On a visit to China earlier this year, The Walt Disney Company’s Jay Rasulo inspected contract factories that make Disney-branded products.  He met with factory managers, walked factory floors, visited worker dormitories and spoke with Disney team members responsible for auditing labor conditions in the factories.  “It was an opportunity for me to see our extended supply chain first-hand,” he said.

Scrooge McDuck

A trip like that would not be unusual for an executive in charge of a company’s corporate citizenship program, as Mr. Rasulo is for Disney.  What was out of the ordinary is that Mr. Rasulo is also Disney’s chief financial officer (CFO) and a senior executive vice president, responsible for a worldwide finance organization that tracks and manages some $40 billion in annual revenue.

In a recent presentation to corporate responsibility executives at the BSR 2012 conference in New York, Mr. Rasulo explained that his two titles required qualities belonging to two very different Disney characters: Toy Story’s Woody (an amiable guy “who’s 100 percent committed to doing the right thing”) and the classic Scrooge McDuck (a guy who “strives to make every dollar count”).

“I do spend most of my time talking to investors and bankers,” Mr. Rasulo said. But wearing two executive hats – CFO as well as leader of the citizenship program - “allows us to integrate our work in citizenship with the other financial strengths of the company.  And if I’m successful in doing that, I believe I’ll actually create even more value for our shareholders.”

Shifting Responsibilities

While Disney’s structure for its citizenship program is more ambitious than that of most companies, a growing number of CFOs are increasingly involved in environmental and social initiatives (often called sustainability programs) that not long ago were totally divorced from their company’s income statements or balance sheets.

Traditionally, “CFOs ran the numbers, letting others handle soft issues such as social responsibility and corporate citizenship,” says a 2011 report by the consulting firm Ernst & Young. “But those job silos are crumbling. Investors, business customers and other stakeholders have shown a growing desire to connect a company’s financial performance to its social and environmental impact. “

As a result, “CFO involvement with sustainability is deepening,” concludes a 2012 survey of 250 CFOs in 14 countries by Deloitte Touche Tohmatsu Limited (DTTL). Two-thirds (66%) of the CFOs surveyed said they were “always” or “frequently” involved with driving sustainability strategy in their organizations.  More than half (51%) said their involvement had increased over the last year.  More than three-fifths (61%) said they expected their involvement to increase over the next two years.

One big reason for the greater CFO involvement, the Deloitte survey concluded, is that “sustainability is being operationalized,” with accountability beginning to shift from an organization’s chief executive officer (CEO) or head of sustainability to its chief operating officer (COO) or CFO.  The percentage of CFOs and COOs accountable to their company’s boards for sustainability issues nearly doubled from 20% to 36% in the past year, the survey found.

Ernst & Young found that these trends are increasing responsibilities for CFOs across a range of activities. In investor relations, for example, “banks, insurance companies, private equity funds and other institutional investors are now considering the sustainability rankings of the companies in which they invest… As sustainability issues intertwine with business strategy, institutional investors are starting to view financial and non-financial performance as two sides of the same coin.”

That has increased pressure for sustainability reporting and new financial controls. “Among other things, customers increasingly want to know that a company’s distribution model has a low carbon footprint; that its procurement policies take “fair trade” issues into account; and that its supply chain uses alternative energy sources,” the E&Y report said.  "While concerns such as these have environmental or social benefits, “each one also has a potential financial impact. Evaluating the return on investment (ROI) of potential capital expenditures and reporting on their bottom-line impact requires the attention of the CFO’s finance team.”

Citizenship Dilemmas

Jay Rasulo, senior executive vice president and chief financial officer, The Walt Disney Company.

Disney’s Mr. Rasulo said that when it comes to making tough corporate decisions on environmental and social initiatives that involve trade-offs between short-term costs and long-term business benefit, “the CFO is well-positioned to do that.”

Disney’s commitment to corporate responsibility, he said, stems largely from what consumers expect of the brand: “More is expected of us.  If we don’t act in accordance with the stories we tell, the experiences we offer, and the images we project, we lose our authenticity. You can’t entertain a family on the one hand and totally disregard the world that that family lives in and the circumstances that they work in.  Acting responsibly is core to our brand.”

In speaking to an audience composed mostly of corporate responsibility executives from large companies, Mr. Rasulo cited three examples of “citizenship dilemmas” confronted by Disney in which he – as CFO – has played a critical role.

- A commitment to promote only “healthier” meals - sold at Disney parks, endorsed by its characters or advertised on its TV outlets – has taken about three years to fully implement and “turn into a win” financially. “We are (now) launching product lines that, frankly, we would not have imagined had we not decided to play a role in helping to create healthier generations,” he said.

- A commitment to reduce greenhouse gas emissions company-wide conflicted with plans to grow some highly-profitable businesses – such as Disney cruise ships – that are carbon intensive.   The company has imposed an internal “carbon tax” on individual business units to encourage technological innovation and “imagineering.”

- A commitment by Disney – the largest product licensor in the world – to maintain fair labor standards at over 25,000 factories in more than 100 countries, where Disney-branded products are made.  “It’s a very profitable business model, as you can imagine,” he said.  “It’s also a business model that creates immense challenges for implementing our Code of Conduct for manufacturers as well as our international labor standards that help ensure proper working conditions in this extended supply chain.”

In making decisions as a CFO or senior executive in situations such as this, Mr. Rasulo said, “you’re in the world of tradeoffs; you’re trading off the profitability against the risk…you want a hard and bright line, but most things are grey.”

Internally, he added, persuading business units to adopt more sustainable practices was frequently a challenge: “It’s not easy.  It takes a lot of work.  It takes a lot of cooperation.”   And he advised against using “moral high-ground” as a primary tool of persuasion in internal deliberations about sustainability strategy. “You’ve got to do your homework,” he said. “You have to approach it like every other business problem.”

One advantage of leading a corporate citizenship program as CFO, Mr. Rasulo added, is that it’s easier to make decisions when there are “tradeoffs among business units” or, when there is a “company good in general,” to decide how costs should be allocated to particular business units.

“As fantastical as it sounds,” he said, “as the CFO of Disney I am as committed to meeting the expectations of children and families on Main Street as I am to delivering results to Wall Street  - because what’s good for kids and families is good for Disney’s financial future too.”

Marketers searching for hip and edgy corporate advertising often risk reputation and close the door on social responsibility in pursuit of a breakthrough moment. It is the yearning for the green light at the end of the dock…..a place, as Fitzgerald’s Gatsby learned, that invites unexpected consequences.

Pepsi pulled a Mountain Dew ad that had been criticized for being racist and glorifying violence against women.

Recent misfires by Pepsi, Hyundai, McDonald’s, Ford and General Motors are the latest round in advertising blunders striving for humor that instead were unwrapped as offensive and insensitive stereotypes.

Learning from others whose attempts at humor have offended isn’t part of the breakthrough playbook. In 2001, Mitsubishi Motors launched its $14,000 Lancer with an ad tag line, “It must be dyslexic. It thinks it’s a $41,000 car.” At the time, I worked for Mitsubishi, and my team was on the receiving end of the hundreds of calls, letters, and faxes from organizations and parents of dyslexic children who found the ads offensive and hurtful. Many parents were either in tears or furious when they registered their protest.

I argued against continuing to run the ad to the Mitsubishi executive who approved it. But he pushed back against criticism, saying it had been created by an agency executive who had dyslexia, so how could it be offensive? That is a seductive but empty argument as the marketing folks at Pepsi’s Mountain Dew found in the backlash to the racial and domestic violence stereotyping in an ad created by Tyler The Creator, an African American rapper. After reviewing the rapper’s body of work, Syracuse University professor Boyce Watkins, who had initially called the ad “arguably the most racist ad in America,” commented “… who made the ad doesn’t change what the public sees.”

In a live online chat in May 2013, after Pepsi pulled the Mountain Dew ad, a representative responded on the company website to a question (from a friend who sent me the exchange) about how the ad could have been approved: "I do apologize for this,” said the Pepsi representative. “….We are going over our reviewal (sic) processes to prevent anything of this nature to occur again in the future, however since this is an ongoing process I do not have any specific steps to share at this moment….”

