OEHHA has Proposed Amendments to Warning Regulations to Clarify the Definitions of Registered Agent and Actual Knowledge

The Office of Environmental Health Hazard Assessment (OEHHA) adopted amendments to the Clear and Reasonable Prop 65 regulations on November 20, 2017 to clarify certain provisions.

The changes relate to two mains topics:  

The first is to clarify the definition of a Registered Agent for the purposes of providing notice of the Prop 65 requirements. These changes were required as manufacturers and distributors needed clarification as to the definition of  a Registered Agent  for the purposes of allowing the transmittal of notice requirements to downstream transferees that is now permitted to transfer responsibility for warnings under the 2016 regulations.

 The changes add language to the relevant provisions of the regulations that an authorized agent is the authorized agent for the business to which they are selling or transferring the product.

This clarifies that the upstream entities need only to give the notice to their immediate downstream customers, which has been a question for entities attempting to comply with the 2016 regulations:

(b)  The manufacturer, producer, packager, importer, supplier, or distributor of a product

may comply with this article either by providing a warning on the product label or labeling that satisfies Section 25249.6 of the Act, or by providing a written notice directly to the authorized agent for the business to which they are selling or transferring the product or to the authorized agent for a retail seller who is subject to Section 25249.6 of the Act, which:

(1)  States that the product may result in an exposure to one or more listed chemicals;

(2)  Includes the exact name or description of the product or specific identifying information for the product such as a Universal Product Code or other identifying designation;

(3)  Includes all necessary warning materials such as labels, labeling, shelf signs or tags, and warning language for products sold on the internet, that satisfies Section 25249.6 of the Act; and

(4)  Has been sent to the authorized agent for the business to which they are selling or transferring the product who is subject to Section 25249.6 of the Act or to the authorized agent for the retail seller, and the manufacturer, producer, packager, importer, supplier, or distributor has obtained confirmation electronically or in writing of receipt of the notice.

(c)  If the manufacturer, producer, packager, importer, supplier, or distributor of a product is complying with this section by providing a written notice directly to the authorized agent for the business to which they are selling or transferring the product who is subject to Section 25249.6 of the Act or to the authorized agent for the retail seller:

(1)  Confirmation of receipt of the notice must be received electronically or in writing, and must be renewed, and receipt of the renewed notice confirmed electronically or in writing by the authorized agent for the business to which they are selling or transferring the product who is subject to Section 25249.6 of the Act or the authorized agent for the retail seller's authorized agent no later than February 28, 2019, then annually thereafter during the period in which the product is sold in California by the retail seller.

(2)Where a business has not designated an authorized agent, the manufacturer, producer, packager, importer, supplier, or distributor may serve the notice on the legal agent for service of process for the business.

(b) The manufacturer, producer, packager, importer, supplier, or distributor of a product

may comply with this article either by providing a warning on the product label or labeling that satisfies Section 25249.6 of the Act, or by providing a written notice directly to the authorized agent for the business to which they are selling or transferring the product or to the authorized agent for a retail seller who is subject to Section 25249.6 of the Act....

 The second change relates to what "actual knowledge" means with respect to duties of the retailers under the Prop 65,  2016 Amendments to the Clear and Reasonable Warnings. 

(f) For purposes of subsection (e)(5), “actual knowledge” means specific knowledge of the consumer product exposure with sufficient specificity for the retail seller to readily identify the product that requires a warning, and that is received by the authorized agent or a person whose knowledge can be imputed to the retail seller from any reliable source. If the source of this knowledge is a notice served pursuant to Section 25249.7(d)(1) of the Act, the retail seller shall not be deemed to have actual knowledge of any consumer product exposure that is alleged in the notice until five business days after the retail seller receives a notice that provides a description of the product with sufficient specificity for the retail seller to readily identify the product in accordance with

Article 9, section 25903(b)(2)(D).

The actual knowledge provision is in turn significant because it relates to the instances when a retailer becomes responsible for the warning.

(e) The retail seller is responsible for providing the warning required by Section 25249.6 of the Act for a consumer product exposure only when one or more of the following circumstances exist:

(5) The retail seller has actual knowledge of the potential consumer product exposure requiring the warning, and there is no manufacturer, producer, packager, importer, supplier, or distributor of the product who: (A) Is a “person in the course of doing business” under Section 25249.11(b) of the Act, and (B) Has designated an agent for service of process in California, or has a place of business in California.

