Judge: Christopher K. Lui, Case: 24STCV09608, Date: 2025-02-11 Tentative Ruling

Case Number: 24STCV09608    Hearing Date: February 11, 2025    Dept: 76

            Plaintiff alleges that Defendants manufacture or supply a clutch and a wallet that contains Diisononyl phthalate (DINP), the principal exposure routes of which are dermal contact  and ingestion, and Defendants have not provided a Proposition 65 warning to consumers.

            Defendants Signal Brands, LLC, Ross Stores, Inc. and Guess?, Inc. demur to the First Amended Complaint and moves to strike portions thereof.

TENTATIVE RULING

Defendants Signal Brands, LLC, Ross Stores, Inc. and Guess?, Inc.’s demurrer to the First Amended Complaint is SUSTAINED without leave to amend as to the first and second causes of action. 

However, Plaintiff may file a new lawsuit if the Consent Judgment is amended in a way which would negate res judicata effect upon the new lawsuit, and if Plaintiff strictly complies with the pre-lawsuit notice requirements of 27 CCR 25903.

Given the ruling on the demurrer, the motion to strike is MOOT.

ANALYSIS

Demurrer

Request For Judicial Notice

            Plaintiff requests that the Court take judicial notice of the Order Denying Defendant Buckner By Storm’s Motion For Judgment on the Pleadings, dated November 12, 2002, in As You Sow v. Conbraco Industries., et al. (Case No. 400568, Superior Court of the State of California County of San Francisco).

            The request is DENIED. This is a superior court ruling which has no precedential effect and is thus irrelevant to this Court’s determination. The Court need only take judicial notice of relevant materials. (Mangini v. R.J. Reynolds Tobacco Co. (1994) 7 Cal.4th 1057, 1063, overruled in part on other grounds noted in In re Tobacco Cases II (2007) 41 Cal.4th 1257, 1276.) The Court may deny a request for judicial notice of material unnecessary to its decision. (Rivera v. First DataBank, Inc. (2010) 187 Cal.App.4th 709, 713.)

            Defendants’ objection to this request is SUSTAINED.

Defendants’ Evidentiary Objections

No. 1: SUSTAINED. Superior Court rulings have no precedential effect and are thus irrelevant to this Court’s determination.

No. 2: SUSTAINED. See above at 1.

No. 3: SUSTAINED. See above at 1.

No. 4: OVERRULED. This is just attorney argument.

Meet and Confer

            The Declaration of Susan Allison reflects that Defendant’s counsel satisfied the meet and confer requirement set forth in Civ. Proc. Code, § 430.41.

Discussion

Defendants Signal Brands, LLC, Ross Stores, Inc. and Guess?, Inc. demur to the First Amended Complaint as follows:

1.         First Cause of Action (Violations of Proposition 65 against Signal Brands, LLC and Guess? Inc.) and Second Cause of Action (Violations of Proposition 65 Signal Brands, LLC and Ross Stores, Inc.)

            Defendants argue that these causes of action are barred by res judicata in that each of the Defendants is covered and bound by the terms of an Amended Consent Judgment entered on May 14, 2024 in the action entitled, CA Citizen Protection Group, LLC v. Signal Products, Inc., et al, Case No. 23CV030099. Defendants argue that, by its terms, the Consent Judgment constitutes a “full, final, and binding resolution” with respect to the specific Proposition 65 violations alleged against Defendants in this action relating to Defendants’ alleged failure to provide compliant Proposition 65 warnings relating to the exposure of Californians to the identical chemical contained in the same products at issue in this action, namely, a Clutch and a Wallet (the “Covered Products”).  

Defendants argue that the Consent Judgment issued broad injunctive relief and civil penalties expressly in the public interest and expressly applicable to the Defendants, thereby imposing the same relief that Plaintiff seeks in this case, relating to the same Covered Products. Thus, Plaintiff’s attempt to re-litigate the identical issues fully resolved by the Consent Judgment is barred by res judicata, and Plaintiff has not alleged that any of the Defendants is in violation of the Consent Judgment. 

