The Toxic Substances Control Act Amendments May Do Little to Relieve California Headaches for Businesses

Posted on July 15, 2016 by Robert Falk

Business groups largely supported the Toxic Substances Control Act (TSCA) Amendments recently signed into law by President Obama to address concerns about the emergence of varying state-by-state requirements regulating the chemicals used in consumer products.  But for those wishing to avail themselves of California’s vast and lucrative marketplace, the TSCA Amendments and EPA’s June 29, 2016 plan to begin implementing them may prove to do little to alleviate business’s headaches.  While the TSCA Amendments include a number of permanent and temporary federal preemption provisions, they are riddled with holes that may allow California’s activist requirements and plaintiffs’ lawyers to proceed largely unimpeded.

Potential Impact of the TSCA Amendments on California’s Safer Consumer Products (“Green Chemistry”) Program

The Amendment’s preemption provisions could halt or constrain the implementation of the California Safer Consumer Products (SCP) program.  The statutory basis for California’s so-called “Green Chemistry Initiative” was enacted just after August 31, 2003 and its initial requirements for Priority Product-chemical pairings were not finalized prior to April 22, 2016 so at least certain types of requirements arising from the SCP program may be subject to TSCA preemption. 

But whether these preemption provisions will have a meaningful effect on the future of the SCP program remains to be seen.  For example, as long as EPA has not taken any regulatory action on a chemical, California will retain full authority to regulate a product that contains it.  Moreover, if the use of the chemical does not fall under EPA’s TSCA jurisdiction, the SCP program’s actions concerning it will never be preempted.  (For instance, TSCA does not cover personal care products or beauty products.)

Indeed, California’s requirement that manufacturers of products designated as Priority Products provide the state with data and conduct an Alternatives Analysis pursuant to the SCP program appears to be left unaltered by the new TSCA preemption provisions.  Likewise certain forms of regulatory responses to an Alternatives Analysis on a Priority Product, such as mandating certain warnings or other information disclosure requirements, may well be found to survive TSCA preemption. 

Potential Impact of the TSCA Amendments on California’s Proposition 65

Proposition 65 requires businesses to provide a “clear and reasonable” warning before knowingly and intentionally exposing a Californian to any detectable amount of a listed chemical unless the business can prove that the exposure level does not pose a significant risk of cancer or is at least 1,000 times below the level which causes no observable reproductive effect.  Public prosecutors are meant to be the primary enforcers of Proposition 65, but the statute is most loathed because any individual claiming to act in the public interest also has the ability to enforce it by filing “bounty hunter” lawsuits against manufacturers, distributors, and retailers of consumer products. 

California’s federal legislators, including retiring U.S. Senator Barbara Boxer, took pains to ensure that Proposition 65, which was enacted in 1986, remained fully shielded from TSCA preemption.  Thus, California can continue to update its list of Proposition 65 chemicals “known” to that State to cause cancer and reproductive harm regardless of the outcome of EPA’s TSCA evaluation on the same chemical.  Proposition 65 bounty-hunter lawsuits can also continue to be filed concerning even the most de minimis exposures to chemicals that EPA determines are safe. 

That said, it still remains for the courts presiding over Proposition 65 cases to determine if EPA’s risk and safety determinations made pursuant to TSCA will have a significant evidentiary role in a business’s defense of a Proposition 65 claim on grounds other than preemption.  California judges may also take EPA’s TSCA determinations about a chemical into account when it comes to assessing (or reducing) Proposition 65 penalties.  And, perhaps at best, TSCA’s preemption provisions may also help convince courts that it is inappropriate to allow plaintiffs to continue to use Proposition 65 to obtain chemical “reformulation” of products made for a national or international market instead of just requiring Proposition 65 warnings for them when offered for sale in California.

Live from California! The Safer Consumer Products Regulations Are Now In Effect

Posted on October 18, 2013 by Lynn L. Bergeson

The long awaited and highly controversial California Department of Toxic Substances Control (DTSC) Safer Consumer Products Regulations (SCPR) took effect October 1, 2013.  These are not your garden variety regulations.  They are intended to promote the inclusion in consumer products of chemicals deemed safer than the chemicals they are replacing and, by reverse logic, encourage the deselection of chemicals for inclusion in consumer products believed to pose risk to human health and the environment.

The regulations establish a four-step process whereby DTSC develops a list of candidate chemicals of concern, develops a list of “Priority Products” containing candidate chemicals, requires manufactures and other responsible entities to notify DTSC and assess potential product component alternatives, and implements regulatory responses that could result in mandated product reformulation or even product cancellation.  Certain “trade secret” provisions in the regulations are still being developed, important provisions considering the context of the regulations.

