California’s Proposition 65 requires businesses to notify consumers that hazardous chemicals may be present in products they buy or places they go. Many of these alleged hazardous chemicals most likely present minimal risk of harm to any single person. However, a person does not need to suffer any harm to win a lawsuit against a business that is not complying with Proposition 65’s notification requirements. Companies that do not comply with Proposition 65 face a high risk of defending a lawsuit for noncompliance. The cost of defending against these types of lawsuits, even if they are frivolous, can be very costly and debilitating to a business’s financial stability. Fortunately, a business can protect itself from the risks of Proposition 65 litigation by taking immediate cost-effective action, which includes complying with Proposition 65’s warning requirements. 

What is Proposition 65?  Proposition 65 is a California initiative that was approved by the voters and enacted as law in 1986. It protects Californians from the risks of undisclosed harmful chemicals that may be present in food, consumer goods and business premises. Businesses that post a "safe harbor" warning about the risk of these chemicals can avoid liability for noncompliance with Proposition 65. The safe harbor posting must state: "WARNING: This product contains a chemical known to the State of California to cause birth defects or other reproductive harm." (Regs., tit. 27, § 25603.2, subd. (a)(2).)

What Can My Business do to Manage These Risks?  A simple, cost-effective approach should mitigate a business’s exposure to Proposition 65 litigation. For instance, a company can post a sign on the wall of its premises, or on its products, that warns consumers of the potential for the presence of hazardous chemicals. Proposition 65 even provides the exact wording for these warning signs: "WARNING: This product contains a chemical known to the State of California to cause birth defects or other reproductive harm." Obviously, the cost of posting a sign is far less than the cost of defending a lawsuit. Because most chemicals in commercial products and buildings are not naturally occurring, but anthropogenic (man-made), it is unlikely that the "naturally occurring" exception will apply to many businesses. However, a case-by-case approach is necessary to determine the nature and extent of the chemicals in a business’s product and/or business location. Turning a blind eye to Proposition 65 requirements does not make long-term economic sense, given the grim realities of costly litigation and harsh statutory penalties. It is important that a business weighs the costs and benefits of complying with Proposition 65. This risk management can only take place after those in charge have a clear understanding of the requirements of Proposition 65, the risks associated with noncompliance and the costs of litigation.