BILL ANALYSIS                                                                                                                                                                                                    �







                      SENATE COMMITTEE ON PUBLIC SAFETY
                            Senator Loni Hancock, Chair              S
                             2011-2012 Regular Session               B

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          SB 977 (Yee)                                                
          As Amended June 4, 2012
          Hearing date:  July 3, 2012
          Health and Safety Code (URGENCY)
          MK:mc

                         SHERMAN FOOD, DRUG, AND COSMETIC LAW:

                                     NAIL POLISH  


                                       HISTORY

          Source:  Author

          Prior Legislation: AB 237 (Galgiani) - held Assembly 
          Appropriations, 2011 
                      SB 1712 (Migden) - failed Assembly Appropriations, 
          2008               
                      AB 595 (Dymally) - failed Senate Health, 2007
                      SB 484 (Migden) - Chapter 729, Statutes of 2005

          Support: Personal Care Products Council

          Opposition:   None known



                                         KEY ISSUE
           
          SHOULD THERE BE AN INCREASED FINE FOR A MISDEMEANOR VIOLATION OF 
          SPECIFIED SHERMAN FOOD, DRUG, AND COSMETIC LAW REGULATIONS BY A NAIL 
          POLISH MANUFACTURER?




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                                       PURPOSE

          The purpose of this bill is to increase the fine for a 
          misdemeanor violation of specified Sherman Food, Drug, and 
          Cosmetic Law regulations by a nail polish manufacturer.

          
           Existing law  requires the Department of Public Health (DPH), 
          under the Sherman Food, Drug, and Cosmetic Law, to regulate the 
          manufacture, sale, labeling, and advertising activities related 
          to food, drugs, devices, and cosmetics in conformity with the 
          federal Food, Drug, and Cosmetic Act.  (Health and Safety Code 
          �� 109875 et. seq.)

           Existing law  provides that any cosmetic is misbranded if its 
          labeling is false or misleading in any particular.  (Health and 
          Safety Code � 11730.)

           Existing law  provides that any cosmetic is misbranded if it is 
          in package form and it does not bear a label containing all of 
          the following information: the name and place of the business of 
          the manufacturer, packer or distributor; and, an accurate 
          statement of the quantity of the contents in terms of weight, 
          measure, or numerical count.  (Health and Safety Code � 11740.)

           Existing law  provides that a cosmetic is misbranded if any word, 
          statement, or other information required pursuant to this part 
          to appear on the label or labeling is not prominently placed 
          upon the label or labeling with conspicuousness, as compared 
          with other words, statements, designs, or devices in the 
          labeling and in terms as to render it likely to be read and 
          understood by the ordinary individual under customary conditions 
          of purchase and use.  (Health and Safety Code
          � 111745.)

           Existing law  provides that any cosmetic is misbranded if its 
          container is so made, formed, or filled as to be misleading.  




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          (Health and Safety Code � 111750.)

           Existing law  provides that a cosmetic is misbranded if it is a 
          color additive, unless its packaging and labeling are in 
          conformity with the packaging and labeling requirements.  
          (Health and Safety Code � 111755.)

           Existing law  provides that a cosmetic is misbranded if its 
          packaging or labeling is in violation of specified poison 
          requirements.  (Health and Safety Code � 111760.)
           
          Existing law  provides that it is unlawful for any person to 
          manufacture, or sell any cosmetic that is misbranded.  (Health 
          and Safety Code � 111765.)

           Existing law  provides that it is unlawful for any person to 
          misbrand any cosmetic.  (Health and Safety Code � 111770.)

           Existing law  provides that it is unlawful for any person to 
          receive in commerce any cosmetic that is misbranded, or to 
          deliver or proffer for delivery any cosmetic.  (Health and 
          Safety Code
          � 111775.)

           Existing law  provides that it is unlawful for any person to 
          alter, mutilate, destroy obliterate or remove any part of the 
          labeling of any cosmetic if the act results in the cosmetic 
          being misbranded.  (Health and Safety Code � 111780.)

           Existing law  defines a manufacturer as any person whose name 
          appears on the label of a cosmetic product.  (Health and Safety 
          Code � 111791.5(e).)

           Existing law  provides that any person who violates any provision 
          in the Sherman Food, Drug, and Cosmetic Law is guilty of a 
          misdemeanor punishable by up to one year in the county jail and 
          or a fine of up to $1,000 (approximately $3,800 with penalty 
          assessments).  If the person has a prior conviction or the 
          violation was with the intent to defraud or mislead the person 
          is guilty of a wobbler with a fine of up to $10,000 




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          (approximately $38,000 with penalty assessments).  (Health and 
          Safety Code � 111825.)

           This bill  would provide that a manufacturer of nail polish who 
          violates the provisions relating to misbranding if convicted 
          shall be subject to a fine of not more than $15,000 
          (approximately $57,000 with penalty assessments).


                    RECEIVERSHIP/OVERCROWDING CRISIS AGGRAVATION
                                      ("ROCA")
          
          In response to the unresolved prison capacity crisis, since 
          early 2007 it has been the policy of the chair of the Senate 
          Committee on Public Safety and the Senate President pro Tem to 
          hold legislative proposals which could further aggravate prison 
          overcrowding through new or expanded felony prosecutions.  Under 
          the resulting policy known as "ROCA" (which stands for 
          "Receivership/Overcrowding Crisis Aggravation"), the Committee 
          has held measures which create a new felony, expand the scope or 
          penalty of an existing felony, or otherwise increase the 
          application of a felony in a manner which could exacerbate the 
          prison overcrowding crisis by expanding the availability or 
          length of prison terms (such as extending the statute of 
          limitations for felonies or constricting statutory parole 
          standards).  In addition, proposed expansions to the 
          classification of felonies enacted last year by AB 109 (the 2011 
          Public Safety Realignment) which may be punishable in jail and 
          not prison (Penal Code section 1170(h)) would be subject to ROCA 
          because an offender's criminal record could make the offender 
          ineligible for jail and therefore subject to state prison.  
          Under these principles, ROCA has been applied as a 
          content-neutral, provisional measure necessary to ensure that 
          the Legislature does not erode progress towards reducing prison 
          overcrowding by passing legislation which could increase the 
          prison population.  ROCA will continue until prison overcrowding 
          is resolved.