One simple suggestion for improving the review process: ask a broader pool of people what they think. When I was at Mitsubishi, the ad review process was broadened after that Lancer ad, at the request of the CEO, to include several of us who represented more diverse viewpoints so that concerns about potential fallout from edgy concepts could be heard sooner.

Beyond damage control, there is a hugely important reason why leaders from the company’s social responsibility area, ethics office and Human Resources should be included in reviewing proposed ad campaigns. While these perspectives aren’t likely to align with the priorities of those responsible for breaking “through the clutter” to sell product, any disagreements are in service of the company’s success – which aligns everyone. Out of any debate about whether edgy and hip have crossed a line is the potential for greater awareness and better decisions.

Selling products or services is the life blood of a company’s financial sustainability.  However, part of providing a sustainable environment for those products and services to be received is ensuring credibility to its stakeholders that what a company says it stands for on its website and in executive communications is also heard in the company’s advertising voice and presence.

That voice long outlasts hip and edgy’s siren song.

Gael O’Brien, a Business Ethics Magazine columnist, is a consultant, executive coach, and presenter focused on building leadership, trust, and reputation. She publishes the The Week in Ethics and is The Ethics Coach columnist for Entrepreneur Magazine.

They crowded in for the hot dog show.

An Oscar Meyer wiener, serving as proxy for a finger, was pushed into the spinning blade of a table saw. The demonstration, at the International Woodworkers Fair in Atlanta, mimicked the way gruesome table saw injuries often occur. But this saw was equipped with a safety device called SawStop that allowed the blade to distinguish between wood and flesh, and to stop fast enough to prevent serious harm. Sure enough, the blade came to a dead stop in about three one-thousandths of a second, leaving the dog with only a minor nick.

Table saw accidents are painful, life-changing and expensive. Each year, more than 67,000 U.S. workers and do-it-yourselfers suffer blade contact injuries, according to government estimates, including more than 33,000 injuries treated in emergency rooms and 4,000 amputations.

Gerald Wheeler had other numbers on his mind as he watched hot dog meet blade that day in August, 2002. As the operator of a wood shop in Hot Springs, Ark., he was all too aware of the unforgiving nature of table saws. Not long before, two of his employees had been maimed within a few weeks of each other. Wheeler felt awful about the injuries, the loss of two good workers, the $95,000 in medical bills, the doubling of his workers compensation rates.

Wheeler thought: If only this had come along sooner. He took out his Visa card to order two of the saws, but was told none were available. As the SawStop guys explained, they had been seeking licensing deals with the big power tool makers, but had found no takers.

Faced with the prospect of never getting the invention to market, the little company, also known as SawStop, eventually started making its own saws. Since they first went on sale in 2004, SawStop says it has recorded 2,000 “finger saves”—customer reports of  accidents likely to have caused disfiguring injuries with conventional saws, but that resulted in minor cuts or a few stitches at most (SawStop acknowledges two reports of amputations).

“Bravo!” a man named Frank Oslick emailed SawStop, explaining that he had lost two fingers and part of his thumb in a table saw accident when he was 14. “I have not lived a single day without regretting that accident,” he wrote. “If your device prevents even one person from going through what I have gone through it is a world class accomplishment.”

However, SawStop still makes the only saws with skin-sensing technology, and accounts for a tiny fraction of sales. Tens of thousands of fingers have been sliced off since the system was invented, but the rest of the industry, which is self-regulating, has been allowed to go on as before.

Over the years, top saw makers and the Power Tool Institute, their trade group, have defended the design of their saws and the decision to snub SawStop.

They’ve argued that injury numbers have been inflated and that the government’s estimate of $2.36 billion in annual costs to society from table saw accidents—including medical bills, lost wages, pain and suffering—is exaggerated. They say the market for popular, lightweight saws costing as little as $100 to $200 would be destroyed by the added expense of SawStop. They note that under some circumstances, SawStop can stop a blade without skin contact--such as when the blade touches conductive materials like metal or very wet wood. In such cases, the owner usually has to replace the blade and an electronic cartridge.

But as court records and testimony have shown, the companies rejected the safety advance for another reason, too: They worried that if a way to prevent severe injuries got traction in the market, they would face liability for accidents with conventional saws.

Even so, they have had to defend lawsuits. About 150 have been filed in recent years, focusing on the companies’ decision not to use available safety technology.

(For examples of power saw injuries and lawsuits, read about those involving Adam Thull of Crosslake, Minn., and Tom Corbett of Manchester, Mass.)

The industry is also trying to keep the Consumer Product Safety Commission from requiring injury reduction systems on all table saws—either SawStop or something similar. Indeed, another firm, Massachusetts-based Whirlwind Tool Co., says it has developed a "proximity detection" systems that will shut down a saw when a hand comes close to the blade.

But the industry may have little to fear from the commission. The agency has been wrestling with the issue, on and off, for 15 years. So far, its most definitive act has been to give SawStop an award for safety innovation. It will be at least next year before the agency adopts a regulation, if it ever does.

The SawStop story is about an industry’s ability to resist a major safety advance that could, by now, have prevented countless disfiguring injuries, but might have been bad for business. It highlights the endless due process that makes it virtually impossible for regulators to enact safety measures over the unified objections of industry.

It’s also something of a David-and-Goliath story--though in this case David, rather than carry a sling, is armed to the teeth with patents.

Several industry representatives declined interview requests or did not return calls and emails seeking comment. The Robert Bosch Tool Corp. provided a statement: "Safety has historically been one of the Bosch principles…and is reflected in our slogan ‘Invented for life.’"

Birth of SawStop

Stephen Gass is energetic and intense, a trimly built man of 49 whose home near Portland, Ore, is a manageable drive from some of his favorite whitewater kayaking runs. He grew up on a horse farm in Eastern Oregon, and was taught woodworking by his father. He earned a doctorate in physics and a law degree, then joined a patent law firm in Portland, but retained his interest in building things.

Stephen Gass, president of SawStop, LLC, at company headquarters near Portland, Ore.

Gass created an elaborate workshop behind his house. For some reason, while out there on a fall day in 1999 he was struck by a question: Would it be possible to stop a saw blade quickly enough to keep it from slicing off your fingers? After a series of calculations and with parts you could buy at Radio Shack, he showed it could be done.

The invention involves running a weak electrical current through the saw blade. When a person comes in contact with the blade, the body absorbs part of the signal. An electronic sensor detects the change in current and activates a spring. The spring jams an aluminum wedge between the teeth of the blade, which acts as a brake. The blade also drops below the surface of the table. It all happens in so few milliseconds that, unless the hand is moving unusually fast when it hits the blade, the injury typically is minor.

One of the mysteries is why the power tool industry, with its engineering prowess, didn’t invent SawStop before Gass did.  Maybe he was smarter. Or maybe the industry didn’t do it because it didn’t need to.

There were no clear financial or legal incentives. Table saws are a must-have tool for millions of construction workers, cabinet makers and do-it-yourselfers. In the U.S., there are about 9.5 million of them in use, according to industry figures. Of about 500,000 sold each year, 85 percent are supplied by members of the Cleveland-based Power Tool Institute, including such well-known brands as Black & Decker, DeWalt, Makita, Skil, Bosch and Ryobi.

For decades, the companies were shielded from liability by a few unquestioned assumptions: Namely, that table saws were inherently dangerous; that everyone knew this; that accidents typically involved carelessness or failure to follow directions; therefore, when people got hurt it was their own fault. As an industry lawyer told a jury: “This is a table saw. It cuts wood. And if you’re not careful, you can get injured.”

Saw designs are governed by a voluntary standard worked out between an industry-dominated technical committee and Underwriters Laboratory. When SawStop came along, the voluntary standard called for a guard that fit like a hood over the blade. Because a hand can slip under the guard, many thousands of injuries occurred even with the guard in place. Usually, however, the guard wasn’t being used. Because it limited visibility, had to be removed for certain cuts, and took a long time to detach and put on again, most people worked without it.  Critics said the guard did more to protect the manufacturers than users.

