Just weeks after a federal judge called the science behind the alleged carcinogenicity of glyphosate “shaky,” a California state court jury hammered Monsanto with a $289 million verdict, blaming a former groundskeeper’s non-Hodgkin’s lymphoma on his exposure to the Roundup® chemical. The August 10, 2018, verdict in Johnson v. Monsanto Co., No. CGC16550128 (California Superior Court, County of San Francisco)—which included $250 million in punitive damages—was just the first in the nearly 8,000 Roundup-related cases currently pending against Monsanto, many of which are consolidated in multidistrict litigation in California federal court. The intense publicity surrounding the verdict has left retailers whose products contain ingredients that might have been treated with glyphosate wondering whether their products may be targeted next.
What is California’s Proposition 65?
California’s Safe Drinking Water and Toxic Enforcement Act of 1986 (“Prop 65”) is one of the most onerous chemical right-to-know statutes in the nation. It prohibits businesses with 10 or more employees, including businesses that merely ship products into California, from exposing people in California to listed chemicals without providing a “clear and reasonable” warning.
Why Should I Care?
Bringing a Prop 65 action is relatively easy and lucrative for private plaintiffs and their counsel. In 2017, there were nearly 700 cases settled with defendants paying more than $25,000,000 in plaintiffs’ attorneys fees and penalties. This does not include defense counsel fees, business interruption and other costs to comply. Continue Reading New California Prop 65 Warning Regulations: What Businesses Need To Know Before August 30, 2018
On July 3, 2018, Governor David Ige of Hawaii signed SB 2571 into law, banning the sale or distribution of any “SPF sunscreen protection personal care product” that contains chemicals oxybenzone or octinoxate without a prescription issued by a licensed healthcare provider. “SPF sunscreen protection personal care product” is broadly defined to include, without limitation, any lotion, paste, balm, ointment, cream, solid stick applicator, brush applicator, roll-on applicator, aerosol spray, non-aerosol spray pump, and automated and manual mist spray. The ban, which Governor Ige indicated is intended to protect marine ecosystems including coral reefs, will go into effect on January 1, 2021. Estimates indicate that at least 70 percent of sunscreen products contain oxybenzone or octinoxate. Continue Reading Hawaii Governor Signs Law Banning Chemicals from Sunscreen Products
Recently, the Securities and Exchange Commission (“SEC”) allowed Apple Inc. to exclude a shareholder proposal from its proxy statement that requested that Apple “produce a report assessing the climate benefits and feasibility of adopting store-wide requirements for having all retail locations implement a policy on keeping entrance doors closed when climate control (especially air-conditioning during warm months) is in use.” Continue Reading Environmental Activist Submits Shareholder Proposal on Climate Control
In a move affecting manufacturers, distributors and retailers in the furniture and other wood-based industries, the Environmental Protection Agency (“EPA”) recently issued a series of amendments to its Final Rule implementing the Formaldehyde Standards for Composite Wood Products Act (the “Formaldehyde Final Rule”), which added Title VI to the Toxic Substances Control Act (“TSCA”). The Formaldehyde Final Rule, 40 CFR Part 770, sets formaldehyde emissions standards for composite wood products and includes requirements for the testing, third-party certification, import certification and labeling of covered products by manufacturers of those products. The Final Rule also imposes requirements on downstream fabricators, distributors and retailers to keep records for at least three years demonstrating that covered products they use, distribute and/or sell are TSCA Title VI-compliant. Continue Reading Recent Amendments to EPA’s Formaldehyde Emissions Final Rule Affect Furniture Industry
As reported in The Nickel Report, our Trends and Developments in Energy and Environmental Law blog, the California Department of Toxic Substances Control (“DTSC”) continues to make California’s hazardous waste management program more onerous and complex than the federal Resource Conservation and Recovery Act, which could raise concerns for some retailers. Public comment on DTSC’s proposed revisions remains open through November 6, 2017.
On January 9, 2017, Hunton & Williams LLP announced the formation of a global cross-disciplinary legal team to advise corporations and investors on issues related to sustainability and efforts to increase utilization of renewable energy in connection with clean power procurement goals. The Hunton team brings together lawyers with experience in transactional, finance (including “green bonds” and similar programs), corporate, securities, tax, environmental and real estate law to counsel clients on the complex legal issues arising out of participation in the market for renewable energy and related transactions. “Retailers, manufacturers and technology companies are either entering the renewable energy arena for the first time or are significantly bolstering their current positions,” said partner Eric R. Pogue, who heads the firm’s efforts in this space. “This multidisciplinary initiative will focus on the unique legal issues that companies face in meeting their sustainability and clean power procurement goals.”
President Obama signed the Frank R. Lautenberg Chemical Safety for the 21st Century Act (“Lautenberg Act”) into law in June 2016, amending the core provisions of the Toxic Substances Control Act (“TSCA”) for the first time in nearly 40 years. Last month, Hunton & Williams detailed how the Lautenberg Act considerably broadens the Environmental Protection Agency’s (“EPA’s”) authority to evaluate chemical safety and regulate use of chemicals in all stages of the supply chain, including manufacturing, distribution and retail sale. Within six months, EPA must select at least 10 chemical substances and begin risk evaluations on them. EPA must also classify chemicals – including those currently in the retail supply chain – as “high priority” or “low priority” for review, and begin risk evaluations on 20 high priority chemicals within the next three and a half years. Continue Reading Major Implications for Retail Industry Following Overhaul of Toxic Substance Control Act
Recently, HoneyBaked Foods, Inc., Wornick Foods and Foster Farms have been in the news because of different kinds of contamination claims. Syed Ahmad and Matthew McLellan, attorneys on Hunton & Williams LLP’s Insurance Coverage Counseling and Litigation team, authored an article entitled A Primer On Insurance Coverage for Food Contamination Losses, which provides an overview of insurance protection for food contamination issues that retailers, wholesalers and manufacturers may encounter. The article describes the insurance coverage available under traditional insurance policies, as well insurance protection designed specifically to cover contamination events experienced by food and beverage retailers. Through discussion of recent, high-profile contamination events and product recalls, the article provides insight on the type of losses that may be covered and the necessary proof of loss, as well as some of the pitfalls and limitations on coverage that retailers and other types of policyholders may face.
We previously reported on the proposed regulations initiated by the California Office of Environmental Health Hazard Assessment and its impact on retailers. Retailers should take steps to ensure that they are protected from Prop 65 claims, particularly with the proposed regulations in the pipeline. As with any regulatory requirements that impact businesses, often the best defense is a good offense — forethought, assessment and implementation of a compliance program can minimize the costs, headaches, business disruption and negative publicity that may otherwise occur. Continue Reading How Retailers Can Protect Themselves from Prop 65 Proposed Regulations, Part 3