How To Avoid Product Liability!
The California Department of Public Health (CDPH) determined that some of the American Licorice Company’s black licorice candy manufactured in 2012 contained quantities of lead significantly in excess of permissible levels, and ordered a recall. American Licorice Company later performed an investigation into the adulterations of its candy, and concluded that the excess lead originated in molasses purchased from Total Sweetness, Inc; it then moved to sue Total Sweetness. American Licorice Company is the candy company that manufactures the popular Red Vines®.
In another case, this past spring, a decision came down through the Northern District Court of San Francisco* against the Safeway grocery chain that posed the question of whether Safeway had a duty to issue a post-sale warning to its “Club Card” loyalty members when the Food and Drug Administration issued Class I Recalls. Class I recalls are implemented when there is a reasonable probability that the use of the product will cause serious, adverse health consequences or death. The question for Safeway was whether failing to issue a post-sale warning constituted negligence—where California law imposes a general duty of care.
Cases like these cause me deep concern for what I see as a significant problem when it comes to the manufacturing and retail distribution of marijuana-infused products and edibles sold in medical marijuana dispensaries (in California called “collectives” or “cooperatives”).
If a product is found to be “abnormally dangerous” or “unsafe,” there are a number of legal theories potential plaintiffs could use as grounds to sue infused-products manufacturers and dispensary retailers, I will refer to these theories as “product liability.” Product liability is where the manufacturer or the retailer can be found legally liable if a product is found to be unsafe. Potential plaintiffs include customers, patients, and any foreseeable third party who consumes the product. The focus of this article is the duty to test and to give post-sale warnings in the event flowers, products, or edibles are tested and found to be unsafe.
An unsafe product in the cannabis industry can, among other things, be a product that has a substance in it or on it that is unsafe for human consumption. For example, in a conversation I had with Dr. Jeffrey C. Raber, CEO of Werc Shop testing laboratory, I learned that it is not uncommon to find cannabis flowers or edible products contaminated after doing lab tests. According to Dr. Raber, flowers and concentrates can be tested for cannabinoids, terpenes, pesticides and microbiologic growth, and edibles and infused products can be tested for cannabinoids and microbiologic growth. Dr. Raber believes that some dispensaries and edible manufacturers do not test the flowers they use because of the added cost, but contaminated products can be unsafe.
According to the Unites States Environmental Protection Agency website, the health effects of pesticides depend on the type of pesticide. Some, such as the organophosphates and carbamates, affect the nervous system. Others may irritate the skin or eyes. Some pesticides may be carcinogenic. Others may affect the body’s hormonal or endocrine systems. Unscrupulous growers may have only one goal in mind—harvest at any cost. We cannot allow folks to come to our dispensaries and sell us untested product!
An unsafe infused product could be one where the flowers were treated with dangerous pesticides in the garden. This is why I believe a best business practice is to ensure that flowers sold in a dispensary be tested before being sold to medical marijuana patients. As a Lawyer in this industry, I believe the dispensary owner has a duty to ensure products being sold in the dispensary are properly tested. Most of us know that this is an unregulated area in most states, and, for the most part, products are not tested. Said another way, without regulation or a law that says one has to test, people don’t test. Notwithstanding a law printed in black and white, one could be found negligent by failing to test. This is because it is foreseeable that flowers could have been treated with dangerous pesticides in the garden.
The next issue is the “standard in the industry” for testing. The standard in most states is not to require testing, because the lawmakers are not necessarily privy to what can happen in a grow room or garden. However, in the event one was sued for product liability (and both the product manufacturer and the retailer could be), the standard unquestionably would be the new high mark of testing regulations and requirements posed by Colorado and Washington’s cannabis industries. Experts from these states would be called to testify to what the understood standard for safety is in the industry. Therefore, a duty to test flowers is the standard for flowers, and any infused product should be tested for microbials. Additionally, where appropriate, the THC levels also should be tested and placed on the label of the product.
Duty to Recall
Next, is there a duty to recall products and give notice to dispensary member patients if it is learned that flowers or an infused product failed testing? Most medical marijuana dispensaries have contact information or a patient database. A jury could very well find a manufacturer or a dispensary retailer is negligent for failing to recall or failing to send a post-sale recall notice to patients they reasonably knew could have ingested (or may ingest) an unsafe product. Most people would say that if a manufacturer’s product is found to be unsafe, that manufacturer should contact every dispensary to whom it has sold a defective batch of product and inform them of the problem. In the same way, many would say a dispensary owner who has contact information for its customers should contact them in the event a product is found to be unsafe.
Therefore, I urge edible manufacturers and dispensary owners to insist on properly tested products by a reputable testing laboratory. Insist on the testing of every batch of flowers, concentrates or any infused product. Let the day of purchasing or distributing untested product be a thing of the past. You will gain the respect of your patients and customers when they know you have tested your products, and the additional cost to avoid potential product liability is well worth it.
*Maclean vs Safeway 2014 U.S. Dist. LEXIS 48591 The Werc Shop: www.TheWercShop.com