AB 2074: Damages: lead-based paint.
- Session Year: 2017-2018
- House: Assembly
- Latest Version Date: 2018-05-17
Existing law authorizes a person who suffers a loss or harm to person or property from the unlawful act or omission of another to recover from the person at fault money damages.
This bill would allow the injured party, in any action to recover damages for injury to person or property caused by lead-based paint, to establish a prima facie case that a particular party lead paint pigment manufacturer is the cause of the injury if the injured party proves by a preponderance of the evidence that a particular party produced, the lead paint pigment manufacturer sold, distributed, or promoted in California either the type of lead paint pigment that caused the injury, injury or a product containing the type of lead paint pigment that caused the injury, and would shift the burden of proof to that particular party the lead paint pigment manufacturer to prove by a preponderance of the evidence that it did not produce, sell, distribute, or promote the lead paint pigment that caused the injury or a product containing the type of lead paint pigment that caused the injury during the relevant time period or in the geographical market in which the injury occurred. The bill would make each party lead paint pigment manufacturer jointly and severally liable if more than one party that produced, sold, distributed or promoted lead paint pigments lead paint pigment manufacturer is found liable for an injury to person or property caused by lead-based paint. The bill would expressly make these provisions retroactive. The bill would also state various findings and declarations of the Legislature related to these provisions. The bill would provide that its provisions are severable.
Existing law authorizes a person who suffers a loss or harm to person or property from the unlawful act or omission of another to recover from the person at fault money damages.
This bill would allow the injured party, in any action to recover damages for injury to person or property caused by lead-based paint, to establish a prima facie case that a particular party is the cause of the injury if the injured party proves by a preponderance of the evidence that a particular party produced, sold, distributed, or promoted the type of lead paint pigment that caused the injury, and would shift the burden of proof to that particular party to prove by a preponderance of the evidence that it did not produce, sell, distribute, or promote the lead paint pigment during the relevant time period or in the geographical market in which the injury occurred. The bill would make each party jointly and severally liable if more than one party that produced, sold, distributed or promoted lead paint pigments is found liable for an injury to person or property caused by lead-based paint. The bill would expressly make these provisions retroactive. The bill would also state various findings and declarations of the Legislature related to these provisions. The bill would provide that its provisions are severable.
Existing law requires an offer of performance on an obligation to be made by the debtor or by some person on the debtors behalf with the debtors assent.This bill would make nonsubstantive changes to the that provision.Existing law requires an offer of performance on an obligation to be made by the debtor or by some person on the debtors behalf with the debtors assent.
This bill would make nonsubstantive changes to the that provision.
The Legislature finds and declares the following:
(a)Lead is highly toxic and causes serious health harms that are irreversible and cumulative. As the American Academy of Pediatrics explained in 2016, [n]o treatments have been shown to be effective in ameliorating the permanent developmental effects of lead toxicity.
(b)Government agencies and health organizations, including the federal Centers for Disease Control and Prevention, the World Health Organization, and the American Academy of Pediatrics, agree that there is no safe level of lead exposure.
(c)Young children are especially susceptible to lead due to their smaller size, the vulnerability of their developing nervous systems, and their high rates of lead absorption.
(d)Each year, the State of California identifies tens of thousands of young children in California whose health has been irreversibly harmed due to lead exposure and these children represent the minimum number of children in California whose health has been irreversibly harmed due to lead exposure.
(e)The economic costs of childhood lead exposure are substantial. These costs include: (1) health care costs associated with treating health problems caused by lead exposure; (2) special education costs incurred due to slower development, lower educational success, and behavioral problems caused by lead exposure; (3) loss of tax revenue due to decreased lifetime earnings resulting from decreased intelligence caused by lead exposure; and (4) costs of criminal activity connected to lead exposure. According to the American Academy of Pediatrics, the estimated annual cost of childhood lead exposure in the United States is $50 billion.
(f)The substantial economic costs of childhood lead exposure fall disproportionately on the state and local governments in California. Because young children who suffer from lead exposure are often poor, their health care and special education costs are typically borne by the state and local governments. Likewise, many of the economic costs of criminal behavior closely connected to lead exposure are shouldered by the state and local governments. Finally, the costs to the state and local governments in California from childhood lead exposure are exacerbated by the loss of tax revenues due to loss of income associated with childhood lead exposure.
(g)Studies indicate that lead-based paint is the source of approximately 70 percent of childhood exposure to lead in the United States, including California.
(h)Virtually all government agencies, scientists, and public health officials agree that lead-based paint on residential surfaces is the predominant source of lead exposure in young children.
(i)Based on extensive evidence presented at trial, a California judge in 2014 found that certain lead pigment paint manufacturers caused lead-based paint to be applied on certain residential surfaces by promoting that paint for use on those surfaces even though they knew about the serious health harms to children that would result (Superior Court, Santa Clara County, No. CV788657).
(j)A California appellate court unanimously affirmed that finding by the judge in 2017 (People v. Conagra Grocery Products Company (2017) 17 Cal.App.5th 51).
(k)Although at least tens of thousands of young children in California continue to suffer serious and irreversible health harms due to their ingestion of lead-based paint each year, these children are unable to identify the precise manufacturer of the lead paint pigment they ingested due to the number of manufacturers, the passage of time, and the loss of records.
(l)As a result, these children are unable to establish causation under traditional common law tort principles.
(m)Recognizing that this would exempt lead paint pigment manufacturers from liability even though they likely contributed to the actual injury to these children and would unfairly shift the cost of the injury to the innocent child, the Wisconsin Supreme Court in Thomas ex rel. Gramling v. Mallett ((2005) 285 Wis.2d 236) applied a risk contribution theory of liability to injuries caused by lead-based paint.
(n)The reasoning of the Wisconsin Supreme Court in Thomas solely as applied to injuries to person or property caused by lead-based paint is both fair and appropriate and should be applied in California.
SEC. 2.Chapter 3 (commencing with Section 3362) is added to Title 2 of Part 1 of Division 4 of the Civil Code, to read:3.Lead-Based Paint3362.(a)In any action to recover damages for injury to person or property caused by lead-based paint, the injured party may establish a prima facie case that a particular party lead paint pigment manufacturer is the cause of the injury if the injured party proves by a preponderance of the evidence that a particular party produced, the lead paint pigment manufacturer sold, distributed, or promoted in California either the type of lead paint pigment that caused the injury. injury or a product containing the type of lead paint pigment that caused the injury.
(b)If the injured party establishes a prima facie case of causation under subdivision (a), the burden of proof shall shift to the particular party that produced, sold, distributed or promoted the type of lead paint pigment that caused the injury lead paint pigment manufacturer to prove by a preponderance of the evidence that it did not produce, sell, distribute, or promote the lead paint pigment that caused the injury or a product containing the type of lead paint pigment that caused the injury during the relevant time period or in the geographical market in which the injury occurred.
(c)If more than one party that produced, sold, distributed or promoted lead paint pigments lead paint pigment manufacturer is found liable for an injury to person or property caused by lead-based paint, each party lead paint pigment manufacturer shall be jointly and severally liable.
(d)The provisions of this section are made expressly retroactive.
SEC. 3.The provisions of this act are severable. If any provision of this act or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
The Legislature finds and declares the following:
(a)Lead is highly toxic and causes serious health harms that are irreversible and cumulative. As the American Academy of Pediatrics explained in 2016, [n]o treatments have been shown to be effective in ameliorating the permanent developmental effects of lead toxicity.
(b)Government agencies and health organizations, including the federal Centers for Disease Control and Prevention, the World Health Organization, and the American Academy of Pediatrics, agree that there is no safe level of lead exposure.
(c)Young children are especially susceptible to lead due to their smaller size, the vulnerability of their developing nervous systems, and their high rates of lead absorption.
(d)Each year, the State of California identifies tens of thousands of young children in California whose health has been irreversibly harmed due to lead exposure and these children represent the minimum number of children in California whose health has been irreversibly harmed due to lead exposure.
