$1.1B California Paint Verdict Could Prompt New Lawsuits

By PAUL ELIAS | December 19, 2013

Paint makers could face a surge of lawsuits after a California state court judge ordered three companies to pay $1.1 billion to help government agencies get rid of lead from an estimated 5 million homes in the state.

The ruling, while preliminary, was a rare loss for an industry that had turned back some 50 lawsuits filed nationwide over the last 25 years by public agencies seeking billions of dollars to remove lead-based paint from homes built before the federal government banned the product from the U.S. market in 1987.

“The California ruling is certainly a significant development,” said David Logan, a class action expert and dean of Roger Williams University Law in Rhode Island. “If it gets upheld, it will open a new path to victory for public agencies.”

Lisa Rickard, president of the U.S. Chamber of Commerce’s Institute for Legal Reform, predicted “a surge of frivolous lawsuits” because of Monday’s ruling, which the industry plans to appeal.

Exposure to lead is linked to learning disabilities and other health problems, especially among poor children living in older dwellings. The Centers for Disease Control and Prevention earlier this year said 535,000 children had dangerously high levels of lead.

In lawsuits against the industry filed on behalf of state and local governments, lawyers have argued that lead-based paint is a “public nuisance” like a major air polluter or a dumper of toxic materials into a river. The lawsuits claimed that unsafe levels of lead found in thousands of children’s bloodstreams each year was caused by the paint industry.

But the lawsuits foundered for a variety of reasons. Many older homes have several layers of lead-based paint, making it impossible to determine which layer of paint was responsible for a resident’s lead poisoning – if in fact paint was the culprit. Lead also is found in water, jewelry, toys and other places.

Other cases were dismissed after judges rejected the “public nuisance” claims, ruling that individuals must file individual lawsuits proving a paint company caused them direct harm.

Finally, the industry argued that the old paint is no longer a significant public health risk and that it never deliberately sold a harmful product.

On Monday, Santa Clara County Superior Court Judge James Kleinberg rejected those arguments, citing corporate documents dating back to 1900 to rule that ConAgra Grocery Products Co., NL Industries Inc. and the Sherwin-Williams Co. marketed lead-based paint they knew was harmful for much of the 1900s.

The judge cited a Sherwin-Williams newsletter from 1900 conceding that lead-based paint was a “deadly cumulative poison” and then a 1922 company advertisement claiming its paint was safe.

“In the 1920s, scientists from the Paint Manufacturers Association reported that lead paint used on the interiors of homes would deteriorate, and that lead dust resulting from this deterioration would poison children and cause serious injury,” the judge wrote in his 110-page decision. “It was accepted by the medical and scientific community before the 1950s, as reflected in literature from as early as 1894, that lead paint was a significant cause of childhood lead poisoning.”

The three companies found liable have vowed to appeal the Santa Clara County Superior Court Judge James Kleinberg’s verdict as far they can and that process is expected to take years. Kleinberg’s ruling was made after a five-week trial conducted without a jury and 13 years after the original lawsuit was filed.

Only one other verdict was returned against the industry. A Rhode Island trial court judge did award the state $2.4 billion in 2006, but that verdict was overturned on appeal two years later.

DuPont is the only paint manufacturer to have paid any damages, agreeing to a $12.5 million settlement in 2005 to get out of the Rhode Island case before a verdict was rendered.

The 10 cities and counties awarded damages Monday are the counties of Santa Clara, Alameda, Los Angeles, Monterey, San Mateo, Solano and Ventura, and the cities of Oakland, San Diego and San Francisco.

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