Courts Get Health Alert Authority : Judiciary: Appeals panel rules that judges can order warnings on consumer products. Decision upholds an order that Alta-Dena dairy must alert customers about its raw milk.

A state appeal court held Thursday that judges can order health warnings on commercial products, saying that a major dairy must alert customers that its raw certified milk may contain dangerous bacteria.

The appellate panel affirmed an unprecedented trial court decision finding that Alta-Dena Certified Dairy had falsely advertised its raw milk as the safest available and requiring as a corrective measure that its products must be labeled to warn that the milk is hazardous for babies, pregnant women, the elderly and others.

In a 3-0 decision, the panel cited “overwhelming” evidence that, contrary to Alta-Dena’s claims, its raw certified milk can contain highly dangerous organisms, is less safe than pasteurized milk, lacks extra nutritional benefits and is not produced under the strictest health standards in the country.

The court rejected the dairy’s key contention that the judiciary, unlike the Legislature, lacked the constitutional authority to order warnings on consumer products.

The purpose of false advertising laws is to protect against unscrupulous business practices, the court noted. “The mere fact that in carrying out this function . . . a court may incidentally duplicate a legislative function does not result in a violation of the separation of powers doctrine,” Appellate Justice J. Clinton Peterson wrote in an opinion joined by Appellate Justices Jerome A. Smith and John Benson.

Gail Hillebrand, an attorney for Consumers Union, said the court’s assertion of judicial power could prove “very important” in future cases. Hillebrand said that such authority could be imposed to counter false claims for products promoting cures for diseases, such as AIDS, when other governmental regulators fail to act.

Raymond A. Novell of Claremont, an attorney for the dairy, assailed the ruling as “absolutely ridiculous” and said an appeal will be filed with the state Supreme Court. “This opens the floodgates for litigation,” he said. “Now lawyers can pick out any product--food, cars, whatever--and go find a judge who will agree to require a label for it.”

Alta-Dena supplies an estimated 90% of the raw certified milk sold in California. Its raw milk products are marketed under the label of Stueve’s Natural.

Consumers Union and the American Public Health Assn. filed suit in Alameda Superior Court in 1985, challenging as false advertising the dairy’s claims that its raw milk was the safest and purest available.

During a 54-day, non-jury trial in 1988 before Superior Court Judge John H. Sutter, several witnesses testified that they had become ill after drinking the product. Experts cited particular dangers for those who have reduced immunity because of illness or medical treatment--such as AIDS or cancer patients. The dairy denied claims of false advertisingand defended the safety and health benefits of its product.

Sutter concluded that the dairy had run a 35-year campaign of “misleading and sometimes downright dangerous” advertising and, as a remedy, ordered the warning labels to be placed on its raw milk products for 10 years. He noted that from 1971 to 1984, 31 people in California had died from illness associated with raw milk.

After the judgment was entered, the state Department of Health Services ordered warning labels to be placed on all raw milk containers sold in California.