Baxter Healthcare Corp. v. Denton

• Decision Date: 01 July 2004
• Docket Number: No. C043352.,C043352.
• Citation: 120 Cal.App.4th 333,15 Cal.Rptr.3d 430
• Parties: BAXTER HEALTHCARE CORPORATION, Plaintiff and Respondent, v. Joan E. DENTON, as Director, etc., et al., Defendants and Appellants.
• Court: California Court of Appeals Court of Appeals

15 Cal.Rptr.3d 430

120 Cal.App.4th 333

BAXTER HEALTHCARE CORPORATION, Plaintiff and Respondent, v. Joan E. DENTON, as Director, etc., et al., Defendants and Appellants.

No. C043352.

Court of Appeal, Third District.

July 1, 2004.

Review Denied September 29, 2004.^*

Bill Lockyer, Attorney General, Richard M. Frank, Chief Assistant Attorney General, Theodora Berger, Assistant Attorney General, Craig C. Thompson, Susan L. Durbin, Janill L. Richards and Edward G. Weil, Deputy Attorneys General, for Defendants and Appellants.

Adams Nye Sinunu Bruni Becht and Bruce Nye, San Francisco, for Plaintiff and Respondent.

SCOTLAND, P.J.

Under Proposition 65, a business must provide a warning when it exposes the public to a chemical that is on a list of chemicals known to the state to cause cancer in animals. However, a warning is not required if the business can show that the exposure poses no significant risk of causing cancer in humans. (Health & Saf.Code, § 25249.5 et seq.; further section references are to the Health and Safety Code unless otherwise specified.)

Director Joan Denton and the Office of Environmental Health Hazard Assessment (collectively OEHHA), which is the lead agency charged with implementing Proposition 65, appeal from the superior court's judgment declaring that a chemical plasticizer contained in medical devices manufactured by Baxter Healthcare Corporation (Baxter) poses no significant risk of causing cancer in humans and, therefore, Baxter need not provide the warning of carcinogenicity required by Proposition 65.

OEHHA raises various procedural challenges to the superior court's ruling and also claims the decision is not supported by substantial evidence. We shall affirm the judgment.

As we will explain, Proposition 65 does not preclude a business from bringing a declaratory relief action under Code of Civil Procedure section 1060 to obtain a declaration that the business is exempt from the initiative's warning requirement. Because an actual controversy existed between Baxter and OEHHA about the carcinogenic effects of a chemical in Baxter's products, Baxter was faced with a Hobson's choice. Even though Baxter could demonstrate that its products do not pose a significant risk of causing cancer in humans, it had to provide a stigmatizing warning to the contrary — which could dissuade the public from using its products — or risk having to defend itself against being slapped with an injunction and costly civil penalties. To extract itself from this no-win situation, it was necessary and appropriate for Baxter to obtain a declaration of its rights and obligations under Proposition 65. In order to obtain relief, Baxter had the burden of proving by a preponderance of the evidence that the chemical in its products poses no significant risk of causing cancer in humans. Substantial evidence supports the superior court's finding that Baxter carried its burden by proving that the biological mechanism via which the chemical causes liver cancer in rats and mice does not exist in humans and, thus, the International Agency for Research on Cancer has reclassified the chemical from "possibly carcinogenic to humans" to "not classifiable as to its carcinogenicity to humans." Since Baxter established that the chemical poses no significant risk of causing cancer in humans, it was entitled to a judgment declaring that it was exempt from the Proposition 65 warning requirement.

STATUTORY BACKGROUND

In 1986, California's voters passed Proposition 65, the Safe Drinking Water and Toxic Enforcement Act of 1986 (the Act), which is codified in sections 25249.5 through 25249.13. The Act is designed to protect Californians from carcinogens and reproductive toxins. (AFL-CIO v. Deukmejian (1989) 212 Cal.App.3d 425, 430-431, 260 Cal.Rptr. 479.) It does so by requiring businesses to give clear and reasonable warnings before exposing the public to a chemical that is on a comprehensive list of chemicals "known to the state to cause cancer or reproductive toxicity," unless a specified statutory exemption applies. (§ 25249.6.)¹ A business violating or threatening to violate the warning requirement may be enjoined in any court of competent jurisdiction and shall be liable for civil penalties. (§ 25249.7, subds.(a), (b).)

The identification and listing of chemicals known to the state to cause cancer or reproductive toxicity is "pivotal to the entire statutory scheme." (AFL-CIO v. Deukmejian, supra, 212 Cal.App.3d at p. 431, 260 Cal.Rptr. 479.) At a minimum, the list, which is published by the Governor on an annual basis, must include substances identified in Labor Code section 6382. (§ 25249.8, subd. (a).) In addition, a chemical must be listed if (1) the state's qualified experts are of the opinion that scientifically valid testing has clearly shown that the chemical causes cancer or reproductive toxicity; (2) a body considered to be authoritative by such experts has formally identified the chemical as causing cancer or reproductive toxicity; or (3) a state or federal government agency has formally required that the chemical be labeled or identified as causing cancer or reproductive toxicity. (§ 25249.8, subds.(a), (b).)

