Introduced in 1986, prop 65 requires manufacturers selling products in California to give clear warnings if their products expose consumers to any detectable amount of 800+ chemicals believed to cause cancer or reproductive toxicity.
While the legislation was not new, it had recently moved up the priority list for many firms in the supplements sector after it had found itself at the receiving end of a tidal wave of prop 65 notices filed by San Diego-based group the Environmental Research Center, said Mennemeier, Glassman & Stroud LLP partner Peg Carew Toledo.
“A lot of small companies think they are OK because they are compliant with federal law, and are not aware of the risks they face under prop 65. But the spate of notices in the last few months from the ERC has acted as a real wake-up call for the sector.
“I don’t think a lot of people realise that prop 65 claims are not insurable and the costs of defending them can be considerable, if not prohibitive.
“You have to have a rigorous testing regime in place and if you can’t get to the prop 65 levels, you should consider not supplying your product in California or putting a warning label on it. But even avoiding California is actually quite challenging, particularly because of the growth in internet sales.”
Federal law vs California state law?
Meanwhile, legal attempts to get the Food and Drug Administration (FDA) to address the conflict between prop 65 and the misleading labeling clauses in the Federal Food, Drug and Cosmetic Act had not proved successful to date, she noted.
Swanson Health Products had launched a high-profile ‘citizen’s petition’ to make the FDA clarify the legal situation in 2008 on the grounds that federal and state law conflicted “irreconcilably” and again cited the pre-emption issue in a subsequent piece of litigation, but had failed on both occasions, she said.
“It will probably come up again, but the conflict pre-emption argument is a very hard one to make.”
Meanwhile, the chances of getting the Californians to overturn or amend prop 65 were also slim given that challenging a law designed to protect consumers from carcinogens was not a vote winner, pointed out Melissa Jones, who chairs the Proposition 65 Practice Group at legal firm Greenberg Traurig.
As for whether firms issued notices by the ERC would settle, it was hard to say, she said: “As ERC is a new plaintiff in this area, it’s hard to predict how these cases will go, but in the vast majority of cases, companies just settle because the costs and risks of going to trial are too great, especially if you are a small company.
“In fact a lot of companies are starting to consider using the warning labels. These cases are very hard to defend against.”
The Mennemeier, Glassman & Stroud seminar, which has already attracted a lot of interest from the dietary supplements industry, will be held on May 12 and will give firms practical tips on compliance.