Certificate of Merit Litigation

AG Offers Opinion that No Certificate Required Before January 1, 2002

A December 21, 2001 letter from Deputy Attorney General Edward Weil laid out the AG's position regarding the effect of SB 471 on enforcement actions filed before and after January 1, 2002. Significantly, the AG believes that:

• 60-day notices served before 1/1/02 do not need to comply with the certificate of merit requirement, even though any enforcement actions filed after that date and based on those notices would otherwise be subject to SB 471.
• All settlements that had not received court approval before December 31 would be required to be submitted to the court by way of noticed motion.
• Any actions alleging a Prop 65 violation filed after January 1 must be reported to the Attorney General.
• The Attorney General could seek to recover fees for private enforcers after January 1 for any case , regardless when it was filed.

Courts Split on Whether Certificate of Merit Required

There have been conflicting rulings from trial courts in San Francisco and Oakland as to whether an enforcement action filed in 2002 must be based on an SB 471 certificate of merit, even if the original 60-day notice was served in 2001. This issue is of continued concern, given the more than 4000 notices that were served in December 2001, many of which remain viable as a potential basis for an enforcement action but would not meet the requirements of the new law.

Alameda Court Dismisses Cases

In DiPirro v. Ace Hardware (Alameda Superior Court no. 02-046321) [light bulb litigation], the defendants demurried to the complaint because DiPirro’s 60-day notices did not include certificates of merit (the notices were served in 2001, but the complaint was not filed until April 2002). The defendants' arguments were based on the language of the statute, which required a certificate of merit to be included in a 60-day notice as a condition precedent to bringing an enforcement action. According to the defendants' brief, "By not including the required certificates of merit in his 60-day notices, plaintiff has no standing to proceed with his enforcement action, and it must be dismissed with prejudice. Plaintiff's opposition argued that the notices were valid when severd, and therefore applying SB 471 to notices served in 2001 would be impermissibly retroactive.

In a July 25 ruling [pdf], Judge Ronald Sabraw of the Alameda Superior Court dismissed DiPirro's Prop 65 enforcement action without leave to amend. Judge Sabraw found that the result was compelled by the plain language of the statute as amended by SB 471, and consistent with case law regarding application of procedural changes. "Finally, it serves the purpose of the legislation and does not work a detriment on consumers to require Plaintiff to have served Defendants with both a notice and a certificate of merit prior to the initiation of this lawsuit. Of interest was the fact that Judge Sabraw reviewed but disagreed with Weil's letter that reached the opposite conclusion.

The court requested additional briefing and argument as to whether the unfair competition claim under B&P Code § 17200 must also be dismissed, and plaintiff has asked the court to reconsider its ruling, and to vacate it based on his "reasonable mistake of law" and reliance upon the Attorney General's interpretation. In the interim, plaintiff served a new round of 60-day notices in August, against both manufacturers and retailers, and is expected to continue to pursue the litigation aggressively. All of the following briefing is available for download:

• Plaintiff's Motion for Reconsideration
• Notice Hearing to Vacate Order
• Points and Authorities In Support of Motion to Vacate
• Plaintiff's Request for Judicial Notice.  

• Exhibit A
• Exhibit B
• Exhibit C

• Decl. of Sheffer in Support of Motion for Reconsideration [pdf]
• Decl. of Sheffer in Support of Motion for Relief [pdf]
• Plaintiff's Supplemental Brief on Demurrer to Unfair Competition Cause of Action [pdf]
• Defendants' Consolidated Opposition to Motion for Relief [Word]
• Defendant's Consolidated Opposition to Motion for Reconsideration [Word]
• Defendant's Consolidated Supplemental Brief on Plaintiff's Unfair Competition Action [Word]
• Plaintiff's Reply Briefs on Motion for Relief and Motion for Reconsideration (included in one pdf document)

In a September 17 ruling, Judge Sabraw dismissed the unfair competition action under Business & Professions Code § 17200. He found that the 60-day notice provision creates "an express Legislative bar to pursuing a UCL claim based on Proposition 65 without serving a valid 60 day notice," and both Prop 65 and UCL claims were brought in "the public interest," such that the more detailed private enforcement mechanism of Prop 65 controlled. The court found that the two acts were "arguably in irreconcilable conflict because the Legislature would not reasonably have created two statutes to enforce [Prop 65] with two different enforcement mechanisms. The way to harmonize the statutes is to incorporate Proposition 65 fully into an 'unlawful' claim under the UCL and require that a 60 day notice be serve[d] prior to the bringing of a claim."

The court also found support for its decision in the policy of SB 471 to discourage frivolous lawsuits, which led the court to believe "that the Legislature considers notice to be an integral part of the neforcement mechanism. The statute contains, in effect, both a 60 day 'safe harbor' for the resolution of cases and, through the certificate of merit, a minimum threshold for the bringing of cases."

Finally, the court denied both plaintiff's motion for relief, based on his "reliance" upon the AG's interpretation, and his motion for reconsideration. See order denying motion for reconsideration, order denying motion to vacate.

San Francisco Courts Hold that Certificates Not Required

On the other side of the Bay, San Francisco judges have not been receptive to the argument that any complaint filed in 2002 must include a certificate of merit. In consolidated litigation over lead in cosmetics, Macy’s and JC Penney filed the identical “certificate of merit” demurrer in front of San Francisco Superior Court Judge Robertson (San Francisco Superior Court no. 407150). The August 21 order overruled the demurrers, siding with a ruling from the other San Francisco law and motion department, Judge McBride.

In an order dated November 7, 2002, Division Three of the First District Court of Appeal denied a petition for writ of mandate filed by Macy's and JC Penney, seeking to have Judge Robertson's ruling overturned. (1st Civil no. A100457.) In their writ petition, the retailers pointed out that different rulings had been reached on the same issue of law in the San Francisco and Alameda courts, but the court declined to address the merits of the issue.

This page last updated 7/7/04