It turns out that even trace amounts of BPA, or bisphenol A, can create a public relations – and public trust – nightmare for a product marketed as an eco-friendly and reusable alternative to single-use plastic water bottles. This is especially true when the manufacturer is caught in a lie about it.
Just ask SIGG Switzerland and its U.S. subsidiary, the maker of hip, colorful reusable water bottles. It has what could turn into a damaging and costly lawsuit on its hands as a result of what was at the very least is a gross misrepresentation and marketing blunder.
BPA is a manufactured chemical compound that is commonly used in the production of plastics and epoxy resins. It mimics the estrogen hormone and is considered a possible health risk. When concerns about BPA and SIGG products were raised several years ago CEO Steve Wasik said testing showed “no presence of lead, phthalates, Bysphenol A (BPA), Bysphenol B (BPB) or any other chemicals which scientists have deemed as potentially harmful” in SIGG aluminum bottles.
That wasn’t exactly true, as revealed in a Huffington Post article last month in which Wasik, in a written apology, admitted he “made a mistake” when he decided to not announce that the company’s old bottle liner contained trace amounts of BPA. He then said he had learned about the liner’s content in 2006, “when there was debate in the scientific community about the effects of BPA.”
Wasik says scientists remain split on the BPA issue, but that is somewhat beside the point in a case where trust, transparency and perceptions can override any continuing scientific debate.
So Wasik owned up, adding, “I was wrong to have waited this long.” Wasik, the first American-born chief executive of the 100-year-old company, says he is still learning to be a green CEO.
But the damage is done. For one thing the clumsy admissions did not come until the legal wheels had started to turn.
In the inevitable class-action lawsuit that followed, the plaintiffs allege they paid significantly more for SIGG bottles than other alternatives because they “believed SIGG’s representations that their bottles were BPA-free.”
The suit goes on to say that SIGG continued to make those representations about its bottle “and even marketed and sold children’s versions of these bottles to concerned parents – until August 2009 when SIGG finally revealed that their bottles contained BPA and that SIGG had been trying to develop new bottles without BPA since 2006.”
It alleges, among other things, that SIGG concealed the presence of BPA in its bottles, breached its contract with consumers and its expressed warranties related to the fitness and quality of its bottle and engaged in “unfair, false, misleading or deceptive acts or practices regarding its marketing and sale of the bottles” in violation of consumer protection laws.
The plaintiffs are seeking injunctive relief, restitution, and decisions on compensatory damages and punitive damages. Although no specific amounts are suggested in the suit, the latter two claims could involve big bucks, especially if the case goes before a jury as the plaintiffs have requested.
SIGG likely will survive as a green company once the legal wrangling – can someone say settlement? – ends, but with a lot of red on its face and its books.