California Senate committee advances Prop 65 reforms

By Jessica Dye - Thompson Reuters News and Insight - 6/20/2013

(Reuters) - A California Senate committee on Wednesday unanimously approved a bill aimed at curbing litigation brought under Proposition 65, which requires businesses to post signs warning the public about the presence of chemicals that could adversely impact human health.

Enacted by voters in 1986, the Safe Drinking and Toxic Enforcement Act, or Proposition 65, has been gradually expanded over the past 27 years to include a list of approximately 800 chemicals known to cause cancer or reproductive disorders.

Warning signs must be prominently displayed where citizens could be exposed to significant amounts of these chemicals, either in the environment or in products for sale at bars, restaurants and coffee shops, as well as office buildings, airports and other public places.

The proposed legislation, A.B. 227, would tweak Prop 65 with regard to violations of rules regarding warning signs.

Under the bill, private parties could not bring enforcement lawsuits if, within 14 days of receiving notice, an alleged violation was corrected and the alleged violator paid a $500 civil penalty.

The bill is tailored to address alleged violations stemming from exposure to chemicals in alcoholic beverages or food or drink prepared on the premises for immediate consumption, such as acrylamide, a chemical created during coffee roasting. It would also cover exposure to environmental tobacco smoke and engine exhaust fumes in parking lots.

The proposed legislation would not affect the ability of California's attorney general or local district or city attorneys to bring enforcement actions under Prop 65.

The legislation was prompted by an increase in litigation over the past few years to enforce Prop 65.

The wave of new actions has sparked complaints from California's business community that private attorneys are filing large numbers of Prop 65 lawsuits to extract quick settlements.

The majority of Prop 65 lawsuits are brought by private parties, according to statistics from the California attorney general's office. In 2012, a total of 437 settlements were obtained for alleged Prop 65 violations, 397 of which were initiated by private plaintiffs. Prop 65 settlements topped $22.5 million in 2012, compared with $16.2 million in 2011, according to the AG's statistics.

Legislative efforts to reform the law over the last decade have mostly fallen short, due to concerns by public health advocates that loosening the law's warning requirements could undermine its safety goals.

BILL PASSED 9-0

Momentum appears to be gathering behind A.B. 227, which was introduced in February by Assemblyman Mike Gatto, a Democrat representing Los Angeles.

A.B. 227 was passed overwhelmingly by the Assembly on May 24 by a vote of 72-0. On Wednesday, the bill was passed unanimously by the Senate Committee on Environmental Quality 9-0.

Dozens of state and local business and trade associations endorsed the bill, and none were listed as opposing it. The Chanler Group, a plaintiffs' law firm that has filed numerous private Prop 65 actions, put out a statement after the bill passed the Assembly in May in support of its reforms, saying meritless lawsuits needed to be weeded out in order for the statute to properly function.

A.B. 227 will now move to the Senate Judiciary Committee for consideration, before advancing to the full Senate, where it needs a two-thirds majority to pass...

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