California Hotel Operators Reach Prop. 65 Settlement; Agreement Deal Limits Hotel Liability from Attorneys Who Sue on Behalf of General Public / March 2002

Hotel Online Special Report

California Hotel Operators Reach Prop. 65 Settlement;
Agreement Deal Limits Hotel Liability from Attorneys
Who Sue on Behalf of General Public

SACRAMENTO, Calif. - March 19, 2002 -- Under the guidance of the California Hotel & Lodging Association, California's hotel and lodging operators have reached a settlement agreement that will provide a way to limit their liability regarding claims filed under Proposition 65.

If approved by a judge, the settlement, which includes new warning/compliance guidelines, would limit a lodging operator's liability from "bounty hunters" -- private attorneys who sue for millions of dollars in fines on behalf of the general public when it is alleged that a lodging operator violates Proposition 65.

Proposition 65 requires anyone exposed to carcinogens or reproductive toxins to be warned -- a concept universally accepted by the operators of California's lodging establishments.

"Our members believe Proposition 65 is a good thing -- we certainly want to make sure the public knows when they're exposed to such things as second-hand smoke or other carcinogens," said Jim Abrams, executive vice president of the

In November 1986, California voters approved an initiative to address growing concerns about exposures to toxic chemicals. That initiative became The Safe Drinking Water and Toxic Enforcement Act of 1986, better known by its original name: Proposition 65.

Proposition 65, unique among environmental laws, is enforced only through civil lawsuits or settlements. Although the law provides for stiff penalties, most cases are settled out of court for "contributions" to the plaintiff group, attorney fees and costs, and some requirement that consumers or workers receive warnings of toxic exposure.

California Hotel & Lodging Association, the trade association which initiated the settlement agreement for the industry. "However, at the same time, we're seeing aggressive attorneys seeking excessive fees from both large and small lodging operators over minor infractions, or even when there might not be any infraction at all. This adds significantly to the cost of running a hotel or an inn, and it therefore takes a tremendous toll on the state's economy."

In fact, California's lodging operators are already at a significant disadvantage when competing with other states for conventions and meetings. Research conducted by the California Hotel & Lodging Association demonstrates that the overall cost of holding a typical convention in California is often 30-50 percent higher than the cost of an identical convention is in other states with which California lodging operators compete for this business. These higher costs result from such factors as California's higher land costs and workers' compensation premiums, California's daily overtime requirement which does not exist in other most other states, and California's higher minimum wage, among others.

"California's cost of business has always been high," said Abrams. "Our settlement strategy will help control those costs and ensure that our members comply with the law while still staying in business."

The California Hotel & Lodging Association is actively working with the attorneys representing many plaintiffs and with the Attorney General's office to secure court approval of the settlement agreement. The objectives of the settlement are to achieve enhanced warnings and information from lodging operators to their guests and employees as well as a means for California's innkeepers to resolve multiple Proposition 65 claims once and for all.

The California Hotel & Lodging Association (CH&LA) is the largest state lodging industry trade association in the country. Its 1,587 member properties, which comprise more than 208,000 guest rooms, consist of hotels, motels, bed and breakfast inns, guest ranches, resorts, spas, condominium rentals, timeshares, and vacation home rentals located throughout California. CH&LA's mission is to "be the indispensable resource for communicating and protecting the rights and interests of the California lodging industry, for providing educational training and cost-saving programs for all segments of the industry, and for supporting strategic alliances to promote the value of California tourism and travel." Sacramento-based CH&LA has been representing California's lodging industry for more than a century.

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Contact:
California Hotel & Lodging Association
Jim Abrams
916/444-5780
[email protected]

Also See	California Hotel Legal Alert: 60-Day Notices and Claims under Prop. 65 Proposition 65 Fact Sheet / Dec 1998
	Proposition 65: Where There�s Smoke, There�s Fire!� An Update on Tobacco Cases / Nov 2000

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