BILL ANALYSIS                                                                                                                                                                                                    



                                                                       



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          |SENATE RULES COMMITTEE            |                  AB 1512|
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                                 THIRD READING


          Bill No:  AB 1512
          Author:   Lieu (D), et al
          Amended:  9/4/09 in Senate
          Vote:     21

           
           SENATE HEALTH COMMITTEE  :  9-0, 7/8/09
          AYES:  Alquist, Aanestad, Cedillo, DeSaulnier, Leno,  
            Maldonado, Negrete McLeod, Pavley, Wolk
          NO VOTE RECORDED:  Strickland, Cox

           SENATE APPROPRIATIONS COMMITTEE  :  Senate Rule 28.8

           ASSEMBLY FLOOR  :  48-29, 5/28/09 - See last page for vote


           SUBJECT :    Food and drugs:  sale

           SOURCE  :     Consumer Federation of California


           DIGEST  :    This bill prohibits a retailer from selling, or  
          permitting to be sold, infant formula, baby food, and  
          drugs, as defined, beyond the expiration date indicated on  
          the product's packaging.

           Senate Floor Amendments  of 9/4/09 (1) provide definitions  
          for infant formula and baby food to correspond with federal  
          definitions; (2) clarify that fines will be calculated  
          between "use by" or expiration date and the date of sale;  
          (3) establish that date of sale shall be established by  
          proof of purchase, including, but not limited to, a sales  
          receipt; (4) provide that nothing in the bill shall be  
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          construed to preclude any other action authorized by law;  
          (5) add legislative intent that local and sales authorities  
          make reasonable efforts to notify the public about  
          potential threats to public safety resulting from the dale  
          of expired products, and for purchasers of expired products  
          to contact their state or local authorities.

           ANALYSIS  :  Existing federal law, under the Food, Drug and  
          Cosmetic Act, provides for the regulation of food, drugs,  
          and cosmetics by the U.S. Food and Drug Administration  
          (FDA).  Existing federal law requires expiration dates on  
          drugs, as defined, and requires a "use-by" date on the  
          product label of infant formula and the varieties of baby  
          food under inspection by the FDA.

          Existing state law establishes the Sherman Food, Drug, and  
          Cosmetic Law (Sherman Act), administered by the Department  
          of Public Health (DPH), to regulate the contents,  
          packaging, labeling, and advertising of food, drugs, and  
          cosmetics in California.

          Existing state law defines a drug as any article recognized  
          in an official compendium; or any article used or intended  
          for use in the diagnosis, cure, mitigation, treatment, or  
          prevention of disease in human beings or any other animal;  
          or any article other than food, that is used or intended to  
          affect the structure or any function of the body of human  
          beings or any other animal; or any article used or in  
          tended for use as a component of any article in the first  
          three.

          Existing state law allows any authorized agent of DPH to,  
          upon presenting appropriate credentials and at a reasonable  
          time, enter any factory, warehouse, or establishment in  
          which any food, drug, device, or cosmetic is manufactured,  
          packed, or held.

          Existing state law allows DPH, upon the request of a health  
          officer, to authorize the local health department of a  
          city, county, city and county, or local health district to  
          enforce the provisions of Sherman and its regulations that  
          pertain to retail food establishments, as defined, if DPH  
          determines that the local health department has sufficient  
          personnel with adequate training to do so, and requires  







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          that the enforcement be limited to the area under the  
          jurisdiction of the local health department.

          Existing state law provides that any person who violates  
          any provision of the Sherman Act or its regulations shall,  
          if convicted, be subject to imprisonment for not more than  
          one year in the county jail or a fine of not more than  
          $1,000, or both the imprisonment and fine.  Existing law  
          provides for higher penalties for other specified  
          violations of the Sherman Act.

          This bill prohibits a retailer from selling, or permitting  
          to be sold, after the "use-by" date, infant formula or baby  
          food that is required to have this date on its packaging  
          pursuant to the federal Food, Drug, and Cosmetic Act and  
          its regulations.

          This bill prohibits a retailer from selling, or permitting  
          to be sold, after the expiration date, an over the counter  
          drug..

          This bill provides that, in lieu of other penalties, any  
          person who violates these prohibitions is guilty of an  
          infraction, punishable by a maximum fine of $10 per day for  
          each item sold, or permitted to be sold, after the  
          expiration or "use-by" date.  The bill provides that the  
          fine shall be calculated based upon the number of days  
          between the expiration or "use by" date and the date of  
          sale.  The date of sale shall be established by evidence of  
          the proof of purchase, including, but not limited to, a  
          sales receipt.  Monies collected from the fines shall be  
          deposited in the General Fund.  Fines collected by local  
          jurisdictions shall be deposited in the General Fund of the  
          local jurisdiction.

