Shh, Can You Keep A Secret?

I was attending one of those swanky wedding luncheons recently and happened to be sitting near a group of Gucci-clad ladies speaking in hushed tones about the Environmental Working Group’s (EWG) 2012 Sunscreen Report. One lady whispered to another, “If you think sunscreen ingredients are dangerous, fragrances are even worse and the ingredients aren’t even listed on the package!”

If you are reading this, then you are a true blue fragrance lover. And being the fragrance connoisseur that you are, you are probably already aware of the fracas in our industry over the safety of fragrance ingredients. You may have even accidentally listened in on conversations similar to the one I heard.

In case you aren’t aware, back in 2010, EWG, a highly visible, seemingly science-averse activist group, posted a report on its website entitled “Not so Sexy: Hidden Ingredients in Perfumes and Colognes.” This report was not published in any peer-reviewed scientific journals but purported that fragrance ingredients are not safe. The report was touted by some media outlets as an exposé on the deadly secret ingredients found in the most popular fragrances on the market. It appears the ultimate goal behind the EWG Report was to misinform and scare consumers all the while spurring Congress to introduce “full disclosure” legislation. Full disclosure legislation would require fragrance manufacturers to reveal all ingredients contained in their proprietary fragrance compositions. This is in direct contradiction to intellectual property laws.

In its report, EWG denounced the fragrance industry by saying outright that manufacturers are deliberately hiding all kinds of dangerous, unpronounceable, synthetic chemicals by not listing them on labels. That not listing them is a “loophole” in the Federal Fair Packaging and Labeling Act that manufacturers love to take full advantage of.

EWG also says that these hidden ingredients cause anything from hormone disruption to cancer. EWG’s marker of danger is that if you can’t pronounce the ingredient, it must be bad for you. We all know that’s not true. All scientific disciplines contain difficult to pronounce terminology that has nothing to do with safety.

The truth is that there is nothing sinister or deceptive about not listing every single ingredient in a fragrance. In fact, in the US, no individual fragrance ingredient is required to be labeled. Perfumes and cologne labels are 100% compliant with just “fragrance” listed on the package. There is no tricky “loophole” here. It is important to note too that the European Union is strengthening its current intellectual property laws to mirror the US.

Unfortunately, some activists groups are banking on, insultingly so, consumers’ lack of familiarity with intellectual property laws. A “fragrance” composition may be composed of just a handful or even several hundred ingredients. This is legal and is not a “red flag” that your favorite fragrance is destroying your health.

The real secret that EWG isn’t telling you is that fragrance compositions are trade secrets which are a protected form of intellectual property much like a patent, copyright or trademark. Many food and cosmetic products contain flavor and fragrance trade secret compositions which are legal. This is nothing new.

Under current law, a cosmetic manufacturer may file a a patent or a trade secret for its formula. The reason patenting a fragrance formula is not a good option for the industry is because unlike trade secrets, patents must be published and they expire after a specified time. Once published, the formula is there for the world to see. And copy. By knowing all ingredients in a fragrance composition, a competitor company can try to recreate it through reverse engineering. Reverse engineering works by dismantling a product formula, its ingredients and percentage of usage and then putting it back together in a similar or identical form and marketing as its own.

Perhaps the most famous trade secret of all is the Coca Cola® formula. It has been kept as a trade secret asset for over 100 years. That trade secret protection has shielded its competitors from attempting to reverse engineer, or copy its formula. If the owner had patented the famous formula, then intellectual property protection would have been lost forever upon the expiration of the patent. Coca Cola® may not have survived as a brand if competitors copied the formula after the patent expired.

This is a perfect example of why full disclosure legislation should be defeated. Activists say consumers have a “right-to-know” what is contained in those mysterious “fragrance” formulas. Actually, they don’t have a right to know. Because current trade secret law says they don’t.

What consumers do have a right to know is that fragrance formulas are safe. And they are safe. The Research Institute for Fragrance Materials (RIFM) was formed in 1966, in an effort to provide research on commonly used fragrance materials. The organization performs toxicity tests, allergy testing, as well as phototoxicity testing. After testing, the results are sent to IFRA, the International Fragrance Association, for evaluation. IFRA then determines the safe use of the material and sets standards for it.

There is no cult of secrecy in the fragrance industry and activist groups like EWG know this. The fragrance industry is not operating through a sinister loophole or attempting to deceive the public. They have a legal right to label their proprietary blends simply as “fragrance” just as Coca-Cola labels its famous recipe as a “flavor”.

Trade secrets provide economic value as well as boost creativity in industries populated by small and medium-sized companies. Piracy of proprietary information eventually weakens the competitive advantage such information provides and dampens the incentive for innovation.

Contrary to what activist groups would have you believe, trade secrets are good for the fragrance industry, good for the economy and good for spurring innovation. The industry cannot and should not acquiesce to activist pressure as it would mean giving away our legally protected intellectual property rights and possibly losing our most beloved fragrances.

About Lisa Leigh

Lisa Leigh is a licensed attorney and the Creator and Founder of Leigh Business Group, a regulatory compliance consulting firm for the fragrance, beauty and personal care industry. Prior to starting her own consulting firm, Lisa worked as a regulatory affairs attorney for the iconic brands Chanel, Gillette and Strivectin. She can be contacted through her website: www.leighbusinessgroup.com. Please feel free to follow her on Twitter at: www.twitter.com/#!/LisaALeigh and her Facebook page at: www.facebook.com/LeighBusinessGroup.
  • http://www.facebook.com/suzanne.voneck Suzanne von Eck

    Very interesting and well written article. Brava!

  • M Gartshore

    Great article, Lisa. But the evaluation that you speak about in your paragraph on RIFM is actually performed by an independent panel of experts. Their recommendations for safe use are then sent on to IFRA for implementation as global Standards.

  • I need an account to post

    These two sentences are key: “Actually, they don’t have a right to know. Because current trade secret law says they don’t.”

    Had the author written, “[a]ctually, they don’t have a *legal* right to know”, I would have no argument … the author is a lawyer after all. But there are other rights of course, and the legislative process in a well-functioning democracy can adjust legal rights to more accurately reflect underlying moral or natural rights (such as the right to not be poisoned by adulterated food).

    (Have not food manufacturers argued in the past against similar disclosure laws with dire predictions, and yet have they not survived the passage of such laws?)

    More fundamentally, the current intellectual-property scheme in this country (and imposed by this country worldwide) is fundamentally pro-oligarchic-business and fundamentally anti-personal-choice-and-freedom. Some degree of intellectual property is of course beneficial, but we’ve lost sight that it’s a balance between freedom and utility.

    Please don’t write “*our* legally protected intellectual property rights” when you really mean “*multi national corporations with more rights to participate in the political process than citizens’* legally protected intellectual property right”. Thank you!

    • red_queen

      You’re overlooking the fact that the same law that protects “multi national corporations with more rights…” ALSO protects small niche perfumers, such as Anya’s Garden, or you if wanted to make your own fragrances.