyclohexyl phthalate and metabolite
Diesel engine exhaust		Diethanolamine
Diethyl hexyl phthalate and metabolites		Diethyl phthalate and metabolite
Diisobutyl phthalate and metabolite		Di-isodecyl phthalate and metabolite
Di-isononyl phthalate and metabolites		Dimethyl sulfate
Dimethylcarbamoyl chloride		Dinitrotoluenes
Di-n-Octyl Phthalate and metabolites		Dodecamethylcyclohexasiloxane (D6)
Emissions, Cokeoven		Epichlorohydrin; 1-Chloro-2,3-epoxypropane
Ethyl acrylate		Ethylbenzene
Ethylene dichloride; 1,2-Dichloroethane		Ethylene Glycol
Ethylene oxide; oxirane		Ethylene Thiourea
Ethyleneimine, Aziridine		Ethyl-tert-butyl ether
Formaldehyde		Fuel oils, high-sulfur; Heavy Fuel oil; (and other residual oils)
Gasoline (automotive, refined, processed, recovered, and other unspecified fractions)		Glutaraldehyde
Glycol ethers		Glycol ethers acetate
Hexabromocyclododecane (HBCD), and mixed isomers		Hexachlorobuta1,3-diene
Hexachloroethane		Hexamethylene-1,6-diisocyanate
Hexamethylphosphoramide		HMX
Hydrazine, Hydrazine compounds and salts		Hydrogen sulfide
Jet Fuels, JP-4, JP-5, JP-7 and JP-8		Lead and Lead Compounds
Maleic anhydride		Manganese and manganese compounds
Mercury and mercury compounds		Methanol
Methyl chloride		Methyl isobutyl ketone, Isopropyl acetone; (MIBK)
Methyl isocyanate		Methylene diphenyl diisocyanates
Methylhydrazine and its salts		Methylnaphthalene; 2-Methylnaphthalene
Mineral Oils: Untreated and Mildly Treated		N,N-dimethylformamide; dimethyl formamide
N,N-Dimethylhydrazine		Naphthalene
n-Hexane		Nickel and Nickel Compounds; Nickel refinery dust from the pyrometallurgical process
Nickel oxides		Nickel, metallic and alloys
Nitrate+Nitrite		Nitrobenzene
Nitrosamines		Nonylphenol, nonylphenol ethoxylates (NP/NPEs) (and related substances)
Parabens		Pentabromophenol
Perfluorochemicals		Petroleum; Crude oil
Phthalic anhydride		Polybrominated diphenyl ethers (PBDEs) congeners
Polychlorinated biphenyl (PCB) congeners		Polychlorinated dibenzo-p-dioxins (PCDDs)
Polychlorinated dibenzo-p-furans (PCDFs) and Furan Compounds		Polycyclic Aromatic Hydrocarbons (PAHs)
Propylene oxide		Quinoline and its strong acid salts
Silica, Crystalline (Respirable Size)		Stoddard solvent; Low boiling point naphtha – unspecified;
Strong Inorganic Acid Mists Containing Sulfuric Acid		Styrene and derrivatives
Sulfur dioxide		Tetrabromobisphenol A (TBBPA)
Tetrachloroethylene; Perchloroethylene; (PERC)		Thallium
Toluene		Toluene Diisocyanates
Trichloroethene (TCE)		Trihalomethanes
Tris(1,3-dichloro-2-propyl) phosphate (TDCPP)		Tris(2,3-dibromopropyl) phosphate
Tris(2-chloroethyl)phosphate (TCEP)		Vanadium pentoxide
Vinyl acetate		Vinyl Bromide, Bromoethylene
Vinyl chloride; chloroethylene		Xylenes; [o-xylene (95-47-6), m-xylene(108-38-3)and p-xylene (106-42-3)]

5
OCT

Beauty Industry, Green Chemistry Initiative, Manufacturing, Regulatory Compliance, Safer Consumer Products Regulations, Technology

Alternatives Analysis, Candidate Chemicals, Carpet Adhesives, Chemicals of Concern, DTSC, formaldehyde, Furniture Foam, Hair Straighteners, Initial Candidate Chemicals, nail polish, Priority Chemicals, Priority Products, SCP

California Green Chemistry Initiative: Does Your Product Contain a "Candidate Chemical” that Could Become a “Chemical of Concern” to the California Department of Toxic Substances Control?