(e)The economic costs of childhood lead exposure are substantial. These costs include: (1) health care costs associated with treating health problems caused by lead exposure; (2) special education costs incurred due to slower development, lower educational success, and behavioral problems caused by lead exposure; (3) loss of tax revenue due to decreased lifetime earnings resulting from decreased intelligence caused by lead exposure; and (4) costs of criminal activity connected to lead exposure. According to the American Academy of Pediatrics, the estimated annual cost of childhood lead exposure in the United States is $50 billion.
(f)The substantial economic costs of childhood lead exposure fall disproportionately on the state and local governments in California. Because young children who suffer from lead exposure are often poor, their health care and special education costs are typically borne by the state and local governments. Likewise, many of the economic costs of criminal behavior closely connected to lead exposure are shouldered by the state and local governments. Finally, the costs to the state and local governments in California from childhood lead exposure are exacerbated by the loss of tax revenues due to loss of income associated with childhood lead exposure.
(g)Studies indicate that lead-based paint is the source of approximately 70 percent of childhood exposure to lead in the United States, including California.
(h)Virtually all government agencies, scientists, and public health officials agree that lead-based paint on residential surfaces is the predominant source of lead exposure in young children.
(i)Based on extensive evidence presented at trial, a California judge in 2014 found that certain lead pigment paint manufacturers caused lead-based paint to be applied on certain residential surfaces by promoting that paint for use on those surfaces even though they knew about the serious health harms to children that would result (Superior Court, Santa Clara County, No. CV788657).
(j)A California appellate court unanimously affirmed that finding by the judge in 2017 (People v. Conagra Grocery Products Company (2017) 17 Cal.App.5th 51).
(k)Although at least tens of thousands of young children in California continue to suffer serious and irreversible health harms due to their ingestion of lead-based paint each year, these children are unable to identify the precise manufacturer of the lead paint pigment they ingested due to the number of manufacturers, the passage of time, and the loss of records.
(l)As a result, these children are unable to establish causation under traditional common law tort principles.
(m)Recognizing that this would exempt lead paint pigment manufacturers from liability even though they likely contributed to the actual injury to these children and would unfairly shift the cost of the injury to the innocent child, the Wisconsin Supreme Court in Thomas ex rel. Gramling v. Mallett ((2005) 285 Wis.2d 236) applied a risk contribution theory of liability to injuries caused by lead-based paint.
(n)The reasoning of the Wisconsin Supreme Court in Thomas solely as applied to injuries to person or property caused by lead-based paint is both fair and appropriate and should be applied in California.
SEC. 2.Chapter 3 (commencing with Section 3362) is added to Title 2 of Part 1 of Division 4 of the Civil Code, to read:3.Lead-Based Paint3362.(a)In any action to recover damages for injury to person or property caused by lead-based paint, the injured party may establish a prima facie case that a particular party is the cause of the injury if the injured party proves by a preponderance of the evidence that a particular party produced, sold, distributed, or promoted the type of lead paint pigment that caused the injury.
(b)If the injured party establishes a prima facie case of causation under subdivision (a), the burden of proof shall shift to the particular party that produced, sold, distributed or promoted the type of lead paint pigment that caused the injury to prove by a preponderance of the evidence that it did not produce, sell, distribute, or promote the lead paint pigment during the relevant time period or in the geographical market in which the injury occurred.
(c)If more than one party that produced, sold, distributed or promoted lead paint pigments is found liable for an injury to person or property caused by lead-based paint, each party shall be jointly and severally liable.
(d)The provisions of this section are made expressly retroactive.
SEC. 3.The provisions of this act are severable. If any provision of this act or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
SECTION 1.Section 1487 of the Civil Code is amended to read:1487.An offer of performance shall be made by the debtor or by some person on the debtors behalf and with the debtors assent. REVISIONS: HeadingLine 2.An offer of performance must shall be made by the debtor, debtor or by some person on his the debtors behalf and with his the debtors assent.
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Date
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Status
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| Jun 4, 2018 | Ordered to inactive file at the request of Assembly Member Bonta. |
| May 17, 2018 | Read third time and amended. Ordered to third reading. |
| May 2, 2018 | Read second time. Ordered to third reading. |
| May 1, 2018 | Coauthors revised. |
| Apr 2, 2018 | Re-referred to Com. on JUD. |
| Mar 22, 2018 | Referred to Com. on JUD. |
| Feb 8, 2018 | From printer. May be heard in committee March 10. |
| Feb 7, 2018 | Read first time. To print. |
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Date
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Description
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Location
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Votes
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| May 1, 2018 | Do pass. | Assembly Standing Committee on Judiciary |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
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Organization
|
Position
|
Date
|
|---|---|---|
| A. Philip Randolph Institute - San Francisco | ** Support | Apr 30, 2018 |
| American Coatings Association | * Against | May 1, 2018 |
| American Insurance Corporation | ** Against | Apr 30, 2018 |
| Bay Area Legal Aid | ** Support | Apr 30, 2018 |
| Board of Supervisors Santa Clara County | * Support | May 1, 2018 |
| Brightline Defense | * Support | May 1, 2018 |
| California Chamber Of Commerce | * Against | May 1, 2018 |
| California League Of Conservation Voters | ** Support | Apr 30, 2018 |
| California Manufacturers And Technology Association | * Against | May 1, 2018 |
| California Paint Council | ** Against | Apr 30, 2018 |
| Central Valley Empowerment Alliance | * Support | May 1, 2018 |
| Children's Advocacy Institute | ** Support | Apr 30, 2018 |
| City of Emeryville | * Support | May 1, 2018 |
| City Of Oakland | * Support | May 1, 2018 |
| Civil Justice Association | * Against | May 1, 2018 |
| Clean Water Action | ** Support | Apr 30, 2018 |
| Community Youth Center | ** Support | Apr 30, 2018 |
| Consumer Attorneys Of California | * Support | May 1, 2018 |
| Consumer Federation Of California | ** Support | Apr 30, 2018 |
| County of Santa Clara | * Support | May 1, 2018 |
| Environmental Working Group | * Support | May 1, 2018 |
| Household and Commercial Products Association | ** Against | Apr 30, 2018 |
| LA County Board of Supervisors | * Support | May 1, 2018 |
| Smartoakland | ** Support | Apr 30, 2018 |
ASSEMBLY THIRD READING
ATR Bill Id:AB 2074
Author:(Bonta)
As Amended Ver:May 17, 2018
Majority vote
Committee | Votes | Ayes | Noes |
Judiciary | 7-3 | Mark Stone, Chau, Chiu, Gonzalez Fletcher, Holden, Kalra, Reyes | Cunningham, Kiley, Maienschein |
SUMMARY: Establishes a risk-contribution theory of liability for injuries caused by lead-based paint, as specified, to enable plaintiffs to pursue claims against lead paint pigment manufacturers in cases where the injured plaintiff is unable to identify the exact manufacturer of the lead paint pigment that caused the injury. Specifically, this bill:
- Allows the injured party, in any action to recover damages for injury to person or property caused by lead-based paint, to establish a prima facie case that a particular lead paint pigment manufacturer is the cause of the injury if the injured party proves by a preponderance of the evidence that the lead paint pigment manufacturer sold, distributed, or promoted in California either the type of lead paint pigment that caused the injury, or a product containing the type of lead paint pigment that caused the injury.
- Provides that if the injured party establishes a prima facie case of causation under 1) above, the burden of proof shall shift to the lead paint pigment manufacturer to prove by a preponderance of the evidence that it did not sell, distribute, or promote the lead paint pigment that caused the injury, or a product containing the type of lead paint pigment that caused the injury, during the relevant time period or in the geographical market in which the injury occurred.
- Makes each lead paint pigment manufacturer jointly and severally liable if more than one lead paint pigment manufacturer is found liable for an injury to person or property caused by lead-based paint.
- Makes all of the above provisions expressly retroactive.
- Makes a number of legislative findings and declarations.
