For the past 20 years, businesses that sell coffee, french fries and potato chips have been defending themselves against lawsuits that allege they violated a voter-approved California law that requires warning labels on products that contain substances known to cause cancer.
A federal appellate court on Thursday blocked any new lawsuits. A panel of the 9th Circuit Court of Appeals ruled that business owners cannot be compelled to say that acrylamide formed when cooking food is known to cause cancer when the truth of that statement is the subject of considerable scientific controversy. The court upheld a U.S. District Court ruling that imposed a temporary injunction on any new acrylamide disclosure lawsuits.
“A reasonable person might think that they would consume a product that California knows will increase their risk for cancer,” the panel’s opinion says. “Such a consumer would be misled by the warning because the State of California does not know if acrylamide causes cancer in humans.”
Acrylamide forms naturally when some foods, including coffee beans, cookies and potatoes, are heated. That wasn’t known until Swedish researchers raised alarm bells when they held a press conference to announce the results of a scientific study in 2002 that found the compound is formed when starchy foods are cooked at high heat.
In that same year, the Council for Education and Research on Toxics, or CERT, filed the first lawsuit asserting that warning labels for acrylamide are required by Proposition 65, a voter initiative approved by California voters in 1986. The organization, represented by the Metzger Law Group in Long Beach, persuaded the state attorney general to join a lawsuit to require fast food restaurants to display warnings about the potential cancer hazard of eating french fries.
The Chamber calls such actions “bounty hunter” lawsuits because private parties that initiate enforcement actions take 25% of the penalties imposed. The Consumer Brands Association and other business groups said in an amicus brief that Proposition 65 has become a cottage industry for law firms. In 2019 there were 899 private settlements of Proposition 65 lawsuits costing $30 million and 615 out-of-court settlements with payments of $12.5 million, the brief says.
The Metzger law firm is also representing CERT in the litigation that prompted the 9th Circuit ruling on Thursday. The California Chamber of Commerce filed a lawsuit seeking a permanent injunction against Proposition 65 lawsuits based on acrylamide exposure from food, arguing that a requirement to post a warning label would violate business’ 1st amendment free speech rights because scientists disagree on whether acrylamide exposure from food actually causes cancer in humans.
“It’s been a part of the food supply since fire was discovered,” said San Francisco attorney Trenton H. Norris, with the Arnold & Porter Kaye Scholer law firm, who represented the Chamber.
Raphael Metzger, founding partner of the law firm representing CERT, did not respond to a request for comment on Thursday.
Acrylamide is among 900 substances that California regulators say is known to call cancer. But that “knowledge” is based on studies involving laboratory mice. The National Cancer Institute stated that “a large number of epidemiologic studies have found no consistent evidence that dietary acrylamide exposure is associated with the risk of any type of cancer,” according to the 9th Circuit’s opinion.
Nevertheless, the Consumer Brands Association said 465 “pre-suit” notices citing acrylamide in food products were filed in 2020 and another 129 in the first half of 2021. Many of these notices were served on small and mid-sized food companies that may not have the resources to litigate with private enforcers,” the organization’s amicus brief says.
Insurance usually is no help. A California appellate court ruled in 2011 that lawsuits alleging violations of the disclosure law are not covered by standard commercial general liability policies, so there’s no duty to defend. However, coverage can sometimes be found through directors and officers insurance or speciality lines.
Los Angeles attorney Jeffrey B. Marguiles, who represented Consumer Brands, said the impact of the 9th Circuit’s ruling may extend beyond acrylamide. He noted that Bayer AG is currently fighting thousands of lawsuits alleging that the main ingredient in the Roundup weedkiller, glyphosate, had caused cancer.
“The court agreed with the general principle that the defense has been urging,” he said.
The appellate panel’s ruling does not put an end to the Chamber’s lawsuit. The case now returns to the US District Court in Los Angeles to determine whether a permanent injunction should be issued, a decision that can be made only after a trial on the merits of the Chamber’s arguments.
“We are pleased that the Ninth Circuit upheld the district court’s analysis in every respect,” said Adam Regele, a senior policy advisor for the Chamber. “We anticipate this will protect California businesses from new acrylamide litigation and look forward to the district court’s ultimate ruling on the merits of our lawsuit.”
The Chamber’s lawsuit was one or two involving acrylamide that the 9th Circuit decided on Thursday. In another decision, the same panel affirmed a district court decision to dismiss a lawsuit filed by B&G Foods North America that charged a woman and her attorney had violated its First Amendment rights by filing a Proposition 65 enforcement action against it — the first step toward a lawsuit. The panel, however, modified the district court judge’s decision to allow B&G to amend its civil complaint and try again.
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