login-customizer domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home1/natiopq9/public_html/wp-includes/functions.php on line 6131The post Buy American and Buy European appeared first on The National Law Forum.
]]>Unsurprisingly, protectionist policies favoring American production can produce similar protectionist measures enacted by foreign countries. The European Union’s (EU) European Green Deal Industrial Plan (sometimes referred to as the Buy European Act), which includes the Critical Raw Materials Act (CRMA) and the Net-Zero Industry Act (NZIA), were both formally adopted within the last few months. The NZIA, which was agreed upon in February, is aimed at the manufacture of clean technologies in Europe and sets two benchmarks for such manufacturing in the EU: (1) that 40% of the production needed to cover the EU will be domestic by 2030; and (2) that the EU’s production will account for at least 15% of the world’s production by 2040. The NZIA contains a list of net-zero technologies, including wind and heat pumps, battery and energy storage, hydropower, and solar technologies. The CRMA, adopted on March 18, sets forth objectives for the EU’s consumption of raw materials by 2030: that 10% come from local extractions; 40% to be processed in the EU; and 25% come from recycled materials. The CRMA also provides that “not more than 65% of the Union’s annual consumption of each strategic raw material at any relevant stage of processing from a single third country.”[1] While Europe’s new acts are perhaps more geared towards raw materials and clean technology, the U.S. and Europe’s concerted efforts to focus on domestic production will be something to watch for years to come. In particular, it is worth watching whether the recent EU measures generate a response from U.S. lawmakers. If so, it could accelerate the already increasing stringency of Buy American and Buy America requirements.
[1] https://www.consilium.europa.eu/en/policies/eu-industrial-policy/
by: Kevin P. Daly, Jeffrey J. White , Sabrina M. Galli of Robinson & Cole LLP
For more news on the Buy American Act and the European Green Deal Industrial Plan, visit the NLR Antitrust & Trade Regulation section.
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]]>The post FTC Starts Long-Awaited Green Guides Review appeared first on The National Law Forum.
]]>© 2022 Keller and Heckman LLP
For more Energy and Environmental Law news, click here to visit the National Law Review.
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]]>The post Small Businesses Don’t Recognize Risk of Cyberattack Despite Repeated Warnings appeared first on The National Law Forum.
]]>CNBC surveys over 2,000 small businesses each quarter to get their thoughts on the overall business environment and their small business’ health. According to the latest CNBC/SurveyMonkey Small Business Survey, despite repeated warnings by the Cybersecurity and Infrastructure Security Agency and the FBI that U.S.- based businesses are at an increased risk of a cyber-attack following Russia’s invasion of Ukraine, small business owners do not believe that it is an actual risk that will affect them, and they are not prepared for an attack. The latest survey shows that only five percent of small business owners reported cybersecurity to be the biggest risk to their company.
What is unfortunate, but not surprising, is the fact that this is the same percentage of small business owners who recognized a cyber attack as the biggest risk a year ago. There has been no change in the perception among business owners, even though there are repeated, dire warnings from the government. Also unfortunate is the statistic that only 33 percent of business owners with one to four employees are concerned about a cyber attack this year. In contrast, 61 percent of business owners with more than 50 employees have the same concern.
According to CNBC, “this general lack of concern among small business owners diverges from the sentiment among the general public….In SurveyMonkey’s polling, 55% of people in the U.S. say they would be less likely to continue to do business with brands who are victims of a cyber attack.” CNBC’s conclusion is that there is a disconnect between business owners’ appreciation of how much customers care about data security and that “[s]mall businesses that fail to take the cyber threat seriously risk losing customers, or much more, if a real threat emerges.” Statistics show that threat actors are targeting small to medium-sized businesses to stay under the law enforcement radar. With such a large target on their backs, business owners may wish to make cybersecurity a priority. It’s important to keep customers.
Article By Linn F. Freedman of Robinson & Cole LLP
For more cybersecurity legal news, click here to visit the National Law Review.
