Last week, the Commission announced its Opinion and Final Order against Ohio-based ECM BioFilms Inc., finding that the company acted deceptively by making false and unsubstantiated environmental claims about its product, a chemical additive that supposedly would make treated plastics biodegrade in a landfill within nine months to five years or within a reasonably short period of time, as alleged in an administrative complaint announced against ECM in 2013.
In its Opinion, written by Commissioner Terrell McSweeny, the Commission affirmed Chief Administrative Law Judge D. Michael Chappell’s Initial Decision (January 2015) that ECM made deceptive claims that plastics treated with ECM’s additive would completely biodegrade in a landfill within nine months to five years, and that scientific tests supported this claim. The Commission also upheld Judge Chappell’s finding that ECM encouraged its customers—companies that manufacture plastics—to pass on the deceptive claims to their customers and end-users.
However, in that same Initial Decision, Chappell also found that the FTC had failed to prove that ECM’s biodegradability claims implied that ECM Plastics will “completely biodegrade into elements found in nature, in a landfill, within one year.”
“The tests upon which ECM relies constitute competent and reliable evidence demonstrating that ECM Plastics are biodegradable, including in a landfill, and Complaint Counsel have not met their burden of proving that these claims are false or unsubstantiated,” he wrote in January of this year.
According to ECM, its additive attracts microbes and other microorganisms to areas on and within the plastic where the additive, fostering the formation of biofilms near the additive sites. This, said the company, promotes the growth of bacteria that metabolize both the additive and the conventional plastic into which it is integrated. The additive may weaken the carbon-carbon bonds of the plastic, or introduce additional weak points, thereby enabling the microorganisms to break down the high-molecular-weight conventional plastic. Based on this analysis, Judge Chappell found that inclusion of the ECM additive contributed to the acceleration of biodegradation.
Based on its own examination of the evidence, the Federal Trade Commission found that ECM made implied claims that plastic products treated with ECM’s additive will biodegrade in a reasonably short period of time, or within five years, and that these claims were false and unsubstantiated, reversing the finding of the Administrative Law Judge.
In his opinion, Commissioner Terrell McSweeny wrote that: “Other evidence raises troubling questions regarding the purported mechanism of action. While the experts agreed that the ECM Additive is biodegradable and that microorganisms gather and ingest the additive when an ECM Plastic is disposed of, questions remain regarding the subsequent steps. Formation of a biofilm—a key step in ECM’s claimed mechanism of action—is not necessarily an indication of degradation of the plastic …The ALJ accepted that the formation of biofilms resulted in biodegradation of the plastic, but formation of biofilms does not amount to competent scientific evidence that the ECM Additive actually promotes biodegradation of conventional plastics.”
“The seriousness of ECM’s deceptive conduct is evidenced by both the duration and pervasiveness of the biodegradation claims that permeated the company’s marketing efforts,” the Commission found, “and was enhanced by ECM’s customers’ inability to ‘readily judge for themselves the truth or falsity’ of ECM’s claims.”
The Commission’s Final Order, which will terminate in 2035, bars ECM from representing that a plastic product or package is degradable, or that any product or service affects a plastic product’s degradability, unless the representation is true, not misleading, and substantiated by competent and reliable scientific evidence.
In addition, the Final Order requires that for claims relating to degradability of plastic products, ECM must ensure that either: 1) the entire plastic item will completely decompose into elements found in nature within five years after customary disposal; or 2) the claim is clearly and prominently qualified by either the time for complete decomposition or the type of non-customary disposal required and the availability of such disposal facilities. Also, ECM must have competent and reliable evidence to substantiate claims for any environmental benefit.
The Final Order also bars ECM from providing others with the “means and instrumentalities” to make any false, unsubstantiated, or otherwise misleading representations of material fact or environmental benefits; and bars the company from misrepresenting the existence, contents, validity, results, or conclusions of any test, study, or research.
ECM may file a petition for review of the Commission decision with the U.S. Circuit Court of Appeals within 60 days of service of the Final Order.