Bpi Environmental, Inc

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IN THE MATTER OF BPI ENVIRONMENTAL, INC.

CONSENT ORDER, ETC., IN REGARD TO ALLEGED VIOLATION OF SEe. 5 OF THE FEDERAL TRADE COMMISSION ACT Docket C-3535. Complaint, Oct. 17, 1994--Decision, Oct. , 1994 This consent order prohibits, among other things, a Massachusetts-based corporation from making unsubstantiated degradability claims for its plastic grocery bags or any of its plastic products in the future. The order also requires the respondent to possess competent and reliable evidence to substantiate claims regarding any environmental benefit of its plastic products. Appearances For the Commission: Gary S. Cooper- For the respondent: Dennis N. Caulfeld, President, North Dighton, MA.

COMPLAINT The Federal Trade Commssion, having reason to believe that BPI Environmental, Inc. , successor to Beresford Packaging, Inc. , a corporation, hereinafter sometimes referred to as respondent, has violated the provisions of the Federal Trade Commission Act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, alleges: PARAGRAPH I. Respondent BPI Environmental, Inc. ("BPI" is a Delaware corporation with its office and principal place of business located at 155 Myles Standish Boulevard, Taunton Massachusetts.

Beresford Packaging, Inc. ("Beresford") was a Massachusetts corporation with its office and principal place of business located at 155 Myles Standish Boulevard, Taunton, Massachusetts. On or about August 2, 1990, Beresford was merged into BPI, at which time the separate corporate existence of Beresford ceased and BPI became the surviving corporation. BPI, as the successor in merger to Beresford, is the legal successor to Beresford and is responsible for the acts or practices of Beresford alleged herein. BPI ENVIRONMENTAL, INe. 931 Complaint PAR. 2. Respondent has advertised, offered for sale, sold, and distributed throughout the United States plastic grocery bags or sacks containing cornstarch additives under such trade names as "BIO- SAC " and plastic grocery bags or sacks containing ultra-violet radiation enhancing additives under such trade names as "PHOTO-SAC." PAR. 3. The acts or practices of respondent alleged in this complaint constitute the maintenance of a substantial course of trade in or affecting commerce, as "commerce" is defined in the Federal Trade Commission Act.

PAR. 4. Respondent, through the sale of its plastic grocery bags or sacks to third party purchasers, has caused plastic grocery bags or sacks containing product labeling, including, but not necessarily limited to the attached Exhibit A, to be distributed to consumers throughout the United States. In the course and conduct of its business, and for the purpose of promoting the sale or distribution of its plastic grocery bags or sacks, respondent has also disseminated or caused to be disseminated to purchasers of its plastic grocery bags or sacks various advertisements and promotional materials, including, but not necessarily limited to the attached Exhibit B. PAR. 5. The product labeling, referred to in paragraph four above, an example of which is attached hereto as Exhibit A, contains among others, the following statements or claims concerning respondent s BIO-SAC plastic grocery sack: a. "BIO-DEGRADABLE" (In large, bold typefaceJ b. "TOT ALLY BIO-DEGRADABLE"

c. "DECOMPOSES WITHOUT SUNLIGHT"

d. "ENVIRONMENTALLY SAFE IN LANDFILLS AND INCINERA- TION"

PAR. 6. The advertisements or promotional materials, referred to in paragraph four above, an example of which is attached hereto as Exhibit B, contain, among others, the following statements or claims concerning respondent s BIO-SAC plastic grocery sack: a. "BIO-SAC IS SAFE FOR THE ENVIRONMENT" (In large typeface) b. "Cornstarch additives in the sack are attacked by micro-organisms which ultimately results in complete degradation of the plastic. c. "BIO-SAC will completely disappear when buried in landfills in 3 to 6 years d. "BIO-SAC decomposes in the environment without sunlight, naturally Complaint 118 FTC. PAR. 7. Through the use of the statements and claims referred to in paragraphs five and six above, and others not specifically set forth herein, respondent has represented, directly or by implication, that compared to untreated plastic grocery sacks, respondent s BIO-SAC plastic grocery sacks offer a significant environmental benefit when consumers dispose of them as trash.

PAR. 8. Through the use of the statements and claims referred to in paragraph six above, and others not specifically set forth herein respondent has represented, directly or by implication, that respondent s BIO-SAC plastic grocery sacks will completely break down decompose, and return to nature within 3 to 6 years when buried in landfills.

