As previously announced, I'm attending DRI's Product Liability Conference in San Diego, and providing summaries as time permits. Not quite live-blogging, but trying to keep it current. There is nothing affiliated with DRI about these posts. Needless to say, my only affiliation with DRI is that I'm a member and I'm here.
We had a very good last minute substitute speaker today, Victoria Davis Lockard, an attorney from Alston & Bird LLP in Atlanta.
The term “greenwashing” is attributed to an environmentalist named Jay Westervfeld, who criticized the hotel industry’s practice of using placards suggesting guests could help “save the environment” by reusing their sheets and towels; Westervfeld maintained, logically enough, that the hotels were motivated by profit, not by any real environmental agenda.
The original Six Sins of Greenwashing were hidden trade-offs, lack of proof, vagueness, irrelevance, less of two evils, fibbing. TerraChoice, a green marketing company, generated the report (available on its web site) after looking at 1700 purportedly green products at big box stores, and found all but one were guilty of one or more of these sins.
The FTC Green Guides (16 CFR § 260), aren’t enforceable as law, but carry weight with the FTC and the courts in evaluating alleged Section 5 violations.
The general principles of the Green Guides are these:
- Qualifications or disclosures must be clear, prominent and understandable;
- The environmental attribute or benefit must be presented in a way that is clear;
- The environmental marketing claim cannot be overstated;
- If there are comparative statements (e.g., 50% more recyclable materials) it must make the basis for the comparison sufficiently clear that it is not deceptive.
There is specific guidance for statements of recyclability. If a product is described as recyclable, it must be accepted at established and commonly available recycling programs. The use of an SPI code (i.e., the triangle with an number in the middle) is the same thing as saying the product is recyclable. If the recycling options are limited, the limitations must be stated.
The USDA rules on "Organic" claims: There are three levels, 100% organic, “organic” (which means 90%) and “made with organic ingredients” (which means 70% organic). These relate only to foods. So cosmetic makers and makers of personal care products technically aren’t subject, but consumer lawsuits have urged that they are if they make those representations.
Victoria poses the following litigation risks:
- Consumer “no injury” class actions: She acknowledges we aren’t seeing a lot of these yet.
- Competitor claims under the Lanham Act, or actions before the National Advertising Division of the Better Business Bureau.
- Section 5 Enforcement actions by the FTC – there have been 37 actions from 1990 to 2000, and none since.
- State attorney general actions under state consumer protection laws.
In California, this is one area where the Unfair Competition Law may have some continuing vitality. While citizens’ suits are problematic in the aftermath of California’s Proposition 64 (which amended our Unfair Competition Law to require that the plaintiff have sustained injury in fact and lost money or property as a result of the unfair, unlawful or fraudulent practice), there is no such requirement when the Attorney General or another public prosecutor files suit. Cases of this type have political sex appeal in California, and pose a real risk for companies that run afoul of the six sins or the green guides.
Chris Bell raised two areas of concern, among others: One relates to companies pitching “carbon offsets” for everything from air travel to conventions, when there is no agreement, policy, regulation, or anything else that provides a bench mark for what is or is not an appropriate carbon offset. The second has to do with claims of sustainability that can’t be entirely documented throughout a company’s supply chain. In California, these mis-steps, as well, might result in the Attorney General prosecuting Unfair Competition Law litigation.