            Defendants argue that the new allegations adding in the First Amended Complaint regarding a pre-suit notice of violation that did not specifically include the clutch or wallet do not change this result because even an erroneous judgment has res judicata effect.

            Defendants also argue that Plaintiff’s pre-lawsuit notice in this action is defective because it did not include the name, address, and telephone number of the noticing individual or a responsible individual within the noticing entity as required by 27 CCR § 25903(b)(2)(A)(1), which provides:

(a) For purposes of Section 25249.7(d) of the Act, “notice of the violation which is the subject of the action” (hereinafter “notice”) shall mean a notice meeting all requirements of this section. No person shall commence an action to enforce the provisions of the Act “in the public interest” pursuant to Section 25249.7(d) of the Act except in compliance with all requirements of this section.

. . .

(b) Contents of Notice.

. . .

(2) Description of Violation. A notice shall provide adequate information from which to allow the recipient to assess the nature of the alleged violation, as set forth in this paragraph. The provisions of this paragraph shall not be interpreted to require more than reasonably clear information, expressed in terms of common usage and understanding, on each of the indicated topics.

(A) For all notices, the notice shall identify:

(1) the name, address, and telephone number of the noticing individual or a responsible individual within the noticing entity and the name of the entity;

(2) the name of the alleged violator or violators;

(3) the approximate time period during which the violation is alleged to have occurred; and

(4) the name of each listed chemical involved in the alleged violation;

     (27 CCR 25903(a) & (b) [bold emphasis and underlining added].)

            Plaintiff argues: The Complaint filed in the CCPG Action in which the Consent Judgment was entered makes no mention of the products at issue in this case. Moreover, in purporting to exhaust its remedies, CCPG’s Proposition 65 60-day notice dated September 2, 2022, upon which the CCPG Action is premised (the “September 2022 Notice”) also makes no mention of the product at issue in this case. The product in this case and the products in that case are entirely different and distinct. The law is clear that a Proposition 65 notice and Complaint identifying the product at issue are absolute requirements for res judicata to apply.

            Plaintiff’s argument relies upon evidence extrinsic to the Complaint as to which the Court has denied taking judicial notice. Further, Plaintiff relied upon a San Francisco County Superior Court ruling on a motion for judgment on the pleadings in, As You Sow v. Conbraco Indus., for the proposition that res judicata can only be applied to the precise allegations in the notice and complaint regardless of the language in the consent judgment. However, this ruling has no precedential effect, and will not treated as such.

            In this regard, the Consent Judgment purports to apply to the products alleged in the operative Complaint in this action. The Consent Judgment applies to the following “Covered Products”:

 1. Guess ?, Inc. or ‘‘Guess” branded cosmetic bags sold, manufactured. imported or distributed by either of the Defendants (“Cosmetic Bags”):

2. Guess ?, Inc. or “Guess’’ branded clutches sold. manufactured, imported or distributed by either of the Defendants (‘‘Clutches”); and

3. Guess ?. Inc., ..Guess” or ‘‘Nine West” branded wallets sold, manufactured. imported or distributed by either of the Defendants ( .. Wallets”).

These are the products alleged at ¶¶ 25 – 30 and ¶¶ 36 – 41 of the Complaint in this action. This lawsuit would appear to be barred by res judicata because the elements of res judicata are satisfied:

The doctrine [of res judicata] is applicable “if (1) the decision in the prior proceeding is final and on the merits; (2) the present proceeding is on the same cause of action as the prior proceeding; and (3) the parties in the present proceeding or parties in privity with them were parties to the prior proceeding.” (Citation omitted.) “[R]es judicata will not be applied ‘if injustice would result or if the public interest requires that relitigation not be foreclosed.’ “ (Citation omitted.)

(Villacres v. ABM Industries Inc. (2010) 189 Cal.App.4th 562, 577.)

“If all the facts necessary to show that an action is barred by res judicata are within the complaint or subject to judicial notice, a trial court may properly sustain a general demurrer. [Citation.]” ( Frommhagen v. Board of Supervisors (1987) 197 Cal. App. 3d 1292, 1299 [243 Cal. Rptr. 390].)” (Henry v. Clifford (1995) 32 Cal.App.4th 315, 320.)

