Legal Lens: The regulations and risks surrounding “clean beauty”

Happy Thanksgiving to all who observe, and welcome back to another edition of Legal Lens, where we discuss all things legal and regulatory in the world of personal care products.

This month’s topic is something I’ve been thinking about for a while: clean beauty. This topic is an odd one for me, since my personal concept of clean beauty involves a lot of dry shampoo, coffee, and not passing out with my makeup on (again).

Nevertheless, the market for “clean beauty,” however you define it, is expected to reach an estimated $11.6 billion by 2027. Clean beauty is big business. But what do we think of when we think of something as “clean,” “natural,” “green,” or “nontoxic”? And why do we care so much about what’s in our beauty products?

What is clean beauty?

Leaving my idiosyncratic take on doing the bare minimum in terms of beauty, the concept of “clean beauty” has been around for a while. It’s the aesthetic you think of when you watch Sofia Coppola’s “The Virgin Suicides”: fresh-faced, youthful, minimalist, and typically Caucasian—nothing in common with her glamorous disco contemporary except relying on the same types of products, synthetic ingredients, and preservatives.

Over time, the concept evolved from an aesthetic to an ethos, emerging alongside concepts like “preservative free,” “nontoxic,” and “all-natural.” This shift reflected growing environmental awareness among consumers, as well the idea that late-stage capitalist consumer culture had become increasingly unhealthy, in contrast to products that favored naturally derived ingredients, while eschewing synthetic ingredients or preservatives.

Today, “clean” typically means products formulated without ingredients linked to human health or sensitivity issues, such as sulfates, parabens, added fragrances, or formaldehyde. Brands have also capitalized on growing consumer demand for environmentally mindful products by adopting terms like “natural,” “conscious,” “sustainable,” “green,” or “organic.”

It’s important to remember that given the ad hoc development of “clean beauty,” different brands and retailers have adopted different criteria for what constitutes “clean” based on varying lists of prohibited ingredients and sustainability commitments. Few “clean beauty” claims are built the same. And many brands and retailers do explain, in detail (oftentimes on their websites) what they mean by “clean beauty.”

Are clean beauty claims regulated by the US FDA?

Good question. Yes, and no.

Under federal law, cosmetics (clean or otherwise) must not be considered misbranded. And this is a term that requires some unpacking.

Prior to 2022, the federal government regulated cosmetics under two main statutes: the Federal Food, Drug and Cosmetic Act of 1938 (FDCA), the Fair Packaging and Labeling Act (FPLA), and regulations promulgating these two statutes.

Under the FDCA, cosmetics (which are defined as “articles intended to be rubbed, poured, sprinkled or sprayed on, introduced into or otherwise applied to the human body for cleansing, beautifying, promoting attractiveness or altering the appearance.”) do not require premarket approval.

But once they enter interstate commerce (i.e., are made available for sale in the United States), cosmetics must be safe when used by customers in accordance with product labeling or customary usage, and not be adulterated or misbranded.

Similarly, the Fair Packaging and Labeling Act (FPLA) require cosmetics intended for sale to direct consumers to be truthful and not misleading, and disclose all ingredients. Products that failed to comply with the FPLA are considered misbranded under the FDCA, and could result in enforcement action by FDA.

Together, the FDCA and the FLPA define misbranding as false or misleading labeling, labeling lacking required information, violative of various regulations, or for all intents and purposes, marketed in such a way that a reasonable consumer would be misled.

And until December 2022, the FDCA and the FPLA formed the basis of federal cosmetics regulation for over fifty years, even as the beauty industry grew exponentially, and required more comprehensive guidance.

In December 2022, Congress enacted the Modernization of Cosmetics Regulation Act (MoCRA). MoCRA significantly expands FDA’s rulemaking and enforcement authority over cosmetics, and created substantial new compliance obligations for manufacturers, packers and distributors of cosmetics intended for sale in the United States.

For example, MoCRA imposes facility registration and product listing requirements, greater recordkeeping obligations, and new labeling requirements for adverse event contact information. MoCRA also requires FDA to, among other things, enact regulations addressing good manufacturing practices (GMP), the identification of fragrance allergens that must be disclosed on cosmetics labels, in line with the European Union and other international requirements, and standardized testing methods for detecting and identifying asbestos in talc-containing products.

But while MoCRA significantly alters the way the federal government regulates cosmetics distributed in the United States, MoCRA doesn’t address or alter the existing regulatory framework for cosmetic labeling and marketing issues, such as defining or restricting the use of certain terms like “natural,” “clean,” “nontoxic” or “safe.” Nor does it provide guidance on how much support brands need to make these claims.

So, what can companies claim about their products?

FDA does not maintain a list of accepted claims for cosmetics. However, there are limits to what brands can say about their products on their labels and in their promotional materials, as well as guidance promulgated by other federal regulatory agencies.

