ILMA Compoundings – March 2019 - 31

WASHINGTON LANDSCAPE

fine, giving some leeway for smaller
businesses to comply. Any entity with
under 10 employees is exempt from
Prop 65 liability.
It is the citizen enforcement
provision in the law that led to the
so-called Prop 65 "bounty hunters."
Under the provision, a citizen keeps up
to 25 percent of any penalty received
in a lawsuit, along with obtaining
attorney's fees, at the successful
conclusion of a trial. Unlike many
lawsuits, a plaintiff does not need to
show that it has been harmed to obtain
a favorable judgment. Although it
is designed to encourage California
citizens to file cases in order to protect
consumers, the reality is that a relatively
small group of attorneys and plaintiffs
file the majority of Prop 65 cases. One
plaintiff filed 675 notices involving
marijuana in 2017, and roughly threefourths of the Prop 65 bounty hunter
cases are filed against businesses outside
of California.
According to the attorney general's
data, 2,083 (88 percent) of the bounty
hunter actions filed in 2018 involved
phthalates, with lead second with 570
actions last year.
WARNING CHANGES
OEHHA amended its Prop 65
regulations in 2016 in an attempt to
make warnings clearer while reducing
over-warning, as well as to reduce the
number of bounty hunter actions. The
new rules, which apply to products

manufactured after Aug. 30, 2018,
require the specific identification of at
least one OEHHA-regulated chemical,
a pictogram, links to OEHHA's
warning website (www.P65Warnings.
ca.gov), and foreign language warning
requirements if any information is
provided in that language.
Short-form warnings are also
allowed, designed for use on products
with limited space, despite no
provision prohibiting their use on
larger products. In addition, websites
and mail-order catalogs are required
to publish Prop 65 warnings. Bounty
hunters will likely look for out-of-state
targets that use online and mail order
marketing in California.
IMPACT
Given the expenses of litigation and
the burden on defendants to prove
that there is either "no significant risk"
or "no observable effect" from Prop
65 chemicals in the targeted product,
it is no surprise that most businesses
agree to settle with the bounty hunters.
As part of the 60-day notice required
before filing a suit, plaintiffs typically
propose settlements between $20,000
and $150,000.
California's attorney general reported
that Prop 65 settlements reached $25.8
million in 2017, with $19.5 million of
that total going to attorneys' fees. Of
the 688 settlements that year, three law
firms accounted for 42 percent of the
agreements, keeping $7.4 million in

fees. It is worth noting that in 2000,
the first year in which California's
attorney general released Prop 65
settlement data, all attorneys' fees
totaled $7.4 million. Keep in mind
that these settlements come from filed
lawsuits and do not include any money
received during the 60-day notice
period.
GOING FORWARD
Before the Prop 65 amendments took
effect last August, bounty hunter
lawsuits typically were filed for failure
to provide any Prop 65 warning. By
providing guidance on what warnings
should look like, but with multiple
confusing variations, OEHHA's
amendments open the door to lawsuits
based on inadequate warning labels.
As a result, it is likely that last
August's labeling changes will not
result in the intended reduction in the
number of bounty hunter cases. First,
the number of chemicals listed by
OEHHA continues to grow even as the
public consciousness about chemicals
and chemical issues, especially
consumer goods and food products, has
increased. Second, the amounts paid
in settlements and fines continues to
increase, acting as a continued lure to
bounty hunters.
Levetown serves as associate
counsel to ILMA through
Bassman, Mitchell, Alfano &
Leiter Chtd. He may be reached
at 202-466-6502 or mlevetown@bmalaw.net.

31


http://www.P65Warnings.ca.gov http://www.P65Warnings.ca.gov

ILMA Compoundings – March 2019

Table of Contents for the Digital Edition of ILMA Compoundings – March 2019

Letter From the Ceo
Inside Ilma
What’s Coming Up
Industry Rundown
In the Know
International Insight
Market Report
Points on a Recycling Continuum
How Are You Regulated?
My Cybersecurity Playbook
Business Hub
Counsel Compound
Washington Landscape
In Network
Member Connections
ILMA Compoundings – March 2019 - Cover1
ILMA Compoundings – March 2019 - Cover2
ILMA Compoundings – March 2019 - 1
ILMA Compoundings – March 2019 - 2
ILMA Compoundings – March 2019 - Letter From the Ceo
ILMA Compoundings – March 2019 - Inside Ilma
ILMA Compoundings – March 2019 - 5
ILMA Compoundings – March 2019 - 6
ILMA Compoundings – March 2019 - 7
ILMA Compoundings – March 2019 - 8
ILMA Compoundings – March 2019 - 9
ILMA Compoundings – March 2019 - What’s Coming Up
ILMA Compoundings – March 2019 - In the Know
ILMA Compoundings – March 2019 - International Insight
ILMA Compoundings – March 2019 - 13
ILMA Compoundings – March 2019 - Market Report
ILMA Compoundings – March 2019 - Points on a Recycling Continuum
ILMA Compoundings – March 2019 - 16
ILMA Compoundings – March 2019 - 17
ILMA Compoundings – March 2019 - How Are You Regulated?
ILMA Compoundings – March 2019 - 19
ILMA Compoundings – March 2019 - 20
ILMA Compoundings – March 2019 - 21
ILMA Compoundings – March 2019 - My Cybersecurity Playbook
ILMA Compoundings – March 2019 - 23
ILMA Compoundings – March 2019 - 24
ILMA Compoundings – March 2019 - 25
ILMA Compoundings – March 2019 - Business Hub
ILMA Compoundings – March 2019 - 27
ILMA Compoundings – March 2019 - Counsel Compound
ILMA Compoundings – March 2019 - 29
ILMA Compoundings – March 2019 - Washington Landscape
ILMA Compoundings – March 2019 - 31
ILMA Compoundings – March 2019 - In Network
ILMA Compoundings – March 2019 - 33
ILMA Compoundings – March 2019 - 34
ILMA Compoundings – March 2019 - 35
ILMA Compoundings – March 2019 - Member Connections
ILMA Compoundings – March 2019 - Cover3
ILMA Compoundings – March 2019 - Cover4
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