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]]>The post The Metaverse: A Legal Primer for the Hospitality Industry appeared first on The National Law Forum.
]]>The metaverse, regarded by many as the next frontier in digital commerce, does not, on its surface, appear to offer many benefits to an industry with a core mission of providing a physical space for guests to use and occupy. However, there are many opportunities that the metaverse may offer to owners, operators, licensors, managers, and other participants in the hospitality industry that should not be ignored.
The metaverse is a term used to describe a digital space that allows social interactions, frequently through use of a digital avatar by the user. Built largely using decentralized, blockchain technology instead of centralized servers, the metaverse consists of immersive, three-dimensional experiences, persistent and traceable digital assets, and a strong social component. The metaverse is still in its infancy, so many of the uses for the metaverse remain aspirational; however, metaverse platforms have already seen a great deal of activity and commerce. Meanwhile, technology companies are working to produce the next-generation consumer electronics that they hope will make the metaverse a more common location for commerce.
The hospitality industry may find the metaverse useful in enhancing marketing and guest experiences.
Immersive virtual tours of hotel properties and the surrounding area may allow potential customers to explore all aspects of the property and its surroundings before booking. Operators may also add additional booking options or promotions within the virtual tour to increase exposure to customers.
Creating hybrid, in-person and remote events, such as conferences, weddings, or other celebrations, is also possible through the metaverse. This would allow guests on-site to interact with those who are not physically present at the property for an integrated experience and possible additional revenue streams.
Significantly, numerous outlets have identified the metaverse as one of the top emerging trends in technology. As its popularity grows, the metaverse will become an important location for the hospitality industry to interact with and market to its customer base.
As we move into the future, the metaverse appears poised to provide a tremendous opportunity for the hospitality industry to connect directly with consumers in an interactive way that was until recently considered science fiction. But like every new frontier, technological or otherwise, there are legal and regulatory hurdles to consider and overcome.
Article By Charles B. Ferguson, Jr. and Kimberly A. Wachen of ArentFox Schiff LLP
For more technology legal news, click here to visit the National Law Review.
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]]>The post L’Oreal PFAS Lawsuit Again Shows ESG Risks of Marketing appeared first on The National Law Forum.
]]>In less than six months, L’Oreal has now found itself to be the target of PFAS lawsuits related to its mascara products. The latest L’Oreal PFAS lawsuit was filed in the New Jersey federal court on April 8, 2022. Cosmetics and PFAS is a topic that saw increased scrutiny from the scientific community, legislature, and the media in 2021. As we predicted in early 2021, the increased attention on the industry presented significant risks to the cosmetics industry, and our prediction was that the developments made the cosmetics industry the number two target for future PFAS lawsuits. In less than three months, four industry giants – Shiseido, CoverGirl, L’Oreal and Burt’s Bees – were hit with lawsuits related to their cosmetics and PFAS content in some of the companies’ products. The industry, insurers, and investment companies interested in the consumer goods vertical with niche interest in cosmetics companies must pay careful attention to the cosmetics lawsuits and the increasing trend of lawsuits targeting the industry.
On June 15, 2021, a scientific study in the Journal of Environmental Science and Technology Letters published conclusions regarding testing of a variety of cosmetics products from the United States and Canada for PFAS content, and found PFAS present in over half of the products. On the same day that the study was published, the No PFAS In Cosmetics Act 2021 was introduced in the Senate by U.S. Senators Susan Collins (R-ME), Richard Blumenthal (D-CT), Dianne Feinstein (D-CA), Maggie Hassan (D-NH), Jeanne Shaheen (D-NH), Kirsten Gillibrand (D-NY), and Angus King (I-ME). The bill sought to ban PFAS in cosmetics.
These two developments led us to conclude “with these developments, our prediction that cosmetics is the number two target for PFAS litigation issues behind water rings true.”
