Judge: Mark A. Young, Case: 22STCV21493, Date: 2024-01-05 Tentative Ruling

Case Number: 22STCV21493    Hearing Date: January 5, 2024    Dept: M

CASE NAME:           Consumer Advocacy Group Inc. v. Walmart Inc., et al.

CASE NO.:                22STCV21493

MOTION:                  Motion for Judgment on the Pleadings

HEARING DATE:   1/5/2024

Legal Standard

A defendant’s motion for judgment on the pleadings may be made after the time to demur has expired and an answer has been filed. (CCP § 438(f).) A motion by a defendant may be made on the grounds that (1) the court “lacks jurisdiction of the subject of one or more of the causes of action alleged” or (2) the complaint or cross-complaint “does not state facts sufficient to constitute a cause of action against that defendant.” (CCP § 438(c).)

A motion for judgment on the pleadings has the same function as a general demurrer but is made after the time for demurrer has expired. Except as provided by statute, the rules governing demurrers apply. (Cloud v. Northrop Grumman Corp. (1998) 67 Cal.App.4th 995, 999.) “A motion for judgment on the pleadings is akin to a general demurrer; it tests the sufficiency of the complaint to state a cause of action. The court must assume the truth of all factual allegations in the complaint, along with matters subject to judicial notice.” (Wise v. Pacific Gas and Elec. Co. (2005) 132 Cal.App.4th 725, 738, citations omitted.) Further, like a general demurrer, a motion for judgment on the pleadings “does not lie as to a portion of a cause of action, and if any part of a cause of action is properly pleaded, the [motion] will be overruled.” (Fire Ins. Exchange v. Superior Court (2004) 116 Cal.App.4th 446, 452.)

EVIDENTIARY ISSUES

Defendants Walmart Inc. and Wal-Mart.com Inc. request that the Court take judicial notice of documents, including the pre-suit notices of violation served by Plaintiff in this matter (Exs. 1-7) and pre-suit notices of violation served by other Proposition 65 private enforcers in certain other matters (Exs. 8-11). These pre-suit notices are official records on file with the California Attorney General’s Office. (Evid. Code § 452(c).) Therefore, these requests are GRANTED. The Court only notices the fact that these documents exist, and the legal effect thereof, but not of the truth of any statements contained therein. (Lockley v. Law Office of Cantrell, Green, Pekich, Cruz & McCort (2001) 91 Cal.App.4th 875, 882.)

The supplemental request for judicial notice is DENIED.

The objections to the Yeroushalmi declaration are SUSTAINED, as the declaration contains extrinsic evidence. The Court will consider this declaration for leave to amend purposes only.

Analysis

Defendants Walmart Inc. and Wal-Mart.com Inc. move for judgment on the pleadings. Defendants Landau uniforms inc. and JFC International Inc. join in the motion. Defendants argue that the pre-suit notices served by Plaintiff Consumer Advocacy Group, Inc. (“CAG”) fail to comply with the Safe Drinking Water and Toxic Enforcement Act of 1986’s (“Prop 65”) pre-suit notice regulations.

Notices

Prop 65 provides that no business with ten or more employees “shall knowingly and intentionally expose any individual to a chemical known to the state to cause cancer or reproductive toxicity without first giving clear and reasonable warning to such individual,” unless an exemption or affirmative defense applies. (Health & Safety Code § 25249.6.) The statute provides for injunctive relief and imposes penalties of up to $2,500 per violation. (Id. § 25249.7(a).)

CCR Section 25903 specifies the information private enforcers “shall identify” in every pre-suit notice. While some pieces of information vary depending on the type of exposure alleged, there are four pieces of information that private enforcers must include in every notice. 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 violator

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(b)(2)(A), emphasis added.)

Defendants argue that the pre-suit notices of violation served by Plaintiff in this matter are ineffective, because they do not identify a person from “within” CAG. Defendants contend that Mr. Yeroushalmi is CAG’s “outside” counsel working for a private law firm. Defendants note that on the face of the pleadings, his name and contact information are associated with the law firm, Yeroushalmi & Yeroushalmi. Each notice states Mr. Yeroushalmi is “designated person,” and provides his contact information. (RJN, Exs. 1-7.) Defendants conclude that he is not a “responsible individual within” CAG such as an employee.

