What is California's Proposition 65 and What Does it Mean to Third-Party Sellers?

California's Proposition 65, officially known as the Safe Drinking Water and Toxic Enforcement Act of 1986, is a law that requires businesses to warn consumers about products that contain chemicals known to the state to cause cancer or reproductive harm. The law applies to all businesses that sell products in California, including third-party sellers on Amazon and Walmart.com.

How do third-party sellers run afoul of Proposition 65's provisions? ​

Third-party sellers can run afoul of Proposition 65's provisions in a number of ways, including:

• Selling products that contain chemicals on the Proposition 65 list without providing a warning label.
• Providing a warning label that is not clear and reasonable.
• Selling products that are exempted from Proposition 65 but do not meet the exemption criteria.

How Attorneys File Proposition 65 Lawsuits on Behalf of "Private Attorney Generals"

Private attorney generals are individuals or organizations that file lawsuits on behalf of the public to enforce environmental laws. Under Proposition 65, private attorney generals can file lawsuits against businesses that violate the law.  Typically, they will file suit against the third-party sales platform, such as Amazon or Walmart, whose contracts with sellers contain an indemnity clause, requiring you to reimburse their attorney's fees as well.  These private attorney generals can be compensated for their efforts in collecting Proposition 65 fines, and their attorney's fees are also collected in the lawsuits.

What Defense Costs and Attorney Fees are Involved Fighting a Prop 65 Lawsuit?

The defense costs and attorney's fees involved in fighting a Proposition 65 lawsuit can be significant. In some cases, these costs can exceed the amount of any potential damages award.  Attorney's fees upward of $25,000 to $50,000 or more are not unusual, and this does not include reimbursing the private attorney general's attorney's fees, which could be even more.

Why is it Better to Settle Proposition 65 Cases Early?

There are a number of reasons why it is better to settle Proposition 65 claims early, including:

• To avoid the risk of a large damages award.
• To avoid the costs and disruption of a lawsuit, which include freezing of funds by the third-party platform, fines, seller's attorney fees, Amazon's or Walmart's attorney fees, and attorney's fees and costs of the private attorney general who brings the lawsuit.
• To protect the seller's reputation.

How Can AMZ Sellers Attorney® Help Sellers Sued for Prop 65?

AMZ Sellers Attorney® can help sellers who find themselves sued for a violation of Proposition 65 by:

• Reviewing the case and assessing the seller's legal risks.
• Developing a defense strategy.
• Negotiating a settlement with the plaintiff.
• Representing the seller in court if necessary.

Key Takeaways

If you are a third-party seller on Amazon or Walmart and you have been sued for a violation of Proposition 65, it is important to contact an experienced attorney immediately. AMZ Sellers Attorney® can help you to protect your rights and interests.