Sherwin Williams Lands in Trouble Over 114-Year-Old Paint Ad

When companies get in trouble over their advertisements, it usually happens quickly. In the case of Sherwin-Williams Co., it took more than a century.

The paint maker is fighting a California court ruling that ordered it and two other companies to collectively pay hundreds of millions of dollars in damages for promoting lead paint over several decades, when they allegedly knew or should have known it was hazardous. The litigation has highlighted Sherwin-Williams ads dating back to 1904.

Sherwin-Williams and its co-defendants in July petitioned the U.S. Supreme Court to take up the case, arguing that they were unaware of the health risks of lead before it became accepted science and are being improperly punished for truthful advertising about a product that was legal at the time. The federal government banned the use of lead paint in homes in 1978.

Companies already put their advertisements through a range of stress tests to ensure legal and regulatory compliance, adding careful wording and disclosures. But some advertising executives say the Sherwin-Williams ruling, if upheld, would raise the stakes, forcing marketers to consider whether advertising a product may open them to liability many years down the road.

That, in turn, could lead creative teams on Madison Avenue — which wasn’t implicated in the lead-paint litigation — to exercise even more caution when dreaming up ads and bulk up on disclaimers.

“You can’t demand companies to have clairvoyance,” said Dan Jaffe, executive vice president of government relations for the Association of National Advertisers, a trade group of marketers that filed a brief in support of Sherwin-Williams. “It’s the precedent we’re concerned about. We believe that what they’re doing in regard to Sherwin-Williams certainly would apply to many other categories.”

The ruling could potentially affect advertising of a range of products that are subject to frequent studies about their health effects, including everyday food items and consumer products, some ad executives said. “We’re constantly learning things about products we didn’t think were of any concern,” said Mr. Jaffe.

Harris Diamond, chief executive of McCann Worldgroup, a network of creative agencies owned by ad giant Interpublic Group of Cos., said while companies are always mindful of potential liability from ads, “I do think this is a reach that’s further and more than we’ve seen in the past.”

In some ways, the fight echoes the legal battle over tobacco marketing in the 1990s. In that case, government officials said there was clear evidence tobacco companies knew of the health risks of cigarettes and deceived the public. A massive settlement between state attorneys general and the tobacco firms resulted in significant restrictions on advertising and huge payments to states by the firms.

The health effects of lead are now well known. Exposure to it can affect physical and mental development in a variety of ways, especially in children, from behavioral and learning problems to slowed growth, according to the U.S. Environmental Protection Agency.

The state of California argued in its suit that several paint companies were aware of lead paint’s toxicity for years while they marketed it. In the case of Cleveland-based Sherwin-Williams, the plaintiff referred to an internal communication in 1900 that described white lead — which was used in paint — as a “deadly cumulative poison.” The defendants said they didn’t have knowledge of risks now known to be associated with lead-based paint.

A California trial court ruled for the state in 2014, ordering Sherwin-Williams and two other companies involved in manufacturing and marketing lead paint in California, ConAgra Grocery Products Co. and NL Industries Inc., to pay $1.15 billion into a state fund that would go toward removing health hazards posed by lead paint in California homes.

An appeals court last year said the companies should only be liable for lead-paint usage before 1951 because there was “insufficient evidence” the defendants had promoted lead paint for interior use after 1950. This could reduce the damages to between $409 million and $730 million, according to a Sherwin-Williams filing.

But the appeals court upheld the substance of the ruling. It pointed to a Sherwin-Williams ad from 1904 that ran in the Los Angeles Times and San Diego Union. It contained images of paint cans with the company’s SWP logo, along with the message, “Put S.W.P. on your house and you will get satisfaction and save money every time.”

A spokeswoman for the law firm representing Sherwin-Williams said the company stopped making white-lead interior paint in 1943.

In their Supreme Court petitions, the defendants say the state ruling violates their rights to free speech and due process. The high court only takes up a fraction of cases. A lawyer for the California plaintiff said in a statement that there are no constitutional grounds for the high court to take up the case.

An executive at one packaged-goods company said the paint ruling could cause some marketers to shy away from advertising products with a long shelf life, or those that involve health claims like “allergen free.” “That science could change over time,” said the executive.

Advertisers may need to think more carefully about how every word in their ad is interpreted 50 years from now, said Gene Grabowski, a partner at crisis firm kglobal who has worked on lead-paint litigation for Sherwin-Williams and other paint companies in the past.