(1)       The decision in the prior proceeding is final and on the merits;

The Amended Consent Judgment was entered on May 14, 2024. (1AC, Exh. E.) The time to appeal has expired.

[I]n California the rule is that the finality required to invoke the preclusive bar of res judicata is not achieved until an appeal from the trial court judgment has been exhausted or the time to appeal has expired. (Producers Dairy Delivery Co. v. Sentry Ins. Co. (1986) 41 Cal. 3d 903, 910-911 [226 Cal. Rptr. 558, 718 P.2d 920].)  For res judicata purposes, the judgment sought to be invoked in bar must be “ ‘the “last word” of the rendering court--a “final” judgment.’ “ ( Sandoval v. Superior Court (1983) 140 Cal. App. 3d 932, 936 [190 Cal. Rptr. 29], italics omitted; see also Rest.2d Judgments, § 13, com. a, p. 132 [for finality purposes “the judgment must ordinarily be a firm and stable one . . . .”].)

(Franklin & Franklin v. 7-Eleven Owners for Fair Franchising (2000) 85 Cal.App.4th 1168, 1174)

(2)       The present proceeding is on the same cause of action as the prior proceeding;

            The Consent Judgment applies to the following “Covered Products”:

1. Guess ? , Inc. or “Guess” branded cosmetic bags sold, manufactured, imported or distributed by either of the Defendants (“Cosmetic Bags”);

2. Guess?, Inc. or “Guess” branded clutches sold, manufactured, imported or distributed by either of the Defendants (“Clutches”); and

3. Guess?, Inc., “Guess” or “Nine West” branded wallets sold, manufactured, imported or distributed by either of the Defendants (“Wallets”).and (3) the parties in the present proceeding or parties in privity with them were parties to the prior proceeding.”

WHEREAS, CCPG alleged in the Notice that persons in the State of California were exposed to Diisononyl Phthalate (“DINP”) in the Covered Products without being provided the Proposition 65 warning set out at California Health and Safety Code§ 25249.6 and its implementing regulations (“Proposition 65 Warning”);

     (1AC, Exh. E; Amended Consent Judgment, Page 2:15 – 24.)

            The products which are the subject of the instant lawsuit are set forth at ¶¶ 25, 26 as follows:

25. On June 7, 2022, Plaintiff served a Proposition 65 60-day notice of violation to Defendant Signal Brands, LLC, and Guess?, Inc., alleging Proposition 65 violations arising from a “clutch,” UPC No. 190231622918 (“Clutch Notice”). Attached hereto is the Clutch Notice as Exhibit A.

26. On June 13, 2022, Plaintiff served a second Proposition 65 60-day notice of violation to Defendant Signal Brands, LLC, and Ross Stores, Inc., alleging Proposition 65 violations arising from a “Nine West Wallet,” UPC No. 193314092066 (“Wallet Notice”). Attached hereto is the Wallet Notice as Exhibit B.

            The cause of action is based on the following allegation:

41. Plaintiff is informed, believes, and thereon alleges that between May 8, 2020[1],  the present, Defendant knowingly and intentionally exposed California consumers and users of the Clutch, which Defendant manufactured, distributed, or sold as mentioned above, to DINP, without first providing any type of clear and reasonable warning of such to the exposed persons before the time of exposure. Defendant has distributed and sold the Clutch in California.  Defendant knows and intends that California consumers will use and consume the Clutch, thereby exposing them to DINP.  Defendant thereby violated Proposition 65.  

     (1AC, ¶ 41.)

            As such, the cause of action asserting in the 1AC are based on the same cause of action resolved in the Amended Consent Judgment.

(3)  The parties in the present proceeding or parties in privity with them were parties to the prior proceeding.

Plaintiff brings this action in the following capacity:

1. Plaintiff, CONSUMER PROTECTION GROUP LLC (“Plaintiff” or “CPG”), is an organization qualified to do business in the State of California.  CPG is a person within the meaning of Health and Safety Code section 25249.11, subdivision (a).  CPG, acting as a private attorney general, brings this action in the public interest as defined under Health and Safety Code section 25249.7, subdivision (d).

     (1AC, ¶ 1.)