- Contains a severability clause, stating that if any provision of this act or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
FISCAL EFFECT: None
COMMENTS: In 2017, an appellate court concluded that three lead-based paint manufacturers were responsible for the health hazards of lead paint in many homes in California, and upheld a lower court order that these companies pay $1.15 billion into a fund for abatement of these hazards in homes across the state. (People v. ConAgra Grocery Products Co. (2017) 17 Cal.App.5th 51.) Shortly after the California Supreme Court declined to review the decision on appeal, thus finalizing the issue and removing any doubt as to the culpability of the paint companies, the defendant paint companies announced they would be sponsoring a ballot initiative, proposed for the November 2018 election, which would vacate the court's decision to hold paint manufacturers liable for cleaning up the lead paint crisis in California and instead create a taxpayer-funded bond for abatement. This bill, like several others before the legislature this session, seeks to ensure robust lead paint abatement in California through the abatement program created by the judgment and by other means, to help homeowners sue to recover costs from lead paint manufacturers, if necessary.
Specifically, this bill seeks to establish a "risk-contribution" theory of liability for injuries caused by lead-based paint, based on the model developed by the State of Wisconsin in 2005, in order to enable plaintiffs to pursue claims against lead-paint companies in cases where the injured plaintiff is unable to identify the exact manufacturer of the lead paint that caused the injury. According to the author:
Although at least tens of thousands of young children in California continue to suffer serious and irreversible health harms due to their ingestion of lead-based paint each year, these children are unable to identify the precise manufacturer of the lead paint pigment they ingested due to the number of manufacturers, the passage of time, and the loss of records. As a result, these children are unable to establish causation under traditional common law tort principles and the costs of the injuries fall on the victims.
In 2005, the Wisconsin Supreme Court also recognized that common law tort principles unfairly shifted the cost of the injury to the innocent child by exempting lead paint pigment manufacturers from liability. In Thomas ex rel. Gramling v. Mallett, the Wisconsin Supreme Court applied a "risk contribution" theory of liability to injuries caused by lead-based paint thereby allowing children to recover damages for lead ingestion. AB 2074 removes a significant hurdle to holding lead paint manufacturers legally accountable for injuries caused by lead-based paint, and seeks to codify a "risk contribution" theory of liability in statute.
Causation and burden of proof: exceptions to general rules. It is well-settled that in order to establish a cause of action based on a defendant's tortious conduct, the plaintiff generally must establish that the defendant's conduct caused the plaintiff's claimed damages. Put another way, the burden of proof that the tortious conduct of the defendant has caused the harm to the plaintiff is upon the plaintiff. (Restat 2d of Torts, Section 433B (2nd 1979).) The California Supreme Court, however, has made exceptions to the general rule that a plaintiff must bear the burden of proving causation, including alternative liability (Summers v. Tice (1948) 33 Cal.2d 80.) and market-share liability (Sindell v. Abbott Laboratories (1980) 26 Cal.3d 588).
Proponents look to the state of Wisconsin for further examples of innovative policy in this area. They note that in 1984, four years after Sindell was decided in California, the Wisconsin Supreme Court reviewed a similar DES-injury lawsuit in a case called Collins v. Eli Lilly & Co. (1984) 116 Wis. 2d 166, in which the court considered adopting market share liability at the behest of the plaintiff, who was unable to identify which manufacturer of DES caused her injuries. Rather than adopting market share liability, however, the Court advanced a similar but novel theory of its own—risk contribution liability.
Like market share liability, risk contribution is another exception to traditional liability doctrine which shifts the burden when, in the court's opinion, it is necessary to avoid leaving the plaintiff without recovery when there are known culpable defendants. To invoke risk contribution, a plaintiff must show: 1) the existence of many potential innocent plaintiffs; 2) the shared culpability in producing or marketing what was later shown to be a harmful product; 3) the inability of the innocent plaintiff to identify the precise manufacturer of the product that caused the injury because of the generic or fungible nature of the product, the large number of manufacturers, the passage of time, and the loss of records; and 4) due to the traditional strictures of legal causation, the inability of the innocent plaintiff to recover from potentially negligent manufactures. (Peter G. Earle, Fidelma Fitzpatrick, and Douglas M. Raines. Negligence in the Paint: The Case for Applying the Risk Contribution Doctrine to Lead Litigation -- A Response to Gray & Faulk, 26 Pace Envtl. L. Rev. 179 (2009), citing Collins v. Eli Lilly & Co. (1984) 116 Wis. 2d 166.)
One year after Collins, the Wisconsin Supreme Court considered a case brought by a lead-poisoned minor seeking to recover damages against possibly negligent manufacturer of white lead carbonate pigment that had injured him. (Thomas v. Mallett (2005) WI 129.) The plaintiff was unable to identify the manufacturer of the pigment that he had ingested, and was potentially left to suffer the cost of his injuries without any recourse if he was not allowed to sue the manufacturers. The Court held that lead-paint manufacturers were subject to liability under the risk contribution doctrine.
Proponents of this bill assert that a similar public policy rule is appropriate in cases for lead-based paint injury in California. They contend that there are tens of thousands of young children in California who continue to suffer serious and irreversible health harms due to their ingestion of lead-based paint each year, and that these children are unable to identify the precise manufacturer of the lead paint pigment they ingested due to the number of manufacturers, the passage of time, and the loss of records, among other things. As a result, they contend, these children are unable to establish causation under traditional common law tort principles, which if allowed to stand, would effectively release lead paint manufacturers from liability even though they likely contributed to the actual injury of these children, and unfairly shift the cost of the injury to these innocent children.
Accordingly, the author proposes to establish risk-contribution liability in California, similar to that developed by the Wisconsin Supreme Court in Thomas. Under this bill, risk-contribution would potentially apply in any action to recover damages for an injury to person or property that was caused by lead-based paint. The bill would allow the injured party to establish a prima facie case that a particular lead paint pigment manufacturer is the cause of the injury if the injured party proves by a preponderance of the evidence that a particular lead paint pigment manufacturer sold, distributed, or promoted the type of lead paint pigment that caused the injury. If the injured party is successful in establishing a prima facie case of causation, then the burden of proof shifts to the lead paint pigment manufacturer to prove by a preponderance of the evidence that it did not sell, distribute, or promote the lead paint pigment that caused the injury, or a product containing the type of lead paint pigment that caused the injury, during the relevant time period or in the geographical market in which the injury occurred.
Opponents of the bill, including the California Chamber of Commerce and the California Paint Council, contend that the bill "will impose liability on a host of product manufacturers where there is no proof that the manufacturer's product caused the alleged harm."
Recent amendments to the bill, however, narrow the scope of who may be held liable in an action to recover damages for injury caused by lead-based paint, by 1) clarifying that this bill only applies to a lead paint pigment manufacturer that is the cause of the injury (as opposed to any "party" that is the cause) and 2) clarifying that a lead paint pigment manufacturer may ultimately be held liable if that manufacturer sold, distributed, or promoted in California (as opposed to any other state or jurisdiction) either the type of lead paint pigment that caused the injury, or a product containing the type of lead paint pigment that caused the injury.
Opponents further contend that risk-contribution liability likely deprives the manufacturer of substantive due process protections, stating: "The requirement for causation is fundamental to constitutional protections of due process and of liberty and property. Public Nuisance liability theories rob manufacturers of the ability to defend themselves by proving that a company's product did not cause the alleged harm."
In response, the author notes that Wisconsin's risk-contribution theory of liability was upheld by the Seventh Circuit Court of Appeals, and determined not to violate substantive due process guarantees under the United States Constitution. (Gibson v. American Cyanamid (2014) 760 F.3d 600.) The author cites the following article by Pamela Maloney, liberally quoted below, which summarizes the Seventh Circuit's analysis of Thomas:
In adopting the theory, the Wisconsin Supreme Court balanced the tortious conduct of pigment manufacturers in distributing an unreasonably dangers product with the possibility of leaving the non-culpable plaintiff without a sufficient remedy, while recognizing that it was relaxing the traditional standard of causation. According to the Seventh Circuit, the Wisconsin high court rationally relied on the wide scope of the health dangers posed by lead pigment against the difficulties in proof faced by victims of pigment poisoning, in part because the pigment was so unreasonably dangerous that it remained a health danger for decades. (Pamela Maloney, "Youth's lead paint exposure claim reinstated under Wisconsin high court's risk-contribution theory," Products Liability Law Daily (July 25, 2014).)
