This post was prepared by Vanessa Adriance of Gibson Dunn.
California’s Office of Environmental Health Hazard Assessment (OEHHA) will hold a public hearing regarding changes to the regulations implementing California’s Safe Drinking Water and Toxic Enforcement Act of 1986, commonly referred to as “Proposition 65,” on March 25, 2015. The proposed changes are far-reaching, and include specific provisions addressing what constitutes a “clear and reasonable” warning that complies with Proposition 65 for the purposes of online retail—an area previously not directly addressed by the regulations or the case law applying Proposition 65.
By way of background, Proposition 65 was enacted via California’s ballot initiative process in 1986. (California Health & Saf. Code § 25249.5 et seq.) As it applies to consumer goods, including apparel and fashion accessories, Proposition 65 is intended to be an informational statute. As such, it requires any person who exposes a consumer to any of more than 900 chemicals deemed to be either carcinogens or reproductive toxicants while “in the course of doing business” to first provide a warning about that exposure. (Id. at § 25249.5.)
Proposition 65 has created an enormous amount of litigation since its passage, due in large part to the provision of the law that permits any taxpayer to sue “in the public interest” to enforce the law. (Id. at § 25249.7(d).) Proposition 65 litigation involving shoes, vinyl handbags and cosmetic cases, and costume jewelry have all made their way through the California courts in the last several years, and plaintiff’s attorneys are constantly on the lookout for new products that they can target. Making compliance even more challenging, OEHHA is constantly updating the list of chemicals subject to the law.
Once it is shown that a product contains a listed chemical, the “exposure” requirement is generally easily met and difficult to dispute in litigation. For example, if a consumer could physically put a product in their mouths (even if that is not its intended use) then plaintiff’s attorneys will argue that an exposure is created. The same is true of things that a purchaser might touch with their hands such that a chemical might rub off, which could them be consumed if they touch their mouths or eyes. There may well be other defenses to a claim based on a piece of apparel, such as that the chemical makeup of the print is such that the listed chemical cannot actually be transferred, or that exposures fall within “safe harbor” levels, but those defenses can be very time consuming and costly to assert, often requiring extensive expert testimony.
Because of the heavy burdens placed on defendants in Proposition 65 cases, the best approach to the law for manufacturers and retailers is often to provide warnings prior to the instigation of any litigation. The provision of a proper warning will, as a general matter, insulate a defendant from liability under Proposition 65.
The issue then becomes what constitutes a proper warning—a question that has only become more acute as more and more retail has moved into the digital sphere, but remains governed by regulations created prior to the advent of online shopping. Broadly speaking, the regulations implementing Proposition 65 require warnings to be “clear and reasonable” and to be provided “prior to exposure.” (Cal. Code Regs. Tit. 27, section 25601(a).) The California Attorney General’s office has taken the position that this regulation requires warnings to be made available before a consumer makes the decision to purchase the product. In the brick-and-mortar context, this means hangtags and labels affixed to products or their packaging are compliant as long as they are “clear and reasonable” and contain the correct language mandated by the regulations.
As noted above, the regulations have not been updated since online shopping became popular, nor has the issue of proper warnings in the e-commerce context been litigated. This leaves manufacturers and online retailers with little guidance regarding how to warn purchasers buying from websites rather than brick and mortar stores.
However, there is some information available, and reasonable inferences about best practices can be made. First, there have been some consent judgments addressing the issue, but consent judgments between litigants do not constitute binding precedent beyond the parties to those cases. However, the consent judgments that do address internet warnings define compliant warnings as those that appear (1) on the same page on which the product is displayed, (2) on the same page as the order form for the product, (3) on the same page as the price for the product, or (4) on one or more web pages displayed to a purchaser during the checkout process. In addition, OEHHA is currently in the midst of a rulemaking process that would overhaul many of the regulations relating to warnings. The proposed new regulations do specifically address internet sales, and the current draft provides as follows: “For internet purchases, the warning message must be provided by a clearly marked hyperlink on the product display page, or otherwise prominently displayed to the purchaser before the purchaser completes his or her purchase of the product. For purposes of this Article, a warning is not prominently displayed if the purchaser must search for it in the general content of the website.”
The proposed language of the new regulations is not far removed from substantive requirements that have been used in consent judgments in the past. Therefore, it is reasonable to infer that at this time, any of the methods for providing warnings to internet purchasers described above is likely to be in compliance.
The bottom line for fashion manufacturers and retailers: At present, a warning that appears on a product landing page or is prominently displayed prior to purchase is probably the safest bet. There does not appear to be any authority explicitly holding that a warning elsewhere on a website, or even provided in a product hang-tag that would be compliant in a brick and mortar context, fails to satisfy the clear and reasonable warning requirements of Proposition 65. However, based on the Attorney General’s approach to warnings generally, putting warnings on product pages of websites or otherwise placing them such that a purchaser sees them before clicking the “purchase” button, is the best practice to reduce the risk of unwanted litigation.
 It should also be noted that though lead is a listed chemical under Proposition 65, California also has a separate law governing lead in costume jewelry specifically. That law is codified at California Health & Safety Code § 25214.1-25214.4.2, and is not the subject of this post.