New York has recently enacted disclosure laws that could impact clean product manufacturers’ ability to protect their trade secret chemical formulations. While California was the first U.S. state to pass a law requiring disclosure of all substances contained in cleaning products, New York’s Department of Environmental Conservation (“DEC”) Household Cleansing Product Information Disclosure Program imposes stricter requirements than California on what must be disclosed.
Both laws require manufactures of cleaning products to disclose all chemicals used in household cleaning products on their websites, and identify any ingredients that appear on authoritative lists of chemicals of concern. However, the New York law also requires manufactures to identify any ingredient that is a nanoscale material.
While both laws have an exemption allowing trade secrets to not be disclosed there are some key differences:
California’s Cleaning Product Right to Know Act of 2017
New York’s Household Cleansing Product Information Disclosure Program
|Disclose all intentionally added ingredients unless it is confidential business information (“CBI”)||Disclose all intentionally added ingredients, including those present in trace quantities, PLUS all ingredients present only as an unintentional consequence of manufacturing and present above trace quantities (0.1%) where the manufacturer knows or should reasonably know of such ingredients, impurities, or contaminants, unless they are withheld as CBI|
|Provide CBI justification only on request for audit by the Attorney General||Provide CBI justification only on request of the DEC for evaluation|
|Penalty: prohibited from selling product||Penalty: prohibited from selling product PLUS an initial fine of up to $2500, and $500 for each additional day of violation|
California’s requirements for manufacturers are a lot clearer than New York’s: the “knew or should have known” standard in New York may make full disclosure more difficult. But in either state, manufacturers are able to protect their trade secret information and withhold it from disclosure. What remains to be seen is how (and if) litigation arises challenging a company’s decision to withhold CBI, what kind of information falls within that scope, and what justification is required to maintain trade secret protection.