Don't Be Blindsided by Prop 65


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Don't Be Blindsided by Prop 65
By: Lisa Horn, Editor
Issue: 2006nov

Don’t Be Blindsided By Prop 65

PPAI has communicated extensively about the implications of Proposition 65, a California law that significantly affects companies in our industry. But rather than assume everyone has seen the articles we’ve published or participated in the webinar presented in August, we believe it’s critical to alert you to the issue once again.

Also known as the Safe Drinking Water and Toxic Enforcement Act of 1986, Proposition 65 affects firms that either ship goods to or distribute products in the state of California. It’s important to note that the law reaches far beyond the state’s borders.

What types of negative effects? For starters, between 2000 and 2005, companies across several industries paid more than $65 million in fines, court costs and settlement fees due to violations—real or not—of Prop 65’s restrictions. Closer to home, several prominent distributors in our industry are paying tens of thousands of dollars to settle claims against them, and we believe we’ve only seen the tip of the iceberg.

Proposition 65 requires businesses to eliminate the offending chemicals or notify Californians via warning labels about “significant amounts” of chemicals or compounds—specified in a list of more than 750—contained in a company’s products or in the inks used to decorate the products. Many of the compounds identified on the Prop 65 list, while permissible under federal regulations, are prohibited or are restricted to lower levels than those imposed by the Federal government. So while the same products may be safely shipped and received in other states, doing so in California without the proper warnings carry significant penalties for the “violators.” And if products violate the law, all involved—suppliers, distributors, clients and end users—are potentially liable.

However onerous the effects of Prop 65 may be on unsuspecting distributors or suppliers, there are remedies that prevent the lawsuits, fines, refused shipments and lost business. Warning labels, properly worded, do work. Changes in the composition of decorating inks to avoid the offending chemicals may be the better choice, however, as no one wants to label products as being potentially hazardous. Changes in the manufacturing process are perhaps less realistic, but suppliers should consider this option, too.

Federal legislation has been introduced to preempt Prop 65, but the prospect for legislative change any time soon is uncertain. We’ve encouraged our members to write letters to their Congressional representatives urging adoption of the legislation, and you can learn more about that effort and listen to the our webinar by going to the PPAI Legislative Action Watch site at www.capwiz.com/ppa/home.

In the meantime, if you have clients in California, don’t leave things to chance. Distributors, ask your suppliers if they are aware of Prop 65 and the restrictions the law may impose on certain products or the methods used in decorating them. Suppliers, be informed, so you can advise your distributor customers how you can help them avoid the costly sanctions that may come as a rude surprise.

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