Products Liability Law Daily $305M settlement reached in California lead paint litigation
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Thursday, July 18, 2019

$305M settlement reached in California lead paint litigation

By Kathleen Bianco, J.D.

Cities and counties granted immediate access to abatement funds and given flexibility in the use of the funds for cleanup and intervention services

A 20-year court battle between the People of the State of California, represented by the County Counsels and City Attorneys of ten jurisdictions, and former lead paint manufacturers has culminated in a groundbreaking $305 million-dollar settlement. Considering the settlement agreement, the parties filed a joint motion of dismissal with prejudice in the Superior Court of the State of California in Santa Clara County, along with a request for the court to retain jurisdiction over the parties and this matter to enforce and to resolve all disputes that may occur concerning the settlement (People of the State of California v. Conagra Grocery Products, July 17, 2019, Kuhnle, T.).

The settlement arises out of a public nuisance lawsuit filed in Santa Clara County Superior Court in 2000 (County of Santa Clara v. Atlantic Richfield Co., Case No. 1-00-CV-788657). Other cities and counties joined the litigation, including the City and County of San Francisco; the Cities of Oakland and San Diego; and the Counties of Alameda, Los Angeles, Monterey, San Mateo, Solano, and Ventura. In 2014, the court ruled that three former lead paint manufacturers—The Sherwin-Williams Company, ConAgra Grocery Products Company, and NL Industries, Inc.—were liable for marketing lead paint [see Products Liability Law Daily’s January 9, 2014 analysis].

Three years later, in 2017, the California Court of Appeal upheld the Superior Court’s decision to hold the former lead paint manufacturers liable for creating a public nuisance in the ten cities and counties, but limited the scope of the remedy to pre-1951 homes and remanded the case to the Superior Court for a hearing on the appointment of a receiver to administer the abatement fund. The California Supreme Court declined to review the Court of Appeal’s decision.

Prior to reaching a settlement, the parties continued to litigate issues related to the final judgment and the process through which the defendants would pay for the lead paint clean-up ordered by the courts. The court had restricted expenditure of funds to certain kinds of remediation projects and had imposed a four-year time limit on the use of the funds allotted to abatement with the unused funds being returned to the defendants at the end of the four-year period.

According to a press release issued by the County Counsel for Santa Clara County, the settlement with the three former lead paint manufacturers that was filed with the court gives cities and counties immediate access to abatement funds, ends the threat of further litigation, and provides flexibility to create more expansive, efficient, and effective clean-up programs tailored to the needs of the communities. The agreement also allows the funds to be targeted for intervention services for children with lead poisoning and removes the possibility of unused funds being returned to the defendants.

In a related statement, Sherwin-Williams said that it was "pleased" that an agreement was reached in the matter and further stated that it will "continue to vigorously and aggressively defend against any similar current or future litigation." While maintaining its long-held belief that the litigation was unfair, unwarranted, and unwise, the company opined that the agreement between the parties will enable all to more forward and is in the best interest of the company and its shareholders.

The case is No.2000-1-CV-788657.

Allen J. Ruby (Skadden, Arps, Slate, Meagher & Flom, LLP) for Conagra Grocery Products Co. David C. Kieman (Jones Day) for The Sherwin-Williams Company. James McManis (McManis Faulkner) and Jameson R. Jones (Bartlit Beck Herman Palenchar & Scott, LLP) for NL Industries, Inc. James R. Williams, Office of the County Counsel County of Santa Clara, Joseph W. Cotchett (Cotchett, Pitre & McCarthy, LLP) and Fidelma Fitzpatrick (Motley Rice, LLC) for The People of the State of California.

Companies: The Sherwin-Williams Co.; ConAgra Grocery Products Co. and NL Industries Inc.

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