The Chamber and business opponents also object to the imposition of joint and several liability under the bill, which they say potentially assigns liability to an entity "having no connection whatsoever to the alleged harm." The opponents state:
An entity's failure to prove this defense would, under this theory of liability, require it to pay 100% of the plaintiff's claimed damages despite having no connection whatsoever to the alleged harm. . . A single entity that played no part in causing a plaintiff's injury and that had nominal production, sales, distributions or promotion in California could nonetheless be held wholly liable for all of a plaintiff's damages.
Proponents counter that by the very nature of risk contribution, or any other form of alternative liability that allows burden-shifting in special circumstances, liability may be assigned to an entity more than he would have under traditional liability theories in the absence of direct causation – essentially for policy reasons. Again, quoting the Maloney article, the proponents note that opponents' argument was contradicted by the Seventh Circuit reviewing the constitutionality of the Wisconsin risk-contribution theory of liability:
The Seventh Circuit also rejected the manufacturers' argument that they would be held liable in particular cases for injuries that they did not cause and that the risk-contribution theory does not reflect the overall liability that the manufacturers should have expected to face from selling lead pigment. The theory's overall compensation framework and reflection of liability was consistent with similar tort-liability theories employed in other mass-tort contexts and with other common-law developments in tort schemes in which causation-in-fact is not required for recovery and liability but instead is premised in some way on the defendants' contribution to the risk of injury. (Id.)
Analysis Prepared by: Anthony Lew / JUD. / (916) 319-2334 FN: 0002967
ASSEMBLY THIRD READING
ATR Bill Id:AB 2074
Author:(Bonta)
As Amended Ver:March 22, 2018
Majority vote
Committee | Votes | Ayes | Noes |
Judiciary | 7-3 | Mark Stone, Chau, Chiu, Gonzalez Fletcher, Holden, Kalra, Reyes | Cunningham, Kiley, Maienschein |
SUMMARY: Establishes a risk-contribution theory of liability for injuries caused by lead-based paint, as specified, to enable plaintiffs to pursue claims against lead-paint companies in cases where the injured plaintiff is unable to identify the exact manufacturer of the lead paint that caused the injury. Specifically, this bill:
- Allows the injured party, in any action to recover damages for injury to person or property caused by lead-based paint, to establish a prima facie case that a particular party is the cause of the injury if the injured party proves by a preponderance of the evidence that a particular party produced, sold, distributed, or promoted the type of lead paint pigment that caused the injury.
- Provides that if the injured party establishes a prima facie case of causation under 1) above, the burden of proof shall shift to the particular party that produced, sold, distributed or promoted the type of lead paint pigment that caused the injury, to prove by a preponderance of the evidence that it did not produce, sell, distribute, or promote the lead paint pigment during the relevant time period or in the geographical market in which the injury occurred.
- Makes each party jointly and severally liable if more than one party that produced, sold, distributed or promoted lead paint pigments is found liable for an injury to person or property caused by lead-based paint.
- Makes all of the above provisions expressly retroactive.
- Makes a number of legislative findings and declarations.
- Contains a severability clause, stating that if any provision of this act or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
FISCAL EFFECT: None
COMMENTS: In 2017, an appellate court concluded that three lead-based paint manufacturers were responsible for the health hazards of lead paint in many homes in California, and upheld a lower court order that these companies pay $1.15 billion into a fund for abatement of these hazards in homes across the state. (People v. ConAgra Grocery Products Co. (2017) 17 Cal.App.5th 51.) Shortly after the California Supreme Court declined to review the decision on appeal, thus finalizing the issue and removing any doubt as to the culpability of the paint companies, the defendant paint companies announced they would be sponsoring a ballot initiative, proposed for the November 2018 election, which would vacate the court's decision to hold paint manufacturers liable for cleaning up the lead paint crisis in California and instead create a taxpayer-funded bond for abatement. This bill, like several others before the legislature this session, seeks to ensure robust lead paint abatement in California through the abatement program created by the judgment and by other means, to help homeowners sue to recover costs from lead paint manufacturers, if necessary.
Specifically, this bill seeks to establish a "risk-contribution" theory of liability for injuries caused by lead-based paint, based on the model developed by the State of Wisconsin in 2005, in order to enable plaintiffs to pursue claims against lead-paint companies in cases where the injured plaintiff is unable to identify the exact manufacturer of the lead paint that caused the injury. According to the author:
Although at least tens of thousands of young children in California continue to suffer serious and irreversible health harms due to their ingestion of lead-based paint each year, these children are unable to identify the precise manufacturer of the lead paint pigment they ingested due to the number of manufacturers, the passage of time, and the loss of records. As a result, these children are unable to establish causation under traditional common law tort principles and the costs of the injuries fall on the victims.
In 2005, the Wisconsin Supreme Court also recognized that common law tort principles unfairly shifted the cost of the injury to the innocent child by exempting lead paint pigment manufacturers from liability. In Thomas ex rel. Gramling v. Mallett, the Wisconsin Supreme Court applied a "risk contribution" theory of liability to injuries caused by lead-based paint thereby allowing children to recover damages for lead ingestion. AB 2074 removes a significant hurdle to holding lead paint manufacturers legally accountable for injuries caused by lead-based paint, and seeks to codify a "risk contribution" theory of liability in statute.
Causation and burden of proof: exceptions to general rules. It is well-settled that in order to establish a cause of action based on a defendant's tortious conduct, the plaintiff generally must establish that the defendant's conduct caused the plaintiff's claimed damages. Put another way, the burden of proof that the tortious conduct of the defendant has caused the harm to the plaintiff is upon the plaintiff. (Restat 2d of Torts, Section 433B (2nd 1979).) The California Supreme Court, however, has made exceptions to the general rule that a plaintiff must bear the burden of proving causation, including alternative liability (Summers v. Tice (1948) 33 Cal.2d 80.) and market-share liability (Sindell v. Abbott Laboratories (1980) 26 Cal.3d 588).
Proponents look to the state of Wisconsin for further examples of innovative policy in this area. They note that in 1984, four years after Sindell was decided in California, the Wisconsin Supreme Court reviewed a similar DES-injury lawsuit in a case called Collins v. Eli Lilly & Co. (1984) 116 Wis. 2d 166, in which the court considered adopting market share liability at the behest of the plaintiff, who was unable to identify which manufacturer of DES caused her injuries. Rather than adopting market share liability, however, the Court advanced a similar but novel theory of its own—risk contribution liability.
Like market share liability, risk contribution is another exception to traditional liability doctrine which shifts the burden when, in the court's opinion, it is necessary to avoid leaving the plaintiff without recovery when there are known culpable defendants. To invoke risk contribution, a plaintiff must show: 1) the existence of many potential innocent plaintiffs; 2) the shared culpability in producing or marketing what was later shown to be a harmful product; 3) the inability of the innocent plaintiff to identify the precise manufacturer of the product that caused the injury because of the generic or fungible nature of the product, the large number of manufacturers, the passage of time, and the loss of records; and 4) due to the traditional strictures of legal causation, the inability of the innocent plaintiff to recover from potentially negligent manufactures. (Peter G. Earle, Fidelma Fitzpatrick, and Douglas M. Raines. Negligence in the Paint: The Case for Applying the Risk Contribution Doctrine to Lead Litigation -- A Response to Gray & Faulk, 26 Pace Envtl. L. Rev. 179 (2009), citing Collins v. Eli Lilly & Co. (1984) 116 Wis. 2d 166.)
One year after Collins, the Wisconsin Supreme Court considered a case brought by a lead-poisoned minor seeking to recover damages against possibly negligent manufacturer of white lead carbonate pigment that had injured him. (Thomas v. Mallett (2005) WI 129.) The plaintiff was unable to identify the manufacturer of the pigment that he had ingested, and was potentially left to suffer the cost of his injuries without any recourse if he was not allowed to sue the manufacturers. The Court held that lead-paint manufacturers were subject to liability under the risk contribution doctrine.
