On Monday, the FTC Commissioners issued an opinion and Final Order, finding that ECM BioFilms, Inc. (“ECM”) made false, misleading, and unsubstantiated environmental claims about its chemical additive product. According to the FTC’s Complaint filed in October 2013, ECM’s advertisements and marketing materials claimed its product would cause plastics using its additive to: (i) biodegrade in a landfill within nine months to five years; and (ii) make the product biodegradable. The Complaint also alleged that ECM made deceptive establishment claims and that ECM provided the means and instrumentalities to its customers to make deceptive statements to consumers about finished products. We’ve written previously about similar challenges to biodegradability. What makes this opinion notable is the disagreement among the Commission about what claims can be inferred from an unqualified claim that a product is biodegradable, the reliability of a relatively new survey methodology, and what the “significant minority” language in the FTC’s Policy Statement on Deception (the “Deception Statement”) means in the context of extrinsic evidence.
In its opinion, the Commission affirmed Chief Administrative Law Judge D. Michael Chappell’s Initial Decision that ECM made deceptive biodegradability claims that plastics treated with its additive will completely biodegrade within nine months to five years and that ECM encouraged its customers to pass on these deceptive claims to consumers. However, upon its own examination of the evidence, the Commission reversed the ALJ and held that ECM also made implied claims that were false and unsubstantiated regarding how plastics treated with ECM’s product will biodegrade within a reasonably short period of time, or within one to five years by making a general biodegradability claim. The ALJ had found that the FTC failed to produce sufficient extrinsic evidence that ECM’s marketing made such implied claims. Continue Reading Consensus Among FTC Commissioners on Green Claims Appears To Be Biodegrading