Bloomberg News

Manufacturers Argue Against $1 Billion Sought for Lead Paint (3)

September 23, 2013

NL Industries Inc. (NL:US) is one of five paint companies that presented closing arguments against a public-nuisance lawsuit by 10 California cities and counties seeking more than $1 billion to replace or contain lead paint in millions of homes.

Superior Court Judge James Kleinberg in San Jose, California, interrupted closing arguments by Don Scott, a lawyer for NL Industries, who relied on studies by U.S .doctors to claim that the companies didn’t know about the potential for lead poisoning in children in the first half of the 20th century, as the counties and cities have claimed.

Kleinberg, who is hearing the case, asked Scott about what he said was a “flat-out ban” of lead paint in Europe in the early 1900s, and a 1918 advertisement by Wilmington, Delaware-based DuPont Co. (DD:US) that “distinguished themselves away from lead paint.”

“Is it your position that if the American doctors that you cite say X, that’s the end of the issue, and that the court should not be concerned with these other pieces of evidence that are undisputed?” Kleinberg asked. “I am troubled by the idea that because American doctors, fine people I’m sure they were, say XYZ that’s the end of the inquiry.”

Scott replied that the laws in Europe were a “mixed bag” in which some countries banned lead paint earlier than others.

‘Prevailing Standard’

“The fact is that on the question of what is pertinent to this case, we’re looking at what was known and knowable here,” Scott said. The “prevailing best and scientific knowledge at the time” didn’t recommend any restriction of lead paint in homes, Scott said, adding that the cities and counties case must focus on “what was the prevailing standard of medicine and science at the time.”

The defendants in addition to Dallas-based NL Industries and DuPont are ConAgra Grocery Products LLC, a unit of the Omaha, Nebraska-based maker of Chef Boyardee pasta and Pam cooking spray, Cleveland-based Sherwin-Williams Co. (SHW:US) and Los Angeles-based Atlantic Richfield Co.

The cities and counties, including San Diego, Los Angeles County and San Francisco, are aiming to break the companies’ streak of victories in similar suits in seven different states. The California plaintiffs’ suit relies on a 2006 California appeals court opinion that reinstated the case.

Joe Cotchett, a lawyer for the cities and counties, told the judge he had met the “substantial and reasonable” standard of proof of lead poisoning to children required for the case to go forward.

1937 Document

Cotchett told the judge that the key document proving his case came from a 1937 Chicago gathering of staff doctors for each of the paint companies titled “Lead Poisoning, Report of Conference Physicians and Surgeons of Member Companies.” Physicians attending the conference were told not to tell anyone about it, and not to take notes, Cotchett told the judge.

“They knew in the 1930s that lead poisoning of children was happening and they tried to conceal it,” Cotchett said in an interview.

Tony Dias, a lawyer for Sherwin-Williams, said in an interview that the document from the 1937 conference concerns the occupational risks of working with lead, and that it has “nothing to do with lead paint.”

Cotchett’s emphasis on the document “shows how little if any evidence they have concerning the knowledge of risks in lead paint in the early half of the last century,” Dias said.

Lead Abatement

At the start of trial in July, Owen Clements, the chief of special litigation for the San Francisco City Attorney’s Office, said in an interview that the counties can’t recoup money they’ve spent over decades on lead-abatement programs.

The lawsuit seeks more than $1 billion for remediation, according to a court exhibit. The total damages figure isn’t final, as it depends on what remediation, if any, is required, and who does it. One estimate, according to a court filing, is more than $2.4 billion.

At the conclusion of today’s hearing, Kleinberg told both sides that “it’s never too late to settle -- never.” Commenting that many of the lawyers in the room had probably spent much of their careers involved in lead paint cases, he said: “What a legacy it would be to actually bring an end in any productive way to this litigation,” he added. “That would truly be a valuable legacy.”

Unique Facts

The defendants argue that each of them have their “own unique facts” and are represented by different lawyers. Sherwin-Williams said in a court filing that the appeals court ruling allowed the case to go forward only as an effort to block future harm, and that the cities and counties “cannot recover money damages or a fund to cover costs of abatement.”

The cities and counties have failed to link the public nuisance of lead paint with its wrongful promotion by Sherwin-Williams, the company claimed in a court filing.

“The alleged wrongful conduct must be connected to the alleged harm today,” a standard which the cities and counties “failed to meet,” Sherwin-Williams said in the filing.

The companies have argued that decisions in states including New York, New Jersey and Wisconsin demonstrate that the California public-nuisance suit is without merit.

In a 2006 opinion, state appeals-court Judge Nathan Mihara said that the plaintiffs alleged that the companies’ “misrepresentations about the dangers of low-level lead exposure” caused government entities “to fail to make timely efforts to prevent and treat” the problem.

The misrepresentations “increased the cost of treatment for those who had been exposed or continued to be exposed,” Mihara wrote, adding that it wasn’t until 1998 that studies adequately analyzed the companies’ misrepresentations and proved that low-level lead exposure could cause serious damage to fetuses, children and adults.

The case is California v. Atlantic Richfield Co., 1-00-CV-788657, California Superior Court, County of Santa Clara (San Jose).

To contact the reporter on this story: Joel Rosenblatt in San Francisco at jrosenblatt@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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Companies Mentioned

  • NL
    (NL Industries Inc)
    • $8.33 USD
    • -0.04
    • -0.48%
  • DD
    (EI du Pont de Nemours & Co)
    • $69.25 USD
    • 3.42
    • 4.94%
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