FTC Takes Landmark Enforcement Actions on Green Guides Violations

A few weeks ago, the Federal Trade Commission (FTC) announced enforcement actions against five companies making deceptive claims for biodegradable plastics, marking the FTC’s first action against biodegradable plastic claims since publishing their recently revised Green Guides. One of these companies, ECM Biofilms, Inc., is a biodegradable additive producer, while the other four, American Plastic Manufacturing, CHAMP, Clear Choice Housewares, Inc., and Carnie Cap, Inc., make and market plastic goods with biodegradable additives.

While each case varies, the FTC’s general assertions are that these companies market their plastics, or additives, as biodegradable in common disposal methods. The FTC found that their products do not degrade within normal disposal parameters, make claims without qualification, and do not have appropriate scientific testing to prove claims. One company in particular, ECM Biofilms, Inc., also used its own “Certificates of Biodegradability of Plastic Products” and provided deceptive marketing materials to distributors.
The FTC also announced an enforcement action against AJM Packaging Corporation, a paper goods company, in violation of a pre-existing 1994 consent order barring them from continued deceptive practices. According to the FTC, the company does not have scientific evidence or substantiation of their claims and as a result, imposed a $450,000 civil penalty for their violation.
The FTC’s enforcement extends to both on-package and off-package marketing claims. These actions bring up two crucial points: are biodegradable additives a sustainable solution and how do companies ensure they make accurate environmental marketing claims?
The FTC requires a product to biodegrade (break down completely and decompose into elements found in nature) within one year in common disposal settings (landfill, litter, or backyard compost) to make an unqualified claim. This has not been the case, as landfills are not designed for biodegradation and the products have failed to show biodegradation in any conditions during the required time frame.
All of this begs the question, are these additives actually a sustainable solution for petroleum based plastics? When they degrade, the environmental investment in the product is lost as recycling or waste to energy are no longer options. Further, when some of these materials are inevitably recycled, they contaminate the recycling stream and risk degrading the performance of the recycled resin.
Biodegradation and environmental marketing are complex issues. The Sustainable Packaging Coalition’s (SPC) previous study on Biodegradation in Landfills and Industry Leadership Committee on Meaningful Marketing Claims hope to clear up confusion and digest the complexity of these issues. The SPC’s How2Recycle Label also works to alleviate confusion around some of these issues by clearly communicating what to do with a package at end of use with clear on-package labeling.
For an easy read on some of the issues with biodegradables and compostables, take a look at a recent Ask Umbra article.