Judgment Date:
05/23/2017
Settlement reported to AG:
Case Name:
Environmental Research Center v. Saga Sciences USA Inc.
Court Name:
Alameda County Superior Court
Plaintiff:
Environmental Research Center, Inc.
Defendant:
Saga Sciences USA Inc.
Saga Sciences International Inc.
Saga Sciences Canada Inc.
Injunctive Relief:
According to Section 3 of the settlement: 3. INJUNCTIVE RELIEF AND WARNINGS 3.1 Beginning thirty (30) days after the Effective Date, SAGA SCIENCES shall be permanently enjoined from manufacturing for sale in the State of California, “Distributing into the State of California”, or directly selling in the State of California, any Covered Products which exposes a person to a “Daily Lead Exposure Level” of more than 0.5 micrograms of lead per day unless it meets the warning requirements under Section 3.2. 3.1.1 As used in this Consent Judgment, the term “Distributing into the State of California” shall mean to directly ship a Covered Product into California for sale in California or to sell a Covered Product to a distributor that SAGA SCIENCES knows or has reason to know will sell the Covered Product in California. 3.1.2 For purposes of this Consent Judgment, the “Daily Lead Exposure Level” shall be measured in micrograms, and shall be calculated using the following formula: micrograms of lead per gram of product, multiplied by grams of product per serving of the product (using the largest serving size appearing on the product label), multiplied by servings of the product per day (using the largest number of servings in a recommended dosage appearing on the product label), which equals micrograms of lead exposure per day. 3.2 Clear and Reasonable Warnings If SAGA SCIENCES is required to provide a warning pursuant to Section 3.1, the warning (“Warning”) must be provided as follows: Prior to August 30, 2018 either of the following Warnings may be utilized: WARNING: This product contains chemicals known to the State of California to cause [cancer and] birth defects or other reproductive harm. WARNING: Consuming this product can expose you to chemicals including lead which is [are] known to the State of California to cause [cancer and] birth defects or other reproductive harm. For more information go to www.P65Warnings.ca.gov/food. After August 30, 2018 the following Warning must be utilized: WARNING: Consuming this product can expose you to chemicals including lead which is [are] known to the State of California to cause [cancer and] birth defects or other reproductive harm. For more information go to www.P65Warnings.ca.gov/food. SAGA SCIENCES shall use the phrase “cancer and” in the Warning only if the “Daily Lead Exposure Level” is greater than 15 micrograms of lead. The Warning shall be provided on the invoice accompanying the Covered Products shipped to California. SAGA SCIENCES shall provide one invoice Warning for each Covered Product or one invoice Warning that lists all of the Covered Products. The Covered Products may be returned by the consumer for a refund within 30 days of the invoice date at no cost to the consumer if the consumer references the Warning as a reason for the return. The Warning must be present on the front of the invoice. The Warning shall be at least the same size as the largest of any other health or safety warnings also appearing on its website or on the label or container of SAGA SCIENCES’ product packaging and the word “WARNING” shall be in all capital letters and in bold print. No statements intended to or likely to have the effect of diminishing the impact of, or reducing the clarity of, the Warning on the average lay person shall accompany the Warning. Further, no statements may accompany the Warning that state or imply that the source of the listed chemical has an impact on or results in a less harmful effect of the listed chemical. SAGA SCIENCES must display the above Warning with such conspicuousness, as compared with other words, statements, design of the label, container, or on its website, as applicable, to render the Warning likely to be read and understood by an ordinary individual under customary conditions of purchase or use of the product.