In a letter to Underwriters Laboratory in April, 1998, an engineer for the CPSC linked the high injury toll to poor design of the guard. Said the engineer, Caroleene Paul:  “Experienced saw users comment that ‘the typical stock guard that comes with many saws is so frustrating to mount, align, adjust, remove and work with, you’re tempted to leave it off permanently.`"

Members of the Power Tool Institute insisted there was nothing wrong with the guard. Following a December, 1999 meeting, Paul summarized their position: “Education is the only way to affect the injury hazard patterns seen. Education, not redesigning the guard, is needed to convince the operators to use the blade guard.” The institute pledged to do its bit by making a video.

SawStop wrecked this way of thinking. Saw makers now had the ability to prevent the tragedies they knew were going to happen, that had always happened. For this reason, Gass thought, his invention should be an easy sell.

“I couldn’t imagine that anyone would not want to put this on the saws that they were offering to people,” he said.

He recruited three friends from the law firm, all named David, to put up seed money for the new venture. The industry’s initial reaction was not encouraging.  Gass recalled being told by one executive: “The marketing guys say safety doesn’t sell."

Hoping to stir grass-roots interest, Gass and the Davids made their first trip to the woodworkers fair in August, 2000. They were sent to the nosebleed section—a tiny booth in a conference room on the third floor of the Atlanta Convention Center. But as word of the hot dog demonstration spread through the fair, they were soon drawing crowds. SawStop was awarded a top prize for technological advancement.

Saw makers also took notice and issued invitations. Soon Gass and his partners were visiting corporate offices of Emerson Electric; Black & Decker (now Stanley Black & Decker), Ryobi and Bosch. In November, 2000, they briefed members of the Power Tool Institute in Cleveland.

The companies seemed intrigued but wary. SawStop vice president David Fanning recalled being asked at Ryobi and Black & Decker: “Have you been to the CPSC? Our response was: ‘What’s the CPSC? ‘” Gass said a Black & Decker executive also warned: “If you guys don’t cooperate with us, the industry is going to get together and squish you.”

Still, the SawStop men were stoked, maybe even cocky. “We think you don’t have any choice here,” Gass said he told an executive of one company: “It’s the right thing to do. And if you don’t do it, you’re going to be liable for the injuries—and there’s a lot of injuries happening.”

Their prospects seemed to rise when CPSC engineers, in July, 2001, announced the results of a technical evaluation. “The SawStop concept is valid and the prototype impressively demonstrates its feasibility.” Ann Brown, then head of the agency, awarded SawStop a Chairman’s Commendation for safety innovation.

Negotiations were held with several companies. Talks with Ryobi advanced farthest, then collapsed under mysterious circumstances.

A leading manufacturer and supplier to Home Depot, Ryobi is based in Anderson, S.C., and is a subsidiary of Techtronics, Inc. of Hong Kong.

In January, 2002, Ryobi sent SawStop a signed licensing agreement. It called for Ryobi to investigate SawStop’s feasibility, and to incorporate it in Ryobi saws within 18 months if it proved feasible.  SawStop would get a royalty equal to 3 percent of the wholesale cost of each saw, with the fee rising as high as 8 percent should the technology be widely adopted.

Gass said a small typo led him to return the contract to Ryobi’s general counsel, who Gass said told him he would immediately fix the mistake and mail the contract back. Days turned into weeks, then months. Gass said he got repeated assurances that Ryobi wanted to proceed, but the contract never came back.

Years later, in the trial of a lawsuit against Ryobi, a company lawyer explained it this way: “Ryobi decided that it did not want to go forward with this project,” he said. Ryobi was going through a corporate acquisition, the SawStop deal took “a back seat”, and “eventually Ryobi lost interest.”

Robert Bugos, the former general counsel Gass said had strung him along, put it another way in a deposition. “There was negotiation back and forth,” Bugos said. “Our position was always that SawStop was asking too much.”

Lawsuit Worries

However, testimony and documents reveal the industry feared liability exposure should SawStop gain a foothold. According to testimony by David Peot, Ryobi’s former director of advanced technologies: “There certainly was a feeling that if a single company invents or improves a product that could have an effect on product liability, then other manufacturers could be at a disadvantage if they don’t have that on their product.”

Without naming SawStop, an April, 2002 Bosch memo warned of the threat from “competitive technology”  The “expectation will be that the most severe injuries will be mild to moderate lacerations and that amputations will be virtually eliminated,” it said. This “will create a new and significant liability concern for our corporation because of this enhanced safety performance.”

Or, as minutes of the Power Tool Institute’s product liability committee put it: “Liability exposure has increased based on the product’s introduction at IWF [International Woodworkers Fair].”

Gass recalled being told by Peter Domeny, then chairman of the committee and Bosch’s director of product safety, that SawStop had kept him awake nights wondering how the industry could defend itself in court. Domeny was questioned about this in 2008, when his deposition was taken in the case of a Pennsylvania man who suffered the amputation of four fingers.

“We had discussions as far as the liability implication, but not in that form as he [Gass] quotes it,” Domeny replied. “I don’t think I have discussed my sleep patterns with Mr. Gass.” Domeny declined an interview request.

Gass said he came to realize the threat his invention posed. “What the industry saw as a problem was not the amputations and injuries occurring on their product,” he said, “but the advent of a technology that could prevent those injuries. That was the problem we created.”

Early on, Gass and two of the Davids had quit the law firm to give full time to SawStop. Having failed to license the technology, they faced a stark choice: Either go back to patent law and let the invention die, or find the capital to make their own saws. They chose the latter, Gass said, and raised $3 million from about 30 investors.

The industry response was unprecedented. Five companies, including Black & Decker, Bosch and Ryobi, formed a joint venture to develop their own injury reduction system. To head off possible anti-trust problems, they told the Justice Department and Federal Trade Commission what they were doing. Their notice said they would pursue “research and development of technology for power saw blade contact injury avoidance, including skin sensing systems, blade braking systems, and/or blade guarding systems.”

Years later, Peot, the former Ryobi executive, still seemed stunned by the move. “The people who belong to the Power Tool Institute are very fierce competitors,” he testified. “Never before in my 30, 35 years of working with the Power Tool Institute had I ever been exposed to something where they said let’s get together and jointly develop something.”

The joint venture ended in 2009, when members said they had developed a system superior to SawStop. It has yet to be incorporated into a single saw.

Their system is designed to retract the blade into the table immediately on skin contact. Unlike SawStop, it does not use a brake, which can damage the blade. Representatives of Ryobi, Black & Decker and Bosch did not return calls about when, or if, the technology will be used. Industry comments filed with the CPSC asserted that SawStop’s patents were holding them back--potentially forcing them to pay royalties or engage in expensive patent litigation to introduce their system.

SawStop, for its part, put its first saws on the market in 2004 and has sold about 40,000 since. Along with flesh-detection technology, the company’s saws came with an important safety device called a riving knife that had been mostly limited to models sold in Europe.  A riving knife is a curved steel blade that cuts the risk of “kickback”, which occurs when a piece of wood suddenly jerks while being cut, sometimes pulling the operator’s hand into the blade.

Gerald Wheeler, who had been wowed by the hot dog show, got two of the first saws.  In March, 2006, Carl Seymour, a foreman at his shop, accidentally touched a whirring blade. A photo on SawStop’s website shows Seymour beaming in triumph as he lifts the wounded thumb, which looks like it has a paper cut.

“You couldn’t wipe the smile off him (Seymour) after this,” Wheeler told FairWarning, saying he, too, was “totally ecstatic.” All saws should have this technology, Wheeler said. “I mean, we’re dealing with human beings.”

Shot Across the Bow

No longer having anything to lose, SawStop fired another shot. It organized a petition signed by more than 300 woodworkers, shop teachers and others, asking the CPSC to regulate. Filed in April, 2003, it called for a performance standard that would most likely require SawStop or something like it.

Gass told Fairwarning the idea came from Caroleene Paul, the CPSC engineer. Given the commission’s limited resources, Gass said Paul told him, the agency would be more likely to investigate the issue if petitioned to do so. (A commission spokesman confirmed this account.)

In July, 2006, commissioners voted 2-1 to instruct their staff to draft a document starting the rulemaking process. Called an Advanced Notice of Proposed Rulemaking, it would have been published in the Federal Register with a request for public comments.