Posted by: H. Kim Sim

Effective October 1, 2013, companies doing business in California will have to navigate and comply with yet another system of complex regulations: The Safer Consumer Products (SCP) regulations adopted by the California Department of Toxic Substances Control (DTSC) will require manufacturers, importers, assemblers and retailers to seek safer alternatives to certain harmful chemical ingredients in widely used products.

The SCP regulations are the first step in implementing California’s Green Chemistry Initiative. The goal of the SCP regulations is to accelerate the manufacture and use of safer versions of products in California by: (1) establishing a process to identify and prioritize chemical ingredients in consumer products that may be considered “chemicals of concern,” and (2) establishing a process for evaluating chemicals of concern and their potential alternatives, to determine how best to limit exposure to or to reduce the level of hazard posed by chemicals of concern.

The SCP regulations apply to all consumer products that contain a “Candidate Chemical” and are sold, offered for sale, distributed, supplied, or manufactured in California. The regulations do not apply to food, pesticides, dangerous prescription drugs and devices, dental restorative materials or medical devices. There are currently 1,060 “Candidate Chemicals” that DTSC believes have hazard traits or environmental or toxicological effects.

The DTSC has already released its list of “Initial Candidate Chemicals” that will receive DTSC’s priority attention. Toluene, formaldehyde and bisphenol A are among the 164 “Initial Candidate Chemicals” that DTSC will consider to identify the “priority products” that DTSC will address first.

Conkle, Kremer & Engel’s lawyers stay current on the latest developments, and guide the firm’s clients through the thicket of expanding regulatory issues affecting their businesses. Watch for our next post on Green Chemistry, identifying the chemicals that can make your product a candidate to be a “priority product” for the DTSC.

2
OCT

Beauty Industry, California Trade Regulations, Green Chemistry Initiative, Manufacturing, Regulatory Compliance, Safer Consumer Products Regulations, Sales, Technology

Alternatives Analysis, bisphenol A, chemicals, Chemicals of Concern, formaldehyde, Initial Candidate Chemicals, nail polish, personal care products, Priority Product, toluene

Naked Juice Labels to be Stripped of "All Natural" and "Non-GMO" Claims in False Advertising Settlement

Posted by: Conklelaw

PepsiCo has agreed to pay $9 million to settle a class action battle over its use of the words “All Natural” and “Non-GMO” (non-Genetically Modified Organism) on its Naked Juice drink products. As part of the settlement, PepsiCo agreed to change its labeling.

If approved by the district court, the settlement would resolve five separate class action lawsuits, which were consolidated with the lead case Pappas v. Naked Juice Co. of Glendora, Inc., in March 2012.

The case against PepsiCo stems from allegations that statements on the Naked Juice labels constitute false advertising. The plaintiffs sued for violation of a number of California statutes – the Consumer Legal Remedies Act (CLRA) and False Advertising and Unfair Competition Laws.

According to the plaintiffs, independent testing revealed genetically modified soy protein in some Naked Juice products. The plaintiffs also alleged that several ingredients in the Naked Juice products are non-natural, including ingredients like beta carotene and biotin which do occur naturally but are produced synthetically when added as supplements to foods, and a fiber ingredient that is produced by chemically rearranging corn starch molecules. All of these ingredients are listed in the ingredient panel, but according to the plaintiffs, a reasonable consumer wouldn’t scrutinize the ingredient list for information contradicting the plain, conspicuous statements “All Natural” and “Non-GMO.”

The settlement in the PepsiCo case is likely to lead to many more class action lawsuits against businesses that advertise their products as “natural” or “all natural.” Unlike use of the word “organic,” use of the word “natural” is not explicitly regulated by federal or state law, leaving the door open for claims of false or misleading advertising by consumers.

What’s the moral of this story? An ounce of prevention is worth a pound of cure. It is important to scrutinize health-related language used in advertising, especially on food products, and ensure there is documentation to back up claims. CK&E routinely works with clients to evaluate the language on product packaging and in advertising as part of a comprehensive risk analysis so they can make informed choices for their businesses. CK&E also has extensive experience defending clients against consumer false advertising claims.