Proponents of this bill assert that a similar public policy rule is appropriate in cases for lead-based paint injury in California. They contend that there are tens of thousands of young children in California who continue to suffer serious and irreversible health harms due to their ingestion of lead-based paint each year, and that these children are unable to identify the precise manufacturer of the lead paint pigment they ingested due to the number of manufacturers, the passage of time, and the loss of records, among other things. As a result, they contend, these children are unable to establish causation under traditional common law tort principles, which if allowed to stand, would effectively release lead paint manufacturers from liability even though they likely contributed to the actual injury of these children, and unfairly shift the cost of the injury to these innocent children.
Accordingly, the author proposes to establish risk-contribution liability in California, similar to that developed by the Wisconsin Supreme Court in Thomas. Under this bill, risk-contribution would potentially apply in any action to recover damages for an injury to person or property that was caused by lead-based paint. The bill would allow the injured party to establish a prima facie case that a particular party is the cause of the injury if the injured party proves by a preponderance of the evidence that a particular party produced, sold, distributed, or promoted the type of lead paint pigment that caused the injury. If the injured party is successful in establishing a prima facie case of causation, then the burden of proof shifts to the particular party that produced, sold, distributed or promoted the type of lead paint pigment that caused the injury, to prove by a preponderance of the evidence that it did not produce, sell, distribute, or promote the lead paint pigment during the relevant time period or in the geographical market in which the injury occurred.
Opponents of the bill, including the California Chamber of Commerce and the California Paint Council, contend that the bill "will impose liability on a host of product manufacturers where there is no proof that the manufacturer's product caused the alleged harm." They further contend that risk-contribution liability likely deprives the manufacturer of substantive due process protections, stating: "The requirement for causation is fundamental to constitutional protections of due process and of liberty and property. Public Nuisance liability theories rob manufacturers of the ability to defend themselves by proving that a company's product did not cause the alleged harm."
In response, the author notes that Wisconsin's risk-contribution theory of liability was upheld by the Seventh Circuit Court of Appeals, and determined not to violate substantive due process guarantees under the U.S. Constitution. (Gibson v. American Cyanamid (2014) 760 F.3d 600.) The author cites the following article by Pamela Maloney, liberally quoted below, which summarizes the Seventh Circuit's constitutional analysis of Thomas:
[E]conomic legislation does not violate substantive due process unless the law is arbitrary and irrational. The Seventh Circuit decided that the risk-contribution theory was not arbitrary or irrational, nor was it unexpected and indefensible. In adopting the theory, the Wisconsin Supreme Court balanced the tortious conduct of pigment manufacturers in distributing an unreasonably dangers product with the possibility of leaving the non-culpable plaintiff without a sufficient remedy, while recognizing that it was relaxing the traditional standard of causation. According to the Seventh Circuit, the Wisconsin high court rationally relied on the wide scope of the health dangers posed by lead pigment against the difficulties in proof faced by victims of pigment poisoning, in part because the pigment was so unreasonably dangerous that it remained a health danger for decades. (Pamela Maloney, "Youth's lead paint exposure claim reinstated under Wisconsin high court's risk-contribution theory," Products Liability Law Daily (July 25, 2014).)
The Chamber and business opponents also object to the imposition of joint and several liability under the bill, which they say potentially assigns liability to an entity "having no connection whatsoever to the alleged harm." The opponents state:
An entity's failure to prove this defense would, under this theory of liability, require it to pay 100% of the plaintiff's claimed damages despite having no connection whatsoever to the alleged harm. . . A single entity that played no part in causing a plaintiff's injury and that had nominal production, sales, distributions or promotion in California could nonetheless be held wholly liable for all of a plaintiff's damages.
Proponents counter that by the very nature of risk contribution, or any other form of alternative liability that allows burden-shifting in special circumstances, liability may be assigned to an entity more than he would have under traditional liability theories in the absence of direct causation – essentially for policy reasons. Again, quoting the Maloney article, the proponents note that opponents' argument was contradicted by the Seventh Circuit reviewing the constitutionality of the Wisconsin risk-contribution theory of liability:
The Seventh Circuit also rejected the manufacturers' argument that they would be held liable in particular cases for injuries that they did not cause and that the risk-contribution theory does not reflect the overall liability that the manufacturers should have expected to face from selling lead pigment. The theory's overall compensation framework and reflection of liability was consistent with similar tort-liability theories employed in other mass-tort contexts and with other common-law developments in tort schemes in which causation-in-fact is not required for recovery and liability but instead is premised in some way on the defendants' contribution to the risk of injury. (Id.)
Analysis Prepared by: Anthony Lew / JUD. / (916) 319-2334 FN: 0002774
Date of Hearing: May 1, 2018
ASSEMBLY COMMITTEE ON JUDICIARY
Mark Stone, Chair
ABPCA Bill Id:AB 2074
Author:(Bonta) – As Amended Ver:March 22, 2018
SUBJECT: DAMAGES: LEAD-BASED PAINT: RISK CONTRIBUTION THEORY
KEY ISSUE: in order to ensure that faultless children who were harmed by exposure to lead-based paint are not ultimately made to bear the cost of injury over culpable paint manufacturers simply because they are unable to establish causation under traditional common law tort principles, should the legislature instead require a "risk contribution" theory of liability, as specified, to be applied in lawsuits seeking damages for injuries caused by lead-based paint?
SYNOPSIS
Every year, thousands of California children are subject to irreversible harm from lead exposure. Despite the fact that consumer lead-based paint has been banned in the U.S. since 1978, it continues to present a serious risk to human health and well-being. According to the Legislative Analyst’s Office, about 60% of houses in California were built before 1978 and are presumed to have lead-based paint. A recent court decision found several manufacturers of lead-based paints to be liable for creating a public nuisance across 10 jurisdictions due to their efforts to sell, manufacture, distribute, and promote lead-based paint despite having actual or constructive knowledge that the paint presented a hazard to human health. The three paint manufacturers named in the case were ordered to pay $1.15 billion into a fund to inspect for and abate lead paint in all homes constructed up through 1980, though an appellate court later ruled that the manufacturers were only liable for lead-based paint in homes built before 1951. This bill, like several others introduced in the Legislature this session, seeks to ensure robust lead paint abatement in California, through the abatement program created by the judgment and by other means to help homeowners sue to recover abatement costs from lead paint manufacturers, if necessary. The package of bills also addresses issues raised by a subsequent ballot initiative, proposed for the November 2018 election and sponsored by the lead paint companies, which would vacate the court’s decision to hold paint manufacturers liable for cleaning up the lead paint crisis in California and instead create a taxpayer-funded bond for abatement.
According to the author, current law, reflecting traditional notions of liability, makes it nearly impossible for victims of lead paint poisoning to hold paint manufacturers legally accountable for the injuries they have suffered. This bill would instead establish a "risk-contribution" theory of liability for injuries caused by lead-based paint, as specified, to enable plaintiffs to pursue claims against lead-paint companies in cases where the injured plaintiff is unable to identify the exact manufacturer of the lead paint that caused his or her injury. Risk contribution theory was initially conceptualized by the Wisconsin Supreme Court, who appeared to model their theory after "market share liability," a similar form of alternative liability first established by the California Supreme Court in 1980. The details of risk contribution are described in this analysis, but more importantly, the policy justification for establishing this theory of liability is to prevent a situation where innocent child victims are ultimately made to bear the cost of injury over culpable paint manufacturers simply because they are unable to establish causation under traditional common law tort principles. The bill is strongly opposed by the Chamber of Commerce, the Paint Council Network, and other business associations who object generally to adoption of any alternative liability theories, including the risk contribution theory proposed by this bill, that do not require the plaintiff to prove causation-in-fact by a specific defendant, and who raise substantive due process concerns about such theories. Supporters of the bill, including consumer advocates and local governments, share the author's desire to help innocent victims recover from culpable paint companies for their injuries, citing a recent opinion by the Seventh Circuit Court of Appeal that found the Wisconsin risk contribution model to not violate substantive due process guarantees under the Constitution.
SUMMARY: Establishes a risk-contribution theory of liability for injuries caused by lead-based paint, as specified, to enable plaintiffs to pursue claims against lead-paint companies in cases where the injured plaintiff is unable to identify the exact manufacturer of the lead paint that caused the injury. Specifically, this bill:
- Allows the injured party, in any action to recover damages for injury to person or property caused by lead-based paint, to establish a prima facie case that a particular party is the cause of the injury if the injured party proves by a preponderance of the evidence that a particular party produced, sold, distributed, or promoted the type of lead paint pigment that caused the injury.
