Cal Biz Lit

ANOTHER ENVIRONMENTAL SETTLEMENT - GAS LEAK IN ALISO CANYON

As a reminder that Proposition 65 was passed by the voters in California as a way to decrease pollution and chemical risks, a settlement has been reached with a Private Attorney General in an action filed against Southern California Edison (a division of Sempra Energy) for a substantial leak that occurred in 2015. We reported on an environmental settlement reached regarding Lake Tahoe a few months ago:  (https://www.calbizlit.com/cal_biz_lit/2021/11/beyond-proposition-65-as-usual-cleaning-up-lake-tahoe.html - “Beyond Proposition 65 As Usual – Cleaning Up Lake Tahoe”).

A massive gas leak was discovered on or about October 23, 2015 near Porter Ranch, in the Santa Susana Mountains (just north of Los Angeles). There was a gas storage facility in Aliso Canyon, and it was determined that one of the wells was leaking. In early January of 2016, it was so severe that Governor Jerry Brown declared a state of emergency, and in February of 2016, it was announced that the well was permanently plugged.

Before the well was capped, it was estimated that some 107,000 short tons of methane and 8,000 short tons of ethane were released into the atmosphere. This is considered the largest natural gas leak in US history in terms of environmental impact. While actual injury not necessary for a chemical exposure to constitute a Proposition 65 violation, many residents in and near Aliso Canyon reported illness possibly related to the gas leak prior to the acknowledgement of the leak by the utility company.

In 2014, the Center for Environmental Health (“CEH”), based in Oakland, started working with Aliso Canyon residents on a health study to explore worries related to the gas storage facility. Once the major leakage was discovered, 2016, CEH filed a Notice of Violation and then a law suit against the gas company (as did several other individuals and organizations).

The CEH suit has now been settled. In terms of injunctive relief, the utility company is going to install “fence line” monitors for benzene leaks, and will notify local residents if excess levels of Benzene are detected (1.5 ppb over 30 minutes). The company must have its utility vehicles used n site changed to zero emission vehicles within the year, as well.

Finally, the monetary terms: So. Cal Edison will pay $500,000 civil penalty 25 percent of which will be paid to CEH and an individual plaintiff and 75 percent of which will go to OEHHA. The company will also pay an additional $275,0000 as an Additional Settlement in lieu of a civil penalty to CEH; which will place this extra money in a fund dedicated to reducing exposure to air pollutants in Southern California. Finally, the company will pay $775,000 in reimbursement of the plaintiffs' attorneys' fees and costs with $27,500 going to CEH and $747,500 going to the Lexington Law Group.

PFOs to be Listed as Proposition 65 Controlled Chemicals

    The Carcinogen Identification Committee (“CIC”) is one organization that California’s OEHHA relies upon to determine whether a chemical should be listed under Proposition 65 as a chemical for which the public requires a warning before purchasing a product containing that chemical. On December 7, 2021, the CIC haled a public meeting to discuss their findings regarding Perfluorooctane Sulfonic Acid (PFOS) and its salts and transformation and degradation precursors (collectively "PFOS") as a potential Proposition 65 carcinogen.

    PFOS and its salts and precursors have been used in a large variety of applications, including non-stick coatings and grease repelling materials. While 3M was the major manufacturer in the United States, other companies outside of the United States manufacture and use PFOS, so it continues to be a potential cancer-causing chemical group in California.

    According to the Hazard Identification Materials, within some 372 pages of studies and materials released before the December 7th meeting, "PFOS is one of the most extensively produced and studied members of a class of chemicals called per- and poly-fluoroalkyl substances (PFAS)", which are known as the "forever" chemicals because of their persistence. "PFOS is ubiquitous, with levels measured in environmental media, biota, and humans. Humans are exposed to PFOS through contaminated food and drinking water, ingestion of dust, and inhalation of indoor and outdoor air."

    As a result of the findings of the CIC discussed at the December 7th hearing, PFOS and its salt and degradation materials will be listed as a chemical subject to Proposition 65 control. As of twelve months after the chemicals are listed, warnings will be required on any product incorporating or releasing such chemicals.