Companies could be “held accountable not just for making a product available, but for touting that product, for encouraging its use,” he said.

https://www.marketscreener.com/SHERWIN-WILLIAMS-14390/news/Sherwin-Williams-Lands-in-Trouble-Over-114-Year-Old-Paint-Ad-27199035/?countview=0

China Protest Over Cash-Strapped City’s School Plan Turns Violent

Hundreds of people angry at a debt-laden Chinese city’s plans to deal with overcrowded public schools clashed with police in a protest that shows the social tensions beneath China’s long-running local-government debt problems.

More than 600 people gathered Saturday night outside police headquarters in Leiyang to express their outrage over a plan to force some students to attend private school. Some threw water and beer bottles, bricks and firecrackers at police officers and local officials, the police said in a news release on Sunday.

“We tried to film it with our phones, but we decided to run. People were pushing each other and there was no place to go. It was terrifying,” Leiyang resident Liu Yun said. “Later, the fighting started. A bunch of children got hurt.”

More than 30 police personnel were wounded in the clash, the gate to the police compound was damaged and several cars were smashed up, according to the news release, posted on a verified police social-media account. Authorities detained 46 people believed to have led attacks on police, said.

Leiyang, which sits in coal-mining country in southern Hunan province, has seen its finances deteriorate over the past year as the coal industry went into a slump while city-backed companies racked up debts to redevelop slums and attract new businesses. In May, the city didn’t have enough money to pay civil servants, until the province dispatched emergency funds, according to the Leiyang government.

After a rapid increase in debt by local governments and government-backed financing companies, Chinese leaders have for the past two years battled to contain further debt by restraining attempts to borrow more. But flagging economic growth this year has made repayment harder, forcing the government to step in and help struggling state-backed firms. In August, a financing vehicle for a paramilitary organization in far west Xinjiang missed repaying interest and principal on $73 million in bonds, sparking investor jitters about more defaults.

Saturday’s protest in Leiyang was triggered by parents dissatisfied with a government plan to reduce class sizes in public schools, police said.

Under the plan, all fifth and sixth grade students in public schools would be required to attend private schools instead, according to an employee at tutoring-services firm Yixue Education Consulting, who said he has been communicating with local parents. The move, in effect, forces families out of the government-funded public-education system and into the private-school system, where fees are higher.

Some of the private schools also recently underwent renovations, and some parents were worried about reports of unhealthy levels of formaldehyde in the school buildings, the consultant said.

Repeated phone calls to the Leiyang Public Security Bureau rang unanswered on Sunday. The Leiyang Communist Party Committee didn’t answer phone calls or immediately respond to an email seeking comment.

A summary of the parents’ complaints that Yixue published Sunday on the popular WeChat messaging platform was quickly taken down, with a notice saying it was in violation of the rules. Photos and video of protests circulating online, which couldn’t be verified, showed protest banners reading “I want to attend public school” and “Boycott private schools.”

In its annual report to the local legislature in February, the Leiyang government nodded to the widespread consequences of its growing debt.

“Contradictions in financial income and expenditures are unusually prevalent,” the report said. “We continue to face no shortage of challenges in education, employment, health care, housing and other areas that directly touch on the personal interests of the masses.”

On June 4, local officials meeting to address the school problems noted that Leiyang’s public schools had 740 classes that were above the nationally mandated limit of 65 students per class, according to an official summary of the meeting. To meet national standards, the city would need to add classes with the capacity to take 10,700 students, according to the summary, which has been removed from the Leiyang government website.

Liu Yun, the Leiyang resident who witnessed the protests, said Saturday’s crowd was likely larger than the police estimate. She said several parents who went to the government offices to complain about the new policies on Friday were detained, which led others to march to the police compound Saturday to demand their release.

The Leiyang Public Security Bureau said only one of the protesters detained after the clashes Saturday night was a parent. It said most were “social malingerers,” including six people with criminal records.

Ms. Liu doubted the involvement of “criminal elements” and complained that she and other residents were being censored on social media.

“We can’t send out any information,” she said. “As soon as we put it out, it’s immediately taken down.”

https://www.marketscreener.com/news/China-Protest-Over-Cash-Strapped-City-s-School-Plan-Turns-Violent–27199039/?countview=0

SEC’s Clayton mulls allowing mom-and-pop investors to play VC with pre-IPOs

Many high-valuation startups like Airbnb and Uber are often the exclusive domain of venture capitalists rather than being accessible to rank-and-file investors on the public markets

Reuters

SEC Chairman Jay Clayton testifies at a Senate Banking Committee hearing last September.

The Securities and Exchange Commission wants to make it easier for individuals to invest in private companies, including some of the world’s hottest startups, the agency’s chairman said in an interview.

