County of Santa Clara v. Atlantic Richfield Co.
137 Cal. App. 4th 292, 2006 Daily Journal DAR 2596, 40 Cal. Rptr. 3d 313 (2006)
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Rule of Law:
A manufacturer's affirmative and knowing promotion of a product for a hazardous use can give rise to liability for creating a public nuisance, a cause of action distinct from products liability that can be used by the government to seek abatement of the hazard.
Facts:
- For nearly a century, a group of lead manufacturers knew about the health dangers associated with lead paint.
- Despite this knowledge, the manufacturers promoted lead paint for interior use in homes, public buildings, and on furniture and toys, claiming that it was safe.
- The manufacturers engaged in a pattern of deceit and misinformation, undertaking a concerted effort to hide the dangers of lead from the government and the public.
- The manufacturers actively opposed government efforts to regulate lead, require warnings about its hazards, and combat lead poisoning.
- The lead paint promoted and sold by the manufacturers has deteriorated or is deteriorating, contaminating homes and buildings and creating a widespread public health hazard.
Procedural Posture:
- The County of Santa Clara and other governmental entities (plaintiffs) filed a class action lawsuit against a group of lead manufacturers (defendants) in the superior court (trial court).
- Plaintiffs filed several amended complaints, alleging causes of action including strict liability, negligence, fraud, and public nuisance.
- Defendants filed a demurrer to the public nuisance cause of action in the third amended complaint.
- The superior court sustained the defendants' demurrer without leave to amend, effectively dismissing the public nuisance claim.
- The superior court denied plaintiffs' subsequent request for leave to file a fourth amended complaint to add a cause of action for continuing trespass.
- Defendants then moved for summary judgment on the remaining causes of action (fraud, strict liability, negligence), arguing they were barred by the statute of limitations.
- The superior court granted the defendants' motion for summary judgment and entered a judgment of dismissal against the plaintiffs.
- Plaintiffs, as appellants, appealed the trial court's dismissal to the California Court of Appeal.
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Issue:
Does a manufacturer create a public nuisance for which it can be held liable for abatement when it affirmatively promotes a product for a hazardous use with knowledge of the danger, even if the harm could also be addressed through a products liability claim?
Opinions:
Majority - Mihara, J.
Yes. Liability for public nuisance can be premised on a manufacturer's affirmative promotion of a product for a hazardous use with knowledge of the danger it would create. This conduct is distinct from merely producing a defective product, and a representative public nuisance action seeking abatement is not a disguised products liability claim. The critical question for nuisance liability is whether the defendant created or assisted in the creation of the nuisance. Here, the governmental entities adequately alleged that the manufacturers assisted in creating the nuisance by concealing lead's dangers and mounting a campaign to promote its interior use despite knowing it was hazardous. Unlike a products liability claim, which requires a plaintiff to have already suffered physical injury and seeks damages, a public nuisance action for abatement can provide relief before physical injury occurs to prevent future harm from a widespread public health hazard.
Concurring - McAdams, J.
Yes. The concurring opinion agrees that the governmental entities stated a cause of action for public nuisance based on the manufacturers' affirmative promotion of a hazardous product use. However, the concurrence disagrees with the majority's implication that a public nuisance action for abatement could never be based on the mere manufacture and distribution of a widely recognized hazardous product. Justice McAdams suggests that where a product is a 'ticking time bomb' posing a significant and imminent risk, a public entity should be able to seek abatement even without the additional element of deceptive promotional conduct, as the public should not have to wait for destructive results before taking action.
Analysis:
This decision is significant for public health litigation because it affirms that the common law of public nuisance can be a viable tool against manufacturers for the harms caused by their products, separate from traditional products liability law. By focusing on the manufacturers' affirmative and deceptive promotional conduct, the court carved out a path for holding companies responsible for creating widespread health crises, even decades after the products were sold. This ruling distinguishes between seeking damages for a defective product (products liability) and seeking abatement to remove a widespread public hazard (public nuisance), empowering governmental entities to pursue cleanup remedies for legacy environmental and health problems like lead paint.
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