PFAS content in cosmetics raises concerns for human health in scientific communities due to the fact that PFAS are capable of entering the bloodstream in ways other than direct oral ingestion, and one of these ways includes dermal absorption. Concerns have also been raised regarding absorption of PFAS into the bloodstream by way of tear ducts. The absorption issue is one that is being studied fairly extensively through various pending scientific studies. At the end of 2021, the federal Agency for Toxic Substances and Disease Registry (ATSDR) went so far as to recommend that citizens in Southern New Hampshire reduce their risk of further PFAS exposure by avoiding the use of certain consumer goods, including cosmetics.
On April 8, 2022, plaintiff Rebecca Vega filed a lawsuit in the New Jersey federal court seeking a proposed class action lawsuit against LOreal. The L’Oreal PFAS lawsuit alleges that the company does not disclose to consumers that its mascara and other products contain PFAS. Instead, the lawsuit states, the products were fraudulently and misleadingly marketed as safe for consumers and environmentally friendly, in violation of federal and state consumer laws. The Complaint details several examples of L’Oreal marketing indicating the safe nature of the products.
The plaintiff seeks certification of the class action lawsuit, injunctive relief, damages, fees, costs and a jury trial. The proposed class is any consumer in the United States, or in the subclass of New Jersey, who purchased the relevant L’Oreal products.
With studies underway, legislation pending that targets cosmetics, and increasing media reporting on cosmetics concerns to human health, the cosmetics industry has a target on its back with respect to PFAS that will have impacts on the industry’s involvement in litigation. Twelve months ago, we made this prediction: “Personal injury / products liability cases, false advertising, and failure to disclose theories of liability are some of the more prominent allegations that cosmetics companies are likely to face. Further, the cosmetics industry is concerned about federal and state level regulatory enforcement action for environmental pollution remediation costs stemming from placing PFAS waste into the environment as a by-product of the manufacturing process.”
The first part of our prediction is becoming reality, as four significant cosmetics industry players now find themselves embroiled in litigation focused on false advertising, consumer protection violations, and deceptive statements made in marketing and ESG reports. The lawsuits may well serve as a test case for plaintiffs’ bar to determine whether similar lawsuits will be successful in any (or all) of the fifty states in this country. Each cosmetics company faces the stark possibility of needing to defend lawsuits involving plaintiffs in all fifty states for products that contain PFAS.
It should be noted that these lawsuits would only touch on the marketing, advertising, ESG reporting, and consumer protection type of issues. Separate products lawsuits could follow that take direct aim at obtaining damages for personal injury for plaintiffs from cosmetics products. In addition, environmental pollution lawsuits could seek damage for diminution of property value, cleanup costs, and PFAS filtration systems if drinking water cleanup is required.
It is of the utmost importance that businesses along the whole supply chain in the cosmetics industry evaluate their PFAS risk. Public health and environmental groups urge legislators to regulate PFAS at an ever-increasing pace. Similarly, state level EPA enforcement action is increasing at a several-fold rate every year. Now, the first wave of lawsuits take direct aim at the cosmetics industry. Companies that did not manufacture PFAS, but merely utilized PFAS in their manufacturing processes, are therefore becoming targets of costly enforcement actions at rates that continue to multiply year over year. Lawsuits are also filed monthly by citizens or municipalities against companies that are increasingly not PFAS chemical manufacturers.
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]]>The post Sugar Association Files Supplemental Petition Urging Regulatory Changes for Artificially Sweetened Foods appeared first on The National Law Forum.
]]>Article By The Food and Drug Law Practice Group at Keller and Heckman LLP
For more biotech, food, and drug legal news, click here to visit the National Law Review.
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]]>The post Fashion Sustainability and Social Accountability Act Proposed in New York appeared first on The National Law Forum.
]]>Happy New Year (are we still saying that?) from the Global Supply Chain Law Blog! In our ever-evolving society, the fashion industry has taken new heights. And with those heights, the industry is on pace to account for more than a quarter of the world’s carbon budget, according to the New Standard Institute. Indeed, the group indicates that apparel and footwear are responsible for roughly 4-8.6% of global greenhouse gas emissions. You may be wondering, “but how?” Well after that sweater you bought last year (or even last month!) goes out of style, you may donate it. According to CBS, some of those donations go overseas to Ghana, for example, to be sold. The unsold clothes, however, end up as landfills creating an environmental nightmare.