While FDA has not defined the term “natural” or established a regulatory definition for it in cosmetic labeling, the US Department of Agriculture’s Agricultural Marketing Service (AMS) has issued guidelines on what qualifies as “natural,” to provide companies with general principles for all “green” and environmental marketing claims.

These principles include which includes substances that are not chemically modified or are derived through natural biological processes.

Similarly, FDA does not define or regulate the term “organic” as it applies to cosmetics or other personal care products. The US Department of Agriculture (USDA) regulates the term “organic” as it applies to agricultural products, however, so if a cosmetic consists of agricultural products and can satisfy the USDA’s criteria for organic production, handling, processing, and labeling, cosmetics may be eligible to claim organic certification with the USDA under its National Organic Program regulations, and make various organic claims, depending on the percentage of organically produced ingredients contained in the product.

The Federal Trade Commission (FTC), which regulates cosmetic advertising under the FTC Act, has promulgated the Green Guides to provide companies with general principles for all “green” and environmental marketing claims. These principles include how consumers are likely to interpret certain claims and how brands can best qualify their claims to avoid allegations of consumer deception.

The FTC’s most recent update to the Green Guides in 2012 includes guidance on products’ use of certifications, as well as “eco-friendly,” “degradable,” and “non-toxic” claims – in particularly stating that companies making non-toxic claims should have “competent and reliable scientific evidence that the product, packaging, or service, is non-toxic for humans and the environment.”

The FTC also can take action against brands to enjoin what it perceives as unfair or deceptive practices, or false advertisements that are likely to mislead a reasonable consumer and material to their purchasing decisions.

What are the legal risks associated with promoting clean beauty?

Although the federal government hasn’t clearly defined what constitutes “clean beauty,” from a regulatory perspective, beauty brands and retailers have nevertheless faced scrutiny for allegedly deceptive “clean” or “natural” claims in the form of private lawsuits brought by consumers.

These lawsuits dispute claims that products are “clean,” “natural,” or “nontoxic,” alleging, instead, that they contain synthetic ingredients or ingredients allegedly linked to human health concerns like hair loss, reproductive issues, or, in certain cases, cancer.

Alternatively, they allege that a product’s “clean” or “natural” labeling is false and/or misleading because the product contains synthetic ingredients and that they were induced to purchase products they would not have otherwise purchased for prices they would not have otherwise paid.

For example, in 2023, plaintiffs claimed they sustained injuries from hair products that contain the fragrance ingredient lilial, which has been linked by the European Commission to adverse health issues.

Additionally, class action lawsuits involving allegedly ingredients like benzene and per- and polyfluoroalkyl substances (PFAS)--a widely used class of compounds that may be inadvertently present in consumer goods because of their use in manufacturing processes or presence in water supplies--have increased.

It’s important to remember that courts have, and can disagreed, on what constitutes a clear definition of “clean beauty,” and plaintiffs alleging clean beauty claims have had varying levels of success, depending on the specifics of the allegations.

On the one hand, courts such as the United States District Court for the Northern District of New York have dismissed class action consumer deception claims arising out of “clean beauty” retail programs where the court concluded that the retailer very clearly disclosed the program’s criteria, in which the retailer did not define “clean” to mean “all-natural” or “free from synthetic ingredients.

On the other hand, courts such as the United States District Court for the District of Minnesota have come out another way.

In a recent decision from this September, the court allowed plaintiffs' claims of statutory consumer fraud and common law fraud, negligent misrepresentation, breach of warranty and unjust enrichment, to proceed to discovery as to whether a reasonable consumer could be misled by a retailer’s “clean at” product scheme, particularly where plaintiffs alleged that certain products considered “clean” under the scheme’s criteria allegedly contained ingredients prohibited by the program, or contained more harmful ingredients than those prohibited.

Given this lack of definitional clarity, questions will remain over how beauty brands use terms like “clean,” “natural,” and “safe” and whether reasonable consumers could find them misleading in light of the products’ ingredients and intended claims.

So what are the takeaways?

Beauty brands should be aware of the risk for potential liability for promoting products as “clean,” “natural,” or “safe.”

While the risk of regulatory enforcement is comparatively low, regulators may scrutinize “all or nothing” claims (e.g. “100% natural”) or easily verifiable claims (e.g. “certified” organic or non-toxic), especially those publicized on the Internet or social media.

Meanwhile, the risk for private (and costly) litigation is increasing as plaintiffs focus on beauty and wellness products as an inexhaustible source of potential claims.

As for consumers of clean beauty, are they looking for a clear explanation and consistent criteria for what clean beauty really means? It’s in the eye of the beholder.

Questions or suggestions? Reach out to Kelly at kabonner@duanemorris.com.