DTSC has created a Safer Consumer Products Web Portal and has posted, and will continue to add, information pertinent to the regulations and various guidance materials.  Litigation challenging the regulations is almost certain, arising under the California Environmental Protection Act, Administrative Procedure Act, and Commerce Clause, among other authorities.  Relying on a favorable outcome in any such challenge and doing nothing now is unwise, as success is at best speculative and more likely optimistic.

These are game-changing new rules.  They are certain to have a global impact on, and influence profoundly and forever, the supply chains of consumer product manufacturers, suppliers, and distributors.  Because the regulations are likely to become the new global standard against which prudent business practices regarding the manufacture, distribution, and marketing of consumer products will be measured, careful review is needed regardless of whether or not you are marketing consumer products in California.

California Revives Its “Green Chemistry” Initiative

Posted on January 10, 2012 by Robert Falk

SUMMARY
After a failed attempt at the end of the Schwarzenegger Administration, under current Governor Jerry Brown, California is now pushing forward with its new “green chemistry” approach to the regulation of chemicals in consumer products.  These regulations are likely to be formally unveiled early this year and will require extensive risk and life cycle analyses for prioritized products, which are likely to initially include children’s products, personal care products, and household cleaning products. 

The Envisioned Process
The revised California green chemistry regulations will establish a four-step process to identify safer consumer product alternatives.

1.  Chemicals:  The State will publish an initial list of Chemicals of Concern (COCs), likely involving close to 3,000 substances. 
2.  Priority Products:  Next, it will develop a list of Priority Products based on its evaluation of products that contain the identified COCs, as well as the distribution, use, and disposal patterns.
3.  Business Duty to Notify and Evaluate:  Responsible entities will be required to notify the State when their product is listed as a Priority Product and to perform an Alternatives Assessment. 
4.  Product/Chemical Limits/Regulations:  California will identify and impose a “Regulatory Response” to limit potential adverse public health and environmental impacts.

Applicability
As drafted, the regulations will eventually apply to all consumer products containing a COC that are sold, offered for sale, supplied, distributed, or manufactured in California.  There are limited exemptions for:

•    Products exempted by law (specified medical and dental devices, “dangerous” prescription drugs, food, and pesticides) and products used solely to manufacture a product exempted by law;
•    Products manufactured, stored in, or transported through, California, solely for out-of-state use; and
•    Products regulated by other federal or California state regulatory programs or international trade agreements, where the program or agreement provides an equivalent or greater level of protection of public health and the environment than would be provided if the product were listed as a Priority Product (no examples are specified, but EU programs seem likely candidates).

There are de minimis exemptions for products with COCs at concentrations equal to:

•    0.01% by weight for chemicals exhibiting one of nine specified hazard traits (carcinogenicity, developmental toxicity, reproductive toxicity, endocrine toxicity, genotoxicity, immunotoxicity, neurotoxicity, bioaccumulation, or environmental persistence);
•    0.1% by weight for chemicals that do not exhibit any of the nine specified hazard traits and environmental and toxicological endpoints; or
•    A lower or higher concentration if specified by DTSC in the Priority Products list.

The regulations apply to any “responsible entity,” which includes the manufacturer, or, if the manufacturer does not comply, the importer or retailer. 

Alternatives Assessment
This assessment remains at the heart of the Green Chemistry regulations.  Each must be conducted in two stages, with a report sent to State regulators at the end of each stage.

Necessity/Identification of Alternatives:  In the first stage, product criteria are identified (e.g., by function, performance, technical, and legal requirements).  A statement must be provided on whether the COC or a substitute chemical is necessary to meet the product’s requirements.  Next, alternatives to the usage of the COC must be identified and screened, and a work plan proposed for the second stage.   
Detailed Assessment of Alternatives:  The second stage requires a more detailed assessment of alternatives.  The product and each alternative must be evaluated with respect to relevant factors and associated exposure pathways and life cycle segments.  At this stage, the responsible entity selects an alternative that will replace or modify the Priority Product or decides not to modify the Priority Product (or discontinue the distribution of the product in California). 

Regulatory Responses
At a minimum, product information will be required to be provided to consumers if a Priority Product contains a COC above the de mimimis level. Additional possible regulatory responses include mandating implementation of engineered safety measures designed to control access or limit exposure to the COC in a Priority Product and, at the extreme, a potential prohibition on sale of the Priority Product within California. 

CONCLUSION
With reform of the Toxic Substances Control Act stalled in Congress, Governor Brown’s Administration appears more determined than its predecessor to take the lead in product stewardship and chemical regulation through California’s so-called “green chemistry” initiative.