PAR. 9. The product labeling referred to in paragraph four above, contains, among others, the following statements or claims concerning respondent s PHOTO-SAC plastic grocery sack: a. "DEGRADABLE"

b. "LANDFILL-SAFE"

PAR. 10. Through the use of the statements and claims referred to in paragraph nine above, and others not specifically set forth here- , respondent has represented, directly or by implication, that: a. Compared to untreated plastic grocery sacks, respondent PHOTO-SAC plastic grocery sacks offer a significant environmental benefit when consumers dispose of them as trash. b. Respondent s PHOTO-SAC plastic grocery sacks wil completely break down, decompose, and return to nature in a reasonably short period of time after consumers dispose of them as trash.

PAR. II. Through the use of the statements and claims and the representations referred to in paragraphs five, six, seven, eight, nine and ten above, and others not specifically set forth herein, respondent has represented, directly or by implication, that at the time the representations set forth in paragraphs seven, eight and ten above were made respondent possessed and relied upon a reasonable basis for such representations- PAR. 12. In truth and in fact, at the time the representations set forth in paragraphs seven, eight, and ten above were made, respon- BPI ENVIRONMENTAL, INe. 933 930 Complaint dent did not possess and rely upon a reasonable basis for such representations. Therefore, the representation set forth in paragraph eleven above was, and is, false and misleading. PAR 13. Respondent s dissemination of the false and misleading representations as alleged in this complaint, and the placement in the hands of others of the means and instrumentalities by and through which others may have used said false and misleading representations, constitute unfair or deceptive acts or practices in or affecting commerce and false advertisements in violation of Section 5(a) of the Federal Trade Commission Act.

\.. . ,..... Complaint 118 F.TC. EXHIBIT A XhlB!T A LABELING ON BIa-SAC PLASTIC SACK . beresford packaging inc.

. 155 myles standish blvd.

taunton, massachusetts 02780 Tel. ISO!) 624-8636 FAXjS08182HB72 IN MAS. IBOOj 6'1-690 OUTSIDE MASS. !B(CJ 628.,206 We care about our envinment . roALLY BJO- DEGRADABLE. DJ.COMPOSES WITHOUT SUNLIGHT. NON WXIC . ENVIRONMENTALLY SAFE IN lADFILlB AND INCINERAION.

BIO-DEGRADABLE 810- DEGRADABLE 610- DEGLR,J\Dl\.BLF J310-DEGRADABLJ ADM -!':Z:! BPI ENVIRONMENTAL, INe. 935 Complaint EXHIBITB EX!-:BIT 3 PRO,"10TIO';A:' LITERt.TLJRE BIO-SAC IS SAFE FOR THE ENVIRONMENT.

Cornstarch additives in the sack are attacked by microorganisms which ultimately results in complete degradation of the plastic. Therefore:

BIO-SAC'. will completely disappear when buried in landfills in 3 to 6 years.

BIO-SAC" decomposes in the envirrJnmenl without sunlight, naturally.

BIO-SAC'. is p,cten with only water based inks. BIO-SAC'. leaves no toxic or harsh chemicals to harm the environment.

BIO-SAC'. IS Incinerator safe.

BIO-SAC'. is recyclable.

BIO-SAC'. is non- leaching in landfills BIO-SAC'. is available only from:

Bereslord Packaging Inc.

155 Myles Standish Blvd.

Taunton, Massachusetts 02780 Tel. (508) 824-8636 FAX (508) 822-6872 Oftle' No BPI- BIO.Q01 Decisiun and Order 118 F.T. DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondent named in the caption hereof, and the respondent having been furnished thereafter with a copy of a draft complaint which the Boston Regional Office proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondent with violation of the Federal Trade Commission Act The respondent and counsel for the Commssion having thereafter executed an agreement containing a consent order, an admission by the respondent of all the jurisdictional facts set forth in the aforesaid draft complaint, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondent that the law has been violated as alleged in such complaint, and waivers and other provisions as required by the Commission s Rules; and The Commission, having thereafter considered the matter and determined that it had reason to believe that the respondent has violated the Act, and that complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record for a period of sixty (60) days, and having duly considered the comments filed thereafter by interested persons pursuant to Section 2.34 of its Rules, and having duly considered the recommendations of its staff to modify the consent agreement pursuant to the comments received and the supplemental letter agreement executed by the respondent counsel, now in further conformty with the procedure prescribed in Section 2.34 of its Rules, the Commission hereby makes the following jurisdictional findings and enters the following order: I. Respondent BPI Environmental, Inc. ("BPI") is a Delaware corporation with its office and principal place of business located at 155 Myles Standish Boulevard, Taunton, Massachusetts. Beresford Packaging, Inc. ("Beresford") was a Massachusetts corporation with its office and principal place of business located at 155 Myles Standish Boulevard, Taunton, Massachusetts. On or about August 2 1990, Beresford was merged into BPI, at which time the separate corporate existence of Beresford ceased and BPI became the surviving BPI ENVIRONMENTAL, INe. 937 Decision and Order corporation. BPI, as the successor in merger to Beresford, is the legal successor to Beresford- 2. The Federal Trade Commssion has jurisdiction of the subject matter of this proceeding and of the respondent and the proceeding is in the public interest.

