As recently featured in the Los Angeles Times, Proposition 65 continues to be big business for a handful of plaintiffs’ lawyers and their select group of clients, but it’s highly questionable how much benefit California residents and consumers receive.
According to settlement data released by the California Office of the Attorney General, in 2019, 909 businesses paid close to $30 million to settle Proposition 65 claims asserted against them. The average settlement payment was nearly $33,000. Of this staggering sum, almost $24 million, or 80%, went directly into the pockets of plaintiffs’ lawyers. In sharp contrast, the California Office of Environmental Health Hazard Assessment (OEHHA), which implements Proposition 65, received only about 11% of the settlement payments, or $3.3 million. The plaintiffs – so-called “private enforcers” – took a share of more than $2.7 million.
Proposition 65, otherwise known as California’s Safe Drinking Water and Toxic Enforcement Act of 1986, is a “right to know” law. Prop 65 requires businesses to provide “clear and reasonable” warnings for exposures to any one of the more than 900 chemicals on the Proposition 65 list that are known to cause cancer, reproductive harm or birth defects, before they can be sold in California. The obligation to warn can fall on all parties in the supply chain – manufacturers, producers, packagers, importers, suppliers, distributors and retailers. Businesses that fail to provide such warnings risk receiving a written “Notice of Violation”, a precursor to a Proposition 65 enforcement lawsuit.
Violations of Proposition 65 can cost businesses tens of thousands of dollars in civil penalties, the noticing party’s attorneys’ fees, and defense costs. The deck is stacked against the business alleged to be in violation: In general, all the noticing party has to show is an exposure to a listed chemical. The burden of proof then shifts to the business to show that no actionable exposure has occurred, which is a difficult burden to meet under the law and can require costly expert witnesses. Accordingly, most Proposition 65 cases settle either out-of-court in a private settlement agreement, or in court through a court-approved consent judgment.
One chemical, di(2-ethylhexyl phthalate) or DEHP, accounted for more than half of the 2019 settlements. DEHP, a phthalate, is on the Proposition 65 list as a chemical known to cause cancer and reproductive harm. DEHP is commonly used in plastics to make them flexible. According to OEHHA, DEHP can be found in various types of plastic consumer products, including some shower curtains, furniture and automobile upholstery, garden hoses, floor tiles, coverings on wires and cables, rainwear shoes, lunchboxes, binders, backpacks, plastic food packaging materials, and medical devices and equipment. In 2019, businesses settled claims over DEHP exposure from such products as cosmetic cases, goggles, gloves, erasers, hangers and bedding storage cases. The phthalate diisonoyl phthalate (DINP) and lead are two other chemicals that were the frequent subjects of 2019 settlements.
Proposition 65 claims in 2019 were again dominated by a small group of plaintiffs’ lawyers whose practices consist of sending out Notices of Violation and extracting settlements from businesses.
The private enforcers that have sent Notices of Violation this year include:
• APS&EE (represented by Law Offices of Lucas T. Novak)
• Anthony Ferreiro (represented by Brodsky & Smith, LLC)
• As You Sow (represented by Danielle Fugere and Chelsea Linsley of As You Sow)
• Audrey Donaldson (represented by Voorhees & Bailey, LLP)
• Berj Parseghian (represented by KJT Law Group PLC)
• Brad Van Patten (represented by Law Offices of George Rikos)
• CA Citizen Protection Group, LLC (represented by Khansari Law Corporation and Blackstone Law)
• Center for Environmental Health (represented by Lexington Law Group)
• Clean Label Project (represented by Davitt, Lalley, Dey & McHale, PC)
• Consumer Advocacy Group, Inc. (represented by Yeroulshalmi & Yeroulshalmi)
• Consumer Protection Group, LLC (represented by Blackstone Law)
• Dennis Johnson (represented by Voorhees & Bailey, LLP)
• Ecological Alliance, LLC (represented by Custodio & Dubey LLP)
• Ecological Rights Foundation (represented by Law Offices of Brian Gaffney)
• Ema Bell (represented by Brodsky & Smith, LLC)
• Environmental Health Advocates, Inc. (represented by Nicholas & Tomasevic LLP and Glick Law Group)
• Environmental Research Center, Inc. (represented by Michael Freund & Associates, Law Office of Richard M. Franco and Aqua Terra Aeris Law Group)
• EnviroProtect, LLC (represented by Kawahito Law Group APC)
• Erika McCartney (represented by Environmental Law Foundation)
• Evelyn Wimberley (represented by Law Offices of Stephen Ure, PC)
• Gabriel Espinoza (or Gabriel Espinosa) (represented by Brodsky & Smith, LLC)
• Keep America Safe and Beautiful (represented by Custodio & Dubey LLP and Sy & Smith, PC)
• Key Sciences, LLC (represented by Kyle Wallace and Davitt, Lalley, Dey & McHale)
• Kim Embry (represented by Nicholas & Tomasevic LLP and Glick Law Group)
• Kimberly Ann Harrison (represented by Law Office of Rick Morin, PC)
• Laurence Vinocur (represented by The Chanler Group)
• Mary Elizabeth Romero (represented by Agency D&L)
• Maureen Parker (represented by Law Offices of Stephen Ure, PC)
• My Nguyen (represented by Seven Hills LLP)
• Paul Wozniak (represented by The Chanler Group)
• Precila Balabbo (represented by Brodsky & Smith, LLC)
• Public Health and Safety Advocates, LLC (represented by Law Offices of Danialpour & Associates)
• Ryan Acton (represented by O’Neil Dennis)
• Sara Hammond (represented by Joseph D. Agliozzo, Law Corporation)
• Shefa LMV, Inc. (represented by Law Office of Daniel N. Greenbaum)
• Susan Davia (represented by Sheffer Law Firm)
• Tamar Kaloustian (represented by KJT Law Group PLC)
• The Chemical Toxin Working Group, Inc. (represented by Khansari Law Corporation)
• Zachary Stein (represented by KJC Law Group APC)
Businesses should be aware of and ensure compliance with Proposition 65’s requirements if their products are sold in California. In the event a Notice of Violation is received, businesses should contact qualified legal counsel. Conkle, Kremer & Engel attorneys are highly experienced in defending businesses against Proposition 65 claims as well as counseling businesses on compliance, in order to minimize the risk of enforcement actions.
2019 Prop 65 By the Numbers:
• 1,000: Notices of Violation Served
• 909: Number of Settlements/Consent Judgments
• $29.7 Million: Paid by Businesses to Resolve Claims
• $23.7 Million: Attorneys’ Fees & Costs Collected by Noticing Parties’ Attorneys
• $2.7 Million: Payments Collected by Noticing Parties
• $3.3 Million: Payments to OEHHA
• $32,706: Average Settlement/Judgment Amount
The number of enforcement actions in 2019 was not a fluke. Similar numbers have been accumulated in prior years. Just in the first few months of 2020, a considerable number of new enforcement actions have been pursued. 2020 Prop 65 enforcement actions will be reviewed in an upcoming blog post.