- Provides that if the injured party establishes a prima facie case of causation under 1) above, the burden of proof shall shift to the particular party that produced, sold, distributed or promoted the type of lead paint pigment that caused the injury, to prove by a preponderance of the evidence that it did not produce, sell, distribute, or promote the lead paint pigment during the relevant time period or in the geographical market in which the injury occurred.
- Makes each party jointly and severally liable if more than one party that produced, sold, distributed or promoted lead paint pigments is found liable for an injury to person or property caused by lead-based paint.
- Makes all of the above provisions expressly retroactive.
- Makes a number of Legislative findings and declarations, including the following:
- Based on extensive evidence presented at trial, a California judge in 2014 found that certain lead pigment paint manufacturers caused lead-based paint to be applied on certain residential surfaces by promoting that paint for use on those surfaces even though they knew about the serious health harms to children that would result. (Superior Court, Santa Clara County, No. CV788657.)
- A California appellate court unanimously affirmed that finding by the judge in 2017. (People v. Conagra Grocery Products Company (2017) 17 Cal.App.5th 51.)
- Although at least tens of thousands of young children in California continue to suffer serious and irreversible health harms due to their ingestion of lead-based paint each year, these children are unable to identify the precise manufacturer of the lead paint pigment they ingested due to the number of manufacturers, the passage of time, and the loss of records.
- As a result, these children are unable to establish causation under traditional common law tort principles.
- Recognizing that this would exempt lead paint pigment manufacturers from liability even though they likely contributed to the actual injury to these children and would unfairly shift the cost of the injury to the innocent child, the Wisconsin Supreme Court in Thomas ex rel. Gramling v. Mallett (2005) 285 Wis.2d 236 applied a risk contribution theory of liability to injuries caused by lead-based paint.
- The reasoning of the Wisconsin Supreme Court in Thomas solely as applied to injuries to person or property caused by lead-based paint is both fair and appropriate and should be applied in California.
- Contains a severability clause, stating that if any provision of this act or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
EXISTING LAW:
- Generally requires a showing by the plaintiff that his or her injuries were caused by the act of the defendant or by an instrumentality under the defendant's control in order to impose liability upon the defendant. (See Sindell v. Abbott Laboratories (1980) 26 Cal.3d 588, 597.)
- Provides for alternative liability, as an exception to the general rule on burden of proof in 1), above. Under alternative liability, where the conduct of two or more actors is tortious, and it is proved that harm has been caused to the plaintiff by only one of them, but there is uncertainty as to which one has caused it, the burden is upon each such actor to prove that he has not caused the harm. (Summers v. Tice (1948) 33 Cal.2d 80; Restat 2d of Torts, § 433B (2nd 1979).)
- Provides for market share liability, as another exception to the general rule on burden of proof in 1), above. Under market share liability, in circumstances where a plaintiff is injured by a product tortuously produced or manufactured by multiple manufacturers, but it is impossible for the plaintiff to identify the specific manufacturer of the product that actually caused his injury, then liability may be apportioned among defendant manufacturers according to their respective market share of the product responsible for the plaintiff's injury. (Sindell v. Abbott Laboratories, supra,26 Cal.3d 588.)
FISCAL EFFECT: As currently in print this bill is keyed non-fiscal.
COMMENTS: In 2017, an appellate court concluded that three paint manufacturers were responsible for the health hazards of lead paint in many homes in California, and upheld a lower court order that they pay for abatement of these hazards. (People v. ConAgra Grocery Products Co. (2017) 17 Cal.App.5th 51.) This bill, like several others introduced in the Legislature this session, seeks to ensure robust lead paint abatement in California, through the abatement program created by the judgment and by other means to help homeowners sue to recover abatement costs from lead paint manufacturers, if necessary. The package of bills also addresses issues raised by a subsequent ballot initiative, proposed for the November 2018 election and sponsored by the lead paint companies, which would vacate the court’s decision to hold paint manufacturers liable for cleaning up the lead paint crisis in California and instead create a taxpayer-funded bond for abatement.
This bill seeks to establish a "risk-contribution" theory of liability for injuries caused by lead-based paint, as specified, to enable plaintiffs to pursue claims against lead-paint companies in cases where the injured plaintiff is unable to identify the exact manufacturer of the lead paint that caused the injury.
Pervasive, ongoing threats to health and safety posed by lead-based paint in California: A short background. Lead poisoning in children is a common, pervasive phenomenon in California and across the nation. According to the Centers for Disease Control and Prevention (CDC), there is no safe blood lead level identified for children. The CDC estimates that approximately 2.6% of U.S. children aged 1 - 5 years old have high levels of lead in their blood (blood lead levels ≥ 5 micrograms per deciliter (µg/dL)). Childhood lead exposure most often occurs because of aging lead-based paint. Like all paint, lead-based paint inevitably deteriorates: it flakes, chips, and turns to dust and can contaminate the air, soil, floors, and other surfaces in the home. This is particularly true of lead paint on windows, doors, and other friction surfaces. Because children are especially likely to play on the ground and put things in their mouths, lead paint presents a larger risk for them than it does for adults living in the same space.
Exposure to lead can seriously harm a child’s health including creating damage to the brain and nervous system, slowed growth and development, learning and behavior problems, hearing, and speech problems. Even a slight elevation in blood lead levels can reduce IQ and stunt development. Decreased intelligence in children and increased blood pressure in adults are among the more serious non-carcinogenic effects of lead. Warnings about the tendency for children to gnaw on painted surfaces and become poisoned with lead were common in medical journals by the 1920s. By the 1930s, parents were warned to avoid using lead-based decorative materials in nurseries and bedrooms. Yet by most accounts, the industry kept promoting residential lead paint by advertising its durability.
In 1948, the Baltimore Public Health Department observed an increase in childhood lead poisoning, primarily in communities living in neglected row houses which contained massive amounts of peeling and flaking lead paint. Health inspectors found that children were eating lead from peeling and chipping lead-based paint in that city’s housing, and in response, the Baltimore Public Health Department issued the country’s first ban on interior lead-based paint in 1951. This would be followed in 1978 by the U.S. Consumer Product Safety Commission prohibiting all consumer uses of lead-based paint across the country. Additionally, in California since 1987, lead has been listed under Proposition 65 as a substance that can cause reproductive damage and birth defects, and has been listed as a chemical known to cause cancer since 1992.
Lead-based paint in California is also responsible for ongoing economic and social costs. Despite the federal ban on consumer uses for lead-based paints in 1978, millions of existing structures across the state still contain lead paint. According to the Legislative Analyst’s Office, about 60% of houses in California were built before 1978 and are presumed to have lead-based paint. Removal costs an estimated $8-$15 a square foot, which means removing all lead from a house of 1,200-2,000 square feet could run as much as $9,600-$30,000, according to RealtyTimes.com.
Judgment against Lead-Based Paint Manufacturers. In 2000, a complaint was filed on behalf of the People of the State of California against three major paint manufacturers for promoting lead paint for use in homes despite their knowledge that the product was highly toxic. The case was filed by Santa Clara County, and nine other cities and counties subsequently joined the litigation: the County of Alameda, the City of Oakland, the City and County of San Francisco, the City of San Diego, the County of Los Angeles, the County of Monterey, the County of San Mateo, the County of Solano, and the County of Ventura. Collectively, there are 18.7 million individuals living in the 10 jurisdictions which brought the case, which represent approximately 46.9% of the population of California.
The trial court issued its order in 2014, finding that Sherwin-Williams, ConAgra, and NL Industries (collectively, the "manufacturers") had created a public nuisance by promoting lead paint for interior use despite knowledge of the substantial harms that would result. The public nuisance created by these manufacturers consists of the collective presence of lead paint in the interiors of homes in the ten cities and counties. The three paint manufacturers were ordered to pay $1.15 billion into a fund to abate lead paint in all homes constructed up through 1980, though a later Court of Appeal decision reduced the scope of the abatement to only include pre-1951 residences. (People v. ConAgra Grocery Products Co. (2017) 17 Cal.App.5th 51.)
