Posternak Blankstein & Lund LLP is now Arent Fox. Read the press release

California Seeks to Turn Up Heat on Cannabis Prop 65 Regulations

With the news media covering the link between marijuana vaping, deaths, and lung conditions, California’s push to add THC to the Proposition 65 harmful chemicals list could mean financial, legal, and reputational challenges for cannabis businesses.

Proposition 65, known as the Safe Drinking Water and Toxic Enforcement Act of 1986, is a California regulation that requires companies to notify consumers about the presence of certain harmful chemicals in consumer products. The Office of Environmental Health Hazard Assessment (OEHHA) publishes and maintains an official list of substances regulated by the law. Proposition 65 requires that the governor revise and republish the list at least once per year. As part of the process for determining whether a chemical should be added to the list, the Developmental and Reproductive Toxicant Identification Committee (DARTIC) of OEHHA’s Science Advisory Board serves as the state’s qualified experts and renders opinions about whether a chemical has been clearly shown to cause reproductive toxicity.

In 2009, “marijuana smoke” was added to the list after state qualified experts determined that marijuana smoke was  shown, through scientifically valid testing according to generally accepted principles, to cause cancer. Thus, currently, all cannabis flower sold in California is already subject to Proposition 65 warnings for cancer since all flower produces “marijuana smoke.” Additionally, other types of cannabis products might already be subject to Proposition 65 due to the presence of  other listed chemicals, such as certain pesticides. On December 11, 2019, DARTIC is scheduled to consider whether cannabis smoke should be further identified as causing reproductive toxicity, and whether Δ-9-tetrahydrocannabinol (THC) should be added to the Proposition 65 list as a reproductive toxicant.

If THC is ultimately added to the Proposition 65 list, even more cannabis-related businesses will be affected by Proposition 65. Once a chemical is listed, an OEHHA committee is tasked with developing a safe harbor level for exposure (in the case of a reproductive toxicant, a Maximum Allowable Dose Level or MADL) in micrograms per day, below which no Proposition 65 warning is required. In the case of cannabis smoke, the safe harbor level would probably be for the inhalation route. However, for THC there would likely be separate levels set for the inhalation route and the oral route (for example, edibles and tinctures). Depending on what priority is assigned to the chemical, the safe harbor development might be fast-tracked or could take years. If OEHHA does not set a safe harbor level for THC, meaning a level of exposure to THC that does not require a Proposition 65 warning, every business that sells a product with even a trace amount of THC — e.g., hemp-derived CBD products — could be affected.

Even CBD products which should contain no THC, but which might contain trace levels that are detectable by various analytical procedures, especially when highly sensitive (and expensive) lab instrumentation is used, could be affected. In the absence of an MADL, bounty hunters could have a field day, claiming that any detectable level of THC warrants a Proposition 65 warning. That would force sellers of CBD products to decide either to add a warning (however undesirable) to their product labeling, or to hire a toxicologist to perform an exposure assessment and derive their own MADL (which could be expensive and challenged by a plaintiff).

If THC is added to the list, businesses that sell products containing THC and even those CBD products which should not contain THC (but might have trace amounts of THC) could face monetary, legal and reputational obstacles. Because Proposition 65 allows private plaintiff “bounty-hunters” to obtain up to $2,500 per day per violation from non-compliant businesses, it is likely that non-compliant businesses will receive Notice of Violations (NOVs) on or shortly after the effective date of the new warning requirements. For example, in the case of Proposition 65 listed pesticides, in May 2017 alone approximately 675 NOVs were issued to marijuana dispensaries and as of July 2017 110 NOVs were issued for failing to warn regarding marijuana smoke.

Additionally, complying with the detailed labeling requirements of Proposition 65 can be confusing, leaving some  businesses  susceptible to NOVs for defective warning labels. Finally, cannabis businesses must carefully balance the reputational risk of labeling for potential health risks from their products, especially given the recent consumer concern surrounding potential health risks associated with vaping.

Arent Fox has extensive experience counseling cannabis businesses on a wide range of regulatory matters and has a leading Proposition 65 team that advises clients on matters ranging from notices of violation through all phases of litigation. The firm frequently provides Proposition 65 training seminars that include practical tips on effective compliance.

Contacts

Continue Reading