However, there is no information on the record which shows that Mr. Yeroushalmi is “outside” counsel, even if he is associated with a private law firm. Mr. Yeroushalmi could be an employee of both CAG and his firm. Thus, even though likely, the Court cannot infer on a motion for judgment on the pleadings that counsel was not acting as an employee of CAG when he provided his contact information on the notices. To prove their point, Defendants would necessarily have to rely on extrinsic evidence which cannot be considered in this motion. Thus, the Court cannot grant the motion on this basis.  The Court agrees, however, that the notice requirements of Section 25903 must be strictly construed and that substantial compliance is insufficient.  Thus, to the extent that Mr. Yeroushalmi is not an also an employee of CAG, then the notice requirement would not have been met in this case.  Providing notice of counsel’s name and address would be insufficient under the plain language of Section 25903.

Issue Preclusion

Defendants also argue that collateral estoppel requires dismissal, since other private enforcers, acting in the same “public interest” as CAG, have had suits dismissed on similar grounds. For instance, Environmental Health Advocates, Inc. (“EHA”), another Prop 65 enforcer, recently had approximately 40 lawsuits dismissed in the complex division of Alameda County Superior Court, including one filed against Walmart. Defendants represent that the court found strict compliance standard applied to pre-suit Proposition 65 notices and that, in part, EHA’s failure to identify a responsible individual “within” the organization warranted dismissal. (RJN, Ex. 15.) Defendants also claim that Walmart was dismissed in another Prop 65 action on “identical” grounds. (RJN, Ex. 16.)

These noticeable facts do not provide any grounds for issue preclusion against CAG on the present action. Collateral estoppel, or issue preclusion, “precludes relitigation of issues argued and decided in prior proceedings.” (Lucido v. Superior Court (1990) 51 Cal.3d 335, 341.)  “The threshold requirements for issue preclusion are: (1) the issue is identical to that decided in the former proceeding, (2) the issue was actually litigated in the former proceeding, (3) the issue was necessarily decided in the former proceeding, (4) the decision in the former proceeding is final and on the merits, and (5) preclusion is sought against a person who was a party or in privity with a party to the former proceeding. [Citation.]” (Castillo v. City of Los Angeles (2001) 92 Cal.App.4th 477, 481.)

The substantive issues presented in this action are not “identical” with the issues presented in the cited matters (RJN, Exs. 15-16) for preclusion purposes. This action regards certain products offered by Walmart within the state, including Flip Flops, Jelly Totes with PVC components, Electronic Abs Stimulator, Roasted Trevalli and Shredded Squid Seafood Snack, Dried Shrimp, Clear PVC Tote Bag, and Toiletry Bag with Plastic Components. These products contain DEHP, DBP, Lead and Lead Compounds, Cadmium and Cadmium Compounds, which are on the Prop 65 list. Plaintiff served seven notices on Defendants as to each item from July through December 2021. This motion raises issues with those notices. On the other hand, the other actions did not concern these same products, did not concern these same notices, and did not concern the same plaintiff. The only similarity is that the actions are all Prop 65 cases which involve Walmart. As far as the Court is aware, the issues presented in this action and, critically, this motion, have never been resolved. There is no indication on the record that CAG, or any other party representing the public interest, had a full and fair opportunity to litigate the issues presented in the notices and pleadings. The fact that similar, but different, issues have been resolved in Walmart’s favor is not res judicata.

Accordingly, the motion is DENIED.

Finally, the Court would remind Plaintiff to comply with the page limitations set forth in the California Rules of Court, including line spacing issues.  At most, counsel should have 32 lines of text on any page (unless there are single-spaced footnotes), and not the 33 lines present in this brief, which still exceeded 15 pages.  In the future, if counsel needs to file an oversized brief, counsel will need to appear ex parte to request additional pages.