 

PFOs to be Listed as Proposition 65 Controlled Chemicals

    The Carcinogen Identification Committee (“CIC”) is one organization that California’s OEHHA relies upon to determine whether a chemical should be listed under Proposition 65 as a chemical for which the public requires a warning before purchasing a product containing that chemical. On December 7, 2021, the CIC haled a public meeting to discuss their findings regarding Perfluorooctane Sulfonic Acid (PFOS) and its salts and transformation and degradation precursors (collectively "PFOS") as a potential Proposition 65 carcinogen.

    PFOS and its salts and precursors have been used in a large variety of applications, including non-stick coatings and grease repelling materials. While 3M was the major manufacturer in the United States, other companies outside of the United States manufacture and use PFOS, so it continues to be a potential cancer-causing chemical group in California.

    According to the Hazard Identification Materials, within some 372 pages of studies and materials released before the December 7th meeting, "PFOS is one of the most extensively produced and studied members of a class of chemicals called per- and poly-fluoroalkyl substances (PFAS)", which are known as the "forever" chemicals because of their persistence. "PFOS is ubiquitous, with levels measured in environmental media, biota, and humans. Humans are exposed to PFOS through contaminated food and drinking water, ingestion of dust, and inhalation of indoor and outdoor air."

    As a result of the findings of the CIC discussed at the December 7th hearing, PFOS and its salt and degradation materials will be listed as a chemical subject to Proposition 65 control. As of twelve months after the chemicals are listed, warnings will be required on any product incorporating or releasing such chemicals.

 

Watch Out for Baby Food?

Something that every parent has the right to believe is not toxic for their infant to consume is baby food sold by national baby food companies (most of whom have been in that business for decades). As it turns out, that assumption is not necessarily correct.

In 2018 Consumer Reports issue a report on the results they had conducted which showed elevated levels of four metals: lead, cadmium, mercury and arsenic in a wide variety of baby foods. All of these chemicals, it should be noted, are covered and subject to regulation by Proposition 65.

In February of 2021, the U.S. House of Representatives’ Oversight Committee’s Subcommittee on Economic and Consumer Policy issued a report on the presence of those metals in baby foods. At the time of the report, they indicated that some national baby food manufacturers had failed to cooperate in their investigation.

In April of 2021 the FDA announced its “Closer to Zero” plan to reduce the levels of these toxic chemicals in baby and infant foods. Now, the good news is that such a plan does – sort of - exist. The bad news is that the FDA currently allows as much as 100 ppb of arsenic in rice cereals. That limitation is the sole regulation thus far issued to control the presence of these toxic metals in baby foods.

In late September of this year, the House Oversight Subcommittee issued a follow up report. (ECP Second Baby Food Report 9.29.21 FINAL.pdf (house.gov)). It included findings that, for example, some major companies practice of testing raw materials but not the finished product contributed to the risk of the increased metal levels (an outcome not at all surprising to those of us who have followed the Proposition 65 litigation concerning chocolates).

This most recent Subcommittee report reveals that sweet potato and rice cereals (“organic rice” – sounds like a good thing, right?) are particularly prone to elevated metal levels. The Subcommittee urged the FDA to, among other things, require testing of finished products, rather than just raw ingredients, and to lower the allowable standards for arsenic in rice products to 10 to 15 ppb, and to establish similar levels in other baby food products.

Recently, California Attorney General Bob Bonta joined with some 22 other State Attorney Generals to urge the FDA to adopt regulation to lower the levels of allowable toxic metals in baby foods. While the FDA adopts standards that it finds to be achievable, the Attorneys General are urging adoption of a modifying standard used in New York, called the “best performer” standard. That is, if one company can get the metals content of its baby foods down to a certain level, other companies should be able to do so as well, and that standard is adopted, because it is achievable.

How does this tie into California, you ask? Well there is the obvious: if the FDA adopts good standards, that benefits all of the country, including California (thus rob Bonta’s involvement).

