Patent Troll Reform Passed out of House

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The Fashion Jewelry & Accessories Trade Association
25 Sea Grass Way, Wickford, RI 02852
Phone (401) 667-0520 Fax (401) 267-9096
www.fjata.org
Newsletter- January, 2014
FJATA Annual Conference
April 9-10, 2014 at Foxwoods
Now is the time to register and then reserve your room for the FJATA Annual Conference at
Foxwoods Casino, April 9-10th, 2014. Invited speakers include a CPSC Commissioner, Len
Morrissey of ASTM International, and the CEO of Alex and Ani, Giovanni Feroce. Sessions
will include compliance and legislative updates, social media marketing B2B, and industry news
with still time to network. We are changing the format with a blend of presentations and more
panel discussions to engage the audience with an interactive experience. Rooms are a very low
$99 per night and bus transportation will be available from NYC to pre-registered attendees.
Please help us serve you by registering early! Register here:
Connecticut Legislative Update: Meetings continued this past month with Rep. Baram, House
Majority Leader Joe Aresimowicz, Deputy Majority Leader Sandy Nafis, Ranking House
Member General Law Committee Rep. Carter, Ranking Senate Member General Law Committee
Senator Witkos, and Senators Doyle, Williams, and Leone. As reported before, we are in a full
court press to educate legislators in Connecticut the benefit of relying on the Children’s Jewelry
Safety Standard to protect children.
The Connecticut limit of 75ppm total cadmium content for children’s products becomes effective
July 1st, 2014 which has put this effort on high alert. It is important that we combat laws that are
not based on current scientific information and the CPSC-supported cadmium testing protocol.
New York:
FJATA has once again filed a Memo in Opposition to A.4822 (Sweeney), a bill that would limit
cadmium in children’s products to 75ppm total content. FJATA had an opportunity to speak
with Assy. Steve Englebright, off the floor of the Assembly Chamber and was asked what he
thought our best course of action is with respect to moving A.5970-A (Englebright) in the
Assembly during this Session. He suggested that he broker a meeting with Assy. Bob Sweeney
and FJATA. Assy. Englebright agreed and we will arrange some Albany meetings in February.
FJATA also spoke to Joe Erdman in Sen. Mark Grisanti's office, about requesting S.3947-A
(Grisanti) out of the Senate Health Committee, in order to get the bill moving and re-pass it in
the Senate as early as possible. Joe reported that he has already formally requested the bill out of
the Health Committee and will follow-up with Kristin Sinclair, Senate Health Committee
Director and with the Chair, Sen. Kemp Hannon as well.
Rhode Island H.7157:
The RI Comprehensive Children’s Jewelry Safety Act currently requires jewelry manufactured
in the state to meet the specifications of ASTM F2923-11. Last year, H.5423, a bill that replaced
the word “manufactured” with “sold” in RI, that captures the original intent of the bill, passed
both houses in a last minute frenzy of activity involving dozens of stakeholders supporting the
bill. Unfortunately the separate bills were not a “same as” and because the Senate version
changed the word “act” to “section” the bill never went to the Governor for signing. Senator
Sheehan and Rep. Craven are our bill sponsors this year and we expect passage to be completed.
Washington State Legislative Update:
After making significant progress with Washington State Ecology and the WA
Department of Health the existence of a competing bill, HB 1294 (CSPA) reduces
the chance for success of a Rhode Island-type bill recognizing the provisions of
ASTM 2923-11. We have stopped HB 1294 three years in a row in the Senate
and amended the bill to only ban TCEP and TDCPP in the Senate last session.
The links are provided below:
http://apps.leg.wa.gov/billinfo/summary.aspx?bill=1294&year=2013
http://dlr.leg.wa.gov/rollcall/rollcall.aspx?bienid=22&legnum=1294
Legislative counsel in Washington State advises that the short legislative schedule this year
combined with the momentum of HB 1294, combined with this being an election year would
make passage of an FJATA supported bill unlikely. Rather than burn our relationships on an
unsuccessful effort we have decided to wait until the 2015 legislative year to introduce and
promote our science based cadmium protocol allowing a migration option, stated to be the only
way to correctly assess risk by the CPSC.
California Adds DINP to Prop 65 List:
The California Office of Environmental Health Hazard Assessment
(OEHHA) added disononyl phthalate (DINP) to its Prop 65 list. The
Carcinogen Identification Committee (CIC) was ultimately responsible for
the decision. DINP may have been frequently used as a non-regulated
alternative after BBP was declared a developmental toxicant in 2005.
DEHP, DIDP, DnHP, and DBP are also included on the Prop 65 list, which means that, if a listed
chemical is used, a warning must appear with the product. DINP is a found in synthetic leather,
gloves, footwear, some adhesives and surface coatings, among other things.
