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Groups Ask SCOTUS to Review CA Lead Case

Monday, August 27, 2018

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The Association of National Advertisers and Atlanta Legal Foundation, a public interest law firm, have filed a “friend of the court” brief that has asked the U.S. Supreme Court to take up the lead abatement case against three coatings companies, arguing that last November’s decision, which ordered Sherwin-Williams, ConAgra and NL Industries to pay into a fund for lead abatement in California homes, threatens advertisers of all kinds.

Case Background

During the 2013 trial, Judge Kleinberg dismissed two other companies, Atlantic Richfield and DuPont, in the case that accused the paint companies of advertising lead-based products after they knew the products were a risk to public health, subsequently ordering The Sherwin-Williams Company, ConAgra Grocery Products Inc. and NL Industries to pay $1.1 billion into a fund that would be distributed to the 10 cities and counties affected, as needed.

In 2014, the judge increased the liability to $1.15 billion. That same year, after being denied the vacation of an amended judgment and the granting of a new trial, the three defendants filed notices of appeal, which effected an automatic stay of the judgment.

In an August 2017 hearing, attorneys representing Sherwin-Williams, ConAgra and NL Industries argued for a reversal of the December 2013 ruling, citing free speech.

© iStock.com / XiFoto

The Association of National Advertisers and Atlanta Legal Foundation, a public interest law firm, have filed a “friend of the court” brief has asked the U.S. Supreme Court to take up the lead abatement case against Sherwin-Williams and other coatings companies, arguing that last November’s decision, which ordered Sherwin-Williams, ConAgra and NL Industries to pay into a fund for lead abatement in California homes, threatens advertisers of all kinds.

In the November 2017 ruling, the Sixth District Court of Appeal in San Jose rejected that free speech claim, but did drop the amount of cleanup that the companies are responsible for to homes build before 1951, instead of 1978, when the use of lead-based paint in home became illegal. This took the $1.15 billion tag down to $400 million.

Then, in February 2018, a high court judge denied a review of the November 2017 ruling, the most recent installment that involved all three companies. At the time, Andre Pauka, a lawyer for NL, said that the companies were planning to appeal to the U.S. Supreme Court.

Early last month, companies withdrew initiatives from California’s November ballot, legislation that would have authorized $3.9 million in taxpayer-paid state bonds to fund remediation of not just lead, but also mold, asbestos and other environmental dangers in residences, schools and senior citizen facilities. To combat the initiative, half a dozen legislators authored bills that would penalize the companies beyond the appeals court ruling. In addition, two California counties filed a lawsuit to get the initiative taken off the ballot, all while negotiations were still ongoing between legislators and the companies.

Recent Filing

In the brief, the ANA and the Atlanta Legal Foundation argue that the California court held Sherwin-Williams, among other paint manufacturers, liable “for ‘public nuisance’ based on an advertisement that Sherwin-Williams ran once in 1904 in the Los Angeles Times and the San Diego Union,” along with $5,000 in donations to a trade organization between 1937-1941; the organization used the funding to “promote better paint, including lead paint, for lumber products.” At the time, the use of lead paint in residential interiors was lawful.

According to Adweek, the distinction here is the dangers associated with ingesting lead were well known when the ad ran, but the material was not considered dangerous for use on interior surfaces in residences.

In the most recent update to the case, the ANA has argued that the case threatens to erode companies’ rights to market their products based on the information they have at the time. ANA spokesman Dan Jaffe said that the California court had retroactively imposed “multi-millions of dollars of damages on Sherwin-Williams by applying today's scientific standards to ads that were published decades ago.”

According to Jaffe, such a precedent would require companies to take on additional insurance for all potentially problematic products; these costs would be passed down to the consumer.

“This case raises serious First Amendment issues regarding future liability for ads that were truthful and non-deceptive at the time they appeared,” the ANA writes in its blog. “The potential implications of this decision are staggering for other products that may be hazardous.”

   

Tagged categories: Health and safety; Laws and litigation; Lawsuits; Lead; Lead paint abatement

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