          For the last several years, severe overcrowding in California's 
          prisons has been the focus of evolving and expensive litigation. 




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           On June 30, 2005, in a class action lawsuit filed four years 
          earlier, the United States District Court for the Northern 
          District of California established a Receivership to take 
          control of the delivery of medical services to all California 
          state prisoners confined by the California Department of 
          Corrections and Rehabilitation ("CDCR").  In December of 2006, 
          plaintiffs in two federal lawsuits against CDCR sought a 
          court-ordered limit on the prison population pursuant to the 
          federal Prison Litigation Reform Act.  On January 12, 2010, a 
          three-judge federal panel issued an order requiring California 
          to reduce its inmate population to 137.5 percent of design 
          capacity -- a reduction at that time of roughly 40,000 inmates 
          -- within two years.  The court stayed implementation of its 
          ruling pending the state's appeal to the U.S. Supreme Court.  






























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          On May 23, 2011, the United States Supreme Court upheld the 
          decision of the three-judge panel in its entirety, giving 
          California two years from the date of its ruling to reduce its 
          prison population to 137.5 percent of design capacity, subject 
          to the right of the state to seek modifications in appropriate 
          circumstances.  Design capacity is the number of inmates a 
          prison can house based on one inmate per cell, single-level 
          bunks in dormitories, and no beds in places not designed for 
          housing.  Current design capacity in CDCR's 33 institutions is 
          79,650.

          On January 6, 2012, CDCR announced that California had cut 
          prison overcrowding by more than 11,000 inmates over the last 
          six months, a reduction largely accomplished by the passage of 
          Assembly Bill 109.  Under the prisoner-reduction order, the 
          inmate population in California's 33 prisons must be no more 
          than the following:

                 167 percent of design capacity by December 27, 2011 
               (133,016 inmates);
                 155 percent by June 27, 2012;
                 147 percent by December 27, 2012; and
                 137.5 percent by June 27, 2013.
               
          This bill does not aggravate the prison overcrowding crisis 
          described above under ROCA.


                                      COMMENTS

          1.    Need for this Bill  

          According to the author:

               The California Department of Toxic Substances Control 
               (DTSC) recently reported that the ingredients listed on 
               the labels of some nail polishes were either inaccurate 
               or made outright false claims.  Despite the product 
               labels claiming to be free of one or more ingredients, 




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               some of the products the DTSC tested actually contained 
               some or all of the chemicals.  (news stories and report 
               links below)

               Existing state and Federal requirements require 
               disclosure of ingredients for all products.  There are 
               no excuses for manufacturers to mislabel or 
               misrepresent the substances in their products.  
               Mislabeling is a bad business practice, clearly 
               uncompetitive, and violates the public trust.  The 
               intent of this bill is to create a creditable deterrent 
               against engaging in mislabeling to reassure customers 
               and workers that the products they use daily are 
               labeled correctly.  We want to send a clear message and 
               SB 977 does just that.

          2.    Existing Penalties for Violations  

          The Sherman Food, Drug, and Cosmetic Law regulates the 
          manufacturing, labeling, sale, etcetera, of food, drugs, 
          devices and cosmetics.  A violation of any provision of the 
          act is a misdemeanor punishable by up to one year in the 
          county jail and/or a fine of not more than $1,000 
          (approximately $3,800 with penalty assessments).<1>  If the 
          violation occurs after a prior violation, it was committed 
          with the intent to defraud or mislead; or, if it was a 
          violation of provisions prohibiting the adulterating food or 
          drugs which was intentional or intended to cause injury, the 
          violation is a wobbler with a fine of not more than $10,000 
          (approximately $38,000 with penalty assessments).

          3.    Increased Penalty for Nail Polish Violations  

          This bill would increase the penalty for violations of 
          regulations relating to labeling by a manufacturer of nail 
          -------------------------
          <1> Until the budget year 2002-2003, there was 170% in penalty 
          assessments applied to every fine, the current
          penalty assessments are approximately 280%.  (See Penal Code �� 
          1464, 1465.7, and 1465.8; Government Code 
          �� 70372, 7600.5, 76000 et seq, and 76104.6.)  











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          polish.  As currently drafted, this bill attempts to create 
          a criminal penalty but merely lists a fine.  It is staff's 
          understanding that the author intends to create a 
          misdemeanor with that fine, and the bill should be amended 
          to clearly state that.

          This bill would increase the fine for violations of labeling 
          by the manufacturer of nail polish to $15,000, which with 
          penalty assessments is approximately $57,000.  Since, as 
          noted above, there is another subsection that creates a 
          wobbler with a $10,000 fine for violations that had the 
          intent to defraud or mislead.  This new penalty for 
          manufacturers of nail polish would be violations without 
          that intent.  Is the new higher fine for manufacturers of 
          nail polish who do not have the intent to mislead or defraud 
          appropriate?  Is it appropriate to single out the 
          manufacturers of nail polish for a higher fine; what 
          differentiates them from the manufacturers of other food, 
          drugs, devices, or cosmetics which will be subject to the 
          existing fine?

          4.   Senate Health  

          This bill passed Senate Health Committee on June 14 on a 
          vote of 7-0.


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