SEC Chairman Jay Clayton, a Trump appointee wrestling with how to boost flagging interest in public markets, said the commission also wants to take steps to give more individual investors a shot at companies that have been out of their reach because they haven’t gone public.

Companies including Uber Technologies Inc. and Airbnb Inc. have shunned the public markets in favor of private investors such as venture capitalists. For decades, regulators have typically walled off most private deals from smaller investors, who must meet stringent income and net-worth requirements to participate because of the added risk private investing holds.

Clayton said the SEC is now weighing a major overhaul of rules intended to protect mom-and-pop investors, with the goal of opening up new options for them.

“The private markets are awash in capital these days,” Clayton said Wednesday in Nashville, where he spoke to groups of entrepreneurs and business-school students. “The question is, ho is participating?”

https://www.marketwatch.com/story/secs-clayton-mulls-allowing-mom-and-pop-investors-to-play-vc-with-pre-ipo-companies-2018-09-02?siteid=rss&rss=1

Health officials, worried about outbreak, investigate HIV cluster in North Seattle

The diagnoses are among 19 HIV cases reported so far this year among heterosexuals in King County. For all of last year, that number was seven, according to the health agency.

A cluster of eight people in North Seattle, described as heterosexuals, drug users, and recently homeless, have been diagnosed with HIV infections since February, and health officials worry their cases could represent a new pattern of transmission for the virus that has been in steep decline.

Officials suspect changes in drug use are to blame.

“There could be a large outbreak potentially,” said Dr. Jeff Duchin, health officer for Public Health – Seattle & King County. “There may be a large number of people vulnerable to new HIV infections which would be a very big problem.”

The diagnoses are among 19 HIV cases reported so far this year among heterosexuals in King County. For all of last year, that number was seven, according to the health agency. It has averaged 10 for the past decade.

Gay and bisexual men are most at risk to contract HIV in Washington state. Statewide, 461 cases were diagnosed each year from 2012-2016, on average, according to state Department of Health statistics. Of those cases, an average of 290 each year were among gay and bisexual men.

The recent Seattle cluster is a departure from the typical pattern of infection, and particularly concerning because it involves homeless people who might not have access to health care or might be missed by HIV-prevention services.

“I would see this cluster as being the canary in the coal mine but not cause for panic,” said Dr. Peter Shalit, a primary care physician in private practice who has been treating HIV patients since the 1990s. “It just sort of reminds us that the epidemic is not over and it’s going to pop up in places that we’re not paying attention to with our prevention efforts.”

That so many more heterosexuals in King County have been diagnosed with the virus this year suggests HIV might be spreading between different populations.

“We’ve known for awhile that men who have sex with men who inject methamphetamine have a very high rate of HIV infection – over 40 percent,” Duchin said.

In contrast, other groups of injective drug users, including heterosexuals, have rates of about 1 to 3 percent, he said.

Duchin said interactions between populations of heroin users and men who have sex with men and use methamphetamine could explain the recent uptick.

“It’s really good that the health department is jumping on this,” Shalit said, noting that an outbreak among a network of people sharing syringes several years ago in Indiana left nearly 200 people infected with HIV.

“I don’t think that will happen here,” Shalit said. “We have a fabulous health department here and we learned from the situation in Indiana where it was allowed to get out of control.”

The recent HIV cluster was discovered through a monitoring program. Medical providers statewide must notify officials when a patient is diagnosed with HIV. After a diagnosis, local public health officials try to get the patient into medical care and determine if others were at risk.

“You try to identify the social milieu and all the people in that area, test them,” Shalit said. “Get them on treatment as soon as possible. If they’re on effective treatment, they can’t transmit.”

Duchin said transmission links among four of the eight people of this cluster have been identified. He said investigators had not tied a specific location to the HIV transmission, other than North Seattle.

At least half of the people in the cluster are receiving medical care. Duchin said health officials are working to make sure syringe-exchange and condom programs are meeting demand. The local health department also is increasing testing and outreach to homeless people.

“If there are a number of cases that we’re not aware of, or if this is the tip of the iceberg, things can get more complicated,” he said.

https://www.seattletimes.com/seattle-news/homeless/health-officials-investigating-cluster-of-hiv-infections-in-north-seattle/

Study shows health, reaction-time declines in firefighters

Randy Brooks’ son had a request three years ago: What could his dad do to make wildland firefighting safer?

To Brooks, a professor at the University of Idaho’s College of Natural Resources who deals with wildland firefighting, it was more of a command.