As a result and in an effort to create more regulation, New York is taking action with respect to the environmental nightmare. Earlier this year, the New York legislator proposed a bill—the Fashion sustainability and social accountability act, which would amend the general business law, requiring fashion retail sellers and manufacturers to disclose environmental and social due diligence and policies.
Specifically, every fashion retail seller and fashion manufacturer doing business in the State of New York and having annual global gross revenues that exceed $100 million dollars must disclose its:
The required disclosures would include supply chain mapping of at least 50% of suppliers (which the retail seller or manufacturer could choose) by volume across all tiers of production, a sustainability report, independently verified greenhouse gas reporting, volume of production displaced with recycled materials, and median wages of workers of suppliers compared with local minimum wage, to name a few.
All disclosures must be posted on the retail or manufacturer’s website within a year of enactment. Enforcement of the bill would fall to the state’s attorney general, who would publish a report listing the fashion retail sellers and manufactures who are out of compliance with the act. Public shaming would not be the only punishment, however. Retailers and manufacturers who fail to comply may be fined up to 2% of annual revenues of $450 million or more. The money from the fines will be deposited into a community benefit fund, which will be used for environmental benefit projects that directly and verifiably benefit environmental justice communities.
In short, if the Fashion sustainability and social accountability act is enacted into law, fashion retailers and manufactures will be held accountable for environmental and social impacts stemming from their supply chain and production of apparel and shoes. According to Vogue, “proponents say the bill will make history” as it could “shift how the fashion industry operates globally.” Thus, stay tuned as we will be tracking the legislation closely and will provide real time updates!
[1] “Due diligence” shall mean the process companies should carry out to identify, prevent, mitigate and account or how they address actual and potential adverse impacts in their own operations, their supply chain and other Business relationships, as recommended in the Organisation for Economic Co-operation and Development Guidelines for Multinational Enterprises, the Organisation for Economic Co-Operation and Development Due Diligence Guidance for Responsible Business Conduct and United Nations Guiding Principles for Business and Human Rights.
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]]>The post Multi-Level Marketing Gets Multi-Level Attention appeared first on The National Law Forum.
]]>Multi-level marketing has touched us all – whether it be purchasing beauty products, essential oils, or health supplements from a friend through social media, or receiving an invitation to join a team of seemingly successful people working their “side hustle.” But multi-level marketing is now getting some additional multi-level attention, both in the media and in the court room.
With interest in documentaries on the rise throughout the pandemic, Amazon recently delivered with its four-part docu-series “LuLaRich.” It follows the multi-level marketing company, LuLaRoe, which is known for its colorfully patterned clothing, messages of empowering women, and nearly $2 billion in purported sales in a single year. But the docu-series also offers a glimpse at the dividing line between a multi-level marketing platform and a pyramid scheme, with the latter running afoul of the law.
Throughout its short existence, LuLaRoe has been no stranger to litigation. Several class actions have been filed against it, including one with allegations that LuLaRoe’s leggings ripped as easily as wet toilet paper. But most notable is a recent class action that was certified just last month by a Federal Court in Alaska. See, e.g., Katie Van et al. v. LLR Inc. dba LuLaRoe et al., No. 3:18-cv-00197, in the United States District Court for the District of Alaska. The claims in Van allege that LuLaRoe charged sales tax on purchases to customers located in tax-free jurisdictions. This was, allegedly, the result of a customized point-of-sale system that did not allow sales tax to be assessed based on the location to where the “retailer” (sales person) shipped the merchandise. LuLaRoe addressed this by creating a “toggle switch” that allowed retailers to “turn off” the automatic tax charges and charge a different amount, including 0%. However, some retailers used the toggle switch to override the collection of sales taxes on taxable transactions while others did not use the toggle switch to override sales taxes on transactions that were not taxable. When LuLaRoe became aware of this, it allegedly disabled the toggle switch and asked retailers to leave the system’s sales tax box “checked,” while LuLaRoe developed a system that would compute and collect sales tax based on the address where the product was purchased and received. The outcome: consumers in jurisdictions without sales tax (or no sales tax on clothing) were improperly billed for sales tax on their purchases, based on the taxes imposed by the retailer’s location, rather than the consumer’s location. The certified class claim alleges LuLaRoe engaged in an unfair trade practice with the imposition of this non-existent sales tax. And, while attempts at similar class actions against LuLaRoe have been made in the past, this class, with more than 10,000 potential class members, has now been certified.