The American Chemistry Council (ACC) opposed the decision, as did several large corporations,
such as Exxon Mobil and BASF, and FJATA likewise opposes the decision. Together, the
message of opponents to the listing was that DINP was not shown to be a health hazard
according to the complete set of studies; although the studies used by the CA CIC did show
probable carcinogenicity. In a press release, the ACC writes:
"The CIC’s decision to list DINP as a Prop 65 ‘carcinogen’ is contrary to the weight of
evidence demonstrating that DINP does not cause cancer in humans. The animal data
summaries cited by the CIC in the Prop 65 listing are both exaggerated and misleading."
CPSC News & Information:
CPSC Report in the Federal Register: The CPSC public calendar posted
1/14/14, notes that Kristina Hatlelid, Directorate for Health Sciences, and
other CPSC staff attended a meeting of the ASTM subcommittee F15.24 on
jewelry on January 29th to discuss the status and possible updates of the
children's jewelry voluntary standard. Dr. Hatlelid was an important
contributor to the prior work leading up to the ASTM 2923-11, and FJATA is
pleased that she and her colleagues plan to participate in the work of updating
the standard.
CPSC Voluntary Recall Proposed Rulemaking Implications:
CPSC has proposed to impose new obligations on companies proposing to issue voluntary recalls
for consumer products through a new “interpretative” rule. While fortunately there have been
very few recalls of jewelry and accessories, the proposed changes will have a significant adverse
impact on companies seeking to engage in voluntary consumer product recalls. FJATA
disagrees that the proposed rule is merely “interpretive” because it in fact affects concrete rights
and obligations. These substantive proposed changes include making corrective action plans
legally binding, imposing legally binding corporate product safety compliance plan obligations
on companies through the voluntary recall process, and denying a company the right to disclaim
a defect in a manner that could create subsequent liability. FJATA plans to submit comments on
the proposed rule, and also is working with the NAM CPSC Coalition. The Federal Register
notice is available at: http://www.gpo.gov/fdsys/pkg/FR-2013-11-21/pdf/2013-27656.pdf. For
former CPSC Commissioner Nancy Nord's most recent post on the subject, click here:
http://nancynord.net/2014/01/16/the-side-effects-of-tweaking/
CPSC Proposes Revisions to 6(b) Rules Protecting Company Confidentiality:
CPSC staff has proposed a set of amendments to the Commission’s policy on the disclosure of
information related to the safety of specific companies’ products. Under Section 6(b) of the
Consumer Product Safety Act, the CPSC generally must give a company 15 days’ notice before
releasing information about a product that would allow the public to identify the product’s
manufacturer or private labeler. Some elements of the draft amendments would curtail
companies’ ability to correct or refine agency disclosures about them and their products. For
example, under current policy companies can submit comments about proposed disclosures and
have been able to keep such comments confidential. The proposed staff amendments would
require companies to provide a rationale and cite applicable statutory or regulatory bases for the
confidential treatment of those comments to justify nondisclosure. Other provisions of the
proposed amendments are limited to “modernizing” the rule to account for technological
changes, such as generally providing for electronic notice when possible.
The rule, provides critical protection for businesses and an incentive to report possible incidents
to the Commission, has long been criticized by some consumer advocates and agency officials,
including acting Chairman Robert Adler. The Commission is scheduled to be briefed on the
staff’s amendments on Thursday, January 23, 2014, and to vote on the matter in a public meeting
on February 5, 2014. The staff briefing package is available at:
http://www.cpsc.gov//Global/Newsroom/FOIA/CommissionBriefingPackages/2014/NPR%20A
mendmenttoRegulationonInformationDisclosureUnderSection6boftheCPSA.pdf.
Patent Troll Reform Passed out of House:
Patent assertion entities (PAEs) have received much attention in recent
months, both from the media and from state and federal legislative bodies.
Termed "patent trolls", PAEs make oncome turning otherwise productive
companies into ATMs. According to an article from Venable LLP,
patents asserted by non-originating entities has grown from 30% to 70% in the last 10 years.
In December, Congress acted by passing the "Innovation Act", a bill that will make the task of
assertion more difficult through a variety of mechanisms. The Patent Transparency and
Improvements Act of 2013 (S. 1730), the Patent Litigation Integrity Act of 2013 (S. 1612), the
Patent Abuse Reduction Act (S. 1013), and the Patent Quality Improvement Act (S. 866), all are
U.S. Senate bills in progress this year. S. 1612 may feature the most effective method for
controlling frivolous assertions: stipulating that the assertion entity secure financing for an
amount sufficient to cover both parties' legal expenses in the event of a loss, except in special
circumstances. For a concise summary of the federal activity, see the Venable LLP article here.
