Opinion
A148208
06-19-2018
CENTER FOR ENVIRONMENTAL HEALTH, Plaintiff and Respondent, v. NUTRACEUTICAL CORPORATION, Defendant and Appellant.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Alameda County Super. Ct. No. JCCP004765)
This appeal arises from a private enforcement action filed by plaintiff Center for Environmental Health pursuant to Proposition 65, the Safe Drinking Water and Toxic Enforcement Act of 1986 (Health & Saf. Code, § 25249.5 et seq.) (hereinafter, Proposition 65). According to plaintiff's complaint, defendant Nutraceutical Corporation (hereinafter, corporation) was in violation of Proposition 65 by failing to issue an adequate warning that one or more of its products contained a chemical included on the Governor's "list of those chemicals known to the state to cause cancer or reproductive toxicity . . . ." (Health & Saf. Code, § 25249.8, subd. (a).) After this lawsuit stalled, plaintiff filed a motion to recover attorney fees as the "prevailing party" under Code of Civil Procedure section 1021.5 (hereinafter, section 1021.5). The trial court granted this motion and awarded plaintiff a total of $76,930 in such fees, prompting this appeal. For reasons set forth below, we affirm.
FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff is a nationally recognized nonprofit environmental group focused on protecting the public from environmental health hazards and toxic exposures. One way in which plaintiff strives to accomplish this objective is by prosecuting Proposition 65 cases. "Proposition 65 is a 'right to know' statute requiring companies that expose consumers to carcinogens or reproductive toxins to provide a reasonable and clear warning. (Health & Saf. Code, § 25249.6.) It is a remedial law, designed to protect the public, and thus we construe its provisions broadly to accomplish that protective purpose. [Citation.]" (Center for Self-Improvement & Community Development v. Lennar Corp. (2009) 173 Cal.App.4th 1543, 1550-1551 (Center for Self-Improvement).)
"Statutory notice is a mandatory condition precedent to establishing a citizen's right to commence a Proposition 65 enforcement action in the public interest. It provides the public prosecutors with appropriate information to assess whether to intervene on the public's behalf, and affords the accused the opportunity to avert litigation by settling with the plaintiff or curing any violation. [Citation.]" (Center for Self-Improvement, supra, 173 Cal.App.4th at p. 1550.)
The corporation, in turn, is a publicly traded corporation offering health-conscious products for sale to consumers. On November 15, 2013, the corporation was served with a written 60-day prelitigation notice from plaintiff, alleging it was in violation of Proposition 65 by offering one or more products containing coconut oil diethanolamine condensate, also known as cocamide diethanolamine (hereinafter, cocamide DEA), a chemical included, as of June 22, 2013, on the State of California's list of chemicals known to cause cancer. (Cal. Code Regs., tit. 27, § 27001, subd. (b).) More specifically, this notice alleged the corporation was exposing individuals to cocamide DEA through its sale of certain products without providing them with a clear and reasonable Proposition 65 warning. The warning identified the offending products as a nonexclusive list of cocamide DEA-containing products that included as the exemplar product the corporation's "Heritage Products Almond Fragrance Olive Oil Shampoo," SKU No. 0-76970-33473-5 (hereinafter, exemplar product).
On January 23, 2014, the corporation's outside counsel responded to the prelitigation notice with a letter indicating the corporation had discontinued the sale of the exemplar product in December 2012, months before cocamide DEA became listed on the State of California list. Moreover, the letter stated, the corporation had not sold the exemplar product for nearly 11 months by the time it received plaintiff's prelitigation notice.
In a subsequent phone call between counsel, however, plaintiff's counsel advised the corporation that it had purchased the exemplar product in California without a warning on October 9, 2013. Plaintiff further advised the corporation that its prelitigation notice was, in any event, not limited to the exemplar product, but covered all cocamide DEA-containing products sold by the corporation. Following this phone call, no further discussions were held between the parties regarding the prelitigation notice. However, the corporation initiated an internal investigation that revealed another of its products, "Heritage Brand Olive Oil Shampoo, Original Formula," had also contained cocamide DEA, but sales of this product were discontinued November 20, 2013, the same day the corporation received the prelitigation notice. The next week, on November 26, 2013, the corporation sent a letter to its distributors, retailers and other customers advising that its sale of the cocamide DEA-containing product had been discontinued and warning that any future sale of the discontinued product in California would require a Proposition 65 warning.
