Monday, September 26, 2005
C.A. Throws Out Settlement of Proposition 65 Action Over Surgical Devices
By a MetNews Staff Writer
The settlement of a Proposition 65 action, in which several manufacturers of surgical devices agreed to pay the plaintiff’s attorney fees even though they and the plaintiffs agreed that their products did not expose the public to carcinogens, has been thrown out by the Court of Appeal for this district.
“We have concluded that this case does not, and has not for some time, presented a justiciable controversy, and should have been dismissed,” Justice Orville Armstrong wrote for the appellate panel. “Although the case was apparently filed in the good-faith belief that the defendants were in violation of the statute, by the time the trial court entered the Consent Judgment, the plaintiff no longer held that belief.
“...We do not see that either Proposition 65 or the rules pertaining to justiciability allows such purely prospective and speculative litigation.”The unusual ruling came in an appeal by the attorney general, who is authorized by Proposition 65 to object in the public interest to settlements of actions brought under the 1986 initiative. Proposition 65 requires businesses that use or market products that may cause cancer or reproductive toxicity to warn consumers of that fact.
The action was brought by Consumer Cause, Inc. The group, represented by Los Angeles attorney Morse Mehrban, has been described as a “Proposition 65 bounty hunter.”
In a 2001 opinion, dissenting from a Div. One ruling that allowed Consumer Cause to sue dental clinics for failure to warn patients that dental amalgam, used to fill teeth, contains mercury, Justice Miriam Vogel noted that the group had sent out hundreds of notices of intent to sue regarding implanted medical devices, settling one case for a $25,000 “donation” plus $25,000 in attorney fees.
In the case ruled on Thursday, Consumer Cause alleged that stainless steel stents and other implantable surgical devices made by the defendants—Johnson & Johnson, Cordis Corp, Ethicon, Inc., Warsaw Orthopedic Inc., Howmedica, Howmedica Osteonics Corporation and Stryker Corporation, and Sofamor Danek Group, Inc., Medtronic, Inc. and Sofamor Danek Manufacturing—were composed of carcinogenic nickel and nickel compounds.
Under the terms of the settlement, the parties agreed that none of the devices currently manufactured by the defendants require Proposition 65 warnings. Instead, the defendants agreed on the specific wording of warnings that would be required if any defendant were to manufacture a product subject to Proposition 65 in the future, and also agreed on payment of $58,000 in fees to Mehrban.
The agreement also included a provision allowing manufacturers of similar devices who were not sued to “opt in” to the consent judgment, under a notice procedure to be implemented in the months following the settlement, by paying $20,000 each, of which $5,000 would go to the defendants to recoup costs and the rest to a nonprofit organization.
The settlement, Mehrban said in court documents, was to “act prophylactically to avert future violations and to mandate warnings where required by Proposition 65.” In asking the court to approve it, the attorney acknowledged that the products currently manufactured by the defendants fell within the initiative’s exemption that applies when exposure to the product “will have no observable effect assuming exposure at one thousand (1,000) times the level in question.”
The settlement was approved by Los Angeles Superior Court Judge Victoria Chaney.
But Armstrong, writing for the Court of Appeal, said that once the plaintiff agreed that the defendants had not violated Proposition 65, the case was no longer ripe for adjudication and the trial court “should have exercised its discretion by refusing to decide it.”
The justice added that “nothing in Proposition 65 authorized further litigation, because there was no violation or threatened violation of the statute” and that the initiative “does not give a private organization a right to sue (or to maintain a suit) in the name of the public where the public has not been harmed.”
The lack of a ripe controversy is especially problematic in this type of case, the justice said, given the difficulty in determining the adequacy of the warnings required by the consent judgment in the absence of “a factual record which includes an actual product which requires an actual warning.”
Armstrong also questioned the trial judge’s finding that the settlement would confer “a substantial public benefit.”
The justice wrote:
“Through this Judgment, plaintiff and defendants seek to foreclose future action by members of the general public, including any subsequent plaintiff who might seek advice from another expert, with an opinion based on perhaps newer or better research. Yet, the Judgment adopts a formula developed by an expert hired by the defendants, a formula not tested through the crucible of litigation by an opponent with a real stake in the outcome. We can have no confidence that a formula so developed truly protects the public.”
The case is Consumer Cause, Inc. v. Johnson & Johnson, 05 S.O.S. 4393.
Copyright 2005, Metropolitan News Company