The United States District Court for the Southern District of New York has unequivocally reversed the Consumer Product Safety Commission's (CPSC) opinion regarding the non-retroactive application of the phthalate ban. According to the SGMA, the court ruled that the Phthalate provisions clearly apply to existing inventory and the Commission's opinion to the contrary must be set aside.


 


SGMA said today's decision has a dramatic impact on affected products in that the ban becomes effective next Tuesday, Feb. 10, 2009 and all non-compliant phthalate inventory will have to be removed from store shelves and cannot be re-sold or exported.  This decision applies to children's toys and child care articles that contain phthalates. Products not defined as toys or child care articles are not impacted by this decision.


 


“SGMA is disappointed in the Court's decision.  Manufacturers who had been told by the CPSC – the U.S. government agency responsible for consumer product regulation – that the ban would apply only to products made after Feb. 9, 2009, made business decisions to comply accordingly.  The decision to impose such a drastic change at this late date will cause serious harm to many companies,” Bill Sells, SGMA's vice president for government relations   


 


On Nov. 17, 2008, the CPSC issued an advisory opinion stating that the phthalate limits in Section 108 of the Consumer Product Safety Improvement Act (CPSIA) do not apply to products manufactured prior to Feb. 10, 2009, and therefore the ban would not be applied retroactively.  However, the CPSC's interpretation of the phthalate prohibitions received immediate criticism from members of Congress, state Attorney Generals and environmental & consumer advocacy groups.


 


On Dec. 4, 2008, two groups, the National Resources Defense Council, Inc. (NRDC) and Public Citizen, Inc. (PC) filed a lawsuit in against the CPSC in the United States District Court for the Southern District of New York.   The NRDC and PC asked the Court to set aside the opinion of the CPSC and declare that the phthalate provisions become retroactive.  In today's decision the Court ruled in favor of the plaintiffs and rejected the CPSC position.


 


The Court stated that Section 108 of the CPSIA forbids the continued sale and distribution of products that violate the ban, whether in inventory or otherwise.  The Court, with great detail, cataloged the faults in the CPSC's opinion letter and explained why Section 108 applies to existing inventory.  The Court found that the language and the structure of the CPSIA unambiguously states that the phthalate provisions of Section 108 apply to all products offered for sale starting Feb. 10, 2009, including existing inventory.  In addition, the Court found that the statutory purpose and legislative history of the CPSIA also support this conclusion.


 


The bottom line is that the phthalate limits in Section 108 of the CPSIA are now retroactive.  As of Tuesday, Feb. 10, 2009, all non-compliant toys and child care articles must be removed from store shelves and inventory, and destroyed.  These products can no longer be sold, stored or transported out of the country after this date.