In March 2014, plaintiff initiated this lawsuit, naming 21 defendants including the corporation. Plaintiff's complaint alleged the corporation was violating Proposition 65 by exposing California residents to cocamide DEA through ordinary use of its products without proper warning. Like the prelitigation notice, the complaint targeted all cocamide DEA-containing products offered by the corporation and was not limited to the exemplar product. It sought injunctive relief, civil penalties, and attorney fees and costs.
The original complaint misidentified the corporation as "Nutraceutical International Corporation," but a subsequently filed "Doe" amendment correctly named the corporation.
On July 21, 2014, the corporation filed a demurrer and motion to quash the complaint. During this time, the parties explored settlement and proceeded with document discovery. In October 2014, the trial court rejected the corporation's demurrer and motion to quash following a contested hearing. Thereafter, in December 2014 and February 2015, the corporation served responses to plaintiff's written discovery requests. Among other things, the corporation's discovery revealed that, in December 2014, the corporation issued an updated specification sheet of approved ingredients to its suppliers that directly advised its suppliers that cocamide DEA was not an approved ingredient in its products. The corporation described this information sheet as a "routine update" given that it had not sold or distributed a product containing cocamide DEA since November 26, 2013.
In October 2015, plaintiff moved to recover attorney fees. On February 18, 2016, following a contested hearing, the trial court granted this motion. After notice of entry of order was served, the corporation timely appealed.
On March 21, 2016, the parties stipulated to a court-ordered dismissal of the complaint "within 10 days of the completion of any appellate activity or after the time for filing a writ or notice of appeal has passed." According to this stipulation, its "sole purpose" was to "clarify[] that the Order [on attorney fees] is final and appealable[.]"
DISCUSSION
The corporation raises three issues for our review. First, the corporation argues the trial court erred in finding plaintiff's lawsuit was the catalyst for the corporation's remedial actions to discontinue its sale and distribution of products containing cocamide DEA because, according to the corporation, it was undisputed that its remedial actions predated and were unrelated to this lawsuit. Second, the corporation contends the trial court erred as a matter of law and policy in finding plaintiff's prelitigation notice of a Proposition 65 violation constituted a catalyst for the corporation's remedial efforts because, the corporation argues, a plaintiff's recovery of attorney fees under the catalyst theory cannot be based on a defendant's prelitigation conduct. Third, the corporation contends the trial court committed prejudicial error by placing upon the corporation the burden to prove plaintiff's lawsuit lacked merit.
I. Legal Framework.
As touched upon above, Proposition 65 provides for citizen enforcement of its provisions if the enumerated public prosecutors do not initiate diligent prosecution within 60 days of service of notice of purported violations to the alleged violator and the public attorneys. (Health & Saf. Code, § 25249.7, subd. (d)(1).) Successful enforcement actions can result in injunctive relief or assessment of civil penalties up to $2,500 per day per violation. (Health & Saf. Code, § 25249.7, subds. (a), (b)(1).) Where, as here, the notice alleges failure to warn of exposure to a known carcinogen, the notice must include a certificate of merit supported by factual information stating that the private enforcer "has consulted with one or more persons with relevant and appropriate experience or expertise who has reviewed facts, studies, or other data regarding the exposure to the listed chemical . . . , and that, based on that information, the [certifier] believes there is a reasonable and meritorious case for the private action." (Health & Saf. Code, § 25249.7, subd. (d)(1).)