His son, Bo Brooks, is a wildland firefighter who a few days earlier during that 2015 fire season fled a wall of flames that killed three of his fellow firefighters in eastern Washington.

The result of the conversation was an online survey that drew some 400 firefighters who mostly identified mental and physical fatigue as the primary cause of injuries to firefighters who are often confronted with a changing, dangerous environment.

But a self-selecting online survey is not necessarily representative of what’s happening in the field. So Randy Brooks decided to apply some science.

That led to an ongoing health-monitoring study involving wrist-worn motion monitors and body composition measurements that last year found health declines and deteriorating reaction times among firefighters as the season progressed.

“A lot of them face peer pressure to perform all the time,” Brooks said. “Others feel pressured to protect natural resources and structures at all costs.”

About 19,000 firefighters are currently in the field fighting nearly 40 large wildfires. Fourteen firefighters have died this year as wildfires have scorched about 3,500 square miles (9,000 square kilometers) and destroyed about 3,000 homes.

The study last year found firefighters lost muscle mass but gained fat based on body-composition testing before and after the season.

The firefighters also wore a wrist device called a Readiband from a company called Fatigue Science. The device keeps track of how many hours of sleep a person gets. Formulas developed by the U.S. military then calculate fatigue, based on a lack of sleep. That’s used to predict alertness and reaction times, which get worse as fatigue levels rise.

Firefighters in the field can get as little as six hours of sleep or less each night. The devices found that not only did reaction times falter as firefighters remained longer on a fire before getting a mandatory break, Brooks said, but firefighters also tended to take longer to recover as the season progressed. Sometimes, fatigue levels reached a level that suggested reaction times slowed down so much it took firefighters twice as long to react.

Brooks said his initial thoughts are that wildland firefighters might need better nutrition to stay fit and mentally sharp. But last year’s study had only nine firefighters. Brooks this year has expanded the study to 18 firefighters, 16 men and two women. They’re smokejumpers, meaning they parachute from airplanes to fight fires.

Brooks said that next year he hopes to have about 100 firefighters and include hotshot crews, a ground-based wildland firefighter that can, like smokejumpers, be deployed on a national basis.

Smokejumpers in the study often eat pre-made meals. Brooks wants to find out if maybe those meals are behind some of the puzzling results from last year’s study, such as a loss in muscle mass.

Hotshots, meanwhile, can return to a central spot where they get prepared food supplied by the U.S. Forest Service. That agency has done extensive research on what it takes to keep wildland firefighters fueled, and contractors who supply the meals must meet Forest Service nutritional guidelines.

Forest Service health experts have even followed firefighting crews to take blood samples to check glucose levels, which can indicate alertness.

Joe Domitrovich, an exercise physiologist with the Forest Service’s National Technology and Development Program in Missoula, Montana, said that experiment led the agency to change gears and recommend firefighters snack during their shifts to keep glucose levels up.

“It’s critical for cognitive function as well as physical movement,” he said.

The agency declined to comment on the University of Idaho study.

Brooks said at this point in his study there are more questions than answers. For example, one question is why so many firefighter deaths are due to falling branches or trees. The deaths of three of the 14 firefighters who died last year were due to what are called hazard trees. At least one firefighter was killed by a falling tree this year, and several more have been injured.

“What I’m trying to figure out is what is causing these accidents,” Brooks said.

A fair number of wildland firefighters also die of heart attacks during the season. Brooks said he wants to know if there’s something about the demanding seasonal job that puts wildland firefighters at greater risk of heart attacks.

Brooks wonders about the smoke firefighters inhale while doing physically demanding work. Many cities in the Pacific Northwest this year issued health alerts due to smoky air.

Ultimately, firefighters themselves might be part of the problem when it comes to calculating risks while protecting natural resources and property.

“There’s a little bit of a hero culture,” said John Freemuth, a Boise State University environmental policy professor and public lands expert. “There is a bonding with everybody. It can create a culture of where you kind of collectively ignore things you shouldn’t ignore.”

 Explore further: Firefighters may face higher odds for skin cancer

https://medicalxpress.com/news/2018-09-health-reaction-time-declines-firefighters.html

Microwave weapon suspected in mystery attacks on US diplomats

Picture of the US embassy in Havana, taken on September 29, 2017 after the United States announced it was withdrawing more than half its personnel in response to mysterious health attacks targeting its diplomatic staff

Doctors and scientists increasingly suspect attacks with unconventional microwave weapons as the cause of the mysterious ailments that have stricken more than three dozen American diplomats and their families in Cuba and China, The New York Times reported Sunday.