2
AUG

Advertising and Labeling, Beauty Industry, Class Actions, Consumer Legal Remedies Act, Food, Craft Beer and Nutrition, Manufacturing, Regulatory Compliance, Sales, Unfair Competition

All Natural, GMO, Juice, Naked Juice, Natural, Non-GMO, PepsiCo

2012: A Bountiful Year for Prop 65 Plaintiffs and Their Lawyers

Posted by: H. Kim Sim

Proposition 65 requires that businesses warn about the presence of chemicals believed by the State of California to cause cancer or reproductive harm. Private citizens may file lawsuits “in the public interest” against businesses alleging a failure to provide the required warning. Such lawsuits are often filed by private law firms (sometimes called “bounty hunters”), in the names of repeat-plaintiffs like “Center for Environmental Health,” after sending Notices of Violation. The apparent primary purpose is to obtain quick cash settlements from bewildered, unsuspecting businesses.

2012 was a particularly “bountiful” year for Prop 65 private plaintiffs, according to data recently released by the California Attorney General’s Office. In 2012, private plaintiffs settled 397 cases. The settlements totaled nearly $20.5 million. When combined with the additional settlements by District Attorneys and the Attorney General’s Office, there were 437 Prop 65 settlements during 2012, totaling over $22.5 million. 2012 was the second-highest annual dollar total for Prop 65 settlements since 2000, and shows a clear upward trend in the settlements extracted from businesses that receive Prop 65 Notices of Violation.

It should surprise no one who studies Prop 65 issues that the bulk of the $22.5 million paid in Prop 65 settlements during 2012 went to the plaintiffs’ attorneys: Attorneys’ fees made up more than $14.5 million, or 71.34% of all private settlements. Private plaintiffs can also take 25% of any civil penalty assessed as a “bounty”. In 2012, the civil penalties retained by plaintiffs represented an additional $755,000 or 3.7% of all private settlements.

A lesser-known fact is that private plaintiffs and their attorneys can and do make even more money from Prop 65 settlements. A portion of each Prop. 65 settlement is supposed to go toward causes or activities that further the purpose of Prop 65, so Prop 65 allows parties to structure some of their civil penalty allocation as a “Payment in Lieu of Penalties” (aka “PILP”). Some Prop 65 plaintiffs have kept such PILP recoveries to support vaguely stated causes; some Prop 65 plaintiffs have even argued that funding more private litigation itself is activity that furthers the purpose of Prop 65, justifying PILP recoveries from settlements. In 2012, PILP money made up 13.88% of all private settlements. That means almost $3 million landed in the hands of private plaintiffs and their attorneys, in addition to the attorneys’ fees and civil penalty bounties they received.

Statewide, there are only a few active Prop 65 plaintiffs. Aggregated settlement data can be useful in achieving cost-effective resolutions of Prop 65 claims. CK&E routinely defends businesses who have received Prop 65 Notices of Violation. CK&E also works with businesses to develop compliance strategies to minimize the risk that they will be future targets of Prop 65 plaintiffs.

This Blog Post was Co-Authored by Jackson McNeill, Law Clerk, UCLA School of Law, Class of 2014

30
JUL

Beauty Industry, Food, Craft Beer and Nutrition, Manufacturing, Proposition 65, Regulatory Compliance, Sales, Technology, Unfair Competition

Attorneys, Attorneys' Fees, Lawyers, Notice of Violation, Payment in Lieu of Penalties, PILP, Settlements, Warning Letter

Proposition 65 Bounty Hunters Target Titanium Dioxide in Personal Care Products

Posted by: H. Kim Sim

Titanium dioxide (TiO2) is commonly used in personal care products. It can be found in cosmetics, skincare products, and sunscreens. Products that may contain titanium dioxide include nail acrylic powders, eye shadows, loose and pressed face powder, powder foundation, bronzers, blushes and spray-on sunscreens.

Titanium dioxide was added to the list of Proposition 65 chemicals in September 2011, and warning requirements took effect in September 2012. The addition of titanium dioxide (airborne, unbound particles of respirable size) to the Office of Environmental Health Hazard Assessment (OEHHA)’s list of chemicals subject to regulation under Proposition 65 has caused professional Prop 65 plaintiffs to send out a number of “Notices of Violation” to manufacturers and distributors in the personal care products industry. They do this because the law requires that a Notice of Violation be served before a private party may commence a Prop 65 lawsuit.

Prop 65 plaintiffs – motivated by the potential to recover civil penalties and attorney’s fees – have seized on the new listing to go after numerous companies, including those in the beauty products business, for failing to provide a warning that titanium dioxide is known to the State of California to cause cancer. Often, such Prop 65 Notices of Violation are motivated more by a desire for a quick settlement than for a long dispute.