What if there are standards adopted, but they are not strict? Can’t Proposition 65 protect our infants and babies? That’s where something called pre-emption comes into play: if the FDA has made a final rule on allowed levels of a chemical in a particular food (or the type of label to be placed on a bottle of wine…) then a given State cannot adopt a different, stronger standard.

A review of Proposition 65 Notices of Violation in 2020 and 2021 reveals a number of such notices related to lead in baby foods, mostly for sweet potato products. And since 2018, it reveals no Notices for arsenic in baby foods, despite the findings of the subcommittee.

Given the consumer Reports publication and the Subcommittee findings, this illustrates the effect of Federal pre-emption when we deal with Proposition 65. If Plaintiffs in Proposition 65 litigation seem to be overstepping rationality, Federal Regulations may be a way to correct the problem (assuming State legislators won’t concur).

What Does That Agency Announcement About Listing a Chemical Mean?

    We often receive questions surrounding announcements from the Office of Environmental Health Hazard Assessment (OEHHA) that the agency is considering adding a chemical to the Proposition 65 List. There can be a substantial amount of confusion around these announcements, with many believing that the announcement means that there is enforcement with regards to the chemicals under consideration. The aim of this posting is to dispel some of the confusion around OEHHA announcements by explaining the announcements that are made by the lead agency at different stages during the listing process.

    The first news about agency action can come in the form of an announcement that OEHHA’s scientific advisory panels, the Carcinogen Identification Committee (CIC) or Developmental and Reproductive Toxicant Identification Committee (DART), are being asked to advise on the relative priority certain chemicals should have for consideration to be listed. That announcement includes a request for public comment. There is then an announcement following the meeting as to what priority the committee advised each chemical should have. Currently perfluorodecanoic acid (PFDA) and its salts, perfluorohexanesulfonic acid (PFHxS) and its salts, perfluorononanoic acid (PFNA) and its salts, and perfluoroundecanoic acid (PFUnDA) and its salts are proceeding through the listing process as reproductive toxins. They made their debut in the listing process as part of a request from OEHHA to DART that they prioritize a list of 22 different chemicals for review at a December 10, 2020 meeting. Following the December 10, 2020 meeting the agency announced that the four preceding chemicals were marked “high priority.”

    The next announcement from the agency in the listing process is the announcement that OEHHA is developing the technical material on the chemicals, the hazard identification material, to provide to the expert committees for their consideration of whether to list the chemicals. The agency again invites the public to comment including by contributing material for OEHHA to consider when assembling the hazard identification materials. The request for comment by OEHHA at this stage for PFDA, PFHxS, PFNA, and PFUnDA was announced on March 26, 2021 and the comment period closed on May 10, 2021.

    After the agency assembles the hazard identification material it is published to the public on the agency website and in the California Regulatory Notice Register. The agency issues a notice on the availability of the hazard identification materials, which is typically accompanied by the announcement of the date of the meeting at which the listing of the chemical will be considered. The public is again given an opportunity to comment, this time directly on the materials. Public comment received on the materials is provided to the committee along with the hazard identification prepared by the agency. The agency published the hazard identification materials for PFNA and PFUnDA and their salts on November 5, 2021, announcing that the meeting for the consideration of their listing would be held on December 14, 2021. The agency has yet to publish the hazard identification materials for PFDA and PFHxS and their salts.

    Following the listing of chemicals by the committees, the agency will formally announce the listing. The warning requirement for a newly listed chemical takes effect 12 months after the addition of the chemical to the Proposition 65 list, and that is when enforcement could start to take place. That does not mean that as long as a product is manufactured before the 12 months are up, the manufacturer is not subject to enforcement. If the product is somewhere in the stream of commerce and gets sold after the 12 month period expires, a warning is required to be given. For consumer product companies or retailers where supply is manufactured many months in advance, action needs to be taken to comply many months prior to the expiration of the 12 month period.

