Companies to test counties’ large lead paint verdict in appellate court

SAN JOSE — A 17-year quest by seven counties and three cities in California to hold former manufacturers of lead pigment liable for public nuisance because of paint in the interior of more than 3 million homes will continue Thursday with arguments in the 6th District Court of Appeal.

Three defendants — ConAgra Grocery Products Co., NL Industries Inc. and The Sherwin-Williams Co. — are appealing a $1.15 billion judgment against them that Santa Clara County Superior Court Judge James P. Kleinberg handed down in 2013. County of Santa Clara v. Atlantic Richfield Co. et. al., 1-00-CV788657 (Santa Clara Super. Ct., filed March 23, 2000).

In a 111-page decision, Kleinberg found not only that lead-based paint caused a harm but that the defendants had knowledge of such harm in the early 20th century and continued to promote the paint’s use inside of homes anyway. The result, he wrote, was “an enormous public health hazard.”

Kleinberg ordered the creation of a $1.15 billion fund to be administered by the state or the local entities to abate lead paint in homes.

The judge, however, also dismissed the case against two defendants: Atlantic Richfield Co. and E.I. DuPont de Nemours.

In addition to Santa Clara County, the plaintiffs are the counties of Alameda, Los Angeles, Monterey, San Mateo, Solano and Ventura and the cities of Oakland, San Francisco and San Diego.

The plaintiffs argue in their brief to the 6th District that the three remaining defendants must marshal all of the evidence in the trial record “and affirmatively demonstrate its insufficiency to sustain the challenged finding.”

Instead, the plaintiffs wrote, “Defendants disregard these fundamental principles. They barely acknowledge the court’s findings … Because of these and other glaring omissions in their recitation of the facts, Defendants have waived any challenge to the sufficiency of the evidence.”

Danny Y. Chou, the Santa Clara County deputy county counsel leading the plaintiffs’ case, said there was more than enough evidence for Kleinberg to rule as he did.

“There’s ample evidence in the record of defendants promoting use of lead paint in homes,” Chou wrote. “They spent decades creating a market for lead paint. To think that people would just stop using it defies common sense.”

The defendants argue, however, that not only the evidence but the law is against Kleinberg’s decision.

In a 2006 decision in the case, the 6th District ruled that, to prove a public nuisance, the counties and cities must show that the companies affirmatively promoted lead pigments for use in interior residential paint while knowing that such use would create a public health hazard.

In one of its briefs, Sherwin-Williams notes that the appellate court instructed the trial court to follow a standard “distinct from and far more egregious than simply producing a defective product or failing to warn of a defective product.” It required proof of “affirmative” promotion, quite similar to an instruction, for a known hazardous use.

Tony Dias, a Jones Day attorney representing Sherwin-Williams, said plaintiffs fell short of that standard.

“While there was a lot of efforts of showing advertising to demonstrate promotion, they categorically failed to show how any of these companies promoted the use of lead paint at that time,” he said. “There wasn’t a single Sherwin-Williams advertisement showing we promoted white lead pigment. Their historian was unaware of any Sherwin-Williams advertisement.

“It is crystal clear that they simply did not meet the burden that the 6th District put into place,” he added.

ConAgra argued in one of its briefs that not only was the evidence insufficient to show such promotion and knowledge, but, “On remand, the trial court applied the wrong legal standard. It departed from this Court’s knowing promotion standard to impose liability based on modern scientific hypotheses that emerged decades after defendants’ conduct.”

Company lawyers further argued that the plaintiffs presented evidence about an earlier company, W.P. Fuller, without proving that ConAgra was a successor to Fuller — thus breaking the link in the alleged chain of liability.

Chou countered, “We presented evidence of chain of liability going back to Fuller, and they didn’t present anything to dispute it.”

The defendants also contend that Kleinberg’s remedy — creation of the $1.15 billion fund to remediate lead paint in homes — was judicial overreach, creating public policy that is the province of the state Legislature.

“The fact is, the public health program designed by the state has been very effective,” Dias said. “But here you have a trial court substituting its own view on how to address a public nuisance that plaintiffs say exists. Millions of property owners across California have just had their homes declared a public nuisance by a judge in Santa Clara.”

In addition, he said the worst properties, owned by the most lax landlords, benefit first.

“Some people have called it the slumlord protection program,” Dias said.

Chou disagreed, noting that the state Supreme Court, when it ruled in the case on another issue, noted that this type of remedy would be available.

“I’m not sure there’s a more efficient way of cleaning up the contamination the defendants have created,” Chou said.