          The bill provides that nothing in this bill shall be  
          construed to preclude any other action authorized by law.

          For purposes of this bill (1) "infant formula" shall have  
          the meaning given in subdivision (z) of Section 321 of  
          Title 21 of the United States Code, and "baby food" shall  
          mean the processing of canned fresh fruits and vegetables,  
          meats, eggs, fruit juices, cereal, formulated entrees, and  
          desserts and snacks using fresh, preprocessed, or any  







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          combination of these and other food ingredients necessary  
          for the production of infant foods; (3) "over the counter  
          drug" means a nonprescription drug regulated by the federal  
          FDA that is required to have an expiration date on its  
          packaging pursuant to the federal act and federal  
          regulations adopted pursuant to the federal act, including,  
          but not limited to, Section 211.137 of Title 21 of the Code  
          of Federal Regulations.

          This bill states that it is the intent of the Legislature  
          in adding Chapter 3.5 (commencing with Section 110286) to  
          Part 5 of Division 104 of the Health and Safety Code that  
          local and state authorities make reasonable efforts to  
          notify the public about potential threats to public safety  
          resulting from the sale of expired products and, for public  
          purchasers of expired products to contact their respective  
          state or local authorities.

           Background

          Attorney General's investigation and settlement agreement  
          with CVS  .  In response to consumer reports about expired  
          products on store shelves in Southern California, the  
          Attorney General (AG) launched an undercover shopping  
          operation in March 2008, which found 48 expired products on  
          the shelves of 26 CVS pharmacies in Los Angeles, Orange,  
          and San Diego Counties.  The investigators found that some  
          of the expired products, which included baby formula,  
          toddler food, and over-the-counter medications, were  
          between four and six months old. (Expired dairy and eggs  
          were also found.) The investigation noted that some of the  
          products' "sell by" dates were hidden with price tags or  
          other store stickers.  As a result of the investigation,  
          the AG stated that CVS Pharmacy's practice of stocking  
          expired items on its stores' shelves falsely implied that  
          the products met federal standards, and called on the  
          pharmacy to change its policies to ensure that sales of  
          expired products would not occur in the future.

          On June 10th, the AG and CVS filed a settlement agreement,  
          under a stipulation for entry of final judgment, in  
          Superior Court.  The judgment states that CVS is  
          permanently enjoined and restrained from selling or  
          offering to sell expired products to any person at a CVS  







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          store in California, among other things.  As a result, CVS  
          agreed to comply with several terms and requirements,  
          including: implementation, review, or revision of written  
          policies regarding appropriate practices to provide that  
          specified items (infant formula, baby food, eggs, dairy  
          products, and over-the-counter drugs) are not sold past  
          their best-by or expiration dates; reviewing and /or  
          revising its expired products policies and training  
          materials, including policies and contracts with  
          third-party providers; disseminating its expired products  
          policies to designated front-store employees, as specified,  
          and requiring the completion and repetition of training  
          regarding such policies; requiring certification of receipt  
          of policies and training; requiring stores to check  
          expiration or best-by dates of various categories of  
          specified  products at least twice a month; implementing a  
          consumer coupon program related to finding expired products  
          in a store; requiring prominent posting of notices in the  
          aisles where specified products are offered for sale; among  
          other requirements.

          As part of the agreement, CVS was ordered to pay $487,500  
          to the Unfair Competition Law Fund, and a similar amount in  
          attorney's fees and costs.

           Federal law and regulations - "use-by" dates  .  According to  
          the Food Safety and Inspection Service (FSIS) of the U.S.  
          Department of Agriculture, except for infant formula and  
          some baby food, product dating is not generally required by  
          federal regulations.  Federal regulations require a  
          "use-by" date on the product label of infant formula and  
          the varieties of baby food under inspection by the FDA.  If  
          consumed by that date, the formula or food must not contain  
          less than the quantity of each nutrient as described on the  
          label.  Formula must maintain an acceptable quality to pass  
          through an ordinary bottle nipple.  If stored too long,  
          formula can separate and clog the nipple.  Dating of baby  
          food is for quality as well as for nutrient retention.  The  
          "use-by" date is selected by the manufacturer, packer, or  
          distributor of the product on the basis of product analysis  
          throughout its shelf life, test, or other information.  It  
          is also based on the conditions of handling, storage,  
          preparation, and use printed on the label.  FSIS states  
          that baby formula and baby food should not be bought or  







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          used after its "use-by" date.