Beyond Proposition 65 As Usual - Cleaning up Lake Tahoe

Those of us in California are familiar with seeing Proposition 65 warnings on goods. Those who read this blog regularly are familiar with Proposition 65 enforcement actions being brought against companies that manufacture, distribute and/or sell products in California that contain one or more of several hundred potentially toxic chemicals without the appropriate warning.
With the thousands of annual actions being brought under Proposition 65 for failure to place product warnings, it’s easy to forget that the actual title of the law that is Proposition 65 is “SAFE DRINKING WATER AND TOXIC ENFORCEMENT ACT OF 1986”.
AT&T’s subsidiary, Pacific Bell or Pac Bell has been given a reason to remember the “Safe Drinking Water” part of the law. Interestingly, and perhaps tellingly, it was not one of the usual Proposition 65 enforcement law firms that brought the action against Pac Bell.
As it happens, there has been some eight miles of old lead-covered telephone cable running under Lake Tahoe. Old as in abandoned by Pac Bell some 30 years ago when they switched to fiber optic cable. Lead containing as in some three pounds of lead per foot, for the entire eight miles. They then just left the lead-covered copper cable behind to rot.
A few years ago, local divers noticed the deteriorating cable when cleaning trash from the lake bottom, and it was the California Sportsfishing Protection Alliance who brought suit against the telecommunications giant, using a combination of Federal law and state laws, including Proposition 65.
In any event, the action seems to have been settled, with Pac Bell agreeing to remove the eight miles of cable after receiving appropriate permitting. If the cost for permitting and removal exceeds $1.5 million, negotiations will re-open (informed sources say that it should not exceed that amount).
There is no word on the amount of attorney fees being recovered.

Proposition 65 Compliance is Often Not About What Chemicals a Product Contains

A lot of our posts on this blog are about changes in the law, recent happenings in litigation, or conclusions we draw from looking at litigation activity. This post is different in that it is focused on explaining a concept that is and has been important for Proposition 65 compliance since the law and its enacting regulations first took effect.
Proposition 65 compliance and enforcement is often discussed in terms of whether a product contains a listed chemical, but chemical content is not what Proposition 65 requires a warning for. Proposition 65 requires a warning for exposures to listed chemicals. Some products that do not contain a listed chemical will require a warning because people using the products will be exposed to a listed chemical when the product is used as intended. Conversely, some products that contain a listed chemical do not require a warning because people are not exposed to the chemical the product contains. Wood dust is a listed chemical and provides a good way to illustrate this distinction. A wood table necessarily contains wood dust, but a wood table would not require a Proposition 65 warning for wood dust. By contrast, in a case brought by California’s attorney general, People of the State of California v. Ace Hardware Corporation, San Francisco Superior Court Case No. 995893, makers and sellers of saws were required to provide a warning for wood dust, despite the fact saws do not contain wood dust. No warning is required for the table that contains wood dust because users of the tables sitting and eating at it are not exposed to wood dust. A warning is required for the saw because a saw is used to cut wood, exposing the user to wood dust. That said, there are some products where the mere fact that the product contains a listed chemical is enough to know that an exposure is taking place. The types of products that most often would fit this category are food products. If the bread contains the listed chemical acrylamide, consumer are going to be exposed to acrylamide because they ingest the bread.
So what does the fact that mere presence of the chemical is not enough to require a warning mean in a practical sense? It means that determining whether a product is in compliance, or whether allegations of a violation of Proposition 65 are defensible, requires more than just a test from a commercial lab for the presence of a listed chemical. Yes, in the vast majority of instances a lab test for the listed chemical is the place to start. But the ultimate question that must be answered is does use of the product result in an exposure to the listed chemical? Is the listed chemical contained in the product in such a way that the user would come into contact with the listed chemical when using the product, or does use of the product create an exposure to a listed chemical when it is used as intended with certain other material? When the alleged exposure is to a chemical contained within the product, the discussion is put in terms of whether the listed chemical is “accessible.” If it is ultimately determined that the chemical is accessible, and an exposure results, then it becomes a question of how much of an exposure. Proposition 65 puts the burden of establishing that the exposure is below a level for which a warning is required on the party defending the claim. Generally, if you get to the question of how much of an exposure occurs, that usually means that the claim will have to be litigated, or a settlement paid out to dispose of it, along with an agreement to reformulate the product or provide a warning going forward. Whether to defend or settle a claim is a business decision that is informed by the advice of counsel, and heavily influenced by the reasonableness of the enforcer bringing the claim.