With so many sales happening through social media controlled by individual retailers, multi-level marketing entities must address unique challenges, including the calculation and imposition of sales tax, especially when customers are located in different states (or even different countries) than their sales person, as was the case in Van. Having the requisite resources – whether that be through staffing or usable technology and software – can be challenging when trying to keep up with the quick growth that often comes with multi-level marketing. Additionally, a multi-level marketing entity’s approach to organizational structure, recruiting, compensation, and manufacturing warrants detailed attention and familiarity with state and federal law.
LuLaRoe’s story, while colorful and seemingly worthy of a hit docu-series, highlights the need to carefully navigate legal issues when operating or becoming involved with a multi-level marketing entity. The potential for legal snags may be hidden in the seams. And it’s never worth becoming too big for your (brightly patterned) britches when it comes to the law.
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]]>The post CPSC Sues Amazon to Force Recall of Hazardous Products Sold on Amazon.com appeared first on The National Law Forum.
]]>The U.S. Consumer Product Safety Commission (CPSC) announced on July 14, 2021, that it filed an administrative complaint against Amazon.com, “the world’s largest retailer, to force Amazon to accept responsibility for recalling potentially hazardous products sold on Amazon.com.” CPSC claims that the specified products sold through Amazon’s “fulfilled by Amazon” (FBA) program are defective and pose a risk of serious injury or death to consumers and that Amazon is legally responsible to recall them. According to the complaint, the products include “24,000 faulty carbon monoxide detectors that fail to alarm, numerous children’s sleepwear garments that are in violation of the flammable fabric safety standard risking burn injuries to children, and nearly 400,000 hair dryers sold without the required immersion protection devices that protect consumers against shock and electrocution.”
CPSC filed the complaint under the Consumer Product Safety Act (CPSA). According to the complaint, Amazon acts as a “distributor,” as defined by CPSA, of its FBA products by: (a) receiving delivery of FBA consumer products from a merchant with the intent to distribute the product further; (b) holding, storing, sorting, and preparing for shipment FBA products in its warehouses and fulfillment centers; and (c) distributing FBA consumer products into commerce by delivering FBA products directly to consumers or to common carriers for delivery to consumers.
The complaint states that after CPSC notified Amazon about the hazards presented by the specified products, Amazon took “several unilateral actions,” including:
According to the complaint, these actions “are insufficient to remediate the hazards posed by the Subject Products and do not constitute a fully effectuated Section 15 mandatory corrective action ordered by” CPSC. The complaint states that “[a] Section 15 order requiring Amazon to take additional actions in conjunction with the CPSC as a distributor is necessary for public safety.” The complaint asks CPSC to:
CPSC “urges consumers to visit SaferProducts.gov to check for recalls prior to purchasing products and to report any incidents or injuries to the CPSC.” CPSC published the complaint in the July 21, 2021, Federal Register. 86 Fed. Reg. 38450.
Commentary
In CPSC’s July 14, 2021, press release, Acting Chair Robert Adler states that the decision to file an administrative complaint is “a huge step across a vast desert — we must grapple with how to deal with these massive third-party platforms more efficiently, and how best to protect the American consumers who rely on them.” According to The Washington Post, CPSC issued the administrative complaint “after months of behind-the-scenes negotiations between regulators and Amazon as the agency tried to persuade the company to follow the CPSC’s rules for getting dangerous products off the market, according to a senior agency official who spoke on the condition of anonymity to comment on internal discussions.” This same official stated that “Amazon officials refused to acknowledge that the CPSC has the authority to compel the company to remove unsafe products.”
