Media Mention: Michael B. Fisher, Esq. & Sarah Syed, Esq., April 24, 2014

By: Andrew Westney

Packaging manufacturer Micro-Pak USA Inc. hit rival YCM Co. Ltd. with a suit in California court Tuesday, claiming YCM gained an edge by using a potentially dangerous chemical in its mold-preventing materials without proper testing.

Micro-Pak USA alleges YCM uses allyl isothiocyanate, an active ingredient in rodent repellent, as a fumigant in its packing materials for shoe and apparel boxes. Because they contain antimicrobial pesticides, YCM’s products should be tested by the U.S. Environmental Protection Agency and the California Department of Pesticide Regulation, according to the complaint.

“By ignoring the regulations implemented by the United States and the state of California, YCM has avoided the expense associated with compliance, gaining an unfair advantage in the marketplace while putting children and consumers at risk,” the complaint says.

Micro-Pak has registered all its products containing antimicrobial pesticides, including stickers and sheets for mold and fungus prevention, with the CDPR and with the EPA under the Federal Insecticide, Fungicide and Rodenticide Act.  That stands in contrast to Taiwan-based YCM, which “operates outside the law of the United States” and has not registered its products with any agency in the U.S., according to the complaint.

Micro-Pak is a subsidiary of Hong Kong-based Micro-Pak Ltd.

YCM is one of the largest producers of products “containing unidentified harmful poisons and chemicals” used in boxes for apparel and shoes, including children’s shoes, imported to the U.S., according to the suit. The products are used to combat mold and fungus from moisture accrued during shipping, the complaint says.

The federal and state registration process is “time-consuming and very expensive,” according to the complaint, with the EPA requiring companies to show their product is safe and effective through chemical analysis, and with California registration requiring CDPR review to ensure a product is properly labeled and will cause no health or environmental problems.

Manufacturers of products with antimicrobial pesticides also are required to pay fees based on the volume of their products sold in California, the complaint says.

Micro-Pak alleges violations of the California Business and Professions Code by acts of unfair competition, claiming YCM harmed MicroPak by not having to pass on the cost of compliance with federal and state regulations to its customers.

The complaint also alleges a tort in essence by YCM for failing to register with the EPA or CDPR in violation of the California Food and Agricultural Code.

Micro-Pak seeks an injunction on the sale of YCM products in the U.S. without EPA approval, and in California until YCM registers with the CDPR.

Representatives for YCM were not immediately available to comment Thursday.

Micro-Pak is represented by Michael B. Fisher and Sarah A. Syed of Buchalter Nemer PLC.

Counsel information for YCM was not immediately available.

The case is Micro-Pak USA Inc. v. YCM Co. Ltd. et al., case number BC543320, in the Superior Court of the State of California, County of Los Angeles.

–Editing by Edrienne Su.