Federal Trade Commission and Biodegradability

The Federal Trade Commissioners have 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.  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 previous opinion issued by the Administrative Law Judge 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.  In the final order the FTC forbade ECM BioFilms from making unqualified biodegradable claims for plastics that would not break down within five years of customary disposal.  Although the order does not amend the Green Guides, it may signal that FTC enforcement officials will be somewhat less likely to apply the one-year standard going forward.