Marijuana Business Magazine November-December 2019

Marijuana Business Magazine | November-December 2019 96 There may not be a regulation that prohibits someone from manufacturing a customizable product. ... (But) a manufacturer needs to be very thoughtful in light of what’s going on and potential liability claims.” —Rachel Gillette Cannabis attorney at Greenspoon Marder Also, maintain clear records such as tracking product materials and ingredients as they move through the supply chain, standard operating procedures and thorough training, said Emily Leongini, a cannabis attorney based in Washington DC. “You’re never going to be able to avoid all litigation risk,” she added. “But compliance will limit the amount of risk exposure a company has.” KEEP AN EYE ON SUPPLY If additives such as vitamin E acetate prove to be the culprit for the vaping- related illnesses, vape cartridge manufacturers need to be able to account for every step of the supply chain, from where the vaporizer was manufactured to when it was filled with cannabis oil and any other chemicals. Cannabis vape companies should have a process in place to investigate their products, Leongini said, citing the importance of knowing “what’s in what you’re selling, the process of how it’s manufactured and what kind of testing is done.” Keeping careful batch records will help defend your company against potential lawsuits. For example, if an executive wants to blame the ingredient supplier who provid- ed the tainted ingredients, he or she will need meticulous records of who supplied all inputs throughout the supply chain. “Have the contracts in place to assign the liability to them so you’re not the one left holding the bag,” Leongini said. David Jaroslaw, a New York City attorney who specializes in product- liability defense, said in any product- liability action, the manufacturer will be considered an expert about the product’s risks. The company should be able to demonstrate the chain of manufacture—from the source materials to the finished vaporizer—to ensure the product is as safe as possible, he added. “Know who you’re buying from, know who you’re selling to,” Jaroslaw said. “Know, if you can, where it’s man- ufactured and what the standards are.” Bodamer backs up that point. “The best way to understand the inputs to a given product is to have meaningful relationships with all the vendors involved,” he said. Bodamer suggests that a cannabis vape cartridge manufacturer should know: • Where the plant came from that was used to make the cannabis oil. • Where the plant was extracted into oil. • Who supplied any additives. • Whether the additives are sanctioned and approved. • Whether the ingredients are compliant with Good Manufacturing Practice in other industries. • Whether there were ingredients that haven’t been approved for human ingestion. “Being able to track the answers to every single one of these questions is among the best defenses that these companies will have to alleged product- liability claims,” he added. KNOW YOUR GMPS Without federal legalization, U.S. cannabis companies aren’t held to the same standards as other industries. But that shouldn’t prevent a company from demanding its vendors are meeting certain standards, Bodamer said. “If you have certifications from suppliers that are following GMP, that goes very far to protect companies against claims that they’ve been negligent or reckless in permitting faulty products into the marketplace,” he added. For example, certifications are available for food products by applying to a number of different global certification groups, including the Health Sciences Authority. Bodamer added that he would like to see cannabis companies going beyond the bare minimum for good practices. “You shouldn’t be meeting them,” he said. “You should be exceeding them.” Leongini also suggested that a cannabis company in danger of falling on the wrong side of a product-liability claim find a good law firm with expertise in both litigation in response to class-action complaints as well as the regulatory subject matter expertise needed to defend against them. “Retain counsel,” Leongini said. “Lawyer up.” Vaping Crisis Bart Schaneman is a reporter for Marijuana Business Magazine. You can reach him at barts@mjbizdaily.com .