Acrylamide, Further Proposition 65 Drama

As was discussed in Ahead of the Curve, here (https://scalirasmussen.com/news/2021/05/13/court-orders-cessation-of-enforcement-of-acrylamide-related-cases) and here (https://scalirasmussen.com/news/2021/08/06/update-on-proposition-65-cases-concerning-acrylamide) acrylamide, a chemical that results from roasting or cooking foods, has become perhaps the most visibly and highly litigated chemical in Proposition 65. This attention dates back to the litigation involving coffee roasters and retailers, and has since then primarily carried by the California Chamber of Commerce (see those articles noted above).

Much like glyphosate, discussed recently in Cal Biz Lit, the defendants in cases concerning acrylamide are objecting that requiring warnings are a violation of their First Amendment Rights, in that it would require them to state that the chemical in their product increases the risk of cancer, something they vehemently deny.
A further objection to the requirement of Proposition warnings has been that certain safe food products cannot be made without the development of acrylamide. In order to address that issue, last fall OEHHA published proposed “safe harbor” limits setting forth acrylamide levels specific to different prepared foods, below which a Proposition 65 warning would not be required.

Those proposed levels are applicable, inter alia, to almond butter, as well as roasted and chocolate almonds; bread, including rolls, buns and baguettes; cookies (differentiating between animal, thin, crackers and sandwich wafers); potato products (hash browns, sweet potatoes, potato puffs and french fries); prune juice and waffles.

While there has not been a noted opposition to the proposed Regulation, they have not as yet been enacted.
In the meantime, OEHHA has proposed new Warning language for those products that contain acrylamide that do exceed the proposed chemical levels. That new Section, subsection (b) to Section 25607.2 of the OEHHA regulations, would state as follows:

"b) A warning for food exposures to acrylamide meets the requirements of this subarticle if it is provided: (i) in accordance with subsection (a), or, (ii) via one or more of the methods specified in Section 25607.1 and includes both elements (1) and (2) below.
(1) The words 'CALIFORNIA WARNING:' in all capital letters and bold print.
(2) The words, “Consuming this product can expose you to acrylamide, a probable human carcinogen formed in some foods during cooking or processing at high temperatures. Many factors affect your cancer risk, including the frequency and amount of the chemical consumed. For more information including ways to reduce your exposure, see www.P65Warnings.ca.gov/acrylamide."
Readers of this blog will note that, as with glyphosate, OEHHA is trying to avoid objections the required warnings results in a First Amendment conflict.

The public comment period for the proposed Regulation as to acrylamide is open until November 8th; the public comment period for the proposed glyphosate has just closed. We will keep you apprised as new warnings regulations come into effect.