          The FDA began requiring expiration dates on drugs in 1979  
          in order to set uniform testing and reporting guidelines.   
          Federal regulations require a drug product to bear an  
          appropriate expiration date as determined by stability  
          testing that analyzes the capacity of the drug to maintain  
          its identity, strength, quality, and purity for the period  
          of shelf life that the manufacturer picks.  Expiration  
          dates are also required to be related to any storage  
          conditions specified on the label.  Homeopathic drug  
          products and new drug products for investigational use are  
          exempt from federal regulations governing expiration  
          dating.  

          Product dating in California  .  According to the Food and  
          Drug Branch (FDB) of DPH, only a few products require "sell  
          by" dates or "expiration dates" in California.  State law  
          requires dairy products to have "open dating" (which  
          includes a pack date, expiration date, or quality  
          assurance/freshness date) requirements.  Infant formula and  
          baby foods are required to bear an expiration date to  
          ensure full nutritional value. Even though the majority of  
          foods do not require expiration or "sell by" dates, most  
          consumers expect some way to determine the age of a  
          product.

           Related Legislation

           SB 550 (Florez) requires a grocery store that uses a  
          point-of-sale system to ensure that when a recalled product  
          is scanned, the point-of-sale system will notify the  
          employee and customer that the product being purchased is  
          subject to a recall.  (Pending in the Assembly Business and  
          Professions Committee.)  
           
           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes    
          Local:  Yes

           SUPPORT  :   (Verified  9/8/09)

          Consumer Federation of California (source)
          Consumer Federation of California (sponsor)
          Amalgamated Transit Union







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          American Federation of State, County and Municipal  
          Employees, AFL-CIO
          California Conference of Machinists
          California Teamsters Public Affairs Council
          Consumer Attorneys of California
          Engineers and Scientists of California, IFPTE L.20, IFPTE  
          L. 21
          International Formula Council
          International Longshore and Warehouse Union
          UNITE HERE!
          United Food and Commercial Workers Union, Western States  
          Council

           OPPOSITION  :    (Verified  9/8/09)

          California Grocers Association

           ARGUMENTS IN SUPPORT  :    The sponsor of this bill, Consumer  
          Federation of California (CFC), states that during tough  
          economic times, consumers deserve to purchase products that  
          are safe and effective for themselves and their families.   
          CFC asserts that requiring the removal of specific products  
          that have exceeded their nutritional or safety  
          effectiveness is a simple practice that retailers can  
          employ to protect their customers.  The International  
          Formula Council notes writes that infant formula products  
          sold past their "sell by" date may experience nutrient and  
          other losses that could impact the product's safety and  
          potentially threaten an infant's health.

          The Consumer Attorneys of California supports this bill  
          because it levies fines against retailers who sell products  
          that have already expired and serves to protect the  
          well-being of California consumers.  Various labor groups  
          write in support that this bill will act as an incentive  
          for retailers to remove expired products from their shelves  
          and protect parents and other consumers from purchasing  
          useless or potentially harmful products in the future.

           ARGUMENTS IN OPPOSITION  :    The California Grocers  
          Association (CGA) objects to the punitive and arbitrary  
          fines in this bill that would be applied even when innocent  
          mistakes are made, and opposes this bill because it  
          inappropriately targets responsible businesses, rather than  







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          bad actors, such as organized retail crime rings that steal  
          quantities of infant formula, drugs, and a variety of other  
          products and make no effort to ensure that products sold  
          are safe.


           ASSEMBLY FLOOR  : 
          AYES:  Ammiano, Arambula, Beall, Block, Blumenfield,  
            Brownley, Buchanan, Caballero, Charles Calderon, Carter,  
            Chesbro, Coto, Davis, De La Torre, De Leon, Eng, Evans,  
            Feuer, Fong, Fuentes, Furutani, Hall, Hayashi, Hernandez,  
            Hill, Huffman, Jones, Krekorian, Lieu, Bonnie Lowenthal,  
            Ma, Mendoza, Monning, Nava, John A. Perez, V. Manuel  
            Perez, Portantino, Price, Ruskin, Salas, Skinner,  
            Solorio, Swanson, Torlakson, Torres, Torrico, Yamada,  
            Bass
          NOES:  Adams, Anderson, Bill Berryhill, Tom Berryhill,  
            Blakeslee, Conway, Cook, DeVore, Duvall, Emmerson,  
            Fletcher, Fuller, Gaines, Garrick, Gilmore, Hagman,  
            Harkey, Huber, Jeffries, Knight, Logue, Miller, Niello,  
            Nielsen, Silva, Smyth, Audra Strickland, Tran, Villines
          NO VOTE RECORDED:  Galgiani, Nestande, Saldana


          JJA:cm  9/8/09   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

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