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NY Department of Environmental Conservation Household Cleansing Product Information Disclosure Program Ruled “Null and Void”

In a significant victory for industry, on August 27, 2019, the State of New York Supreme Court invalidated the New York Department of Environmental Conservation (NYDEC) Household Cleansing Product Information Disclosure Program (Disclosure Program). Information related to NYDEC’s prior delay of its enforcement of its Disclosure Program is available here, and general information regarding the Program and its extensive requirements for manufacturers of certain consumer cleaning products to disclose information regarding the ingredients in those products is available here.

Two trade associations, the Household and Commercial Cleaning Products Association (HCPA) and the American Cleaning Institute (ACI) (Petitioners), filed the lawsuit last October. Petitioners sought declaratory relief and a judgment invalidating the Disclosure Program on the basis that the Program was a “rule” for which NYDEC did not comply with its State Administrative Procedure Act (SAPA) rulemaking procedures. Petitioners also argued that the Program was established in violation of Article IV Section 8 of the New York State Constitution, was issued in excess of NYDEC’s statutory authority, and was arbitrary and irrational.

In its Decision, the court first rejected NYDEC’s motion that the Petitioners lacked the necessary associational standing to bring the proceeding. The court found that Petitioners had demonstrated that their members would “suffer an injury in fact through the submission of proof indicating that the Disclosure Program will require cleaning product manufacturers to expend significant resources to fundamentally change their business practices in terms of their product testing procedures, website format, and research methods.” The court further found that Petitioners’ members alleged an injury within the zone of interests sought to be protected by alleging that they were deprived of the protections (e.g., opportunity to submit comments, consideration of regulatory impact, and consideration of regulatory flexibility for small businesses) afforded by SAPA.

The court next found that the Disclosure Program was established in violation of SAPA and the NY State Constitution. In making this finding, the court held that the Program was a “rule” as argued by Petitioners and not “guidance” for which adherence to SAPA was not required, as argued by NYDEC. The Decision states:

Here, the Court finds that the Disclosure Program, which dictates a new set of rules governing the types of ingredients that must be disclosed, the manner of their disclosure, and imposes a new requirement mandating that each disclosure be accompanied by a certification of its completeness and accuracy, constitutes a clear rule and not a mere interpretative statement without any legal or binding effect.

The court also found that “since there is no opt out provision whereby petitioners may choose to deviate from the program, the Disclosure Program is not mere guidance.”

The Disclosure Program is thus “null and void and the matter is remitted back to DEC with the directive to comply with SAPA.” Since the decision was reached based on violations of SAPA, the court did not address the other bases upon which Petitioners sought to invalidate the Program. The court also denied requests for intervention and amicus curiae status from certain non-profit organizations because there was “no indication that the representation of the proposed intervenors’ interests could not be adequately protected by the parties to the proceeding.” Finally, the court in the exercise of its discretion stated that it did not deem it appropriate in this case to grant Petitioners’ request for attorney’s fees.

Commentary

The court’s decision is a decisive victory for Petitioners. Although NYDEC has the option to appeal the Decision or ask the legislature to pass a law authorizing the Disclosure Program, it is hoped that NYDEC takes to heart the court’s rebuke of the abuse of process and initiates a rulemaking while working with stakeholders to develop a workable program. This path would present an important opportunity to align NYDEC’s Program with California’s SB 258 that also sets forth ingredient disclosure requirements for certain cleaning products. Implementing a national model for ingredient communications will ultimately benefit industry interested in ensuring compliance and better inform consumers about the information communicated when provided in a consistent manner.

©2019 Bergeson & Campbell, P.C.

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