Glyphosate In the Trial Courts – Liability for Failure to Warn, Cancer Causation

As noted in CalBizLit on September 22nd, Proposition 65 warning requirements regarding the chemical glyphosate are currently being litigated. As it happens, aside from Proposition 65, glyphosate is also a subject of civil litigation, and is also in signficant dispute in that realm.
Let’s take a moment to be clear, because this is not actually universally understood: A company can be liable for a violation of Proposition 65 without any allegation (let alone proof) that anyone was injured as a result of that product’s sale or use in California. If Californians have been exposed to a potentially cancer causing or reproduction injury-inducing chemical without providing warning to California citizens, there is potential liability.
In contrast, liability under products liability theories in civil litigation requires that there be a finding that the given chemical not only was a potential cause of injury, but rather that it actually did cause (was “a substantial factor” in causing) an injury to the Plaintiff (or their decedent.)
The contrast between the two theories of liability is currently well illustrated when considering glyphosate. As noted in the September 22, 2021 edition of CalBizLit, there is a Court Order coming from the US District Court holding that the maker or user of glyphosate cannot be found liable under Proposition 65 for failure to have warnings about cancer risks on their products. The rationale is that it is a violation of the First Amendment to require such a warning because there is a substantial dispute in the scientific literature as to whether the product is actually a cancer causing substance.
In contrast, Bayer, the current manufacturer of the pesticide Round Up, which includes glyphosate as an active ingredient, is facing substantial civil liability. Most recently, the California Court of Appeals upheld a verdict that was rendered in 2019 favor of the Pilliod family. The husband and wife both claimed use of Round Up had caused them to develop non-Hodgkin’s Lymphoma. The jury had awarded them a total of $55 million in general damages, and $2 billion in punitive damages. The trial court reduced that number of $81 million total, including punitive damages, and the Pilliods agreed to accept that amount.
Bayer did not agree to even the reduced damages. In upholding the Judgment the Court of Appeals specifically approved the punitive damages by noting “Monsanto’s conduct evidenced reckless disregard of the health and safety of unsuspecting consumers it kept in the dark”.
Quite a contrast with a finding that companies that use glyphosate cannot be forced to put a Proposition 65 warning on the product. And this verdict is not an isolated one:: Bayer has paid out some 411 billion to settle cases pending against it for damages allegedly result in from glyphosate exposure. Bayer is, however, pursuing in the US Supreme Court a preemption defense based on 7 U.S.C. § 136 et seq., which requires that prior to distributing a pesticide in commerce, a manufacturer must register the pesticide with the United States Environmental Protection Agency (USEPA) by submitting scientific data regarding efficacy and health and environmental impacts, as well as proposed product labeling.

Proposed Glysophate Specific Proposition 65 Warning Language Could Be the First Time California Acknowledges Scientific Debate In Warning Language

Glysophate, mostly used as a weed killer, was listed as a chemical known to the State of California to cause cancer in July of 2017. This followed the International Agency for Research on Cancer’s determination that Glysophate was “probably carcinogenic” in 2015. In 2018 a federal jury awarded hundreds of millions in damages to consumers stricken with cancer who used Glysophate branded as “RoundUp.” Nevertheless, in January of 2020 the Federal Environmental Protection Agency (“EPA”) determined that Glysophate was safe when used in compliance with its label and likely not a human carcinogen. In a suit brought against California’s attorney general, a Federal Court in the Eastern District of California agreed with a first amendment challenge to the Proposition 65 warning for Glysophate. The court in Nat’l Ass’n of Wheat Growers v. Becerra, 468 F. Supp. 3d 1247, 1266 (E.D. Cal. 2020) determined it was a violation of first amendment rights to require a warning when “the great weight of evidence” is that Glysophate is not a human carcinogen. The court entered a permanent injunction, prohibiting enforcement actions for a failure to warn of a glysophate exposure. OEHHA’s response to the trial court loss has been to issue proposed warning language that seeks to avoid forcing parties to provide what the court determined to be a false warning. The proposed warning language is:

Using this product can expose you to glyphosate. The International Agency for Research on Cancer classified glyphosate as probably carcinogenic to humans. Other authorities, including USEPA, have determined that glyphosate is unlikely to cause cancer, or that the evidence is inconclusive. A wide variety of factors affect your personal cancer risk, including the level and duration of exposure to the chemical. For more information, including ways to reduce your exposure, go to www.P65Warnings.ca.gov/glyphosate.”

Written comments are being accepted by OEHHA until October 9th on the proposed warning language. The injunction currently in effect would prevent enforcement of even the proposed warning language. The Court had refused to accept proposed alternative warning language from California, noting the proposed language would violate warning regulations then in effect. Issuing a new regulation providing for the specific warning language is an effort by California to avoid that issue. For the new warning language to go into effect, OEHHA would have to enact the regulation following the comment period and find success on appeal. Should the proposed regulation go into effect, it would be the first time OEHHA promulgated safe harbor warning language that gives space to both sides of a debate about a listed chemical.