ORDER DEFINITION For purposes of this order, the following definition shall apply: BPI Environmental plastic product means any product or product packaging composed of plastic, in whole or in part, including but not limited to plastic grocery bags or sacks, plastic T-shirt bags or sacks, plastic produce bags or sacks, and plastic bakery bags or sacks that is offered for sale, sold, or distributed by respondent, its successors and assigns, or that is distributed to the public by any other person, corporation or third party who has purchased said plastic product from respondent, its successors and assigns, under the "Blo- SAC" or "PHOTO-SAC" brand names or any other brand name of respondent, its successors and assigns; and also means any plastic product that is sold or distributed to the public by third parties under private labeling agreements with respondent, its successors and assigns.

It is ordered That respondent BPI Environmental, Inc. , a corporation, its successors and assigns, and its officers, representatives, agents, and employees, directly or through any corporation subsidiary, division, or other device, in connection with the advertising, labeling, offering for sale, sale, or distribution of any BPI Environmental plastic product, in or affecting commerce, as "commerce is defined in the Federal Trade Commission Act, do forthwith cease and desist from representing, directly or by implication, by word or depiction:

(I) That any such plastic product is "degradable biodegradable " or "photodegradable; or Decision and Order 118 F.TC. (2) Through the use of such terms as "degradable biodegradable photodegradable " or any other substantially similar term or expression, that the degradability of any such plastic product offers any environmental benefits when disposed of as trash in a sanitary landfill, or when incinerated unless at the time of making such representation, respondent possesses and relies upon a reasonable basis for such representation consisting of competent and reliable scientific evidence that substantiates such representation. For purposes of this order, competent and reliable scientific evidence shall mean tests, analyses, research, studies, or other evidence based on the expertise of professionals in the relevant area, that has been conducted and evaluated in an objective manner by persons qualified to do so, using procedures generally accepted in the profession to yield accurate and reliable results. II.

It isfurther ordered, That respondent BPI Environmental, Inc. , a corporation, its successors and assigns, and its offcers, representatives, agents, and employees, directly or through any corporation subsidiary, division, or other device, in connection with the advertising, labeling, offering for sale, sale, or distribution of any BPI Environmental plastic product, in or affecting commerce, as "commerce is defined in the Federal Trade Commission Act, do forthwith cease and desist from representing, directly or by implication, by word or depiction, that any such product offers any environmental benefit unless at the time of making such representation, respondent possesses and relies upon competent and reliable evidence, which when appropriate must be competent and reliable scientific evidence that substantiates such representation.

It is further ordered That, for a period of three (3) years from the date that any representation covered by this order is last disseminated, respondent shall maintain and upon request make available to the Commission for inspection and copying: BPI ENVIRONMENTAL. INe. 939 Decision and Order A. All materials that were relied upon to substantiate such representation; and B. All test reports, studies, surveys, demonstrations or other evidence in respondent s possession or control, that contradict, qualify, or call into question such representation or the basis relied upon for such representation.

IV.

It is further ordered That respondent shall distribute a copy of this order within sixty (60) days after service of this order upon them to each of its operating divisions and to each of its officers, agents representatives, or employees engaged in the preparation of labeling or the preparation or placement of advertisements or other such sales or promotional materials covered by this order. It is further ordered That respondent shall notify the Commssion at least thirty (30) days prior to any proposed change in the corporation such as a dissolution, assignment, or sale resulting in the emergence of a successor corporation, the creation or dissolution of subsidiaries, or any other change in the corporation which may affect compliance obligations under this order.

VI.

It isfurther ordered That respondent shall, within sixty (60) days after service of this order upon it, and at such other times as the inCommission may require, file with the Commission a report, writing, setting forth in detail the manner and form in which it has complied with this order.

Commissioner Varney not participating.

Complaint 118 F.