CBP and the New Bipartisan Budget Act
The new U.S. budget includes some sequester relief, corresponding cuts, puts discretionary
spending at just over $1 trillion, and extends the current customs user fees rates through
9/30/2023. The rates were scheduled to revert in October of 2021 to levels that only allowed
fees in amounts that would cover costs associated with providing customs services. The addition
to the sunset provision timeline is projected to add $6.8 billion in budget offset dollars for the
sequester relief. It also has some worried that the Generalized System of Preferences (GSP)
renewal may not receive support because the usual method of compensating for GSP duty losses
is by increasing customs user fees. With the user fee increases already accounted for, funding for
a GSP may then be lacking.
FJATA Association News:
FJATA Joins Multi-Industry Coalition in Calling for GSP Renewal
A multi-industry coalition of over 460 companies and associations on January 27 in sending a
letter to all members of the U.S. Senate and a letter to all members of the U.S. House of
Representatives calling for renewal of the Generalized System of Preferences program, which
has been expired since July 2013. FJATA has supported swift renewal of the valuable trade
preference program intended to support developing countries, and has advocated for the
inclusion of an update to the program to allow eligibility for non-import-sensitive travel goods.
The ASTM F15.24 Jewelry Sub-committee began a new session this month to review both the
adult and children’s standards and discuss technical corrections as well as a new proposed nickel
test, cadmium in plastics testing protocol, the flux index calculation and other business raised by
the committee. ASTM requires that standards undergo a review every three years. The “11”
postscript from the ASTM F2923-11 indicates the year the version was published; it is FJATA’s
hope that agreement among the Committee on these changes will be achieved quickly and that a
new version can be issued in 2014. As noted earlier, the meeting was posted on the CPSC Public
Calendar and CPSC Staff will participate.
International News: The Chinese New Year falls between January 31 and February 6 this year.
Health Canada Draft Risk Assessment Framework:
The comment period for the draft Health Canada (HC) Risk Assessment
Framework (RAF) ended on January 30, 2014, focusing on the
manufacturer/importer's obligation to ensure that a consumer product does not
pose a risk to Canadian consumers through a reasonable risk assessment
process. The RAF was written pursuant to the Canada Consumer Product
Safety Act's coming into force in June of 2011. Health Canada defines the
purpose of the RAF as:
"to provide clarity and guidance to internal and external stakeholders on the principles
and processes associated with risk assessment in the Program and to support a risk based
approach to determine where the Program should focus its attention."
Particular elements resemble those used for compliance with U.S. regulations such as the CPSIA,
CPSA, FHSA, and state statutes. Companies must consider: 1) the degree to which their product
may pose a hazard, 2) use evidence and sound judgment to determine risk, 3) make the process
transparent to regulators and the public, 4) identify uncertainties, 5) consider sensitive
populations, and 6) include potential use and abuse in evaluating risk. You may review the
complete HC RAF draft here. FJATA in general supports a regulatory approach that applies
sound, science-based risk assessment criteria, and submitted comments on the framework.
CBP Nominee Kerlikowske:
Richard G. Kerlikowske, President Obama's nominee for U.S. Customs and Border Protection
(CBP) Commissioner, received strong bipartisan support, a sign that his confirmation is highly
probable. Some key points Kerlikowske makes in his prepared comments include that business
needs a "consistent, stable, and predictable environment" to operate in, and that as CBP
Commissioner, he has goals to reduce paperwork, to "minimize transaction costs" at border
crossings and to continue to prioritize completion of the Automated Commercial Environment
(ACE) and International Trade Data System (ITDS).
http://www.fjata.org/wp-content/uploads/KERLISKOWSKE-WRITTEN-STATEMENT-SFC011514-FNL.pdf
China's New Trademark Regulations under Consideration:
It is important to remember that every sovereign nation has its own set of legal protocols.
Registering a trademark in the U.S. and the EU does not ensure that the trademark is recognized
in China. China is in the process of amending its trademark regulations, so new companies and
those involved in trademark registrations should be aware. One key provision in the draft
regulations is the China Trademark Office will no longer accept trademark records filed after the
three month deadline. Companies can still own an unrecorded trademark, but will have difficulty
litigating infringement cases, particularly when the defendant can show they acted in good faith.
For a detailed synopsis of the proposed rules by Alan Chiu of Mayer Brown JSM, click here.
http://www.mondaq.com/x/283762/Trademark/Chinas+New+Trademark+Implementing+Regula
tions&email_access=on
Conflict Minerals Compliance Tools:
FJATA, in collaboration with 6 other leading trade associations, (American Apparel and
Footwear Association (AAFA), National Association of Manufacturers (NAM), the National
Electrical Manufacturers Association (NEMA), the National Retail Federation (NRF), the Toy
Industry Association (TIA) and the United States Fashion Industry Association (USFIA))
together representing 15,000 companies with annual economic output over $3 trillion, introduces
the Conflict Minerals Resource Center (CMRC). Driven by the research and analysis of Shulte
Roth & Zabel LLP, a leading firm on Dodd Frank Section 1502 issues, and the data management
systems of Source Intelligence, the CMRC puts together important information that companies
need to know about how to comply with the law and provides helpful tools to help them
document that process. Learn more by visiting the CMRC. http://www.fjata.org/?p=3846
Tech Jewelry?
