Gatto's Prop 65 reform bill likely to be law

Assemblyman Mike Gatto’s bill reforming Proposition 65 looks likely to become law, and no one is happier than the business owner whose suggestion spurred the legislation.

AB 227, which passed the Assembly state Senate with unanimous votes, modifies a voter-approved law that requires establishments to post “clear and reasonable” warnings if the public is at risk of being exposed to chemicals known to cause cancer or birth defects.

That includes restaurants that serve alcohol, which frequently find themselves at the receiving end of “shakedown” lawsuits that are filed, proponents of change say, with the intent of extracting settlements to make the litigation go away. The law allows members of the public to sue for up to $2,500 for each day the signage isn’t properly displayed.

Gatto’s bill gives business owners a two-week period to post the correct signage before they can be sued.

Brett Schoenhals, who owns the Coffee Table restaurant in Eagle Rock, told Gatto (D-Silver Lake) about these lawsuits — one of which he had been served with — in January, at the inaugural meeting of the assemblyman’s Small Business Advisory Commission.

Nine months later, Schoenhals said he was happy that he was able to raise an issue that affects all businesses in the state.

“It affects everybody, and nobody ever does anything and nothing ever changes,” he said. “My big mouth did something.... I used my big mouth one time for good.”

Gatto said Thursday that giving businesses a chance to post the correct signage before becoming liable for damages was a way to discern the actual concerns that were the intent of the imitative.

“We also look at it as a little bit of bluff-calling,” he said. “These people who sue, these groups that sue, they say ‘We just want the warnings up.’ OK, well guess what? We just gave business-owners a 14-day window to put the warnings up.”

The primary source of the Prop. 65 lawsuits was the firm of Miguel Custodio Law in Pasadena, who when the bill was introduced had filed suits against 10 restaurants in Burbank and Glendale.

Custodio said on Friday that his firm would abide by whatever the law said.

“Well, in terms of what I personally really think about it, it’s irrelevant,” he said. “I think if the people want to change a part of the law, they can do so … that’s the whole part of the democratic process.”

Custodio also filed the suit against Schoenhals. Schoenhals said he refused to settle with Custodio, who then dropped the suit, and that he hoped the new law would help other business owners do the same.

“Hopefully these other people that have gotten these letters aren’t paying him off,” he said. “Hopefully this will stop it.”

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Follow Daniel Siegal on Google+ and on Twitter: @Daniel_Siegal.

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