OEHHA will receive comments by 5:00 p.m. on December 31, 2018. All comments will be posted on the OEHHA website at the close of the public comment period.

Prop 65 Proposed Changes to Calculating Exposure to Reproductive Chemicals in Food

(OEHHA) has proposed changes to the regulations that govern how Prop 65 reproductive toxicants in foods should be calculated. The proposed changes to the Prop 65 regulations amend 27 CCR §25821(a) and 27 CCR §25821(c) (2) purportedly to prevent incorrect or inconsistent determinations as to the applicability of Prop 65.  https://oehha.ca.gov/proposition-65/crnr/proposed-amendment-sections-25821a-and-c-level-exposure-chemicals-causing.

§ 25821. Level of Exposure to Chemicals Causing Reproductive Toxicity

(a) For purposes of the Act, “level in question” means the chemical concentration of a listed chemical for the exposure in question.  The exposure in question includes the exposure for which the person in the course of doing business is responsible, and does not include exposure to a listed chemical from any other source or product.  For purposes of this section, where a business presents evidence fo r the “level in qu e stio n ”   of a listed chemical in a food product based on the average of multiple samples of that food, the level in question may not be calculated by averaging the concentration of the chemical in food products from different manufacturers or producers, or that were manufactured in different manufacturing facilities from the product at issue.

This proposed rule bars a producer from calculating an average exposure level from multiple samples based on food from different manufacturers or producers or from different manufacturing facilities. OEHHA stated that they believe  that it is inconsistent with the purposes of [Prop. 65] to average concentrations of chemicals in products manufactured over extended periods, and “based on concentrations measured in samples of foods from different manufacturers or producers, or from different manufacturing facilities, because these are not necessarily representative of the levels of the chemical in products an individual would typically be exposed to when consuming a particular product in California.” Initial Statement of Reasons https://oehha.ca.gov/media/downloads/crnr/isor25821100518.pdf at p.9.

OEHHA also made proposed changes to the way the rate of intake or exposure is calculated:

§ 25821.(c)(2) For exposures to consumer products, the level of exposure shall be calculated using the reasonably anticipated rate of intake or exposure for average users of the consumer product, and not on a per capita basis for the general population.  This rate of intake or exposure is calculated as the arithmetic mean of the rate of intake or exposure for users of the product. The rate of intake or exposure shall be based on data for use of a general category or categories of consumer products, such as the United States Department of Agriculture Home Economic Research Report, Foods Commonly Eaten by Individuals: Amount Per Day and Per Eating Occasion, where such data are available.

In this section 27 CCR § 25821(c)(2), OEHHA  attempts to define  the method of calculating  the reasonably anticipated rate of intake  by using the arithmetic mean of differing exposure rates. According to OEHHA the arithmetic mean best captures that variability because it, unlike a geometric mean or median methodology it “accounts for consumption levels at both the low and the high end of the range, weighing the intake of each consumer equally.” Initial Statement of Reasons at p.8.

These amendments would arguably abrogate the state appellate court decision in Environmental Law Foundation v. Beech-Nut Nutrition. et al., (2015) 235 Cal.App.4th 307, (“Beech-Nut”) in which the Court allowed exposure calculations based on the average lead levels across different manufacturers and facilities. It also permitted the use of the geometric mean to calculate rates of rather than the arithmetic as these proposed rules require.

OEHHA in the Initial Statement or Reasons makes it clear that they believe that the Court in Beech-Nut was wrong:

Neither [of the Court] finding[s]  is consistent with the intent of OEHHA’s regulations or Proposition 65, which is focused on an individual exposure from a specific product. Therefore, OEHHA believes that the regulations should be clarified so that businesses and courts can apply the correct analysis in the future. It should be noted that it is also inconsistent with the purposes of the Act to average concentrations of chemicals in products manufactured over extended periods. OEHHA considered including a time element in this regulation. Initial Statement of Reasons at p.11

The consequence of these new rules would be to make it more difficult for food producers to support a decision to forego labeling certain food products, as  the proposed  rule makes the Prop 65 threshold more difficult to calculate because of  the inherent variability of constituents in foods with respect to the levels in the foods and the variability of  the rate of exposure to consumers.