Then things took a bizarre turn. Within days of the vote, commission Chairman Hal Stratton, who had voted yes, resigned to join a law firm. The resulting 1-1 stalemate meant the rulemaking notice could not be approved. This was during the Bush administration, which was stridently anti-regulation. The commission would go three years before getting a third commissioner and again having a quorum.

Battling in the Courts

Even as the threat of regulation eased, the industry faced trouble in the courts.

Carlos Osorio was a computer technician from Colombia who moved to the Boston area in 2003 to be near his girlfriend. Unable to find work in his field, he took a job as a flooring installer and learned to use a table saw.

He was working at a home in Lexington, Mass., in April, 2005 when a piece of flooring got stuck in the Ryobi saw and Osorio’s hand slid into the blade. “There was blood on my face, my body. It was everywhere,” Osorio testified. “I was able to see my tendons.”

Screaming in pain, Osorio and a co-worker ran into the street and flagged down a motorist, who called 911.  The first of five surgeries lasted 12 hours and reattached Osorio’s pinky finger. Another transferred tendons from a toe to his hand in an attempt to restore movement. Osorio said he endured so much pain that one doctor suggested he have two fingers surgically amputated. Osoriio had  95 physical therapy sessions. His medical bills topped $384,000. Now living in Florida, he still has limited use of his left hand. “The damage that was done to my hand, it’s something that stays with you for the rest of your life,” he said in an interview. “I think the manufacturers should think less about cost, but more about people who are using the saws.”

During the trial of his lawsuit in February, 2010, in federal court in Boston, Osorio admitted he was working without a saw guard, and said guards were not used by anyone on his crew.

Before SawStop, this fact alone would have made a successful lawsuit unthinkable. But Gass testified about his efforts to license SawStop to Ryobi and others. He said that Osorio almost certainly would have escaped serious injury had SawStop or another skin-detection system been in use. The jury awarded damages of $1.5 million.

SawStop was a “game changer,” said Osorio’s attorney Richard Sullivan, whose Wellesley, Mass., firm has been involved in most of the recent cases. The industry position was “ 'Hey, don’t blame us,’ ” Sullivan said. “Now with Saw Stop it was ‘Oops, we actually can prevent these accidents from taking place.’”

About 70 of the roughly 150 cases have been settled, said Sullivan. Only two, besides Osorio, have been tried. A Los Angeles case last year ended in a hung jury, then was settled. In the other, tried last July in Chicago, Ryobi was victorious.

The plaintiff was Brandon Stollings, who suffered the amputation of two fingers while installing flooring at his mother’s house in Wisconsin in May, 2007. Stollings, then 23, had been captain of his high school basketball team, and had passed on college to pursue his goal of becoming a homebuilder. He testified that after the blade sliced into his hand, he began running around in circles in his mother’s yard, screaming in pain and terror about what had just happened.

“ ‘Am I ever going to be able to do carpentry?’ “ he remembered thinking. “ ‘If I cut off my ring finger, who’s going to want to marry me if I can’t even put a ring on my finger? ‘ ” Lying in the ambulance, he told his mother: “ ‘Just let me die’…because I thought my life was over.”

After nine hours of surgery the ring finger was reattached, but Stollings lost the index finger. Though five years had passed between the accident and his court appearance, Stollings said he remained self-conscious about his hand. “If I’m meeting new people, my hands will be in my pocket,” he said. “I never had this hand really out in the open.”

Stollings, who had years of experience with table saws, testified that he was not using a guard and never did because it got in the way. Gass testified that Stollings would have escaped serious injury if the saw had skin-sensing technology.

“If the manufacturers had to pay the cost of those injuries,” Gass said, “they would have adopted technology like this within months of the time they heard about it instead of looking for excuse after excuse to delay for year after year.”

This time, however, Ryobi’s lawyers shifted the focus from the maiming of a young man to a purported conspiracy between plaintiffs’ attorneys and Gass—designed to bleed the industry by, in the case of the lawyers, filing lawsuits; and in the case of Gass, forcing manufacturers to adopt SawStop. The jury found Ryobi not liable.

Wall of Patents

SawStop’s headquarters is in the back of a business park in the Portland suburb of Tualatin, next to a marshy field favored by egrets and geese. About 40 employees occupy the hive of offices, workbenches and warehouse space. Saws aren’t actually manufactured here; as with nearly all others sold in the U.S., SawStop’s models are made to its specifications in Taiwan

Rows of gleaming patents for saw components cover entire walls. Those patents have become an obsession of the industry as it fights to keep the CPSC off its back.

Legislation passed by Congress in 2008 had resuscitated the agency, adding funding and expanding it to five commissioners. Yet the table saw issue stalled. In November, 2010, —the National Consumers League fired off a protest letter to commission chairman Inez Tenenbaum.

“While this…languishes before the Commission, with no action taken by previous CPSC officials, every day ten new amputations associated with the use of table saws occur,” the letter said. “The hazards posed by table saws are unacceptable, especially when we have the means to prevent these accidents.”

The thrust of the letter, said the league’s executive director Sally Greenberg, was “what the heck have you guys been doing over there?”

The league arranged for several injury victims to meet with commissioners. In October, 2011, they voted 5-0 to publish an Advanced Notice of Proposed Rulemaking--the step nearly taken five years earlier. In the notice, the CPSC pegged the average cost of a table saw injury at $35,000—for a total cost to society of $2.36 billion for the estimated 67,300 injuries per year.

The Power Tool Institute disputed the estimate as highly exaggerated. And in comments filed with the commission in March, 2012, it said a federal regulation would grant a “monopolistic advantage’’ to SawStop, whose patents might shut out rival safety systems, such as the one developed by the joint venture.

“There can be little question that Mr. Gass and the SawStop company primarily are motivated by their own monetary gain,” the institute declared, “rather than purely to improve public safety.”

Further, the industry reminded the commission of a legal constraint that could block regulation. By law, the commission must defer to voluntary standards that could adequately improve safety. As a result, by revising a voluntary standard, or by simply working on revisions, an industry might be able to forestall regulation indefinitely.

The industry had, in fact, made a couple of changes to its voluntary standard. A 2005 revision provided for use of a riving knife; another in 2007 called for an improved blade guard.

Since late 2007, hundreds of thousands of saws with the new guard had come into the market. Therefore, the industry said, before adopting a regulation the CPSC must investigate the impact of the changes. The agency has agreed to study consumer usage of the new guards.

“This is a serious hazard which has greatly impacted far too many lives,” commission spokesman Scott Wolfson told FairWarning. “This is a rulemaking that can make a difference…if we can reach the final rulemaking stage."

Ann Brown, who left the chairmanship soon after the commendation to SawStop in 2001, told FairWarning she was “shocked” that the issue remains unresolved. “The industry has managed to delay every step of the way.”

Hal Stratton, chairman until 2006, said he was not shocked. “How could I be, after being there and experiencing working at the agency?” he asked. “The way the law is written, there’s a lot of hurdles to get over to get a regulation passed.”

Expecting little from the CPSC, SawStop tried another way to force the issue. Last year, it lobbied the California legislature to pass a bill requiring injury reduction technology for table saws sold in the state. California is such a huge market that when forced to meet its design standards, companies sometimes apply the changes across entire product lines. The bill was defeated, however.

SawStop could make plenty of money if a table saw standard were adopted, but is profitable just selling its saws, according to Gass.

“I feel like I’m doing a good thing,” he said, adding that he would not take “a lot of moral credit.  I’m doing what I also think is in my financial interest.”

Lilly Fowler of FairWarning contributed to this story.

FairWarning (www.fairwarning.org) is a Los Angeles-based nonprofit investigative news organization focused on public health and safety issues.

For a more extensive investigation of power saw safety and the industry's role, see Power Tool Industry Circles the Wagons as Disabling Saw Injuries Mount.

by Lilly Fowler, Fairwarning

Adam Thull was building a checkout counter for a local bookstore when he noticed a wood panel falling off the edge of his table. As he lunged to catch it, his right forearm got caught on the blade of his Ryobi table saw – and the machine quickly cut completely through one of his forearm bones and a nerve.