*Non-Contingent Civil Penalty:
$ 10,827.00
Attorney(s) Fees and Costs:
$ 36,053.00
Payment in Lieu of Penalty:
$ 8,120.00 (According to Section 4 of the settlement: 4. SETTLEMENT PAYMENT 4.1 In
full satisfaction of all potential civil penalties, additional settlement payments, attorney’s fees, and costs, SAGA SCIENCES shall make a total payment of $55,000.00 (“Total Settlement Amount”) according to the following payment schedule: • Payment 1 -- $20,000.00 within 14 days of the Effective Date (“Due Date”) • Payment 2 -- $20,000.00 within 45 days of the Effective Date (“Due Date”) • Payment 3 -- $15,000.00 within 75 days of the Effective Date (“Due Date”). SAGA SCIENCES shall make this payment by wire transfer to ERC’s escrow account, for which ERC will give SAGA SCIENCES the necessary account information. The Total Settlement Amount shall be apportioned as follows: 4.2 $10,827.13 shall be considered a civil penalty pursuant to California Health and Safety Code section 25249.7(b)(1). ERC shall remit 75% ($8,120.35) of the civil penalty to the Office of Environmental Health Hazard Assessment (“OEHHA”) for deposit in the Safe Drinking Water and Toxic Enforcement Fund in accordance with California Health and Safety Code section 25249.12(c). ERC will retain the remaining 25% ($2,706.78) of the civil penalty. 4.3 $3,754.38 shall be distributed to ERC as reimbursement to ERC for reasonable costs incurred in bringing this action. 4.4 $8,120.34 shall be distributed to ERC as an Additional Settlement Payment (“ASP”), pursuant to California Code of Regulations, title 11, sections 3203, subdivision (d) and 3204. ERC will utilize the ASP for activities that address the same public harm as allegedly caused by SAGA SCIENCES in this matter. These activities are detailed below and support ERC’s overarching goal of reducing and/or eliminating hazardous and toxic chemicals in dietary supplement products in California. ERC’s activities have had, and will continue to have, a direct and primary effect within the State of California because California consumers will be benefitted by the reduction and/or elimination of exposure to lead in dietary supplements and/or by providing clear and reasonable warnings to California consumers prior to ingestion of the products. Based on a review of past years’ actual budgets, ERC is providing the following list of activities ERC engages in to protect California consumers through Proposition 65 citizen enforcement, along with a breakdown of how ASP funds will be utilized to facilitate those activities: (1) ENFORCEMENT (65-80%): obtaining, shipping, analyzing, and testing dietary supplement products that may contain lead and are sold to California consumers. This work includes continued monitoring and enforcement of past consent judgments and settlements to ensure companies are in compliance with their obligations thereunder, with a specific focus on those judgments and settlements concerning lead. This work also includes investigation of new companies that ERC does not obtain any recovery through settlement or judgment; (2) VOLUNTARY COMPLIANCE PROGRAM (10-20%): maintaining ERC’s Voluntary Compliance Program by acquiring products from companies, developing and maintaining a case file, testing products from these companies, providing the test results and supporting documentation to the companies, and offering guidance in warning or implementing a self-testing program for lead in dietary supplement products; and (3) “GOT LEAD” PROGRAM (up to 5%): maintaining ERC’s “Got Lead?” Program which reduces the numbers of contaminated products that reach California consumers by providing access to free testing for lead in dietary supplement products (Products submitted to the program are screened for ingredients which are suspected to be contaminated, and then may be purchased by ERC, catalogued, sent to a qualified laboratory for testing, and the results shared with the consumer that submitted the product). ERC shall be fully accountable in that it will maintain adequate records to document and will be able to demonstrate how the ASP funds will be spent and can assure that the funds are being spent only for the proper, designated purposes described in this Consent Judgment. ERC shall provide the Attorney General, within thirty days of any request, copies of documentation demonstrating how such funds have been spent. 4.5 $9,765.00 shall be distributed to William F. Wraith as reimbursement of ERC’s attorney’s fees, while $22,533.15 shall be distributed to ERC for its in-house legal fees. Except as explicitly provided herein, each Party shall bear its own fees and costs. 4.6 In the event that SAGA SCIENCES fails to remit any of the payments set forth in Section 4.1 on or before their respective Due Dates, SAGA SCIENCES shall be deemed to be in material breach of its obligations under this Consent Judgment. ERC shall provide written notice of the delinquency to SAGA SCIENCES via electronic mail. If SAGA SCIENCES fails to deliver the delinquent payment within five (5) days from the written notice, the Total Settlement Amount shall be immediately due and owing and shall accrue interest at the statutory judgment interest rate provided in the California Code of Civil Procedure section 685.010. Additionally, SAGA SCIENCES agrees to pay ERC’s reasonable attorney’s fees and costs for any efforts to collect the payment due under this Consent Judgment)
Total Payments:
$ 55,000.00
Is Judgment Pursuant to Settlement?
Address:
24422 Avenida de la Carlota, Suite 400
City, State, Zip:
Laguna Hills, CA 92653
Phone Number:
(949) 452-1234
