Center for Environmental Health: Organic Products Need Better Federal Regulation

The United States has some of the strongest laws on the books when it comes to organic food labeling. That’s no surprise, since annual organic food sales in the U.S. are now more than $26 billion, up from $1 billion in 1990, when the United States Department of Agriculture first began regulating the industry. The USDA, which based its laws on California’s earlier Organic Food Act of 1979, sets the national standards when it comes to ensuring that ingredient content in organic products actually match their labels.

Yet, when it comes to the regulation and enforcement of organic cosmetics and personal care products, it’s an entirely different story, says Charles Margulis, who serves as the Communications Director and Food Program Director for the California-based Center for Environmental Health (CEH).

Since 2011, CEH  has filed lawsuits against more than 40 companies that manufacture and distribute personal care products and have been accused of selling products in California under “phony” labels. They are being sued because California, unlike the federal government, has laws on the books that regulate what must be in an organic personal care product. According to the state’s Organics Products Act of 2003, products that use the word “organic” in its name or description must contain at least 70 percent organic ingredients.

But, when it comes to the federal regulation of personal and body care products like shampoo and cosmetics, the rules may seem more round-robin than straight forward.

The USDA regulates the use of the word "organic" through its National Organic Program when it comes to the presence of agricultural-based ingredients. * It provides a definition of "organic" in regard to those ingredients, and it will certify products that meet certain content and labeling specifications in relation to those ingredients. But it doesn't regulate cosmetics per se. According to the FDA, that’s the Food and Drug Administration’s job, which doesn’t define what either "organic" or "natural" means.

The end result, says Margulis, is what CEH found when it started checking the shelves of local California retailers that sold organic products: a glut of nationally distributed products that were labeled by their manufacturers as organic, but fell way short of the California Organic Production Act’s (COPA) requirement.

“It’s a wide problem,” said Margulis in a recent interview, who admits that conflict between California’s carefully tailored COPA 2003 and the federal regulatory procedures has existed for some time.

“It’s something that the organic community has been concerned about for at least a decade.”

In June 2011, CEH filed suit against 26 manufacturers for false labeling. Products included some of the biggest names in personal care products, like Kiss My Face, Jason (Hain Inc.), and Organix. Many of the products contained no discernible organic ingredients; others had less than the required 70 percent.

By November of that year, 11 companies had offered to settle. The initial group of settlements was touted as a major victory by organic proponents, and required the companies to either amend their labeling procedures by taking the word “organic” out of its description or to increase the organic ingredients to meet COPA standards.

Since that time, Margulis says, CEH has filed further lawsuits. Approximately 40 companies have settled so far, leaving a relatively small list of companies that have evaded all efforts to settle.

Among the holdouts is Vogue International (formerly Todd Christopher International), which manufactures the Organix brand out of Tampa, Florida. Margulis says Organix presents an interesting example of the dilemma that exists at the heart of these lawsuits. While most of the respondents that settled were able to change the labeling on the packaging to comply with state law, the challenge – and ultimately the expectation -  for Organix was greater.

“They did not want to increase the use of organic (ingredients) and they didn’t want to change their name. We quickly realized that name was a goldmine for this company,” says Margulis.

In fact, a class-action suit filed in October, 2012, by five individuals from California, Washington State, Hawaii and New York against Vogue International and its owner Todd Christopher, suggests that Vogue was aware of this dilemma when it attempted to register Organix through the United States Patent and Trademark Office (USPTO) in 2007. On two separate occasions the lawsuit alleges, the corporation was told by USPTO that its application for Organix would be rejected unless the product “comprised of primarily organic ingredients” and later, that “if applicant uses or intends to use the mark on goods other than those that are organic, such use would be deceptive … Therefore applicant must amend the identification by limiting it to organic goods.” In response, Vogue International submitted the third application with the information amended to reflect “organic” personal care products, and was approved.

“Although Vogue changed the description of the goods to secure USPTO approval of the trademark,” the suit alleges, “Defendants did not change the formulation of the Products. In fact, the Products all contain less than 10 percent of organic ingredients – in most cases, far less.” The suit alleges that Vogue International was aware it was misleading consumers when it marketed the products as organic.

*Although Organix has not changed its name, and continues to market its products nationally, Margulis notes that an agreement was reached last May after Vogue International was ordered by California Supreme Court to stop marketing products in California under the Organix label that did not conform to COPA standards. However, the court denied a motion that would have required Vogue to change the name of its products line (Organix). The court found that "the hardship to Vogue arising from such an  injunction against the Organix trademark outweighed the hardship to CEH arising from a denial during the intervening months before trial."

Multiple attempts were made to reach Todd Christopher, owner, and Bill Rohr, Chief Financial Officer, for comment. Phone calls were not returned.

And while the Organix label may seem like one of the more “egregious” examples of misleading labeling, says Margulis, it isn’t an exception. Other companies have strived to show a link between product name and the wholesome, organic marketing concept – without complying with COPA requirements. Namasté Laboratories’ Organic Root Stimulator may eventually be forced to change the name of its product in order to comply with state law if it doesn’t want to increase the organic percentage in its ingredient list.

Ironically, CEH’s greatest clout in this battle may be California’s own consumer base. The state is not only the largest producer of organic products in the country, but one of the largest when it comes to consumption. And that's why companies like Organix and Namasté may have been willing to risk marketing in a state that imposes more stringent content and labeling requirements than the FDA or USDA require.

Margulis says that even though some 40 companies have already settled, the work isn’t over for CEH staff. There will be more rounds at California drug stores and supermarkets to check on labeling compliance in the fall.

“(We’ll) be asking national supporters outside of Calif. … to shop and look (as well),” says Margulis.

As to the lack of federal regulation of organic cosmetic and personal care products, Margulis says he is hopeful that the government will eventually take action. While lawsuits have helped to highlight the need for regulation, CEH isn’t the only nonprofit organization that has spoken up in recent years. In 2010, the Consumers Union and the Organic Consumers Association filed a petition with the USDA and the Federal Trade Commission alleging “widespread, misleading use of ‘organic’ claims on personal care products” that it said could be addressed under the USDA's own statutory authority.

Consumers want to know that what they see on the label is really what they have purchased.

"Consumers believe they are getting something better because it is organic,” says Margulis.  “They believe they are getting something safer. They believe they are getting something healthier. They believe they are getting something more pure and natural. The word organic connects all of those things and that’s why it’s big business.

“(Our) goal is to make sure that when these companies are using the term organic, that they are maintaining the integrity that consumers expect that the organic industry deserves. If organic becomes meaningless, there is really not anything better to fall back on."

* July 15, 2013 - Additional information added to clarify USDA/FDA regulations in regard to cosmetics and personal care products and Organix's court agreement under California law concerning its marketing in California. This agreement does not address or affect its marketing of products nationally.