Revisions to the California Safe Drinking Water and Toxic Enforcement Act, commonly known as Proposition 65, go into effect on April 1, 2020. The amendments are intended to clarify methods of compliance by upstream parties, including manufacturers, producers, packagers, importers, suppliers, or distributors of products with chemicals subject to warning requirements under the Act. They also include a modified definition of the key phrase “actual knowledge,” one of the triggers that can result in retailer responsibility for warnings.

Under the revised language, entities upstream in the supply chain for a regulated product may meet warning requirements in two ways: either (1) by providing a warning on product labels, or (2) with written notice to the business to which they are selling the product, including to retailers, to be updated annually during the period of sale in California. Previous language did not clearly indicate that retailers were not the only entities that could receive information for purposes of compliance. The update also clarifies that confirmation of receipt of warning notices must be renewed annually, along with the notices themselves.

The changes also sharpen the definition of “actual knowledge,” seeking to provide retailers additional shelter from general imputed knowledge that the previous definition of the phrase could be interpreted to support. Existing regulations define “actual knowledge” to mean “specific knowledge of the consumer product exposure from any reliable source.” The new definition of “actual knowledge” specifies that “information from a reliable source” must enable the retail seller or an authorized agent to “to identify the specific product or products that cause the consumer product exposure.” In other words, general information about a group or category of products that could be subject to warning requirements is not enough—a retailer must have information about a specific product from an identifiable, credible source. Moreover, a statement by the Office of Environmental Health Hazard Assessment (OEHHA), which is responsible for adopting and implementing Proposition 65 regulations, explained that information cannot be provided to any employee, as some plaintiffs have contended: new language clarifies that it must be provided to an “authorized agent or a person whose knowledge can be imputed” to the retailer, such as one of its officers.

Proposition 65, which was approved by voters in 1986, requires business to provide a “clear and reasonable warning” for products with chemicals listed by the State as causing cancer or reproductive toxicity. The changes to the definition of “actual knowledge” extend and expand protections for retailers that were implemented in August 2018, according to OEHHA, in response to subsequent stakeholder comments. The 2018 changes established protections for retailers from responsibility except in certain circumstances—including when they have “actual knowledge” of the requirement to warn, and there is no upstream producer or supplier with ties to California. Those rules are discussed in detail here.