Since its listing, titanium dioxide has been the subject of four Notice of Violations – two by the Center for Environmental Health, and two by the Public Interest Alliance. The Center for Environmental Health is a well known Prop 65 plaintiff represented by Mark N. Todzo of Lexington Law Group in San Francisco. Its Notices of Violation with respect to titanium dioxide have attacked manufacturers and distributors of spray-on sunscreens.

The Public Interest Alliance is new to the group of Prop 65 plaintiffs and is represented by Jeffrey M. Judd of Judd Law Group in San Francisco. It has only sent out two Notices of Violation since it appeared on the Prop 65 scene, but both have been over titanium dioxide, and the two Notices combined attack more than 100 companies.

Manufacturers and distributors of personal care products should carefully review the contents of products that may contain titanium dioxide. CK&E has helped clients with personal care products businesses understand and comply with the requirements of Prop 65, to avoid being one of those who receive a Notice of Violation. If a Notice of Violation is received, CK&E works aggressively to help clients resolve the claims as quickly and economically as possible, without being held captive to the bounty hunters’ demands.

14
JUL

Beauty Industry, Personal Care Products, Proposition 65

Lead in Baby Food? Failure to Warn Leads to Unusual Prop 65 Trial

Posted by: Eric S. Engel

Proposition 65 actions are notoriously expensive and difficult to defend. For that reason, most Prop 65 cases settle. But a rare case involving allegedly high levels of lead in baby food, packaged fruits and juices is in trial in the Alameda Superior Court.

In September 2011, the Environmental Law Foundation (one of a handful of organizations in California that files Prop 65 actions in the name of the public interest) brought a lawsuit against food companies Beech-Nut Nutrition, Dole, Gerber, Del Monte Foods, and many others. ELF claimed that the manufacturers made and sold baby and children’s food containing lead, without a warning as required by Prop 65, California’s Safe Drinking Water and Toxic Enforcement Act.

What is at stake in the Prop 65 action is whether baby food and children’s food such as carrot and potato baby food, grape juice and fruit cocktail must include a warning that the foods contain a chemical known to the state of California to cause cancer or reproductive harm. Naturally, the food manufacturers do not wish to be forced to warn potential consumers that their foods contain harmful chemicals.

The food companies’ defenses are being tried to Superior Court Judge Steven A. Brick. The food companies claim that their products contain only trace levels of lead that are below the level required for a Prop 65 warning. They also claim that the lead is “naturally occurring” in the foods and therefore no duty to warn is required under the “naturally occurring” exposure defense to Prop 65. Finally, the food companies have argued that Prop 65’s warning requirements are preempted by the Food, Drug and Cosmetic Act and the Nutrition Labeling and Education Act. They contend that the FDA has determined that the baby food and children’s food in question do not pose unacceptable risks to health, so a Prop 65 warning requirement would create a conflict between federal and state law.

This will be a closely-watched case, because the Court’s ruling on these defenses is likely to have a significant impact on the defenses available to businesses faced with Prop 65 actions in the future. Regardless of the outcome, CK&E’s lawyers will continue to work with businesses to help them develop a plan of compliance so that they can achieve their goal of minimizing the risk of being named as a defendant in a Prop 65 lawsuit. If a lawsuit is threatened or filed, CK&E’s lawyers apply can create and implement effective and cost-efficient defense strategies to minimize its impact.

25
APR

Food, Craft Beer and Nutrition, Proposition 65, Regulatory Compliance, Unfair Competition

Bounty Hunters, Notice of Violation, OEHHA, Warning Letter

Starting a Fire: "Tris" Listing Increases Risks of Prop 65 Claims

Posted by: H. Kim Sim

Tris / TDCPP is a common flame retardant additive used in the manufacture of polyurethane foam, resins, plastics, textile coatings and rubber. Tris / TDCPP is found in a wide variety of common products such as upholstered furniture and padding. California’s Office of Environmental Health Hazard Assessment (OEHHA) recently added the chemical Tris(1,3-dichloro-2-propyl) phosphate (chlorinated Tris or TDCPP) to its ever-growing list of chemicals “known to the State of California to cause cancer or reproductive toxicity.” As a result, Tris / TDCPP is now subject to Proposition 65, California’s Safe Drinking Water and Toxic Enforcement Act of 1986.

Prop 65 has a well-earned reputation as a “bounty hunter” statute, and is presently the subject of reform legislation, AB 227. This notorious “right to know” law does not ban any particular chemical from being used in products. In most cases it simply requires a generic warning label if a product contains chemicals found on the OEHHA’s Prop 65 list.

