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2001 Legislative News
AG Prop 65 Reform Bill Becomes Law
On October 8, 2001 SB 471 was signed by Governor Gray Davis. [SB 471 links below.] SB 471 sets forth several provisions that are intended to weed out some frivolous lawsuits by erecting some barriers to filing of lawsuits, and will become effective January 1, 2002. Among its provisions are the following:
Certificate of Merit
A private plaintiff would need to certify that the attorney or party believes there is good cause for the notice, based on consultation with an appropriate expert who has reviewed appropriate information. The information supporting the certificate must be attached to the 60-day notice served on the Attorney General, and may be reviewed by a court at the termination of litigation "if the trial court determines that there was no actual or threatened exposure to a listed chemical," and may render an action frivolous.
It is currently unclear whether this provision (and other limitations of Prop 65, including the 60-day notice requirement) apply to cases brought under the Unfair Competition Law (Cal. Business & Professions Code 17200). The bill retains neutral language, asserting that the amendments are not intended to "affect the requirements imposed by statute or a court decision in existence on the effective date of the act amending this section during the 2001-02 Regular Session concerning whether any person filing any action in which a violation of this chapter is alleged is required to comply with the requirements of subdivision (d)."
Settlement Approval
If signed, the bill will require all settlements in enforcement actions be approved by a court. The parties would need to provide notice to the Attorney General, and would allow participation in settlement hearings by public prosecutors. After some amendments, the final bill contained neutral language on whether such approvals would preclude subsequent lawsuits by public or private enforcers.
A court may approve a settlement only if it makes the following findings:
"(A) Any warning that is required by the settlement complies with this chapter.
(B) Any award of attorney's fees is reasonable under California law.
(C) Any penalty amount is reasonable based on the criteria set forth in paragraph (2) of subdivision (b)."
The bill makes clear that the plaintiff "has the burden of producing evidence sufficient to sustain each required finding."
In connection with the bill, the AG wrote to one defense attorney setting forth his view in detail on the ability of a private enforcer settlement to preclude the AG from prosecuting an enforcement action. [pdf] The bill contains neutral language on the preclusive effects of private settlements.
Settlement Criteria
The bill would establish criteria for a court to consider in assessing civil penalties awarded under the Act. The purpose of these criteria were to answer criticisms that the existing penalty provision established a high maximum penalty, with no minimum, and provided no guidance. The factors a court must consider are:
"(A) The nature and extent of the violation.
(B) The number of, and severity of, the violations.
(C) The economic effect of the penalty on the violator.
(D) Whether the violator took good faith measures to comply with this chapter and the time these measures were taken.
(E) The willfulness of the violator's misconduct.
(F) The deterrent effect that the imposition of the penalty would have on both the violator and the regulated community as a whole.
(G) Any other factor that justice may require."
Private Attorneys' Fees
The bill would allow a public prosecutor to seek costs on behalf of a private party that had rendered assistance in a case. The purpose of this provision was to minimize the necessity of separate actions being filed by private enforcers when the Attorney General or other public enforcer files an action based on information provided in a 60-day notice. Whether to seek such costs will be in the prosecutor's discretion.
Expanded Reporting
The bill would expand the existing requirements to report on Prop. 65 actions to the Attorney General to expressly include those settlements entered into without filing a complaint, and other types of complaints in which violations of Prop. 65 are alleged, such as 17200 actions.
In the face of arguments from the business community that these reforms did not go far enough in weeding out frivolous actions, the AG and Senator Sher did commit to continuing a dialogue on further reform provisions in the next legislative session.
Based on commitments from the AG and Senator Sher, it is anticipated that reform will again be a topic for legislative action in 2002.
- SB 471 Status
- History
- Bill Text [HTML/PDF]
- Analyses [Senate Floor (9/13/01)/Assembly Floor (9/13/01)]
Connecticut Rejects Bill
On April 3, 2001 the Connecticut General Assembly defeated SB 1030, "An Act Concerning Toxic Substances." Like Prop 65, the bill would have required the "manufacturer of a consumer product to notify consumers if such product contains a known carcinogen or toxic substance unless the chemical is present in an amount that is determined by the Commissioner of Public Health to be a safe exposure level." While the proposed act would have been broader than Prop 65 (not limited to cancer and reproductive toxicity), it would also have allowed for private enforcement (but not private penalty actions). The act also would have placed the burden on the manufacturer to establish that the product met the safe exposure level.
See bill text.
Diesel Engine Warning Exemption Bill Killed
AB 986, introduced February 23, 2001, would exempt exposures from onroad heavy-duty truck or bus engines from the Prop 65 warning requirements the State Air Resources Board or the United States Environmental Protection Agency has certified emission standards for the engines, and if a statewide warning is published annually. The statewide warning is defined as "a warning issued annually by the State Air Resources Board that is printed in a newspaper of general circulation in accordance with Section 6062 of the Government Code in each city with a population exceeding 250,000."
This bill contains a sunset clause, providing that it would expire on December 31, 2005, or earlier if either a reformulated diesel fuel program is implemented by the United States Environmental Protection Agency or by the State Air Resources Board, or if diesel particulates are removed from the list of toxic air contaminants.
On May 22, 2001, the hearing on this bill in the Assembly Environmental Safety and Toxic Materials Committee was cancelled by the author, effectively killing the bill for 2001.
This page last updated November 19, 2001
