Americans seem to have a love/hate relationship with information. We crave certain types of data. We want to know our FICO scores, calorie counts, miles per gallon, and children’s test scores. Recently, the FTC reported that data brokers collect billions of individual data points to produce detailed portraits of the online habits of individual Americans. FTC Chairwoman Edith Ramirez testified, “You may not know them, but they know you. They know where you live, what you buy, your income, your ethnicity, how old your kids are, your health conditions and your interests and hobbies.”
There was no public outcry; we are apparently O.K. with being reduced to bits and bytes of information for marketing purposes. We understand that “Big Data” increasingly drives decision making on an individual, local and national level. We constantly create and consume data. We seem to want more and more of it as time goes on.
Risk, however, is one area where Americans do not appear to be interested in data. When press reports claim that a particular product “has been linked” to cancer, birth defects or other negative health consequences, consumers do not ask “linked how?”, or “linked by whom?” They do not say “show me the data and let me make up my own mind.” Instead, they shun the product entirely and sometimes seek to have their states or cities ban it.
Genetically modified crops are an example. GMOs have been around for decades and some would argue that genetic modification, in one form or another, goes back centuries. Lately, however, GMOs have become a lightning rod for criticism. While the manufacturers and suppliers of genetically modified crops are ready to offer reams of data and high quality studies on the safety of their products, consumers do not want to know. The anti-GMO forces are continuing to dominate the conversation. Once an alleged health risk is identified, no matter how poorly documented or poorly understood, a groundswell of support will usually arise seeking to ban the product.
There are other examples, such as BPA and triclosan. Despite what you may have read, the alleged link between BPA exposure and human health risk is very tenuous. In other words, the data linking BPA is obesity, diabetes and cancer is very weak. BPA was never banned and BPA-containing products were never recalled. Retailers dropped the products based on public perception and now proudly tout “BPA-free” alternatives. Still, try to find a product containing BPA on store shelves today.
Triclosan is in a similar place. The data linking it to human health risks is very, very slim. Consumers, however, are pressuring personal care product companies to remove triclosan from their offerings. Manufacturers are now moving in that direction. If the recent upswing in class actions involving cosmetics is any indication, this trend is not going to end soon. When it comes to products we consume or put into our bodies, our reaction seems to be to default to the “Precautionary Principle.”
Stated simply, the precautionary principle reflects a “better safe than sorry” approach. That is, unless a manufacturer can prove that there are no health risks associated with a product, the manufacturer should not sell it or consumers should not buy it. This approach may seem laudable in the abstract, but in reality it is impossible to prove that any product is 100% safe under all circumstances, and every human activity involves some risk. The question for regulators and consumers should be how much risk is acceptable, not how can we avoid all risk.
Understanding risk, however, involves understanding risk-based science and the underlying data. We do not seem to want to confront that.
A version of the precautionary principle currently informs European chemical regulation, and the current efforts in the U.S. to reform chemical regulations are motivated in large part by a precautionary approach. So whether or not the precautionary principle reflects sound public policy, it is not going away anytime soon. What we really need is a national conversation about risk and about the quality of the data used to support statements about risk. We could also use more skepticism about the sources of studies employed to attack useful, safe consumer products. How are consumers to know whether health based claims about a product are the result of a smear campaign begun by a competitor? The only way to evaluate such claims is to dive into the data which support them.
Unfortunately, consumers do not seem to have the same desire for this type of data that they do for the enormous volume of other information they readily consume.
So what can you do to protect your products from an attack based on the precautionary principle? Unfortunately, there is no clear answer. The following are some suggestions that may be helpful in anticipating problems and mitigating effects of an attack:
· Stay on top of the science: Even if your company is not the primary manufacturer of the active ingredients you use, it is beneficial to stay apprised of the developing science surrounding the product. This may be as simple as setting an alert through Google or some other search engine which will deliver an update once daily if the product has been mentioned in news reports or blogs. A better approach might be to retain a health science consultant to stay on top of these issues. If negative studies are published regarding a product you use or sell, it helps to know about them sooner, rather than later.
· Attempt to obtain a third-party certification: “Sustainability” and “Green Chemistry” are difficult concepts to define, but consumers are increasingly demanding that manufacturers work to minimize the impacts of their products on the health and the environment. There are numerous third-party services which evaluate products and provide independent verification and certification of environmental, sustainability, stewardship, quality, safety and purity claims. The process can be expensive, but it is becoming increasingly important to retailers that products they sell undergo such third-party evaluations.
· Work with industry associations to promote good science and good public relations: Many attacks on personal care products employ non-standard and non-verified scientific tests which somehow gain public attention. If you suspect that a product you make or sell will be subject to such an attack, it may be helpful to support independent, standardized testing to help prove that the product is safe. Industry associations are an excellent vehicle for such testing as they are able to pool the resources of multiple manufacturers and distributors. They also help distance the industry members from the research, helping to blunt claims of undue influence by industry members over the independent researchers.
· Have a backup plan: No amount of careful planning can prevent all unfounded attacks on your products. It may be useful to have an approved substitute product ready to introduce. Issues of cost, availability and effectiveness will all come into play, and the switch to a substitute may create a perception that there was something wrong with the original product, but being able to quickly introduce a substitute may be necessary to keep your customers happy.
· Cost shifting: This is a less desirable option, but if you suspect that a product you are making or selling might come under attack – especially a regulatory or legal attack – you may wish to evaluate your supply contracts to see if it is necessary to insert, strengthen or eliminate indemnification language. You may also wish to evaluate your insurance policies to see if you have coverage for product liability and consumer fraud claims as well as product recalls.
· Litigation: This is perhaps the least attractive and least predictable option, but if the statements being made about your product are untrue, there are numerous federal and state laws that allow for recovery based on false advertising claims. The details of these claims are beyond the scope of this article, but you should consider consulting counsel if you believe you have been damaged by untrue statements about a product you make or sell.
The love/hate relationship between American consumers and data is not likely to end soon. As a result, there is often little a manufacturer can do to fight irrational fears based on weak or illegitimate data. But staying on top of the science and having contingency plans in place to address the consequences of an unfounded attack may help to lessen the impact to your business in the event that your product is ever perceived as posing an unacceptable risk.
About the expert
Tony Hopp is a partner Edwards Wildman Palmer LLP and is co-chair of the firm's Product Liability/Mass Tort Practice Group. He represents clients in complex commercial, environmental and mass tort matters. He has handled all phases of single plaintiff, multi-plaintiff, and class action claims and has tackled a wide variety of litigation and counseling engagements.