The list must include not only those chemicals that are known to cause cancer in humans, but also those that are known to cause cancer in experimental animals. (AFL-CIO v. Deukmejian, supra, 212 Cal.App.3d at pp. 436, 438, fn. 7, 260 Cal.Rptr. 479.) There is a "broad scientific acceptance of the inference that carcinogenicity in other animals means carcinogenicity in humans." (Western Crop Protection Assn. v. Davis (2000) 80 Cal.App.4th 741, 749, 95 Cal.Rptr.2d 631; see also AFL-CIO v. Deukmejian, supra, 212 Cal.App.3d at p. 438, fn. 7, 260 Cal.Rptr. 479.) And data confirming human carcinogenicity (from epidemiological studies, case reports, and studies on isolated human cells or human tissue) may not exist and may be difficult or impossible to obtain given that it is unethical to test humans. (AFL-CIO v. Deukmejian, supra, 212 Cal.App.3d at p. 438, fn. 7, 260 Cal.Rptr. 479.) "[B]ecause of the 20- to 30-year latency period of many human cancers, epidemiological studies do not adequately warn humans and protect them from the risk of exposure to new carcinogens. [Citation.]" (Ibid.) Therefore, it is prudent to control exposure to chemicals known to cause cancer in animals as if they had demonstrated effects in humans. (Ibid.)

The Governor has designated OEHHA as the lead agency charged with implementing Proposition 65. In this role, OEHHA has the authority to adopt or modify regulations and standards necessary to carry out the Act.² (§ 25249.12; People ex rel. Lungren v. Superior Court (1996) 14 Cal.4th 294, 310, fn. 6, 58 Cal.Rptr.2d 855, 926 P.2d 1042; Cal.Code Regs., tit. 22, § 12102, subd. (o); future references to Regulations are to title 22 of the California Code of Regulations.)

Within OEHHA, there are two committees of the Science Advisory Board — the Carcinogen Identification Committee and the Developmental and Reproductive Toxicant (DART) Identification Committee—which are the "State's qualified experts" who advise and assist the Governor and the Director of OEHHA in the implementation of section 25249.8 by rendering opinions regarding whether a chemical has been clearly shown to cause cancer or reproductive toxicity. (Regs., §§ 12102, subds.(c),(t), 12302, subd. (a), 12305, subds. (a), (b).)

Although OEHHA is responsible for implementing the Act, actions to enforce it are brought by California's Attorney General, any district attorney, certain city attorneys, or a city prosecutor with the consent of the district attorney. (§ 25249.7, subd. (c).) If the aforementioned officials fail to take any action despite notice of an alleged violation, any person may bring an enforcement action in the public interest. (§ 25249.7, subd. (d).)

Under certain circumstances, exposures to listed chemicals are exempt from the warning requirement of section 25249.6. As relevant to the present case, section 25249.10 states that "[s]ection 25249.6 shall not apply to any of the following: [¶] ... [¶] (c) An exposure for which the person responsible can show that the exposure poses no significant risk assuming lifetime exposure at the level in question for substances known to the state to cause cancer ... based on evidence and standards of comparable scientific validity to the evidence and standards which form the scientific basis for the listing of such chemical pursuant to subdivision (a) of Section 25249.8. In any action brought to enforce Section 25249.6, the burden of showing that an exposure meets the criteria of this subdivision shall be on the defendant."

OEHHA has adopted regulations establishing exposure levels at which specific listed chemicals are deemed to pose no significant risk for purposes of section 25249.10, subdivision (c). (Regs., §§ 12701, subd. (d), 12705.) An exposure level representing "no significant risk" is "one which is calculated to result in one excess case of cancer in an exposed population of 100,000, assuming lifetime exposure at the level in question...." (Regs., § 12703, subd. (b).) A no significant risk level generally is determined via a quantitative risk assessment "based on evidence and standards of comparable scientific validity to the evidence and standards which form the scientific basis for listing the chemical as known to the state to cause cancer." (Regs., §§ 12703, subd. (a), 12705, subd. (b).) But another regulation promulgated by OEHHA states: "Nothing in this article shall preclude a person from using evidence, standards, risk assessment methodologies, principles, assumptions or levels not described in this article to establish that a level of exposure to a listed chemical poses no significant risk." (Regs., § 12701, subd. (a).)

Any interested person may ask OEHHA to issue an interpretive guideline concerning any subject related to the Act, which may be treated by...