In this era of greenwashing, legal experts offer guidelines to researching product claims and protecting your business from litigation.
By Katy Tomasulo
Las Vegas, Jan. 22 – The number of products advertised as “green” has multiplied at a record pace in recent years. But while some are as eco-friendly as they say, others are dripping in greenwashing. So how can pros ensure they are selecting green building products that not only live up to their sustainability claims but also offer the expected performance of the products they are replacing? The key is good old-fashioned research, according to a panel of legal experts during the workshop “Green Building Products: Can They Perform as Promised?” at the International Builders’ Show.
The panelists—Sheila Fix of Wood, Smith, Henning & Berman, LLP in Glendale, Calif.;
Loly Tor of K&L Gates in Newark, N.J.; Peter E. Nelson of Simpson Gumpertz & Heger Inc./Consulting Engineers in Waltham, Mass.; and Patrick J. Perrone of K&L Gates—outlined a three-part plan for analyzing and selecting green products, and for protecting your business in the process.
“You will be inundated with green product advertising,” said moderator Perrone. “You need to have an approach to selecting those products.”
EVALUATING PRODUCT CLAIMS
Part 1: Will It Perform?
The first step is to determine if the green product will perform as promised and what installation changes you need to make to accommodate its unique characteristics. To avoid a performance problem, said Nelson, you need an approach to avoid product failure. Understand the nuances of the product’s installation versus the product it is replacing and if different or additional steps need to be taken.
To determine product performance, ask the following questions:
- What is it supposed to do?
- How does the green product compare to the traditional version?
- Does the product meet recognized industry standards, such as building codes, that tell you how to apply it?
- Does it have third-party certification?
- Can large quantities be delivered on a timely basis?
- How long will the product last? Request test data and consider conducting your own testing under the conditions you will be using the product in.
- How difficult is the product to repair?
- Are there installation issues that need to be considered? For example, efficient windows are great, but not if you don’t flash them properly.
- Are there any maintenance requirements to ensure long-term performance?
- How will the product work in a wet environment or if it gets wet?
- What effect will the product have on the home system?
- What is the product’s performance history? Ask about claims history and to speak with other pros who have used the product.
Not every product will meet every criterion. The key is to weigh all of the data and avoid items with too many strikes against them, or that appear risky or unproven.
Part 2: Is It Green?
Like in part one, Tor recommends exploring the following areas to determine if the product lives up to its green marketing claims:
- Ask how the product affects the environment. Weigh energy efficiency, carbon footprint, water efficiency, material optimization, and public health. Bamboo, for example, is rapidly renewable but has to be shipped long distances. Wood takes much longer to grow, but is available locally in many cases.
- Look for applicable green standards that you can measure the product against. Look to green labels such as Greenguard, Greenspec, SFI, FSC, Energy Star, and others for third-party validation. (But remember that not all labels are the same. Look for programs that identify specific criteria; are objective and consensus based; and are stringent so that only the best products can achieve their label.)
- Beware of greenwashing. Proceed with caution if manufacturers cannot support green claims or if they focus on only one attribute. Sticking the word “eco” in front of a brand does not make it green.
- Ask if a Life Cycle Analysis has been conducted. Compare the LCA against that of similar products.
- Consult reliable databases of environmentally preferred products. These include the EPA, EcoLogo, and GreenSeal.
Asking questions and obtaining data can help you better evaluate each new product you’re considering. “There’s no magic formula,” Perrone said. “What we’re trying to convey is a practical, common-sense approach to evaluate products that are out there.”
PROTECTING YOUR BUSINESS
Once you’ve determined a product lives up to its green claims and will perform as needed, it’s important to take steps to limit your liability. Fix and Tor offered the following recommendations:
Pre-construction considerations with manufacturers:
- Work only with reputable companies that have proven track records.
- Obtain an extended warranty and look at it closely. Seek warranties that cover replacement AND cost of replacement (labor).
- Avoid overly restrictive limitation of damage or limitation of remedy provisions.
- Seek permission to assign and pass all warranties on to the homeowner. This is critical; otherwise, the owner will look to the builder to remedy a failure.
- Seek defense and indemnity provisions for third-party claims involving defects.
- Seek additional insured coverage under manufacturer’s policy. And be sure to get a copy of the endorsement and certificate of insurance.
- Ask if manufacturer provides instructions/training concerning proper installation.
- Pre-construction considerations with subcontractors:
- Seek warranty regarding ability to properly install the green product. Ensure they are familiar with it and keep an open dialogue. Consider third-party testing of assemblies.
- Ask for references regarding prior experience with installation of that product; follow through on checking references.
- Seek defense and indemnity provisions for third-party claims arising from improper installation.
- Seek additional insured status for installation problems causing damage to “other property.” Get a copy of the insurance certificate and endorsement.
Post-construction considerations with homeowners:
- Avoid misrepresentation of claims and be careful about what you say. Tor recommended:
- Avoid vague references to green and health benefits
- Avoid inflated or unsubstantiated claims
- Don’t promise specific energy savings
- Train employees, particularly sales, about what they can and can’t say
- Look to FTC Green Guides for guidelines on what you can and can’t say. The FTC is currently considering changes to add claims for green products.
- Let others speak for you. For your new homes, seek third-party certification such as through LEED for Homes, NAHB Model Green Home Building guidelines, and Energy Star.
- Pass along the manufacturer’s warranties. Make them a part of the move-in package. In the contract, say you assign warranties to the purchaser.
- Define what you mean by green in your contract documents.
- Limit liability by contract.
- Provide homeowners with materials on maintaining their products.
Reprinted from ECOHOME Magazine January 2009.