A successful party to Proposition 65 litigation may thereafter apply for an award of attorney fees pursuant to section 1021.5. " 'An award of attorney fees under section 1021.5 requires the applicant to meet three criteria: (1) the action resulted in the enforcement of an important right affecting the public interest; (2) a significant pecuniary or nonpecuniary benefit was conferred on a large class of persons; and (3) the necessity of private enforcement and the attendant financial burden thereof make the award appropriate. Whether the applicant has proved each of these criteria is a matter primarily vested in the trial court. [Citation.] [¶] 'On appeal, our review of the trial court's decision under section 1021.5 is circumscribed. "The 'experienced trial judge is the best judge of the value of professional services rendered in his court, and while his judgment is of course subject to review, it will not be disturbed unless the appellate court is convinced that it is clearly wrong.' [Citations.]" [Citation.] Thus, we may not disturb the ruling here "absent a showing that the court abused its discretion . . . , i.e., the record establishes there is no reasonable basis for the [ruling]." [Citation.]' [Citation.]" (Hogar Dulce Hogar v. Community Development Com. of City of Escondido (2007) 157 Cal.App.4th 1358, 1364 (Hogar).)
" ' "In determining whether a plaintiff is a successful party for purposes of section 1021.5, '[t]he critical fact is the impact of the action, not the manner of its resolution.' [Citation.]" ' (Graham v. DaimlerChrysler Corp. (2004) 34 Cal.4th 553, 566 [21 Cal.Rptr.3d 331, 101 P.3d 140] (Graham).) Under this 'broad, pragmatic view of what constitutes a "successful party" ' (id. at p. 565) within the meaning of section 1021.5, a plaintiff need not obtain a judgment in its favor to be a 'successful party.' [Citation.] Rather, a plaintiff is a 'successful party' whenever it obtains the relief sought in its lawsuit, regardless of whether that relief is obtained ' "through a 'voluntary' change in the defendant's conduct, through a settlement, or otherwise." ' (Graham, supra, 34 Cal.4th at p. 567.)" (Hogar, supra, 157 Cal.App.4th at p. 1365.)
"A party is successful within this pragmatic approach if: '(1) the lawsuit was a catalyst motivating the defendants to provide the primary relief sought; (2) . . . the lawsuit had merit and achieved its catalytic effect by threat of victory, not by dint of nuisance and threat of expense, as elaborated in Graham; and (3) . . . the plaintiffs reasonably attempted to settle the litigation prior to filing the lawsuit.' (Tipton-Whittingham v. City of Los Angeles (2004) 34 Cal.4th 604, 608 . . . .)" (Hogar, supra, 157 Cal.App.4th at p. 1365.)
Here, plaintiff relied upon the "catalyst theory" in seeking an award of attorney fees against the corporation. "Under the catalyst theory, a plaintiff is a successful party and entitled to attorney fees if its lawsuit motivated the defendant to voluntarily provide the relief sought by [the plaintiff]." (Hogar, supra, 157 Cal.App.4th at p. 1365; see also Graham, supra, 34 Cal.4th at p. 567.) "Importantly, the catalyst theory does not require that [plaintiff's] litigation be the only cause of defendant's acquiescence. Rather, [the] litigation need only be a substantial factor contributing to defendant's action." (Hogar, supra, at p. 1365.) "When, after litigation is initiated, a defendant has voluntarily provided the relief a plaintiff is seeking, the chronology of events may raise an inference that the litigation was the catalyst for the relief. [Citations.] ' "The appropriate benchmarks in determining which party prevailed are (a) the situation immediately prior to the commencement of suit, and (b) the situation today, and the role, if any, played by the litigation in effecting any changes between the two." ' " (Id. at p. 1366.)
The trial court accepted plaintiff's argument that its lawsuit was the catalyst for the corporation's remedial efforts to cease its sale or distribution of products containing cocamide DEA. Specifically, the trial court found that plaintiff had provided "evidence establishing a presumption that its actions were a catalyst for, and a substantial causal factor of, Defendant's decision to discontinue sales of products containing actionable amounts of Cocamide DEA in California. Defendant has not provided evidence to rebut that presumption." In so finding, the court rejected the corporation's argument, also raised here, that, for purposes of applying the catalyst theory, proper focus must be on the date plaintiff filed the complaint (here, in March 2014) rather than the date plaintiff served its Proposition 65 prelitigation notice (on November 15, 2013). Ultimately, however, the trial court found the corporation's distinction between service of the notice and filing of the complaint beside the point because there was before it "some evidence of Defendant's failure to avoid a violation, or threatened violation, of Proposition 65 as late as December 2014, eight months after the lawsuit was filed."