Adam Thull with his wife, Courtney, 4-year-old daughter, Stevie, and 8-year-old son, Cyril. (Kelli Engstrom)

Thull, 32, who was working at his shop at home in the small community of Crosslake, Minn., was airlifted to a hospital. That was the beginning of a medical odyssey that has included seven surgeries and visits to a specialist at the Mayo Clinic in Rochester, Minn., more than 200 miles away.

Still, after three years of treatment on his ulnar bone and nerve, Thull has yet to recover full use of his arm. He also remains unable to work and reluctant to go through surgery and a lengthy recuperation again. “I can’t endure anymore. I need to stay out of bed before my mind goes nuts,” Thull said.

Thull acknowledges that when the accident occurred in May, 2010, he wasn’t using the saw guard, which fits like a hood over the top of the blade. According to the Consumer Product Safety Commission, most operators work without the guard at least part of the time because it limits visibility and must be removed for some cuts.

But Thull is suing Ryobi, its parent company Techtronic Industries and the saw’s retailer, Home Depot, in federal district court in Duluth. He contends that his saw was defective because Ryobi had failed to adopt flesh detection technology, a system that can virtually eliminate serious injuries by immediately shutting down the blade on contact with skin.

The defendants deny responsibility for the incident, one of thousands of serious accidents suffered by American workers and do-it-yourselfers using saws from the major manufacturers that lack skin sensing technology.

Thull, who said he “kind of grew up with a hammer in his [my] hand,” had planned to continue supporting his wife and two young children with his home-based woodworking business. At the time of the accident, his venture had been profitable for close to three years.

Adam Thull's arm after surgery. (Photo courtesy of Adam Thull)

But now Thull’s wife, Courtney, struggles to keep the family financially afloat on her own. For about a year after the accident, Courtney handled a night shift as a nurse and also worked at two coffee shops, one of which was 75 miles away. The stress of juggling three jobs, Thull said, sent the couple back into marriage counseling.

His wife “went from raising her children to not seeing her children,” Thull said. Even so, “There’s not a way to compensate for me losing my arm no matter how hard she works.”

Thull said he went from “working and providing a life for my family to being the stay-at-home parent. Not only is that emotionally devastating to us, but, financially, it’s devastating as well because she can’t produce the money,” Thull said, adding that he is still unsure what he will do in the future to help support the family.

His role as a father has suffered, too. Their daughter was just one-year-old when the accident occurred, and Thull said, “I couldn’t even change her diaper at the beginning, with my left hand. It’s not something you could do one-handed. You can’t pick a child up and carry her around and do that stuff with only one arm.”

Thull said he and his wife weren’t able to keep up payments on their student loans, and they are now in default. As a result, he doesn’t see going back to school as an option.

If his family wasn’t getting a break on their rent by living in a home his uncle owns, Thull said, they would be out on the street.

Listen to Adam Thull describe his accident and how it has affected his life.

For a more extensive investigation of power saw safety and the industry's role, see Power Tool Industry Circles the Wagons as Disabling Saw Injuries Mount.

by Lilly Fowler, Fairwarning

Tom Corbett was helping remodel the front entryway of a home in Manchester, Mass., two years ago when suddenly his life changed forever.

Tom Corbett, 43, who lost two fingers in a table saw accident.

A piece of wood he was trying to cut jammed in his table saw, and his hand was thrown into the blade. He still struggles to remember all of the horrible details, but he’s haunted by the fact that four of his fingers were severed. “I just know within a second my fingers were on the ground,” he said.

That’s how Corbett became one of the thousands of Americans suffering amputations or other serious injuries in table saw accidents every year.

As often is the case, Corbett, 43, wasn’t a novice when it comes to working with wood. He has done carpentry since the age of 14 and says he has used almost every type of table saw on the market.

The accident cost him his pinky and ring finger. Even though doctors were able to reattach two other fingers, he will never have full use of them and he still suffers severe pain.

Corbett, who is suing the table saw manufacturer, already has gone through a half-dozen surgeries and more operations are possible.

He says every time he has surgery, he needs physical therapy three or four times a week to try to break up the scar tissue that builds up. And although the operations straighten Corbett’s fingers, they have always curled back after a short time. The last surgery involved freeing up tendons and joints with the hope that he will gain more movement in his hand.

“I’m starting to get a little leery whether or not they’re ever going to be able to do anything for me,” Corbett said.

At the time of the accident Corbett was covered by workers compensation insurance through his employer, JW Custom Carpentry, based in Byfield, Mass. That pays for Corbett’s medical bills, which he estimates could be as high as $500,000. Corbett, who is separated and helps support his three children, said workers compensation also provides 60 percent of his previous regular wage, but that isn’t enough for him and his family to get by.

Corbett's injured right hand.

Doctors tell him that he’s unlikely ever to work as a carpenter again, the job he has done all of his adult life. That means, Corbett said, he will have to turn to “something that I probably don’t like as much. I don’t know what that could be. I was never really anybody to work in an office, my work was always hands on. So I’m really not sure what I’m going to do.”

Corbett is suing Black & Decker, which made the DeWalt table saw he was using when he got hurt. He blames the company for not installing the available technology that could have prevented the accident by shutting down the blade immediately upon skin contact.

Black & Decker denies responsibility for the accident.

Corbett  acknowledges that he wasn’t using the tool’s safety guard. According to the Consumer Product Safety Commission, most saw operators at least part of the time work without the guard, which fits like a hood over the blade, because it limits visibility and must be removed for some cuts.

But Corbett hopes his lawsuit will spur the table saw industry to change and adopt more effective technology that would stop the blade on contact with skin.

“I think anything they can do to save anybody from going through this, I think they should do it,” Corbett said.

“I would never have thought anybody like myself could ever have this type of injury at all. I consider myself so experienced and safety conscious. So I’d say if it can happen to me it can happen to anybody.”

“My life changed in less than a second it seemed like, from being able to do anything I wanted to not being able to do anything,” he added. “I just feel like a rock. I just sit here, and I feel like I’m kind of useless.”

Listen to Tom Corbett describe his accident and how it has affected his life.

Dear EarthTalk: What are the big delivery companies like FedEx and UPS doing to green their truck fleets and operations in general? -- Mitchell Glaser, Overland Park, KS

Package delivery companies like FedEx and UPS have come a long way in a relatively short time regarding sustainability, but they still have considerable room for improvement. While there is only so much these companies can do to reduce their huge carbon footprints—given their reliance on emissions-heavy air transport—they’ve made great strides in greening their ground fleets, optimizing their choices of modes and otherwise streamlining energy use.

For its part, UPS was an early adopter of cleaner vehicles, and today operates upwards of 2,500 low-emission vehicles that run on alternative fuels and technologies. The company is particularly jazzed about a new generation of hydraulic hybrid package delivery trucks unveiled in the fall of 2012 in partnership with the U.S. Department of Energy’s Clean Cities program. These new trucks—which employ a diesel combustion engine along with a hydraulic high-pressure accumulator that stores energy captured during braking—get 35 percent better fuel economy and generate as much as 30 percent fewer greenhouse gas emissions as compared to the non-hybrid diesel-powered vehicles they are replacing. While these trucks may cost UPS $7,000 apiece more than their traditional counterparts, the company estimates the upgrade will save $50,000 or more, while substantially reducing emissions, over the lifetime of each vehicle.

UPS has also been blazing new trails in operational efficiency via intermodal shifting, e.g., using the most fuel-efficient transport mode (airplane, train, truck or ship) or combination of modes to meet customer needs. A concerted effort by the company to streamline its operations in 2011 led to savings of two million metric tons of greenhouse gas emissions by moving delivery volume from air (the most emissions-intensive mode by far) to ground, and another 800,000 metric tons by shifting volume from ground to rail.

Meanwhile, FedEx, with one of the largest hybrid-electric fleets in the industry and upwards of 2,000 alternative energy vehicles in service worldwide, is no slouch either when it comes to green streamlining. Back in 2008 the company worked with the Environmental Defense Fund (EDF) in setting the ambitious goal of improving the fuel efficiency of its worldwide fleet of Express delivery vans and trucks by 20 percent within a dozen years. Then early in 2013 the company announced that it had already exceeded its goal seven years ahead of schedule (with an overall savings of 22 percent so far) but was also upping its goal to a 30 percent fleet-wide efficiency gain by 2020.

