SGS Societe Generale de Surveillance : California Proposition 65 Settlement Update

June 2, 2016

SAFEGUARDS | Consumer Products NO. 104/16

Product manufacturers and retailers who sell products in California that expose consumers to any of the over 900 chemicals known by the state of California to cause cancer or reproductive toxicity must provide a clear and reasonable warning prior to exposure. Failure to do so can result in significant costs to product manufacturers and retailers.

The state of California requires business to provide a clear and reasonable warning before knowingly exposing anyone to a listed chemical in excess of established safe harbour limits. The primary enforcement mechanism for California Proposition 65 has been thru civil law suits that result in monetary settlements or consent decrees, otherwise referred to as 'bounty hunter lawsuits'. Failure to provide a clear and reasonable warning can result in damage to brand image and costly settlements.

Unlike other global legislation which limits the scope of the covered products, California Proposition 65 applies to products, the physical location of the business, and discharges into water from the business, the broad scope provides a target rich environment for 'bounty hunter lawsuits'.

California Proposition 65 requires that clear and reasonable warnings must be provided for products, if they contain a listed chemical exposure, sold by brick and mortar retailers, catalogue or internet sales channels.

A review of settlements starting in 2012 thru 2015 provides the following data, which does not include legal defense fees paid to lawyers by businesses to defend against lawsuits which may not result in a settlement.

Table 1

Throughout a global network of laboratories, SGS can offer comprehensive testing, product assessments and consultancy services related to California Proposition 65 to assist your risk management in your supply chain for consumer goods such as DIYs, electrical and electronics, hardgoods products, juvenile products, and textile & toy products. For further information, pleasevisit our website.

For enquiries, please contact:

Kenneth StanvickTechnical Manager,Consumer and Retail Services t: +01 603 305 4103

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