"In a split decision, the California Supreme Court on Wednesday [this week] declined to review a state appeals court ruling against major manufacturers of lead paint that held them liable for hundreds of millions of dollars in remediation costs ..." Ben Hancock, The Recorder, February 15, 2018. Here is the article.
Also, it is a blow to their lawyers who had been victorious in previous state-level versions of this litigation. For example, the Rhode Island Supreme Court tossed the lawsuit which had gone through two trials.
Hancock notes that the lawyers for Sherwin-Williams and NL Industries stated that they would attempt to have the case reviewed by the U.S. Supreme Court.
Meanwhile, what's in play are the stock price and the brand of major corporation Sherwin-Williams. The market does not like uncertainty. So far, though, the stock price - at about 402 - hasn't taken a hit from this latest development.
But investors have much to fear if other counties in CA and other states decide to do copycat lead paint class action public nuisance lawsuits. Both the legal expenses and the abatement costs could be a burden to Sherwin-Williams.
Also there could be an impact on its corporate reputation. In the bench trial it was concluded that those at Sherwin-Williams were aware of the dangers of lead paint in residences and still continued to market it.
In 2016, there had been controversy about Sherwin-Williams' manufacture and sale of lead paint for use abroad.
Another implication of this CA Supreme Court decision is to embolden plaintiff lawyers and government entities to apply the public nuisance legal strategy to other industries. They range from energy production to pharma.
Corporations should be consulting with their in-house lawyers and outside counsel about how vulnerable they are to this kind of litigation.
In addition, they should be asking their communications experts how to protect their branding in what could be a new golden age of litigation.
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