FTC Targets Deceptive Safety, Environmental Claims in Settlement with Sierra Antifreeze Marketers

For Release

Safe Brands Corporation, Warren Distribution, Inc. and ARCO Chemical Company have agreed to settle Federal Trade Commission charges that the companies made unsubstantiated advertising claims about the safety of Sierra antifreeze, as well as its environmental benefits and ability to protect vehicle engines. Under the proposed settlement agreement, the companies would be prohibited from making such claims unless they are adequately substantiated, and would be required to put a statement on Sierra antifreeze containers cautioning consumers that it may be harmful if swallowed.

"We always want to encourage innovation in the development of products that are safer for people, pets or wildlife," said Jodie Bernstein, Director of the FTC's Bureau of Consumer Protection,"but we must also move quickly to correct exaggerated safety or environmental claims."

Safe Brands, the manufacturer of Sierra antifreeze, and its parent company, Warren Distribution, are based in Omaha, Nebraska. ARCO Chemical, a subsidiary of Atlantic Richfield Company, Inc., is a multi-billion dollar producer, refiner and marketer of petroleum and chemical products. ARCO Chemical supplies the principal ingredient in Sierra antifreeze and allegedly has participated in advertising and marketing the product along with Safe Brands. Sierra antifreeze is made primarily from the chemical propylene glycol. Most automobile antifreezes are made with a different chemical, ethylene glycol.

According to the FTC complaint detailing the charges, Sierra antifreeze advertisements and product labeling described Sierra as"essentially non- toxic" and"safety freeze." The ads and labeling also claimed that Sierra is "ENVIRONMENTALLY SAFER,""biodegradable" and"THE ULTIMATE IN ... ENVIRONMENTAL SAFETY."

The FTC complaint alleges that the companies have claimed without adequate substantiation that Sierra is absolutely safe for people and pets. The complaint also challenges one of the reasons given by the companies for the antifreeze's safety -- that it contains propylene glycol, an ingredient generally recognized as safe by the Food and Drug Administration that is found in foods, drugs, cosmetics and pet food. The complaint alleges that, while the companies could substantiate that Sierra is less toxic than conventional antifreeze, and is therefore safer for people and pets if accidentally ingested, they did not have adequate proof that Sierra is absolutely safe.

The companies also allegedly represented that Sierra is safer for the environment generally (for example, the air, water, soil, plants or aquatic life) than conventional, ethylene glycol-based antifreeze, and that, because it is biodegradable, it is absolutely safe for the environment after ordinary use. The complaint alleges that the companies could not support these claims because, among other reasons, used antifreeze (whether ethylene glycol or propylene glycol-based) may contain lead or other environmentally hazardous substances. The complaint does note that the companies could substantiate that Sierra and other propylene glycol antifreezes are less toxic than conventional antifreeze and safer for that part of the environment composed of humans, pets and wildlife who might accidentally ingest it.

The companies also made claims that both Sierra antifreeze and its container are recyclable, the FTC charged. But, because there are few collection facilities nationwide that will accept either propylene glycol- based antifreeze or plastic antifreeze containers, the claims were false and misleading, according to the complaint. In addition, Sierra ads allegedly claimed that it provides better protection from freezing temperatures, boilovers and corrosion than conventional antifreeze. In fact, the complaint states, Sierra did not adequately substantiate these claims.

The proposed consent agreement to settle the charges would prohibit the respondents from making safety claims about any antifreeze, coolant or deicer, unless the claims are based on reliable scientific evidence. The agreement would require a statement on propylene glycol-based antifreeze or coolant containers that states:"CAUTIONARY INFORMATION: This product MAY BE HARMFUL IF SWALLOWED. STORE SAFELY AWAY FROM CHILDREN AND PETS. Do not store in open or unlabeled containers." Under the agreement, the companies would also be required to have reliable substantiation for any claims that an antifreeze, coolant or deicer will not harm the environment, is less harmful than other products or offers any environmental benefit. Finally, the agreement would prohibit misrepresentations about the recyclability of any antifreeze, coolant or deicer or its package, and would require substantiation for claims about the level of engine protection any such product provides. The respondents would be allowed to continue using labels that were printed before the order is final and are distributed within the following 100 days.

This FTC case is another in a series involving allegedly unsubstantiated or false environmental marketing claims. In 1992, the FTC issued guidelines for marketers making environmental claims to help reduce consumer confusion about what various claims mean, and to help prevent the false and misleading use of environmental claims. Those guidelines currently are under review, and the FTC will hold a public workshop/conference Dec. 7 and 8 to discuss comment it has received on the guidelines.

The Commission vote to accept the proposed consent agreement for public comment was 4-0, with Commissioner Roscoe B. Starek recused. The proposed consent agreement will be published in the Federal Register shortly and will be subject to public comment for 60 days, after which the Commission will decide whether to make it final. Comments should be addressed to the FTC, Office of the Secretary, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580.

NOTE: A consent agreement is for settlement purposes only and does not constitute an admission of a law violation. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of $10,000.

Copies of the complaint and proposed consent agreement, as well as the Environmental Marketing Guidelines and more information about the public workshop/ conference, are available from the FTC's Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326- 2710. FTC news releases and other materials also are available on the Internet at the FTC's World Wide Web site at: http://www.ftc.gov

(FTC File Nos 942 3012, 942 3243)

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