Because of the recent addition of Tris / TDCPP, products containing that chemical now must have a warning label in order to comply with Prop 65. Manufacturers and distributors who use outdated labeling and inadvertently fail to include the required warning are likely to be targeted by lawyers and claimants looking for violations on which they can capitalize. The penalties imposed by Prop 65 include fines as well as liability for the plaintiff’s attorney’s fees and costs.

Prospective Prop 65 plaintiffs are required to serve a “Notice of Violation” and wait at least 60 days before they can file a lawsuit. (California Health and Safety Code section 25249.7(d)) A review of the 159 Notices of Violation with respect to Tris / TDCPP served in the past 6 months reveals that just two law firms are actually behind the onslaught of Prop 65 notices regarding Tris / TDCPP:

The Chanler Group of Berkeley, California, through attorney Josh Voorhees and the firm’s “usual plaintiffs” (Peter Englander, Laurence Vinocur, Russell Brimer and John Moore) – 146 of the 159 Notices (92%).
Lexington Law Group of San Francisco, California, through attorney Mark N. Todzo and the firm’s plaintiff, Center for Environmental Health – 13 of the 159 Notices (8%).

The products identified in these notices have included foam-cushioned upholstered furniture, such as chairs, ottomans, stools and benches, foam-cushioned mattress toppers, back and seat cushions, car seats, and foam mats and pads for children and infants.

Manufacturers and distributors should promptly assess whether their products contain Tris / TDCPP. CK&E’s lawyers are experienced in helping clients take action to protect themselves from Prop 65 liability, and to help put out the fire if a Notice of Violation is delivered.

2
APR

Advertising and Labeling, Fashion, Manufacturing, Proposition 65, Regulatory Compliance

Lawyers, Notice of Violation, OEHHA, TDCPP, Tris, Warning Letter

Prop. 65 Reform — Is a Safe Harbor from Bounty Hunters on the Horizon?

Posted by: Conklelaw

California’s now-infamous Proposition 65 (Prop. 65, Cal. Health & Safety Code § 25249.5) allows a private citizen to file a lawsuit against any business that fails to post adequate warnings about the presence of chemicals known to cause cancer or reproductive harm. The private enforcer may seek an injunction, penalties of up to $2500 per violation, per day, and an award of attorneys’ fees.

Assembly Member Mike Gatto (43rd District of California) recently proposed legislation, Assembly Bill 227, that would reform Prop. 65 by providing a “safe harbor” in the form of a 14-day period for businesses to correct alleged violations. If enacted as proposed, a business who receives a demand under Prop. 65 would have a brief opportunity to demonstrate its compliance with Prop. 65 requirements to the California State Attorney General, or the responsible city attorney or district attorney. If the business takes advantage of that “safe harbor” then the claimant would be barred from filing a lawsuit against that business.

While the purpose of Prop. 65’s private enforcement provision is to allow private citizens to act on behalf of the public to ensure warnings are properly posted, supporters of AB 227 criticize Prop. 65 as a “bounty hunter” statute that primarily benefits plaintiff’s attorneys. In 2011, businesses paid a total of nearly $16 million to settle lawsuits brought by private citizens, of which almost $12 million was paid to the plaintiffs’ attorneys. In fact, nearly half of the attorneys’ fees were paid to a single firm: The Chanler Group.

AB 227 would give businesses the opportunity to come into compliance with Prop. 65 warning requirements without paying exorbitant settlement fees to prevent costly litigation. But businesses would have to take swift action. As CK&E attorneys John A. Conkle, Amy Burke and Mark Riedel discussed in their November 2012 presentation to the Personal Care Products Council, What’s Your Game Plan?, it is important for businesses to develop strategies for ensuring regulatory compliance and for handling notices of violation quickly and efficiently. AB 227, if signed into law, would be another reason that businesses should prepare contingency plans for the day that they receive a notice of violation from plaintiffs seeking to take advantage of Prop. 65 — a business could avoid being sued at all if it responds quickly and correctly to take advantage of the safe harbor. CK&E advises clients in regulatory compliance, responding to warning and demand letters, and developing an individualized game plan to suit each client’s needs.

18
MAR

Beauty Industry, Food, Craft Beer and Nutrition, Manufacturing, Proposition 65, Regulatory Compliance, Sales, Technology, Unfair Competition

AB 227, Assembly Member Mike Gatto, Bounty Hunters, Injunctions, Injunctive Relief, Lawyers, Notice of Violation, Prop 65 Reform, Proposition 65 Reform, Warning Letter

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