With a strong commitment to swapping out older vehicles with newer more efficient ones, the company is well on its way. It now operates 360 hybrid-electric trucks and 200 electric vehicles and is replacing many of its delivery trucks with “right-sized” Sprinter-type vans that are as much as 100 percent more fuel efficient than their predecessors. FedEx has also been upgrading its fleet of Express diesel trucks to cleaner-burning models, and is making similar upgrades in its Freight and Ground divisions as well. Likewise, the company is well on its way toward reducing greenhouse gas emissions from its airplanes by 30 percent by 2020.

Photo: Biofriendly, courtesy Flickr

EarthTalk® is written and edited by Roddy Scheer and Doug Moss and is a registered trademark of E - The Environmental Magazine (www.emagazine.com). Send questions to: earthtalk@emagazine.com. Subscribe: www.emagazine.com/subscribe. Free Trial Issue: www.emagazine.com/trial.

What possesses an audit partner to trade on inside information and violate the accounting profession’s most sacred ethical standard of audit independence? Is it carelessness, greed, or ethical blindness? In the case of Scott London, the former partner in charge of the KPMG’s Southern California’s regional audit practice, it was a bit of each that motivated him to violate ethical standards and, in the course of doing so, causing the audit opinions signed by London on Skechers and Herbalife to be withdrawn by the accounting firm.

Overall, London is charged with leaking confidential information to his friend, Brian Shaw, about Deckers, Pacific Capital Bancorp, Manhattan Beach-based Skechers, and Los Angeles-based Herbalife. The leak of information about quarterly earnings information led to Shaw’s unjust enrichment of $1.27 million. Shaw, a jewelry store owner and country club friend of London, repaid London with $50,000 in cash and a Rolex watch, according to legal filings.

The leaking of financial information about a company to anyone prior to its public release affects the level playing field that should exist with respect to personal and business contacts of an auditor and the general public. It violates the fairness doctrine in treating equals, equally, and it violates basic integrity standards. London and Shaw acted in a way that cuts to the core values of integrity and trust – the real foundations of our free enterprise system.

The KPMG scandal concerns me because a pattern of such improprieties may be developing. In 2010, Deloitte and Touche was investigated by the SEC for repeated insider trading by Thomas P. Flanagan, a former management advisory partner and a Vice Chairman at Deloitte. Flanagan traded in the securities of multiple Deloitte clients on the basis of inside information that he learned through his duties at the firm. The inside information concerned market moving events such as earnings results, revisions to earnings guidance, sales figures and cost cutting, and an acquisition. Flanagan’s illegal trading resulted in profits of more than $430,000. In the SEC action, Flanagan was sentenced to 21 months in prison after he pleaded guilty to securities fraud. Flanagan also tipped his son, Patrick, to certain of this material non-public information. Patrick then traded based on that information. His illegal trading resulted in profits of more than $57,000.

The KPMG case is a particularly egregious one because it involves insider trading by an auditor of client stock. This incident jogged my memory and I came up with a characterization of London’s actions as “stupid is as stupid does.” Forrest Gump quotes are uncomplicated, basic and true. They are almost Zen-like in their simplicity. This one fits Scott London’s actions perfectly. However, in public accounting stupidity is not a defense for violating the independence standard that protects the public from shortsightedness and egoistic behavior on the part of auditors who are charged to protect the public interest.

This isn’t the first time in recent years that KPMG has been investigated for gross violations of ethical standards. In 2005, KPMG agreed to pay a hefty fine of $456 million and cease its private client tax practice after admitting that it defrauded the government and the IRS in a major tax shelter scandal. The firm agreed not to develop, sell, or implement any pre-packaged tax products.  Three staff members were sentenced to serve terms ranging from 6 ½ to ten years in prison as a result of providing opinion letters that endorsed the shelters and helped KPMG's wealthiest clients claim bogus losses to offset their massive capital gains.

In withdrawing its audit opinion on Skechers and Herbalife, KPMG released a statement that should raise red flags for all CPA firms that audit public companies. The firm stated it had concluded it was not independent because of alleged insider trading. This is a weak statement at best and illustrates the moral blindness of some public accounting firms that do not seem to realize they are at fault for the actions of auditors with respect to the use of inside information.

Public accounting firms have an ethical obligation to monitor the actions of its partners, managers, and staff that may impair audit independence. The failure in this instance of KPMG is in its lack of quality controls to prevent and detect violations of basic ethical standards. I call on the California Board of Accountancy to investigate the KPMG insider information case for the firm’s failure to properly oversee its own internal controls on safeguarding client information and monitoring the independence standards that underlie audited financial statements and build trust in our financial reporting system.

Update: On May 6,  following publication of this article, jeweler Bryan Shaw reportedly agreed to plead guilty to conspiracy for allegedly making illegal stock trades based on inside information given to him by KPMG partner Scott London.

Steven Mintz is a professor in the Orfalea College of Business at Cal Poly San Luis Obispo. Dr. Mintz blogs about ethics issues at: www.ethicssage.com. 

Dear EarthTalk: The recent explosion at a West, Texas fertilizer plant that killed many people really alarmed me. Places like this must exist near many communities around the country. How do I know if my own community might be at risk of a similar disaster? – Mary Cyr, Sarasota, FL

On April 17, 2013 in the town of West, Texas, a fertilizer plant with an unreported large stockpile of explosive ammonium nitrate blew up, killing 14 and rendering hundreds of others injured and homeless.

Many people may not realize that what happened on April 17, 2013 in the town ofWest,Texas—a fertilizer plant with an unreported large stockpile of explosive ammonium nitrate blew up, killing 14 and rendering hundreds of others injured and homeless—could happen almost anywhere.

According to Greenpeace, one in three Americans could fall victim to a similar poison gas disaster by virtue of living near upwards of 12,000 plants that store and use highly toxic substances. “A chemical disaster at just one of these facilities could kill or injure thousands of people with acute poisoning,” the group reports. Greenpeace has identified 483 U.S.facilities where 100,000 people or more would be at risk during a disaster. And one in five of those threatens areas with populations topping one million.

“Even though chemical plant safeguards fail every week, the chemical industry has largely refused to make their plants safer and more secure,” says Greenpeace. “Congress even amended the Clean Air Act in 1990 to try and address this problem, but the amendment has gone largely unused.” The group would like to see the Obama Administration create new regulations under the Clean Air Act that will require such facilities to prevent chemical disasters by switching to safer alternatives.

On the Greenpeace website, one can use an interactive map to determine whether they live in harms way of a potentially dangerous chemical plant. Each plant on the map is surrounded by a red circle marking its “vulnerability zone,” which ranges from less than a mile to 25 miles out, depending on the type and extent of chemicals in use as well as local topography and weather patterns. “Anyone within this zone could potentially be impacted by a toxic chemical release,” adds Greenpeace. “Impacts could range from minor injury to fatality depending on the chemical involved and the extent of exposure.”

Calls by the Department of Homeland Security and Environmental Protection Agency to require the use of safer chemical processes where feasible have fallen on deaf ears among Congressional Republicans loathe to require constituents to pay for costly environmental upgrades. But that could soon change: Senator Frank Lautenberg (D-N.J.) has introduced a bill that would make negligence regarding chemical reporting a federal crime with consequent harsh penalties. “The chemical reporting laws on the books today are toothless and do little to help us protect communities from chemical explosions,” says Lautenberg. “Facilities that break the reporting rules today essentially get away with just a warning.”

“The good news is that there are many cost-effective, safer chemical processes already in use that eliminate these risks without sacrificing jobs,” says Greenpeace, adding that more than 500 plants have voluntarily switched to safer alternatives over the last decade. The group wants President Obama to invoke executive privilege to tighten regulations on chemical plants that have not done so. Readers can sign on to the group’s online petition calling on the White House to require companies to design and operate chemical facilities in a way that prevents the catastrophic release of poison gases.