The trial court then rejected the corporation's argument, also raised here, that plaintiff failed to achieve the primary relief sought through the litigation, explaining "[plaintiff's] pre-suit demand sought reformulation, and the complaint sought injunctive relief, which is the equivalent of reformulation." Noting that civil penalties would not have provided plaintiff significant monetary relief because "the period of non-compliance was relatively brief" and the corporation's sales of the offending products were " 'miniscule,' " the trial court concluded: "Plaintiff's Proposition 65 notice and lawsuit achieved the primary relief sought." (Italics added.)
II. Did the trial court properly find this lawsuit to be a catalyst for the corporation's remedial efforts?
In arguing the trial court prejudicially erred in finding plaintiff's lawsuit to be a catalyst for its decision to cease offering products containing cocamide DEA, the corporation insists its decision was in fact made many months before plaintiff's complaint was filed—a fact precluding application of the catalyst theory. The corporation relies on case law holding that "a plaintiff can be considered a prevailing or successful party when it achieves its litigation objectives by means of defendant's 'voluntary' change in conduct in response to the litigation." (Coalition for a Sustainable Future in Yucaipa (2015) 238 Cal.App.4th 513, 522 (Coalition for a Sustainable Future), citing Graham, supra, 34 Cal.4th at p. 572.) The corporation also relies on the statutory language authorizing attorney fees " 'in any action which has resulted in the enforcement of an important right affecting the public interest . . . .' " (Opening Brief, at p. 25, quoting section 1021.5.) Thus, the corporation reasons, because there is no evidence it took any post-complaint remedial action as a result of this lawsuit, the trial court erred as a matter of law in awarding plaintiff attorney fees based on its pre-complaint actions.
We conclude the corporation misconstrues both the law and the record in this case. We begin with the law. As Coalition for a Sustainable Future explains, to "satisfy the causation prong of the catalyst theory, the plaintiff need not show that litigation was the only cause of the defendant's acquiescence, only that it was a substantial factor contributing to the defendant's action. [Citations.] In other words, it is enough that ' "but for" ' the party's legal action, the right would not have been vindicated. [Citation.] When, after litigation is initiated, a defendant has voluntarily provided the relief a plaintiff is seeking, the chronology of events may raise an inference that the litigation was the catalyst for the relief. [Citation.] [¶] The causation issue may be resolved by relatively economical, straightforward inquiries by trial judges close to and familiar with the litigation and its determination of causation is entitled to deference by the appellate court if there is any reasonable basis in the record to support the determination. [Citation.] We are required to draw all reasonable inferences in support of the findings and view the record most favorably to the trial court's conclusion; if there is evidence to support its finding, we must affirm even if other evidence would support a contrary finding." (Coalition for a Sustainable Future, supra, 238 Cal.App.4th at p. 522.)
As plaintiff correctly notes, this is a deferential standard affording trial courts broad discretion based upon their proximity to the proceedings to determine whether a causal link exists between the plaintiff's litigation and the defendants' remedial efforts: " 'The trial court in its discretion "must realistically assess the litigation and determine, from a practical perspective, whether or not the action served to vindicate an important right so as to justify an attorney fee award" under section 1021.5.' " (Graham, supra, 34 Cal.4th at p. 566; accord, Coalition for a Sustainable Future, supra, 238 Cal.App.4th at p. 520 ["The pertinent question is whether the reasons for the trial court's [ruling] are consistent with the substantive law of . . . section 1021.5 and, if so, whether their application to the facts of the case is within the range of discretion conferred upon the trial courts under [section 1021.5], read in light of the purposes and policy of the statute"].)
