Understanding Proposition 65 Litigation in California: A Guide for Businesses

California’s Proposition 65, formally known as the Safe Drinking Water and Toxic Enforcement Act of 1986, is a law designed to protect California residents from exposure to harmful chemicals. However, its expansive scope and strict compliance requirements have made it a frequent source of litigation, presenting significant challenges for businesses operating in the state. This article provides an overview of Proposition 65 (“Prop 65”), highlights key litigation risks, and outlines best practices for compliance.

What Is Proposition 65?

Prop 65 requires California to publish a list of chemicals known to cause cancer, birth defects, or other reproductive harm. The list, updated annually, contains over 1,000 substances, including naturally occurring and synthetic chemicals found in common products such as household cleaners, foods, personal care products, and industrial materials. Notable chemicals include lead, acrylamide, and formaldehyde. See here for a list of Prop 65 chemicals: https://www.p65warnings.ca.gov/chemicals.

Businesses with ten or more employees must provide “clear and reasonable” warnings before knowingly exposing individuals to listed chemicals. Warnings are typically required on product labels, at the point of sale, in advertisements, or in public postings. The law also prohibits businesses from discharging listed chemicals into sources of drinking water.

Litigation Under Prop 65

Prop 65 is enforced through civil actions brought by the California Attorney General, district attorneys, city attorneys, or private enforcers acting “in the public interest.” Private enforcement has become particularly prominent, often involving specialized law firms or nonprofit organizations that issue hundreds of notices annually.

Common Litigation Issues

1. Failure to Provide Adequate Warnings: Businesses may face lawsuits for failing to display clear and reasonable warnings about potential chemical exposures. For example, a retailer selling ceramic mugs with lead-containing glazes might be sued for omitting proper warning labels about lead exposure risks.
2. Presence of Listed Chemicals in Products: Claims frequently arise when products sold in California contain listed chemicals above the regulatory safe harbor levels. For instance, food manufacturers have faced lawsuits alleging that acrylamide levels in baked goods and coffee exceeded allowable limits.
3. Testing and Methodology Disputes: Litigation often involves disputes over testing methods used to detect listed chemicals. Plaintiffs may argue that a business’s testing failed to account for specific exposure scenarios, such as cumulative exposure from daily use of a product.
4. Discharge Violations: Allegations of prohibited chemical discharges into drinking water sources can result in significant penalties and remediation requirements. An industrial facility found to be releasing chromium-6 into groundwater might face costly enforcement actions.

Penalties and Settlements

Prop 65 allows for civil penalties of up to $2,500 per violation per day, as well as injunctive relief to correct alleged violations. Many cases settle out of court, with businesses agreeing to reformulation commitments, revised warnings, or financial payments. Settlements can include substantial attorney fees for private enforcers. For example, a dietary supplement company might agree to pay $500,000 in penalties and legal fees while reformulating its product to reduce lead content. Relevant legal defenses can reduce this amount significantly.

Compliance Challenges

1. Broad Chemical List: The expansive and evolving Prop 65 list makes it challenging for businesses to monitor compliance. Newly added chemicals, such as per- and polyfluoroalkyl substances (PFAS), often require rapid adjustments to warnings or product formulations.
2. Ambiguities in Warning Requirements: Determining what constitutes a “clear and reasonable” warning can be subjective. OEHHA’s regulations provide guidance, such as specifying that warnings should include the chemical name and its associated risk (e.g., cancer or reproductive harm). However, practical application varies by industry and product type.
3. Complex Supply Chains: Ensuring compliance across global supply chains is particularly difficult, as manufacturers, suppliers, and distributors must work collaboratively to assess the presence of listed chemicals in products. For instance, a clothing retailer sourcing items from multiple overseas factories may struggle to verify compliance with California’s regulations.

Best Practices for Businesses Concerned with Prop 65 Litigation

1. Conduct Comprehensive Risk Assessments: Regularly review products, ingredients, and processes for the presence of Prop 65-listed chemicals. Use reliable testing methods and consult with experts to evaluate potential exposure risks. For example, a winery might test for naturally occurring arsenic in its water supply used for production.
2. Maintain Detailed Records: Document compliance efforts, including test results, supplier certifications, and communications regarding Prop 65 requirements. This documentation can be invaluable in defending against litigation. A cosmetics company might keep records of its raw material safety certifications to demonstrate due diligence.
3. Update Warnings and Labels: Stay informed about changes to the Prop 65 list and OEHHA regulations. Ensure that warnings comply with current standards and are prominently displayed where required. For example, food packaging could include labels like, “WARNING: This product can expose you to acrylamide, a chemical known to the State of California to cause cancer.”
4. Audit Supply Chains: Work with suppliers to obtain certifications or disclosures about listed chemicals in raw materials and components. Include Prop 65 compliance clauses in supplier contracts. A toy manufacturer might require suppliers to certify that paints used on their products are lead-free.
5. Engage Legal Counsel Early: Retain experienced Prop 65 counsel to review compliance programs, assess potential liabilities, and develop strategies to mitigate risks. Proactively addressing concerns can help avoid costly lawsuits. For example, our legal team can help a beverage company navigate safe harbor thresholds for bisphenol A (BPA) in its packaging.

Trends and Developments in Prop 65 Enforcement

Recent years have seen increased enforcement targeting specific industries, including:

• Food and Beverage: Coffee companies faced high-profile lawsuits over acrylamide content, leading to disputes about whether warnings were necessary given the health benefits of coffee.
• Personal Care Products: Nail polish and hair dye manufacturers have been targeted for containing toluene and formaldehyde.
• Consumer Electronics: Retailers selling cables or headphones with phthalates have been sued for inadequate warnings.

Enforcement trends also reflect heightened scrutiny of emerging chemicals, such as PFAS, often referred to as “forever chemicals.” These substances are found in products ranging from nonstick cookware to water-resistant clothing.

Additionally, OEHHA has issued revised regulations and safe harbor warning language, emphasizing the importance of clarity and specificity. For example, generic warnings such as “This product contains chemicals known to the State of California to cause cancer” may no longer suffice without naming specific chemicals and risks.

Conclusion

Prop 65 compliance is a critical and ongoing responsibility for businesses operating in California. While the law aims to protect public health, its litigation landscape creates significant risks for companies. By understanding the law’s requirements, proactively addressing compliance challenges, and seeking expert legal guidance, businesses can reduce exposure to Prop 65 lawsuits and ensure continued market access in California.

For more information or assistance with Prop 65 compliance, please contact Stuart K. Tubis, Esq. at skt@jmbm.com or 415-984-9622.