Photo: Shane Torgerson

EarthTalk® is written and edited by Roddy Scheer and Doug Moss and is a registered trademark of E - The Environmental Magazine (www.emagazine.com). Send questions to: earthtalk@emagazine.com. Subscribe: www.emagazine.com/subscribe. Free Trial Issue: www.emagazine.com/trial.

Dear EarthTalk: I heard that a number of beer brewing companies have banded together to support the Clean Water Act. Can you enlighten? -- Mitch Jenkins, Cincinnati, OH

In April 2013 the non-profit Natural Resources Defense Council (NRDC) brought together two dozen nationally respected craft beer brewers to launch the Brewers for Clean Water Campaign, which aims to leverage the economic growth of the craft brewing sector into a powerful voice for bolstering clean water protection in the United States.

“Whether brewers are creating ales, pilsners, porters, wits or stouts, one ingredient must go into every batch: clean water,” says Karen Hobbs, a senior policy analyst at NRDC. “Craft brewers need clean water to make great beer.”

While hops, malt and the brewing process itself are also clearly important, water just may be the secret ingredient that gives a specific beer its distinctive flavor. “Beer is about 90 percent water, making local water supply quality and its characteristics, such as pH and mineral content, critical to beer brewing and the flavor of many classic brews,” reports NRDC. “For example, the unusually soft water of Pilsen, from the Czech Republic, helped create what is considered the original gold standard of pilsner beers. The clarity and hoppiness of England’s finest India Pale Ales, brewed since the 1700s in Burton-on-Trent, result from relatively high levels of calcium in local water.” Brewers can replicate the flavors of beers like these and others by sourcing freshwater with similar features or by starting with neutral water and adding minerals and salts accordingly to bring out certain desired characteristics.

Of course, clean water is essential to more than great-tasting beer. “It’s critical for public health and the health of a wide range of industries,” adds NRDC. “Now our streams, wetlands and water supply need our help. Without strong legal protections, they are under threat from pollution like sewage, agricultural waste, and oil spills.”

The popularity of craft brewers’ “microbrews” in recent years is another reason why NRDC has hitched its clean water wagon to the industry. “Craft brewers are closely tied to their communities with a very real understanding of the impacts bad policy can have on regional water sources,” reports the group. “While the participants in the campaign include brewing operations large and small, all have demonstrated a commitment to sustainability in their operations and beer development.”

By taking part in the campaign, New Belgium, Sierra Nevada, Allagash, Short's, Temperance, Arbor, DryHop, Finch's, Revolution, Flossmoor, Cranker’s, Wild Onion, Right Brain, Half Acre, Goose Island and other craft brewers are helping spread the word in a way that hits home with consumers. For its part, NRDC is urging beer lovers (and other concerned environmentalists) to use the form on its website to e-mail the White House encouraging President Obama to finalize guidelines recently created by the Army Corps of Engineers and the U.S. Environmental Protection Agency that call for greater protections for streams and wetlands in important headwaters regions from coast to coast. And consumers should be glad to know that for once drinking beer can actually be good for the environment. So bottoms up!

EarthTalk® is written and edited by Roddy Scheer and Doug Moss and is a registered trademark of E - The Environmental Magazine (www.emagazine.com). Send questions to: earthtalk@emagazine.com. Subscribe: www.emagazine.com/subscribe. Free Trial Issue: www.emagazine.com/trial.

Any day now, the standard police warning is likely to sound like this:

“Step away from the keyboard and keep your hands where I can see them.”

Criminals rob banks, or rape women, and are caught after bragging about it on Facebook.  The Dow Jones Industrial Average drops 145 points after the self-styled Syrian Electronic Army hacks into the Associated Press Twitter feed with the fake message “Breaking: Two explosions in the White House and Barack Obama is injured.”

And while Internet stupidity isn’t a crime, it certainly has impact as well – for the pop concert fan ejected for tweeting during a performance, the cheating spouse caught exchanging lurid emails, or the politician(s) forced to resign over ill-considered and offensive Internet  postings.

A Wall Street analyst resigned as campaign manager for a New York GOP candidate for Congress after falsely tweeting during Hurricane Sandy items such as “BREAKING: Confirmed flooding on NYSE. The trading floor is flooded under more than 3 feet of water.”

The division between what’s permissible and what’s merely outrageous online grows fuzzier day by day.  And legislators, regulators, police officers and businesses are scrambling to harness the wild wild west of social media law.

Although he isn’t the only pubic office to use the phrase, New York County (Manhattan) District Attorney Cyrus Vance Jr. sums it up quite nicely:

“The Internet is our 21st century crime scene.  There isn’t a crime that happens, here in Manhattan, or elsewhere, that doesn’t leave some electronic fingerprint.”

Lessons from Boston

On the positive side, the Boston Marathon bombings in April provided dramatic evidence of how instant, online social media reaction pays off:

--missing runners were able to connect with friends and family via Twitter and Google+:

--police were able to gather many photos and videos of the bombing site, helping fill out the evidence.

Yet there were negatives as well.  Social news website Reddit’s online thread “dedicated to help find the bombers” resulted in incorrect identification of the possible culprits and links to what turned out to be false leads.

The online buzz became so chaotic that, when the FBI on April 18 released photos and videos of the suspects, it cautioned that “other photos should not be deemed credible and unnecessarily divert the public’s attention in the wrong direction and create undue work for vital law enforcement resources.”

And some media outlets came in for severe scolding. Atlantic Magazine senior editor Alexis C. Madrigal wrote a commentary titled “Hey Reddit, Enough Boston Bombing Vigilantism:  It’s only the illusion that what we do online is not significant as what we do offline that allows this to go on.”

Reddit later added a notice to its site declaring “we do not strive, nor pretend, to release journalist-quality content for the sake of informing the public” and that “we do not support any form of vigilante justice. We are not law enforcement....keep in mind that most or all of the ‘suspects’ being discussed are, in all likelihood, innocent people and that they should be treated as innocent until they are proven guilty.”

A week after the bombing, Reddit general manager Erik Martin commented in part “…though started with noble intentions, some of the activity on Reddit fueled online witch hunts and dangerous speculation which spiraled into very negative consequences for innocent parties…After this week, which showed the best and worst of Reddit’s potential, we hope that Boston will also be where reddit learns to be sensitive of its own power.”

And Buzzfeed, another widely viewed social news site that helped spread some of the confusion, in late April announced it had hired Lisa Tozzi, a former deputy national news editor of the New York Times, to supervise a team of ten reporters and manage fast-breaking news. “I do believe that there’s a new model that’s waiting to be discovered for how to present live information,” Tozzi was quoted at the Atlantic.com website.

Law Enforcement Moves Online

Police departments and federal agencies find the social media world a fertile source of intelligence and a worrisome source of criminal activity.

The LexisNexis information and technology firm in 2012 surveyed 1,200 law enforcement professionals about their use of social media and found that four out of five use social media in their investigations -- identifying people and locations and discovering evidence of criminal activity.  A growing number of police departments are using the photo-posting tools of Pinterest to help track down criminals as well as publicize police programs.

Since its founding in 2000, the Internet Crime Complaint Center has received more than two million complaints – in 2011, the latest figures available, the Center received more than 300,000 complaints for the third year in a row. The top five states were California, Florida, Texas, New York and Ohio, and financial losses averaged $4,187.   (The largest single category of cases involved criminals posing as the FBI and sending spam emails to defraud victims.)

The Philadelphia Police Department says its YouTube channel "is setting the standard for police departments across the nation. "

California’s attorney general in 2011 established an eCrime unit to investigate and prosecute large scale identity theft and technology crimes with actual losses in excess of $50,000;

The Philadelphia Police Department in October 2012 reported the 100th criminal to be arrested through use of social media, an armed robber identified on a surveillance video; there’s a 39% chance of arrest, the department said, “when a crime video is disseminated through social media.”  The department had 352 videos posted on YouTube in April 2012, many seeking the public’s input to help identify suspects.  It uses Twitter for a wide variety of public service and investigation postings.

The New York City police department’s Crime Stoppers website regularly posts photos and information about dozens of wanted individuals or seeking information about crimes; there’s even a separate page for bank robberies.