As reported in our February 16, 2018, blog item, “EPA Settles with Amazon on Distribution of Unregistered Pesticides,” the U.S. Environmental Protection Agency (EPA) and Amazon entered into a Consent Agreement and Final Order (CAFO) whereby Amazon agreed to pay $1,215,700 in civil penalties for approximately 4,000 alleged violations under Section 3 of the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) for the distribution of unregistered pesticide products. EPA later issued stop sale, use, or removal orders (SSURO) to Amazon and eBay for selling certain pesticide products that EPA claims are unregistered, misbranded, or restricted-use pesticides, and pesticide devices that EPA asserts make false or misleading claims. More information on the SSURO is available in our June 17, 2020, blog item, “EPA Issues Stop Sale, Use, or Removal Orders to Amazon and eBay for Unregistered and Misbranded Pesticides and Devices, Including Products with Claims Related to COVID-19.”
As reported in our October 9, 2020, blog item, Representatives Frank Pallone, Jr. (D-NJ), Chair of the House Committee on Energy and Commerce, and Jan Schakowsky (D-IL), Chair of the House Energy and Commerce Subcommittee on Consumer Protection and Commerce, requested that Amazon Chief Executive Officer (CEO) and Chair Jeff Bezos launch an investigation into the safety of Amazon’s product line, AmazonBasics, and answer a series of questions pertaining to the company’s product safety and recall practices. The Committee’s October 7, 2020, press release notes that the request comes after a CNN investigation found that many of AmazonBasics’ electronic products “have exploded, caught fire, sparked, melted, or otherwise created hazardous situations at rates well above comparable products.” According to the press release, many of these products were never recalled and continue to be sold.
CPSC’s administrative complaint is just the latest indication of the pressure on Amazon to ensure the safety of the products the platform hosts. These federal agency and Congressional efforts will almost certainly cause more pressure on product manufacturers to ensure the products they offer for sale on Amazon are compliant with the relevant regulations.
Article By Lynn L. Bergeson, Lisa M. Campbell and Carla N. Hutton at Bergeson & Campbell, P.C. For more CPSC news, see the Consumer Protection section of the National Law Review.
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]]>The post It is Not Just Auto, Supply Chains are Stressed appeared first on The National Law Forum.
]]>We will not reiterate the known problems with microchips in the auto industry because if you read this blog, you surely are aware of them. But there are shortages in other components as well. The basics are hard to find. For example, steel shortages impact not just auto, but many other industries. The same is true with plastics, which are in short supply for autos and other companies. While not auto, even lumber prices are rising due to a lack of supply. The list could go on and on.
Will anything change? Maybe. Some of this is due to the focus on reducing cost through reducing inventory of parts to as close to zero as possible. Some of this is due to the same focus that results in sole-sourced, just-in-time supply chain management. It is possible that these shocks to the supply chain will cause companies and supply chain managers to want to pull their supply closer to their manufacturing facilities and to use more than one supplier, with some inventory in reserve as a protection against disruption.
But the current shocks are so deep, so wide, and so persistent that this is just as likely to be seen as a one-time event. A perfect storm from which there is little or no escape. When an auto company is unable to get steel, plastics, microchips and other key components all at the same time, the fact is that production is going to slow industry wide.
As lawyers, we routinely assist companies with one-off shocks to their supply chain through preparation, negotiation and as a last resort, litigation. But those tend to be between one buyer and one supplier over one discrete issue. Those disputes offer lessons in contracting, inventory, diversification and supply chain management. Once in a lifetime pandemics along with hundred year storms and the various shocks to the economic and supply chain system that have been well documented since March 2020 offer less opportunity to identify discrete, or even systemic, issues for a company to address and change.
© 2021 Foley & Lardner LLP
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