 The Public comment cutoff was extended until November 26, 2018 and with a public hearing that will be held on November 19, 2018.Public comments cutoff was extended until November 26, 2018 and with a public hearing that will be held on November 19, 2018.

Proposition 65 - Adoption of No Significant Risk Level for Roundup/glyphosate

This just in from OEHHA on Roundup:

Proposition 65 - Adoption of No Significant Risk Level for Glyphosate

"The Office of Environmental Health Hazard Assessment has adopted a No Significant Risk Level of 1100 micrograms per day for glyphosate. This means that exposures to glyphosate below 1100 micrograms per day are not considered a significant risk of cancer for purposes of Proposition 65 and would not require a warning. Safe-harbor levels help businesses determine when a warning is required for exposures to listed chemicals. Once the warning requirement takes effect on July 7, 2018, businesses with 10 or more employees who cause exposures above the safe harbor level may need to provide warnings. Enforcement of the warning requirement is currently the subject of pending federal litigation that may affect the duty to warn for glyphosate exposures.  See National Association of Wheat Growers et al., v Lauren Zeise, et al. (Eastern District of California, Case # 2:17-cv-02401-WBS-EFB).  A preliminary injunction has been issued in that case prohibiting enforcement of the warning requirement by the California Attorney General and OEHHA.  The case is still pending in the Federal District Court."

Tentative Ruling Prop 65 Coffee Products/Chocolate Settlement

A Superior Court Judge in the latest in a series of Prop 65 cases involving coffee industry has tentatively ruled that the Prop 65 warnings are required. CERT  v. Starbucks.( LA Ct. NO. BC435759). The chemical at issue, Acrylamide, is formed in coffee beans during the roasting process and is  then introduced  into coffee itself when the coffee is brewed. These cases are derived from several cases that were filed against 91 defendant coffee sellers. Several of the defendants have settled both before and during the trial.

The trial was divided into three phases. During earlier phases the Judge ruled that there was no first amendment right related to the warning, that there was no federal preemption, and that the levels in coffee , were not below the “no significant risk” safe harbor level established by regulation.

The tentative ruling addresses in part the question of whether the beneficial effects of coffee outweigh the need to warn for potential cancer impacts. Defendants argued that they can take advantage of an “alternative” safe harbor exposure risk level ( [Title 27 section 25703(b) of the California Code of Regulations), which lays out the required procedure for conducting a “quantitative risk assessment” to establish a safe harbor for a Prop. 65 listed carcinogen.

The trial court has tentatively held that the defendants could not meet the requirements of this section  as  the risk assessment according to the court  looked at acrylamide exposure generally and not at exposure to acrylamide in coffee products. 

The defendants have until April 10 to respond to the tentative ruling. If the ruling is not reversed or modified the next phase in the trial would be the calculation of penalties. Some distributors have already begun including the warning to cut off potential liability.

Chocolate Products Settlement.

In additional Prop 65  news a San Francisco Superior Court  approved a settlement of a lawsuit alleging that manufacturers of certain chocolate products were required  to provide Proposition 65 warnings as the products allegedly contained levels of cadmium and lead above the safe harbor levels for those elements.

The settlement  requires manufacturers to provide warnings based on the levels of the two substances in their products. The settlement also requires the  parties to establish a panel that will study the origin of the contamination and will make recommendations that could require warnings at lower or higher levels of the two substances. As You Sow v. Trader Joe’s, Consent judgment, 548791.

 The total settlement was $925,875, which includes; Civil Penalty: $22,000.00 Attorney(s) Fees and Costs: $900,000.00 and Payment in Lieu of Penalty: $3,875.00.  The settlement includes  language that allows other manufacturers or sellers of chocolate products to join in the settlement by accepting its terms.

Each of the defendants must provide a Prop. 65 warning on their products one year after the effective date of the settlement- if the products exceed initial levels specified for each product category. After seven years those levels will be reduced to  levels specified in the settlement. Those levels are to be modified to be consistent with any of the trigger levels recommended by the expert panel. The  language for the warnings is specified in the settlement.