New Proposition 65 warning requirements applicable to cannabis and CBD products took effect on January 3, 2021, after a one-year enforcement grace period. Companies who manufacture, distribute, or sell at retail THC products in California – including CBD products made with industrial hemp – are now required to warn consumers that exposure to THC is known to the state of California to cause reproductive harm. As we discussed in a prior publication, this change in the law brings a wider range of cannabis and CBD products into the scope of Proposition 65, and companies that manufacture or sell cannabis or CBD products will need to reevaluate their label warnings or risk potentially costly litigation from an aggressive plaintiffs’ bar.
California’s Safe Drinking Water and Toxic Enforcement Act of 1986, known commonly as “Prop 65,” is a state law that requires labeling of products that contain chemicals the state has designated as being known to cause cancer, birth defects, or other reproductive harm. On January 3, 2020, the state listed both cannabis (marijuana) smoke and delta-9-tetrahydrocannabinol (THC) as reproductive toxins under Proposition 65. The one-year grace period initially offered to come into compliance with the new requirements expired on January 3, 2021.
The effect of the change in the law is to require Prop 65 warnings on some products that did not previously require them (edibles, for example), and additional Prop 65 warnings on some products that already contain them (e.g., smokeable products). The listing does not include a safe harbor limit, meaning that products with any detectable level of THC – including, for example, CBD products that contain less than 0.3% THC in conformance with federal law – will require Prop 65 warning labels. As a result, products made or infused with cannabis or CBD must be labeled in accordance with Prop 65.
Prop 65’s warning requirements apply to any business in the chain of distribution, including manufacturers, distributors, and retailers (including out-of-state companies selling products in California). Companies that sell cannabis or CBD products in California can take advantage of the safe harbor provisions of Prop 65 and avoid potential litigation by providing warnings that satisfy the complex and specific requirements of the regulation. It will be important for these companies to consult with experienced regulatory counsel prior to creating packaging or labeling to ensure that they comply with Prop 65 and other labeling requirements promulgated by the California Department of Public Health (“CDPH”).
THC products sold without warnings (or with warnings that do not satisfy the regulation) can expose sellers to Prop 65 enforcement actions brought by government agencies or individuals. Prop 65 allows the state to pursue enforcement actions or violations, and fines can be substantial – up to $2,500 per day per violation. In practice, however, Prop 65 is “enforced” primarily by an aggressive plaintiffs’ bar (seeking quick settlements) that often targets groups of products by filing citizen suits immediately after the waiting period on a newly-listed chemical expires.
Foley has extensive experience with both Prop 65 and cannabis/CBD products, including review of product packaging, labels, and warnings, as well as review and drafting contracts to allocate Prop 65 liability across the supply chain to optimize protection for your business. Our strategic approach to the provision of warnings, if necessary, is compliant with the regulation, is cost-effective, and is less burdensome than the traditional approach.