Defense Lawyers Say Prop. 37 Will Bring Bumper Crop of Litigation

SACRAMENTO — With recent polling suggesting Californians want labels on genetically modified food, defense attorneys warn that an upcoming ballot initiative could generate a bumper crop of litigation.

Proposition 37, also known as the Right to Know Genetically Engineered Food Act, would require labels on edibles containing ingredients whose DNA was tweaked to increase yield, to fight off disease or f or any other reason. If voters approve the initiative in November, California would become the first state in the nation to employ such a far-reaching consumer alert system.

Proponents say their measure has a simple rationale: Californians should know what’s in the food they buy and eat. But legal critics say compliance would be a far more complex task. And they point to an enforcement provision authorizing private consumer lawsuits, something defense lawyers compare less than flatteringly to Prop 65, the 1986 law that requires businesses to warn consumers about chemicals they use

“When I used to go and talk about Prop 65 when it was on the ballot, I would say the biggest beneficiaries would be lawyers. I think that goes double for Prop 37,” said Michele Corash, a environmental defense pa rtner with Morrison & Foerster.

James Wheaton, the Oakland attorney who helped draft Prop 37, said such claims amount to scare tactics.

Comparing Propositions 65 and 37 “is like comparing apples and hot dogs,” Wheaton said. “Both food, but [then] no resemblance.”

The Prop 37 campaign is shaping up into a multimillion-dollar battle between a team of grocers and food science companies like Monsanto and DuPont and a coalition of organic growers and natural food activists. Legal arguments surrounding the measure have generally taken a backseat to public talk about the contents of tomatoes and toasted oats.

But defense attorneys say the measure’s impacts could be sweeping.

“Go into a grocery store. That is the landscape that is available,” sai d Thomas Hiltachk, the managing partner of Bell, McAndrews & Hiltachk who’s working on the campaign to defeat Prop 37.

The initiative exempts a range of products from the labeling requirement, including meats from animals that ate genetically modified feed, alcohol and restaurant-served meals. Retailers and others in the food-supply chain could also shield themselves from fail-to-label lawsuits by providing sworn statements from producers indicating that the item wasn’t knowingly or intentionally altered.

That’s a potential record-keeping nightmare, Hiltachk said. What’s more, he said, many retailers will feel pressured to settle claims when threatened with litigation.

“It’s in my mind unquestionably g oing to happen because it already happens every day in California,” Hiltachk said. “And Prop 37 creates an entirely new opportunity for that to occur.”

Hiltachk and others in the defense bar cast a wary eye toward Wheaton, who is legal director of the Oakland-based Environmental Law Foundation. The organization has filed a number of Prop 65 lawsuits and secured two settlements totaling $660,000 last year, according to the attorney general’s office.
Wheaton said he wasn’t the principal author of Prop 37 and, in fact, wasn’t brought into the process until late in the drafting. He is listed as the official proponent, “but only as a conduit,” he said, for a diverse group of campaigners who wanted a single registered California voter for the job.

The measure authorizes shoppers to sue under the Consumer Legal Remedies Act, which doesn’t require plaintiffs to show that they suffered any damages. Wheaton defended the initiative’s use of the CLRA, not as a dodge of the plaintiff restrictions in California’s Unfair Competition Law as critics have alleged, but as a better mechanism for enforcing the law.

“The CLRA was written to deal with the precise situation here, where hundreds or thousands of consumers each are duped in a small way to a cheater’s large benefit,” Wheaton said.

Backers say the public has little reason to worry the measure will unleash a wave of lawsuits, as critics complain Prop 65 has done. In fact, the Yes on 37 campaign commissioned a study comparing the two initiatives.

James Cooper, an adjunct professor at Virginia-based George Mason University School of Law, concluded that Prop 37 would cover a smaller number of products than Prop 65. And it would provide more legal protections to defendants, he said.

&quo t;Accordingly, there is reason to believe that these important differences substantially reduce the potential for [Proposition 37] to foster the type of abusive private litigation associated with Proposition 65,” Cooper wrote.

Hiltachk said Cooper underestimated the potential reach of Prop 37. Almost all U.S.-grown corn and soybeans, which comprise the base ingredient in many products, are genetically engineered. In its study of Prop 37, California’s legislative analyst cited estimates that 40 to 70 percent of food sold in the state contains some genetically modified ingredients.

A July poll of 800 likely voters conducted by the California Business Roundtable and Pepperdine University found that almost 65 percent of respondents supported Prop 37.

Reprinted from The Recorder (July 27, 2012)