Author's Statement. According to the author, this bill seeks to establish a "risk-contribution" theory of liability for lead paint injuries in California, based on the model developed by the State of Wisconsin in 2005. The author states:
The dangers from exposure to lead paint are well known, severe and often irreversible. The health effects include damage to kidneys and reproductive systems, as well as serious developmental and behavioral challenges for exposed children.
Based on extensive evidence presented at trial, a California judge in 2014 found that certain lead pigment paint manufacturers caused lead-based paint to be applied on certain residential surfaces by promoting that paint for use on those surfaces even though they likely knew about the serious health harms to children that would result. A California appellate court unanimously affirmed that finding in 2017.
Although at least tens of thousands of young children in California continue to suffer serious and irreversible health harms due to their ingestion of lead-based paint each year, these children are unable to identify the precise manufacturer of the lead paint pigment they ingested due to the number of manufacturers, the passage of time, and the loss of records. As a result, these children are unable to establish causation under traditional common law tort principles and the costs of the injuries fall on the victims.
In 2005, the Wisconsin Supreme Court also recognized that common law tort principles unfairly shifted the cost of the injury to the innocent child by exempting lead paint pigment manufacturers from liability. In Thomas ex rel. Gramling v. Mallett, the Wisconsin Supreme Court applied a “risk contribution” theory of liability to injuries caused by lead-based paint thereby allowing children to recover damages for lead ingestion.
Unfortunately, under current law it is nearly impossible to hold paint manufacturers legally accountable for injuries. AB 2074 removes a significant hurdle to holding lead paint manufacturers legally accountable for injuries caused by lead-based paint, and seeks to codify a “risk contribution” theory of liability in statute.
Causation and burden of proof: exceptions to general rules. It is well-settled that in order to establish a cause of action based on a defendant's tortious conduct, the plaintiff generally must establish that the defendant's conduct caused the plaintiff's claimed damages. Put another way, the burden of proof that the tortious conduct of the defendant has caused the harm to the plaintiff is upon the plaintiff. (Restat 2d of Torts, Section 433B (2nd 1979).)
The California Supreme Court, however, has made exceptions to the general rule that a plaintiff must bear the burden of proving causation. One exception was set forth in Summers v. Tice (1948) 33 Cal.2d 80. In Summers, the plaintiff was injured when two bird-hunting defendants fired their guns in the plaintiff's direction at the same time. The plaintiff was hit by two pellets: one in the eye and the other in the lip. The plaintiff was unable to show which defendant caused the more serious injury, and would have been nonsuited under the general rule. Nevertheless, the Court held that it would be unfair to leave the plaintiff without a remedy when each defendant had brought about a situation which resulted in injury to the plaintiff. In such a case, the Court ruled, the burden is shifted to each defendant to prove that he has not caused the harm. (Ibid.)
Another exception to the general rule was announced by the Court in the case of Sindell v. Abbott Laboratories (1980) 26 Cal.3d 588. Under market share liability, in circumstances where a plaintiff is injured by a product tortuously produced or manufactured by multiple manufacturers, but it is impossible for the plaintiff to identify the specific manufacturer of the product that actually caused his injury, then defendant manufacturers may be apportioned liability according to their respective market share of the product responsible for the plaintiff's injury.
In that case, plaintiffs were allegedly injured by their mothers' ingestion, while pregnant, of a drug known as DES. Plaintiffs sued five of 200 known manufacturers of DES, but were unable to identify which one manufactured the drug ingested by the plaintiffs' mothers. The five named defendants produced about 65 percent of the DES on the market during the time the plaintiffs' mothers were taking the drug. In Sindell, the Court for the first time announced the rule of "market share liability" and held that if plaintiffs joined in the action the manufacturers of a substantial share of the product that caused the injury, the burden of proof would shift to the defendants to show that they could not have produced the substance that injured the plaintiff. The Court further held that each defendant in such a case would be liable "for the proportion of the judgment represented by its share of the market unless it demonstrates that it could not have made the product that caused plaintiffs' injuries." (Id., at p. 597.)
Proponents look to the state of Wisconsin for further examples of innovative policy in this area. They note that in 1984, four years after Sindell was decided in California, the Wisconsin Supreme Court reviewed a similar DES-injury lawsuit in a case called Collins v. Eli Lilly & Co. (1984) 116 Wis. 2d 166, in which the court considered adopting market share liability at the behest of the plaintiff, who was unable to identify which manufacturer of DES caused her injuries. Rather than adopting market share liability, however, the Court advanced a similar but novel theory of its own—risk contribution liability.
Like market share liability, risk contribution is another exception to traditional liability doctrine which shifts the burden when, in the court's opinion, it is necessary to avoid leaving the plaintiff without recovery when there are known culpable defendants. To invoke risk contribution, a plaintiff must show: (1) the existence of many potential innocent plaintiffs; (2) the shared culpability in producing or marketing what was later shown to be a harmful product; (3) the inability of the innocent plaintiff to identify the precise manufacturer of the product that caused the injury because of the generic or fungible nature of the product, the large number of manufacturers, the passage of time, and the loss of records; and (4) due to the traditional strictures of legal causation, the inability of the innocent plaintiff to recover from potentially negligent manufactures. (Peter G. Earle, Fidelma Fitzpatrick, and Douglas M. Raines. Negligence in the Paint: The Case for Applying the Risk Contribution Doctrine to Lead Litigation -- A Response to Gray & Faulk, 26 Pace Envtl. L. Rev. 179 (2009), citing Collins v. Eli Lilly & Co. (1984) 116 Wis. 2d 166.)
One year after Collins, the Wisconsin Supreme Court considered a case brought by a lead-poisoned minor seeking to recover damages against possibly negligent manufacturer of white lead carbonate pigment that had injured him. (Thomas v. Mallett (2005) WI 129.) The plaintiff was unable to identify the manufacturer of the pigment that he had ingested, and was potentially left to suffer the cost of his injuries without any recourse if he was not allowed to sue the manufacturers. The Court heldd that lead-paint manufacturers were subject to liability under the risk contribution doctrine.
Proponents of this bill assert that a similar public policy rule is appropriate in cases for lead-based paint injury in California. They contend that there are tens of thousands of young children in California who continue to suffer serious and irreversible health harms due to their ingestion of lead-based paint each year, and that these children are unable to identify the precise manufacturer of the lead paint pigment they ingested due to the number of manufacturers, the passage of time, and the loss of records, among other things. As a result, they contend, these children are unable to establish causation under traditional common law tort principles, which if allowed to stand, would effectively release lead paint manufacturers from liability even though they likely contributed to the actual injury of these children, and unfairly shift the cost of the injury to these innocent children. Accordingly, the author proposes to establish risk-contribution liability in California, similar to that developed by the Wisconsin Supreme Court in Thomas.
Risk contribution liability, as proposed by this bill. Under this bill, risk-contribution would potentially apply in any action to recover damages for an injury to person or property that was caused by lead-based paint. The bill would allow the injured party to establish a prima facie case that a particular party is the cause of the injury if the injured party proves by a preponderance of the evidence that a particular party produced, sold, distributed, or promoted the type of lead paint pigment that caused the injury. If the injured party is successful in establishing a prima facie case of causation, then the burden of proof shifts to the particular party that produced, sold, distributed or promoted the type of lead paint pigment that caused the injury, to prove by a preponderance of the evidence that it did not produce, sell, distribute, or promote the lead paint pigment during the relevant time period or in the geographical market in which the injury occurred.
Proponents further note that nothing prevents the Legislature from determining that, as a matter of public policy, it is necessary to modify rules of liability in order to respond to the pervasive presence of lead-paint in buildings in California, and the serious risk to public health that arises as a result, which proponents believe can be directly attributed to the harmful conduct of lead-paint companies over the years.
ARGUMENTS IN OPPOSITION: The California Chamber of Commerce and a number of other business organizations submitted a joint letter opposing the bill and characterizing it as "setting a troubling precedent for all types of consumer products sold in the state." Opponents state:
These bills place into California law an unprecedented and extreme system of absolute liability by discarding the plaintiffs' burden to prove which entity caused their alleged harm. Rather, the named entity would be deemed liable unless it could prove a nearly impossible defense—that it never manufactured, sold, distributed, or promoted the product in the "geographical area" or "relevant time period," both of which are not defined.