The 1AC names the following Defendants:

2. Defendant, SIGNAL BRANDS, LLC (“Defendant” or “SIGNAL BRANDS”) is a California Corporation and doing business in the State of California at all relevant times herein.

3. Defendant, ROSS STORES, INC (“Defendant” or “ROSS”) is a Delaware Corporation, doing business in the State of California at all relevant times herein.

4. Defendant, GUESS?, INC. (“Defendant” or “GUESS”) is a Delaware Corporation, doing business in the State of California at all relevant times herein.

     (1AC, ¶¶ 2 – 4.)

By that same token, in 23CV030099, CA Citizen Protection Group, LLC v. Signal Products, Inc., et al., Plaintiff Citizen Protection Group, LLC alleged that it brought the:

[A}ction in the interests of the general public pursuant to California’s Safe

Drinking Water and Toxic Enforcement Act of 1986, codified as Cal. Health & Safety Code (“HSC”) § 25249.5 et seq. and related statutes (also known and referred to herein as  “Proposition 65”) and, based on information and belief, hereby alleges:

THE PARTIES

. . .

2. Plaintiff is a person within the meaning of HSC § 25249.1 l(a) and brings

this enforcement action in the public interest pursuant to HSC § 25249.7(d).

(1AC, Exh. D; 23CV030099, CA Citizen Protection Group, LLC v. Signal Products, Inc., et al., County of Alameda Superior Court.)

As such, both Plaintiffs brought the action as private attorneys general pursuant to Health & Safety Code § 25249.7(d), on behalf of the public interest. As such, the general public was represented by private attorneys general in both actions.

All elements of res judicata are present.

Plaintiff argues that CCPG did not provide statutory notice to the Attorney General alleging violations related to Plaintiff’s Clutch and Wallet Notices. (FAC, Exh. C and G). The first time CCPG referred to the Clutch and Wallet that are at issue here was in the amended consent judgment. (FAC, Exh. E) But, as the Court in Consumer Defense Group held, under Proposition 65, notice is not sufficient when it is given for the first time in a settlement or consent judgment.(Consumer Defense Group v. Rental Housing Industry Members (2009) 137 Cal.App.4th 1185, 1209.)

However, Consumer Defense Group involved an appeal from the case in which the consent judgment was entered, and the appellate court ordered that those consent judgments be reversed and the cases dismissed. The instant case involves a different lawsuit vis-à-vis a consent judgment which Plaintiff alleges was erroneously entered due to insufficient pre-lawsuit notice that action. As Defendants point out, an erroneous judgment has res judicata effect, and the defective notice requirement should have been raised before the consent judgment was entered:

CAG first seeks to distinguish the primary right in this case by arguing that “[t]he CAG action included 63 sites of violations distinct from those cited in the CBE action.” This assertion is premised on CBE’s settlement having been invalid as to the overlapping sites. As we explained in our discussion of exclusive concurrent jurisdiction, this court does not intend to perform a collateral review of the final judgment in the suit between CBE and  [*687]  ExxonMobil.  In any event,  “‘[a]n erroneous judgment is as conclusive as a correct one’” for the purpose of claim preclusion. (Busick v. Workmen’s Comp. Appeals Bd., supra, 7 Cal.3d at p. 975.) The settlement approved by the San Francisco court resolved CBE’s claims as to all of the sites in CBE’s eighth amended complaint. CAG admits that CBE’s final complaint incorporated all of the sites at issue in the CAG action. We conclude that the primary right at issue in this case cannot be distinguished from the primary right at issue in the CBE action on the basis of the sites being litigated.

(Consumer Advocacy Group, Inc. v. ExxonMobil Corp. (2008) 168 Cal. App. 4th 675, 686-687 [bold emphasis added].)

In addition to its argument based on exclusive concurrent jurisdiction, CAG also argues that the settlement is invalid as to the overlapping sites because CBE’s intent to sue notices for those sites did not comply with the requirements of Proposition 65. The notice requirements under Proposition 65 are intended to give notice to potential defendants, as well as giving public prosecutors such as the Attorney General the opportunity to file suit themselves. (§ 25249.7, subd. (d)(1).) CAG is neither a defendant nor a public prosecutor and is not entitled to notice under this provision. Thus, even if the Proposition 65 notice requirements were violated, a question on which we express no opinion, CAG has not shown that it has standing to complain of the violation. These questions should have been raised before the judgment in the CBE action became final; we decline to address them on collateral review.