That is just what the trial court did in this case. Based on its direct involvement in the litigation, the trial court realistically assessed the extent to which plaintiff's actions in litigating consumers' right to notice regarding the health hazards of cocamide DEA triggered defendant's remedial actions with respect to its cocamide DEA-containing products. In doing so, the court found the corporation had read the prelitigation notice too narrowly to apply only to the exemplar product, when in fact it applied to all cocamide DEA-containing products. The court then found "evidence that Defendant was selling other products containing Cocamide DEA, which were continuing to make their way into California or threatened to do so." The record supports this finding. Particularly, there is evidence that, after the corporation advised plaintiff that it had stopped offering the exemplar product in California, many months before receiving the prelitigation notice, plaintiff informed the corporation that one of its representatives had in fact purchased the exemplar product in California in October 2013. In addition, the corporation's own internal investigation revealed that it had sold at least one cocamide DEA-containing product, "Heritage Brand Olive Oil Shampoo, Original Formula," until the day it received plaintiff's prelitigation notice. And the trial court referred to evidence, likewise found in the record, of "Defendant's failure to avoid a violation, or threatened violation, of Proposition 65 as late as December 2014, eight months after the lawsuit was filed"—to wit, a reference to the fact that the corporation did not specifically state in its ingredient specification sheet for suppliers that cocamide DEA-containing products were unauthorized until December 2014.
Moreover, in making these findings, the trial court did not run afoul of California law by relying on both the complaint and the prelitigation notice as reference points for determining whether this lawsuit served as a catalyst or substantial factor contributing to the corporation's actions in accordance with plaintiff's demands. As an initial matter, the corporation directs us to no case holding that a trial court cannot consider the service of a plaintiff's prelitigation notice when applying the catalyst test. Indeed, rather than impose restrictions on a trial court's inquiry, the case law described above directs the trial court in exercising its broad discretion to realistically assess the litigation from a practical perspective. (Karuk Tribe of Northern California v. California Regional Water Quality Control Bd., North Coast Region (2010) 183 Cal.App.4th 330, 362.) "Put another way, courts check to see whether the lawsuit initiated by the plaintiff was 'demonstrably influential' in overturning, remedying, or prompting a change in the state of affairs challenged by the lawsuit." (Id. at p. 363.) And, here, we conclude the trial court did not abuse its broad discretion in considering whether plaintiff's litigation activities, encompassing both service of the prelitigation notice and filing of the complaint, demonstrably influenced the corporation's decisionmaking with respect to its sale or distribution of cocamide DEA-containing products.
In so concluding, we reject the corporation's claim that the trial court erred as a matter of law in awarding attorney fees under the catalyst theory on the sole basis of plaintiff's prelitigation notice (rather than their subsequently filed complaint). As explained above, even assuming their legal argument is correct in the abstract, in this case the trial court did not rely solely on the prelitigation notice. Rather, the court found both the prelitigation notice and the complaint triggered the corporation's remedial efforts. The court's decisionmaking was appropriate. (See Graham, supra, 34 Cal.4th at p. 566 [explaining the "catalyst theory is an application of the . . . principle that courts look to the practical impact of the public interest litigation in order to determine whether the party was successful, and therefore potentially eligible for attorney fees"]; Hogar, supra, 157 Cal.App.4th at p. 1368 [rejecting the defendant's contention that for purposes of determining the plaintiff's overall success, the court must treat the litigation as commencing in August 1998, when the complaint was filed, and instead recognizing that, under the particular circumstances, it was appropriate to apply an earlier date when it had become "clear . . . [the parties] were operating as if they were in fact engaged in litigation which they needed to resolve"].)
We agree with the corporation's general proposition that its prelitigation notice argument is purely a legal matter subject to de novo review on appeal. (Center for Self-Improvement, supra, 173 Cal.App.4th at p. 1550.)
As plaintiff points out, the Graham court, in affirming the plaintiff's fee award, considered a plethora of evidence relating to the defendant's remedial actions, including the defendant's voluntary actions taken both before and after the lawsuit was initiated. (E.g., 34 Cal.4th at p. 562 [prior to the filing of plaintiff's complaint on August 23, 1999, DaimlerChrysler had set up a response team to address the problem (by February 1999); had taken steps to replace the incorrect marketing materials, owners manuals, and engine and door labels for not-yet-sold trucks (by June 1999); and, with respect to existing buyers, had notified them their trucks' towing capacity had been erroneously stated in brochures and other marketing materials, warned against attempting to tow more than 2,000 pounds, and provided them with modified materials (as of August 1999)].)