The bill is also opposed by the California Paint Council and the American Coatings Association, two trade associations representing the paint and coatings industry. They write:
(We) oppose these bills as they will impose liability on a host of product manufacturers where there is no proof that the manufacturer’s product caused the alleged harm. The damages provided for are sweeping and don’t make sense. Rather than tie a right to damages to harm caused for personal injury, the damages in this bill are overly expansive. Proof of causation is fundamental in product’s liability law.
Collective theories of liability completely ignore the historical basis for recovery in products liability law -- causation. The fundamental relationship between the product and the alleged victim that must exist is that the product actually caused the harm at issue. It is not enough to show that the plaintiff merely used or was exposed to the product in question.
The principles of mass product tort liability include the following: (1) A plaintiff must show that a specific defendant actually caused the harm; (2) A plaintiff must prove the products that caused the harm were either defective under strict products liability or negligently made; and (3) A plaintiff’s claim must be filed within the statute of limitations.
The requirement for causation is fundamental to constitutional protections of due process and of liberty and property. Public Nuisance liability theories rob manufacturers of the ability to defend themselves by proving that a company’s product did not cause the alleged harm.
In response, the author notes that Wisconsin's risk-contribution theory of liability was upheld by the Seventh Circuit Court of Appeals, and determined not to violate substantive due process guarantees under the U.S. Constitution. (Gibson v. American Cyanamid (2014) 760 F.3d 600.) The author cites the following article by Pamela Maloney, liberally quoted below, which summarizes the Seventh Circuit's constitutional analysis of Thomas, and emphasizes the applicability of the court's analysis to the similar facts surrounding the problem of lead-paint injuries in California and the similar nature of the risk contribution doctrine proposed in this bill in response to those problems:
The lack of a controlling test for the issue in this case returned the Seventh Circuit to its starting point which was that economic legislation does not violate substantive due process unless the law is arbitrary and irrational. The Seventh Circuit decided that the risk-contribution theory was not arbitrary or irrational, nor was it unexpected and indefensible. In adopting the theory, the Wisconsin Supreme Court balanced the tortious conduct of pigment manufacturers in distributing an unreasonably dangers product with the possibility of leaving the non-culpable plaintiff without a sufficient remedy, while recognizing that it was relaxing the traditional standard of causation. According to the Seventh Circuit, the Wisconsin high court rationally relied on the wide scope of the health dangers posed by lead pigment against the difficulties in proof faced by victims of pigment poisoning, in part because the pigment was so unreasonably dangerous that it remained a health danger for decades. (Pamela Maloney, "Youth’s lead paint exposure claim reinstated under Wisconsin high court’s risk-contribution theory," Products Liability Law Daily (July 25, 2014).)
The Chamber and business opponents also object to the imposition of joint and several liability under the bill, which they say potentially assigns liability to an entity "having no connection whatsoever to the alleged harm." The opponents state:
An entity's failure to prove this defense would, under this theory of liability, require it to pay 100 percent of the plaintiff's claimed damages despite having no connection whatsoever to the alleged harm. . . A single entity that played no part in causing a plaintiff's injury and that had nominal production, sales, distributions or promotion in California could nonetheless be held wholly liable for all of a plaintiff's damages.
The Committee notes that by the very nature of risk contribution, or any other form of alternative liability that allows burden-shifting in special circumstances, liability may be assigned to an entity more than he would have under traditional liability theories in the absence of direct causation—essentially for policy reasons. The author may wish to verify whether Wisconsin also imposed join and several liability as a part of its risk-contribution doctrine, as this bill requires. In any case, the author contends that joint and several liability is not inconsistent with a theory where "causation-in-fact is not required for recovery and liability but instead is premised in some way on the defendants’ contribution to the risk of injury." (See below.)
The Seventh Circuit also rejected the manufacturers’ argument that they would be held liable in particular cases for injuries that they did not cause and that the risk-contribution theory does not reflect the overall liability that the manufacturers should have expected to face from selling lead pigment. The theory’s overall compensation framework and reflection of liability was consistent with similar tort-liability theories employed in other mass-tort contexts and with other common-law developments in tort schemes in which causation-in-fact is not required for recovery and liability but instead is premised in some way on the defendants’ contribution to the risk of injury. (Pamela Maloney, "Youth’s lead paint exposure claim reinstated under Wisconsin high court’s risk-contribution theory," Products Liability Law Daily (July 25, 2014).)
The author notes that this bill employs similar time and geographical boundaries related to plaintiff's exposure to lead-paint that retain some traditional cause-in-fact requirements.
The Wisconsin high court went on to find that the manufacturers either knew or should have known of the harm that they were causing, and concluded that the risk-contribution theory placed culpability “at the feet of the manufacturers.” Relaxing the causation standard was justified in favor of the innocent plaintiff and against the risk-creating manufacturers because they were in a better position to absorb the cost of the injuries, insure themselves against liability, and pass the cost along to the consuming public. The manufacturers were also in control of the records needed to establish whether they had produced or marketed white lead carbonate pigment either during the house’s existence or in the geographical market where the house was located.
The Seventh Circuit also emphasized that in developing the risk-contribution theory and relaxing the traditional cause-in-fact requirement, Thomas did not entirely eliminate proof of causation. Plaintiffs still were required to prove that the pigment manufacturers produced or marketed white lead carbonate pigment for use during the relevant period of time (the duration of the house’s existence). This requirement posed a substantial causation question because there were other sources of lead poisoning (ambient air, drinking water, soil, and dust) and there was no “signature” injury for lead poisoning resulting from ingestion of lead pigment. (Id.)
Pending Related Legislation: Lead-based paint is still in many California homes built before 1978 and continues to present a serious threat to public health. This year a package of legislation has been introduced to address various issues on lead-based paint, including liability, abatement, and the legal classification of lead-based paint. The package includes the following bills:
AB 2803 (Limon) would provide that residential lead-based paint interferes with a public right, while also establishing that a party may be liable for public nuisance if it promoted lead-based paint with actual or constructive knowledge that it was hazardous. Additionally, the measure establishes that an aggrieved party does not need to identify the specific party which caused the injury, but instead may infer causation from other evidence. AB 2073 (Chiu) provides immunity from liability to property owners who participate in a lead paint abatement program if they are sued for recovery of costs associated with such a program. AB 2995 (Carrillo) defines lead-based paint on a residence or other building as a physical injury to property, and provides that civil actions to recover damages to property due to the presence of lead-based paint do not accrue until the aggrieved party has actual knowledge of the lead-based paint. All three of the bills are being heard in the Assembly Judiciary Committee at the same hearing as this bill.
AB 2934 (Stone) would allow the California Department of Public Health to contract with counties to certify lead paint inspectors in order to help fill a shortage of inspectors to help bring homes up to safe standards. Additional qualified, lead paint inspectors will be needed as work proceeds to remove toxic paint from homes under the judgement. AB 2934 is currently on the Assembly Floor. AB 3009 (Quirk) would enact a fee on paint manufacturers for all paint sold in the state and would create a fund for residents of single-family or multi-family dwellings to abate lead-based paint in their homes. This measure will only be enacted if the proposed ballot proposition removing liability for paint manufacturers passes in November of 2018. AB 3009 is currently in the Assembly Revenue and Tax Committee.
REGISTERED SUPPORT / OPPOSITION:
Support
A. Philip Randolph Institute – San Francisco
Bay Area Legal Aid
Brightline Defense Project
California League of Conservation Voters
Children’s Advocacy Institute
City of Oakland
Clean Water Action
Community Youth Center
Consumer Federation of California
Environmental Working Group
Santa Clara County
SmartOakland
Opposition
American Coatings Association
American Insurance Corporation
California Chamber of Commerce
California Manufacturers and Technology Association
California Paint Council
Civil Justice Association of California
Household and Commercial Products Association
Analysis Prepared by: Anthony Lew / JUD. / (916) 319-2334
Discussed in Hearing
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Bill Co-Author(s):