The victims reported hearing intense high-pitched sounds in their hotel rooms or homes followed by symptoms that included nausea, severe headaches, fatigue, dizziness, sleep problems and hearing loss.

A medical team that examined 21 of those affected in Cuba did not mention microwave weapons as a cause in a study published in March in the Journal of the American Medical Association.

But its lead author, Douglas Smith, the director of the Center for Brain Injury and Repair at the University of Pennsylvania, told the Times that microwave weapons are now considered a main suspect and that the team is increasingly sure the diplomats suffered brain injury.

“Everybody was relatively skeptical at first,” he was quoted as saying, “and everyone now agrees there’s something there.”

Neither the State Department nor the FBI has publicly pointed to microwave weapons as the culprit, and the Times said there were many unanswered questions as to who might have carried out the attacks and why.

After holding Cuba responsible for either carrying out the attacks or failing to protect American officials, the US in September 2017 recalled more than half of its staff from the embassy and expelled 15 Cuban diplomats from Washington.

Cuba has firmly denied any role in, or knowledge of, the incidents.

In June 2018, the State Department announced it had sent home US government personnel from China after they reported eerily similar incidents.

Microwave research

According to the Times, an American scientist, Allan Frey, first discovered in 1960 that the brain can perceive microwaves as sound.

His discovery opened a new field of research that ultimately led both the United States and the Soviet Union to explore microwaves’ potential use in unconventional weapons.

The Russians dubbed the class of envisioned weapons as psychophysical or psychotronic, according to the Times.

It said the US Defense Intelligence Agency warned in 1976 that Soviet research on microwaves showed potential for “disrupting the behavior patterns of military or diplomatic personnel.”

A National Security Agency statement obtained by Washington lawyer Mark Zaid on behalf of a client described how a foreign power built a weapon “designed to bathe a target’s living quarters in microwaves, causing numerous physical effects, including a damaged nervous system,” the Times said.

The US military also researched weapons applications of microwaves, with the air force winning a patent on an invention shown to beam comprehensible speech into an adversary’s head, according to the Times.

Navy researchers explored the use of the Frey effect to induce sounds powerful enough to cause painful discomfort, and even immobilize the subject, it said.

The Times said it is not known if Washington deploys such weapons.

 Explore further: Researcher links diplomats’ mystery illness to radiofrequency/microwave radiation

https://medicalxpress.com/news/2018-09-microwave-weapon-mystery-diplomats.html

Who wins when a prescription copay exceeds the drug price? Not the patient

Prescription drug copayments often exceed the retail cost of a drug, a recent USC study reveals. This means that technically an overpayment occurs, and someone—not the patient—keeps the excess payment.

Researchers at the USC Schaeffer Center for Health Policy & Economics who recently analyzed claims found that the copay exceeds the cost to the insurer in 1 in every 4 claims. The average overpayment is about $7.69. However, almost 1 in 5 overpayments exceeded $10. Sixty percent were worth $5.

“Our study sheds light on what many had assumed to be an uncommon practice and finds that overpayments may occur much more frequently than we realized,” said lead author Karen Van Nuys, a research assistant professor at the USC Price School of Public Policy and executive director of the Schaeffer Center’s life sciences innovation project. “These findings have implications for patients’ out-of-pocket spending as well as national drug spending trends.”

Drugs with frequent overpayments include antibiotics, statins, anti-hypertensives, sleep aids, anti-inflammatories, and cough and cold medications. Almost 23 percent of the claims—2.2 million—involved overpayments. Not surprisingly, they occurred more frequently on generic drugs than on branded, 28 percent versus nearly 6 percent.

“Not only does this raise drug costs for consumers, but it is inherently unfair to penalize people for having—and paying for—insurance,” said Geoffrey Joyce, a co-author on the study and director of health policy at the Schaeffer Center. “And furthermore, for patients who are financially constrained, $5 or $10 could mean the difference between being filling a prescription or not.”

Most consumers—whether insured through their employer, the individual market or government programs—have set copays for prescription drugs, an out-of-pocket expense they pay at the pharmacy counter. The copay framework is intended for the patient and insurer to share the cost.

Pharmacies pass the copays to pharmaceutical benefits managers, who reimburse the pharmacies a negotiated rate to cover drug costs, as well as any dispensing fees and markups.

 Explore further: Drug copayments often exceed prescription drug costs

More information: Karen Van Nuys et al. Frequency and Magnitude of Co-payments Exceeding Prescription Drug Costs, JAMA (2018). DOI: 10.1001/jama.2018.0102

https://medicalxpress.com/news/2018-08-prescription-copay-drug-price-patient.html