Lastly, the corporation raises several policy arguments in seeking reversal of plaintiff's attorney fee award, including that, by awarding fees based on "pre-suit notice," courts will discourage corporations from proactively addressing plaintiffs' Proposition 65 concerns since they would "be on the hook for attorneys' fees regardless of whether they took remedial action during the 60-day notice period." We disagree.
First, as plaintiff notes, regardless of a possible attorney fee award, a Proposition 65 defendant has ample reason to remedy actual or threatened violations as soon as possible because the statute also authorizes civil penalties of up to $2,500 per violation per day. (Health & Saf. Code, § 25249.7, subd. (b)(1).) These penalties are assessed by the trial court based upon its consideration of several enumerated factors, including the nature and extent of the violation(s), the number and severity of violation(s) and whether "the violator took good faith measures to comply with this chapter [Proposition 65] and the time these measures were taken." (Health & Saf. Code, § 25249.7, subd. (b)(2) italics added.)
Further, in Graham, a case likewise involving both pre- and post-complaint remedial actions, the California Supreme Court directly weighed in on the policy implications of allowing recovery under the catalyst theory and decided in favor of its application. In doing so, the Graham court rejected the defendant's argument (also made here) that catalyst theory cases inevitably lead to costly and time-consuming litigation over the issue of causality, noting "the defendant in such cases knows better than anyone why it made the decision that granted the plaintiff the relief sought, and the defendant is in the best position to either concede that the plaintiff was a catalyst or to document why the plaintiff was not." (Graham, supra, 34 Cal.4th at p. 573.)
Acknowledging the theory's potential for abuse in that it could "encourage nuisance suits by unscrupulous attorneys hoping to obtain fees without having the merits of their suit adjudicated," the Graham court referred to two "sensible limitations on the catalyst theory" that had been adopted by the court. Specifically, in catalyst theory cases, the law requires the trial court to determine the plaintiff's lawsuit is not " 'frivolous, unreasonable or groundless,' " and the plaintiff seeking fees must establish that it "first reasonably attempt[ed] to settle the matter short of litigation." (Id. at pp. 574-575, 577.) We agree with and defer to the high court's weighing of these significant policy concerns.
III. Did plaintiff achieve the primary relief sought in its complaint?
In a related argument, the corporation argues plaintiff was not entitled to fees because it failed to achieve the primary relief sought through its lawsuit, namely, injunctive relief requiring reformulation of the corporation's cocamide DEA-containing products, because the corporation had already ceased offering such products. (See Westside Community for Independent Living, Inc. v. Obledo (1983) 33 Cal.3d 348, 353 ["in order to justify a fee award, there must be a causal connection between the lawsuit and the relief obtained"].) The corporation reasons that it had ceased offering cocamide DEA-containing products, and had informed its distributors to do the same, before the complaint was filed, a fact it claims establishes as a matter of law that plaintiff failed to achieve its primary litigative objective. We disagree for the same reason discussed above: There is indeed evidence in the record that it was not until months after the complaint was filed that the corporation issued revised specifications to its suppliers adding cocamide DEA to the list of banned ingredients. Additionally, as plaintiff points out, the injunctive relief it sought was intended to address actual and threatened violations of Proposition 65's bar on unwarned exposures to cocamide DEA through consumer use of the corporation's products. Not only is injunctive relief for threatened violations authorized under Proposition 65 (Health & Saf. Code, § 25249.7, subd. (a)), case law teaches that the successful prevention of a threatened violation may serve as the basis for a section 1021.5 fee award (Gafcon, Inc. v. Ponsor & Associates (2002) 98 Cal.App.4th 1388, 1403, fn. 6 ["Ordinarily, injunctive relief is available to prevent threatened injury and is not a remedy designed to right completed wrongs"]).