(Consumer Advocacy Group, Inc. v. ExxonMobil Corp. (2008) 168 Cal. App. 4th 675, 687 n.4 [bold emphasis added].)

            In any event, if there are grounds to set aside or amend the consent judgment, the forum to hear a request for relief is in the other action, not this one. Plaintiff admits at Page 7 of the Opposition that “[a]s of the date of this opposition, the Consent Judgment has not been amended in the CCPG Action to exclude the unnoticed products,” citing at foot note 2, Page 8, the underlying action of CA Citizen Protection Group, LLC v. Signal Products, Inc., et. al – 23CV030099, Superior Court of Alameda County.

            Unless and until the Consent Judgment is so amended, it will operate as res judicata as to the instant action.  The fact that the Attorney General claims the Consent Judgment is not valid (1AC, Exh. G) is not dispositive, the Attorney General cannot declare a judgment invalid and unenforceable—only a court can do that.  And as noted, this Court cannot do so.

            As for Defendants’ argument that Plaintiff’s pre-lawsuit notice in this action is defective because it did not include the name, address, and telephone number of the noticing individual or a responsible individual within the noticing entity as required by 27 CCR § 25903(b)(2)(A)(1), the Court finds that listing an attorney representing the noticing entity does not satisfy this requirement. (See 1AC, Exh. A.)

An attorney acting on behalf of the noticing entity is acting as its agent, but the Legislature did not allow an attorney or an agent to be listed (unless, presumably, it is in-house counsel). Rather, the contract information of a noticing individual or responsible individual “within,” not “on behalf of,” the noticing entity must be included in the notice. It appears this requirement would ensure that there is an actual Plaintiff who has taken responsibility for testing the product at issue, with hands on knowledge of the violation with whom the Attorney General’s office can work with in an investigation.

Thus, if the insufficiency of the notice cannot be a reason for the trial court to reject a settlement, then the investigation requirement could easily be circumvented. Would-be private enforcers could easily overwhelm the Attorney General’s office with a torrent of notices, and by the time the office got a handle on whether there was anything that actually needed investigation or remediation, the enforcers would have already negotiated, Trevor-Law Group style, a myriad of settlements that would then, at least under Graham &  [*1209]  Martin and the trade group’s theory, be untouchable. (See also DiPirro v. American Isuzu Motors, Inc. (2004) 119 Cal.App.4th 966, 975 [14 Cal. Rptr. 3d 787] [affirming order of dismissal based on prelitigation absence of certificate of merit even though plaintiff offered to cure the failure after litigation began because such late service “would reduce the effectiveness of prelitigation efforts by the Attorney General to discourage filing the frivolous suit in the first place”].) As the Attorney General points out here, the breadth of these notices “deprived the Attorney of a ‘meaningful opportunity to investigate.’ “

(Consumer Defense Group v. Rental Housing Industry Members (2006) 137 Cal.App.4th 1185, 1208-09 [bold emphasis and underlining added].)

            It is common knowledge that attorneys file lawsuits on behalf of clients. The Court places importance on the fact that the Legislature required that a person “within” not “on behalf of,” the noticing entity must be identified in the notice. “Significance should be given, if possible, to every word of an act. [*799]  (Citation omitted.) Conversely, a construction that renders a word surplusage should be avoided. (Citations omitted.)” (Delaney v. Superior Court (1990) 50 Cal.3d 785, 798-99.)

For the foregoing reasons, the demurrer to the First Amended Complaint is SUSTAINED without leave to amend. However, Plaintiff may file a new lawsuit if the Consent Judgment is amended in a way which would negate res judicata effect upon the new lawsuit, and if Plaintiff strictly complies with the pre-lawsuit notice requirements of 27 CCR 25903.

Motion To Strike

Given the ruling on the demurrer, the motion to strike is MOOT.