Commissioner Raymond Kelly’s most recent year-end review noted that the Juvenile Justice Division organizes “social media-driven investigations,” looking online for gang threats or intimidation, admissions of criminal conduct and plans to commit crimes.  A 2012 investigation of a Bronx gang of drug dealers turned up a Facebook message reading (sic) “Trufulley we shot 2 of them they shot 2 of us we kan kall it even 4 now.”

In 2012, city officials announced $4.2 million in new cybercrime lab funding which District Attorney Vance said will expand ability to analyze information from cell phones, smart phones, and computers as well as cell site mapping.

Rules for Cops

The NYPD in 2012 established rules for use of social media in investigations; officers can uses aliases to get on Facebook looking for useful information and can get a laptop issued by the department which can’t be traced back to the NYPD.  However, officers must register their aliases with the department.

And earlier this year, the department advised officers to use caution in their personal Facebook and other electronic media accounts, avoiding identifying themselves as policemen, posting pictures of themselves in uniform, or posting photos of crime scenes or other non-public information from investigations.

A Missouri sheriff’s department has had to alter its sobriety checkpoint strategy after finding that traffic and arrests fell sharply once word of an operation spread on Twitter and Facebook.

Rules for Everybody Else

Divorce lawyers, too, are turning to social media.  The American Academy of Matrimonial Lawyers found that dating website Match.com turns up as a useful source of evidence, particularly when users embellish personal information.  “Identifying yourself as single when you are not, or listing that you have no children when you are actually a parent, can represent some key pieces of evidence against you during the divorce process,” said Alton Abramowitz, president of the group, in a press release discussing a survey.

Even as law enforcement improves its social media presence and technique, the Internet poses problems for other parts of the legal systems.  Both the federal judicial system and several states have amended their model codes of instruction to jurors to add electronic media to restricted sources of information. “You should not consult dictionaries or reference materials, search the Internet, websites, blogs, or use any other electronic tools to obtain information about this case or to help you decide the case,” declares a federal instruction memo. And at the close of a case, the instruction memo declares “Information on the Internet or available through social media might be wrong, incomplete, or inaccurate.  You are only permitted to discuss the case with your fellow jurors during deliberations because they have seen and heard the same evidence you have.”

New Jersey’s model instruction declares:   “You must not go on the Internet, participate in, or review any websites, Internet chat rooms or blogs, and you must not seek out photographs, documents, or information of any kind that in any way relate to this case.”

Privacy for passwords

Social media has amped up the perennial tug-of-war between workers and employers over what’s legal conduct, particularly when it comes to private email and Facebook accounts.  Employers properly worry about keeping corporate secrets secret, while employees resent the intrusion of a Big Brother atmosphere online.

The NLRB says employer social media policies can be unlawful when they interfere with an employee's "right to discuss wages and working conditions with co-workers."

In a series of memos, the NLRB acting general counsel has advised employers that social media policies could violate the National Labor Relations Act if they violate legal protections of employee speech. The Board recently invalidated a policy on Costco Wholesale Corp.’s employee handbook which generally banned employees from posting damaging or disparaging content on electronic message board.

In an alert from its Advanced Media and Technology Law group, law firm Loeb & Loeb said the ruling, “which we anticipate will be the first of many decisions in this arena,” shows that exempting protecting communications and behavior while setting limits is “not an easy task, and a tightrope that Costco learned to its cost that it was unable to walk.”

Employee privacy disputes have led a number of states to adopt privacy laws prohibiting employers from asking for passwords on private accounts.  California’s Social Media Privacy Act, which went into effect Jan. 1, 2013, prohibits public and private employers from demanding usernames or passwords in order to access personal social media accounts.

On the other hand, the proliferation of employee password privacy laws worries Wall Street.  The Wall Street Journal reported that securities regulators and industry groups want to be able to sidestep bans on social media privacy in some cases.  They worry, the Journal said, that social networks “could create new channels for Ponzi schemes and other frauds,” and that the laws could make it harder for companies to monitor employee conduct.

Privacy concerns are extending beyond the workplace.  New Jersey lawmakers this year passed, and Gov. Christi signed, the “Anti-Big Brother Act requiring a school district that furnishes students with laptops or other electronic devices to notify students and their families that the device may record or collect information on student activities.

The measure was prompted by reports that the Lower Merion, Pennsylvania school district had transmitted more than 50,000 images taken by laptop cameras to district administrators.

The district was able to secretly activate webcams in district-issued laptops, a system intended to help track missing or lost devices.  But parents sued the district for invasion of privacy and the case was settled in 2010 for $610,000 including attorneys’ fees.

Can the Law Catch Up?

The FBI in January 2012 asked private industry for information about its ability to provide an automated social media alert and mapping system to search networking sites and open source news sites for breaking events, crisis and threats. “Examples include but are not limited to Fox News, CNN, MSNBC, Twitter, Facebook, etc.,” the posting said. Social media, the FBI said, can help monitor “threat scenarios” at special events such as political conventions, national holidays and sporting events.

Janet Napolitano, head of the Department of Homeland Security, says her agency needs about 600 “hackers for good,” young college-age hackers to help counter daily computer attacks on the nation’s electrical grid and financial networks.

Meanwhile, social media companies receive literally thousands of requests annually from government agencies asking for information about users or seeking other information.  Twitter’s transparency report in late April 2013 said that since the start of 2012, it had received 1,858 information requests and 48 requests to remove information, as well as 6,646 complaints from copyright holders under the Digital Millennium Copyright Act.

Microsoft’s Law Enforcement Requests Report for 2012 disclosed 70,665 requests specifying 122,015 users or accounts; requests from Turkey led the list (11,434), followed by the U.S. (11,073), France (8,603) and Germany (8,419).  Slightly more than 2.2% of the requests led to content disclosure, which could include emails, photos and address book information.  And almost 80% of the requests resulted in disclosure of “non-content” data such as the user’s name, billing address and IP history.

Microsoft said the overall total reflects “the number of criminal requests received from a law enforcement agency and/or court seeking customer data.  Examples of the types of requests include a subpoena, a court order, and a warrant.”

Microsoft separately disclosed 4,713 requests for information about Skype users, none of which resulted in disclosure of content.

Congress, meanwhile, is awash with debates over more security vs. more privacy, over the need for expanded legal authority to search electronic communications and the need to protect private information.

And the states are trying to decide how to handle online behavior bullying and “sexting” messages, for example.

One law enforcement/privacy debate seems headed for possible resolution in Congress this year:  amending the 1986 Electronic Communications Privacy Act. The ECPA, recalls Sen. Patrick Leahy, was adopted when “email was a novelty.”

The Senate Judiciary Committee approved amendments in April 2013 that would:

--require a search warrant based on probable cause for the government to obtain the content of Americans’ email when requested from a third-party service provider.

--require the government to promptly notify an individual whose email content has been accessed from a service provide, and provide a copy of the search warrant.

 ---the search warrant  requirement does not apply to other Federal criminal or national security laws such as the Foreign Intelligence Surveillance Act of 1978.

The measure addresses a number of anomalies in existing law; for instance, currently no judicial approval is needed for a subpoena to access private emails that have already been opened or are more than 180 days old.

Meanwhile, a House Judiciary subcommittee is exploring how the existing ECPA Act affects standards for courts to authorize disclosure of a person’s location via geolocation information such as cellphones.

In recent committee testimony, Catherine Crump, a staff attorney for the American Civil Liberties Union, said "in many parts of the country, the police have been obtaining mobile phone location data for days, weeks, or months at a time, without ever having to demonstrate to an independent judge that they have a good reason to believe that tracking will turn up evidence of wrongdoing.....With assistance from mobile phone carriers, the government now has the technical capability to covertly track any one of the nation's hundreds of millions of mobile phone owners, for 24 hours a day, for as long as it likes."

Noting that the existing ECPA Act does not expressly address law enforcement access to mobile phone location data, she urged the committee to require law enforcement request a warrant and show probable cause to receive cellphone location data.

The U.S. Supreme Court in 2012 held that attaching a GPS device to a car and tracking its movements is a search under the Fourth Amendment, but left unresolved whether such tracking requires a warrant based on probable cause.