Thus, based on the evidence set forth above, we conclude the trial court could reasonably find on this record that plaintiff successfully achieved its litigation objective of preventing the corporation from engaging in the future sale or distribution of any product containing cocamide DEA without the requisite Proposition 65 notice to the consumer. No further showing was required. (Graham, supra, 34 Cal.4th at p. 572 ["It would be perverse, and contrary to the basic public interest objectives of section 1021.5, to hold that a plaintiff who obtains a final judgment has 'enforced' a right, but not a plaintiff whose litigation position is so strong that it achieves the same result by compelling the defendant to change its conduct rather than face a probable judgment against it"].)
IV. Did the trial court erroneously assign the burden of proof to the corporation?
The corporation's last contention is that the trial court erroneously reversed the burden of proof when it required the corporation to prove plaintiff's case lacked merit. Both parties agree California law requires the party seeking attorney fees to prove, among other things, that the plaintiff's lawsuit had merit and achieved its catalytic effect by threat of victory, not by dint of nuisance and threat of expense. (See Tipton-Whittingham v. City of Los Angeles, supra, 34 Cal.4th at p. 608 ["In order to obtain attorney fees without such a judicially recognized change in the legal relationship between the parties, a plaintiff must establish that (1) the lawsuit was a catalyst motivating the defendants to provide the primary relief sought; (2) that the lawsuit had merit and achieved its catalytic effect by threat of victory, not by dint of nuisance and threat of expense . . . ; and (3) that the plaintiffs reasonably attempted to settle the litigation prior to filing the lawsuit"].)
As plaintiff notes, the corporation does not dispute for purposes of appeal that plaintiff's action resulted in the enforcement of an important right affecting the public interest, that a significant benefit was conferred on the general public or a large class of people, that the necessity and financial burden of private enforcement weigh in favor of the fee award, or that, prior to filing suit, plaintiff made a good faith effort to settle the dispute.
In making this argument, the corporation does not contend, much less demonstrate, plaintiff's lawsuit lacks merit. To the contrary, the only specific finding by the court challenged by the corporation is the finding that this lawsuit was a substantial causal factor motivating it to address its consumers' unknowing exposure to cocamide DEA-containing products. Nonetheless, the corporation contends the trial court's misapplication of the burden of proof is reversible error, relying on one statement in the trial court's order that "[the corporation] has not established that this case is frivolous, unreasonable, or groundless." We reject this argument.
First, applying the correct standard of review, we decline to accept the corporation's portrayal of the trial court's finding on the basis of one line in the challenged order. It is well established that, on appeal, this court must presume in the absence of a statement of decision that the trial court made all factual findings to support the order, and that the trial court was aware of and followed the applicable law. (Shaw v. County of Santa Cruz (2008) 170 Cal.App.4th 229, 267; People v. Stowell (2003) 31 Cal.4th 1107, 1114.) The corporation provides no grounds to set aside these well-established rules.
Moreover, after considering this record in the proper light, we conclude the trial court indeed had a reasonable basis for finding plaintiff's lawsuit meritorious. Contrary to the corporation's suggestion, plaintiff submitted, and the trial court considered, substantial evidence proving a Proposition 65 claim for injunctive relief, including evidence that a person or business entity, in the course of doing business, "knowingly and intentionally expose[d] an[] individual to a chemical known to the state to cause cancer or reproductive toxicity without first giving clear and reasonable warning to such individual," or threatened to do so. (Health & Saf. Code, §§ 25249.6, 25249.7, subd. (a).) Without rehashing our analysis from above, there is evidence in this record that, until December 2014, several months after the complaint was filed, the corporation was violating or threatening to violate Proposition 65 by failing to definitively inform its suppliers that cocamide DEA was a banned ingredient. Accordingly, we find no reversible error on this record.
DISPOSITION
The order awarding reasonable attorney fees to plaintiff pursuant to section 1021.5 is affirmed. Respondent is awarded costs on appeal.
/s/_________
Jenkins, J. We concur: /s/_________
Pollak, Acting P.J. /s/_________
Siggins, J.