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Back to Business: Re-opening Guidance for California Retailers

As states continue to wrestle with when to reopen, California has unveiled a phased-in plan that gives counties control over how quickly to reopen, and provides guidelines specific to each industry. What does this mean for your business? What procedures should you consider implementing? Joined by Rachel Michelin, president of California Retailers Association, presenters will offer a number of best practices and model guidelines to help retailers, not only in California, but across the U.S., protect against the spread of COVID-19 to keep workers and customers safe.

As part of our continuing series of teleconferences on the impacts of COVID-19, presenters will cover the following topics:

  • Creating a worksite specific plan
  • Employee Training
  • Individual control measures and screening
  • Cleaning and disinfecting protocols
  • Physical distancing guidelines

Date Wednesday, May 20, 2020 Time 10:30 a.m. to 11 a.m. PDT 11:30 a.m. to 12 p.m. MDT 12:30 p.m. to 1 p.m. CDT 1:30 p.m. to 2 p.m. EDT

Register

U.S. COVID-19: California Governor Newsom Announces Guidelines for Some Non-Essential Retailers to Reopen

One day before allowing “low-risk” retailers to reopen on a limited basis, California Governor Gavin Newsom on Thursday announced guidelines for certain retailers, manufacturers and other businesses to reopen fully during Stage 2 of the state’s reopening plan.

Even prior to full implementation of these guidelines, retailers perceived as presenting a lower risk of spreading COVID-19 can reopen on a limited basis, such as by offering curbside pickup, as early as today.  As we previously reported, Newsom has stated that such retailers include shops that sell items such as clothing, books, music, toys, sporting goods, and flowers.

At the press conference on Thursday, it was recommended that retailers offering curbside pickup take precautions such as having employees wear masks and gloves, bringing merchandise to a designated pickup location at the entrance or curbside, and encouraging use of payment methods and devices that reduce contact between employees and customers.

Whether non-essential retailers can reopen will also depend on the county and city where they are located. Seven Bay Area shelter-in-place orders have been extended through May 31. Los Angeles County’s order is set to expire May 15. Governor Newsom has stated that local governments have a right to issue and enforce stricter orders than the state, where warranted.

Under the state’s reopening roadmap, prior to reopening, all businesses are expected to:

  • Perform a detailed risk assessment and implement a site-specific protection plan
  • Train employees on how to limit the spread of COVID-19, including how to screen

Year in Review: 2019 Food and Beverage Litigation and Regulatory Roundup

2019 was another active year for new regulatory activity and litigation targeting the food, beverage, and supplement industries.

In this roundup, Bryan Cave Leighton Paisner LLP presents a collection of regulatory developments, key court decisions, and notable settlements that were reached in 2019 and early 2020.

The highlights of this 2019 roundup include:

  • New federal legislation governing food labeling.
  • New regulations and a burst of litigation regarding CBD-based products.
  • An update on slack fill litigation.
  • Notable rulings, trials, and settlements.
  • Prop 65 and food safety update.
  • A preview of areas to watch in 2020.

We will continue our commitment to monitoring and analyzing industry trends in these areas and advising clients on legal and regulatory developments.

 

What Rules Will Govern Claims Relating to CBD in Food, Beverages and Supplements?

Within the last two months, three class action lawsuits have been filed in federal courts against companies that sell ingestible products containing cannabidiol (CBD), a chemical compound found in the cannabis plant, alleging that the products contain significantly less CBD than advertised.  Sellers of other food and supplement products facing this type of claim regarding their non-CBD products’ content have successfully argued that such claims are preempted by the federal Food, Drug and Cosmetic Act (FDCA) and its implementing regulations.  But the Food and Drug Administration (FDA) has not yet approved CBD as an ingestible ingredient, food or dietary supplement.  And while some states have followed the FDA’s lead, other states have legalized sales of ingestible, hemp-derived CBD products.  This can leave food, beverage, and supplement companies confused about what rules apply to CBD as an ingredient in ingestible products.

The first of the three class actions was filed on August 16, 2019, in the United States District Court for the Southern District of Florida.  Plaintiff alleges that defendants operate “JustCBD,” which advertises and labels ingestible products as containing certain amounts of hemp-derived CBD, when they really contain much less.  Plaintiff allegedly tested defendants’ products and found that (1) the “JustCBD honey Liquid Tincture” has only 48.92mg of CBD even though it purports to have 100mg, and (2) the “JustCBD Apple Rings Gummies” contain a non-detectable quantity of CBD even though they purport to contain 250mg of CBD.  Plaintiff claims he relied on representations and warranties regarding the quantity of

Food Suppliers: Understand What Your Contamination and Recall Insurance Policies Cover — Then Plan Accordingly

Last year saw a massive E. coli outbreak linked to romaine lettuce which left growers, packers and retailers struggling to identify root causes and assign liability – all while trying to protect end users from illness and injury.  To address the costs of contamination and recalls, food producers and manufacturers commonly obtain contamination insurance.  However, typical contamination policies cover only those losses incurred due to actual contamination, while arguably providing no coverage for recalls due to potential contamination.  A company that recalled its salads due to a risk that its romaine was contaminated with E. coli faces the likelihood that its insurer will claim the recall costs are not covered under the standard food contamination insurance policies – even though the recall was in the public’s best interest.  Food suppliers should evaluate whether there is a gap in their insurance coverage created by the limited language in certain contamination policies and how best to close that gap, including through specialized recall insurance or contractual protections with their supply chain partners.

Several courts have held that product contamination insurance policies do not cover the costs of recalls issued due to potential contamination.  For example, a California District Court held in the Ruiz Food Products case that a policy that covered “any accidental or unintentional contamination … provided that the use or consumption of the Insured product(s) … [h]as resulted in or would result in [bodily injury]” did not cover a recall issued due to potentially contaminated products.1  In Ruiz, an upstream

California’s Cage-Free Eggs Law Faces Supreme Court Challenge By Other States

Briefing is now complete in a lawsuit filed by more than a dozen states asking the United States Supreme Court to block a California law requiring any eggs sold within the state to come from chickens that have sufficient space to stretch out in their cages.

In the lawsuit, filed directly with the high court in December, Missouri, Iowa and 11 other states allege that “California has single-handedly increased the costs of egg production nationwide by hundreds of millions of dollars each year” due to its stringent regulations prohibiting confinement of egg-laying hens. The complaint contends that California’s requirements violate the Constitution’s interstate commerce clause. The lawsuit also alleges that California’s regulations are preempted by the Egg Products Inspection Act (EPIA), a federal law requiring uniformity of labeling, standards, and other provisions allowing for free movement of eggs and egg products in interstate commerce. To support their claims, plaintiffs rely on a study from an economist concluding that the price of a dozen eggs has increased nationwide between 1.8 percent and 5.1 percent since January 2015 due to California’s requirements.

The controversy arises out of California’s Proposition 2, a 2008 ballot measure that requires the state’s farmers give each egg-laying hen at least 116 square inches of space. Proposition 2 specifically forbids a person in California “from tether[ing] or confin[ing]” certain animals, including egg-laying hens, on a farm, “for all or the majority of any day, in a manner that prevents such animal from: (a) Lying down, standing up, and

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