This year's International Consumer Electronics Show featured a novel union of technology and
fashion jewelry: the "June" bracelet by Netatmo. June is a smart-looking, fashionable jewelry
piece that tracks the amount of UV exposure the wearer receives and gives recommendations
through an iPhone app. Scheduled availability is, appropriately, the 2nd quarter of this year, and
is expected to have a $99 price tag. At the show, June won two awards: Wearable Technologies
and Tech for a Better World. Click here to read a National Jeweler article on June, and here to
read more about June from the manufacturer, Netatmo.
Walmart Fund to Support US Manufacturing
The New York Times
William S. Simon, chief executive of Walmart for the United States, said at the United States Conference
of Mayors that the company was providing a $10 million fund to promote American manufacturing in a
public push to sell more American-made products. MORE
The FJATA CSR Committee:
The CSR committee is reviewing a range of existing social
compliance audits with the intent to develop a comprehensive audit
for the industry that would eventually become a compliance standard
acceptable to a major portion of the fashion industry. This will be
developed with the collaboration of FJATA member UL.
Comments welcomed. Thank you, David Newman; Chairman [email protected]
Continuing Education:
FJATA/Olympus webinar discussing compliance issues, CPSIA,
Prop 65, component part testing, and how to save money using
XRF technology is available here.
A webinar on CPSC’s 1112 Rule allowing the use of HDXRF for lead certification testing in
substrates of children’s products, and the approved use of HDXRF for lead certification
testing of surface coatings is available here.
Webinars and Publications:
Stacey Bowers, of Compliance and Risks, presented a webinar (1/15/14) covering updates on
new legislation of chemicals in products. Chemicals covered include flame retardants,
phthalates, mercury, and other chemicals across a wide range of products including cosmetics,
toys and jewelry. Activities by specific government, environmental and industrial organizations
will also be addressed. You can access the webinar for free with a quick registration.
http://www.complianceandrisks.com/webinar-video-signup-jan-2014-chemicals-update-q4-2013/
UL’s Responsible Sourcing group we host our annual Responsible Sourcing Summit and this
year’s Summit will take place March 5-6, 2014 in San Francisco, CA. Summit Event Link :
http://industries.ul.com/blog/responsible-sourcing-summit-san-francisco-ca
Schulte Roth & Zabel held a complimentary webinar on November 25 entitled, "Dodd-Frank
Section 1502: Perspectives From the U.S. GAO". The moderator, Attorney Michael Littenburg,
coauthored a comprehensive document (included in The Complete Compliance and Ethics
Manual) that focuses on Dodd-Frank compliance. The firm has an area on their website devoted
to Dodd-Frank Section 1502 that provides information.
Kathleen Boozang, a law professor with Seton Hall University, and FJATA counsel, Sheila
Millar of Keller and Heckman, participated in a teleforum sponsored by the Federalist Society on
the Responsible Corporate Officer doctrine. This is the doctrine CPSC is seeking to apply to
hold the former CEO of the company that made Buckeyballs personally responsible for the costs
of the recall. A podcast of the discussion is available at: http://www.fedsoc.org/publications/detail/the-responsible-corporate-officer-doctrine-and-regulatory-crimespodcast.
Our Mission- We continue to assume the leadership role in legislative issues and the establishment of
internationally recognized, sensible standards for the jewelry and accessories industries on behalf of our members.
FJATA Committees:
The Annual Meeting Committee is chaired by Keith Barber, [email protected]
The CSR Committee is chaired by David Newman, [email protected] .
The Membership Benefits Committee is chaired by Keith Barber, [email protected] .
The Legislative Committee is chaired by Anthony DeGeorge, [email protected]
Please express your interest in participating by contacting the committee chairs.
The Executive Board
President
Jim Heagney
K&M Associates
Vice President
George Morse
Fifth & Pacific Companies
Secretary/Treasurer
Keith Barber
Shalom International
Directors Emeritus
Stephan Rubin
Gary Rose
David Gordon
Board of Directors
Martha Berry
Sabrina Berry
Eddy Capobianco
Anthony DeGeorge
Brent Cleaveland
Stephan & Co.
Isa & Stef, LLC/Robert Rose
Carole, Inc.
Berry Jewelry Company
NY & Company
Swarovski North America
FAF Inc.
Executive Director
Ed Flinn
Dee Marino
Rebecca Orand
(401) 667-0520
Crimzon Rose
TSI Accessories Group
Claire’s Stores
[email protected]
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