BILL ANALYSIS SB 67 Page 1 SENATE THIRD READING SB 67 (Kopp) As Amended July 24, 1997 Majority vote SENATE VOTE : 28-9 JUDICIARY 11-3 Ayes: Escutia, Aroner, Caldera, Figueroa, Keeley, Kuehl, Martinez, Ortiz, Pacheco, Shelley, Sweeney Nays: Morrow, Baugh, McClintock SUMMARY : Repeals the current immunity from product liability actions conferred upon tobacco manufacturers, and their successors in interest, but retains this immunity for all others, including but not limited to retailers and distributors of tobacco products. Specifically, this bill : 1) Deletes tobacco from the list of examples of products granted immunity from liability. 2) Restores the common law rules governing legal actions based upon product liability with respect to tobacco manufacturers and their successors in interest. However, continues the exemption from product liability actions involving tobacco extended to all others, including but not limited to retailers and distributors of tobacco products. 3) Declares that there is no statutory bar to, or immunity from, tobacco-related personal injury, wrongful death, or other tort claims by smokers or others against tobacco manufacturers and their successors in interest, and that such claims shall be determined on their merits. EXISTING LAW : 1) Provides in Civil Code Section 1714.45 that a manufacturer or seller of a product is not liable in a product liability action if the product is inherently unsafe and ordinary consumers know it is inherently unsafe. Lists tobacco as one of the products barred from product liability claims. 2) Defines "product liability action" as any action for injury or death caused by a product, except that the term does not include an action based on a manufacturing defect or breach of an express warranty. 3) States, in American Tobacco Co. v. Superior Court (1989), that Civil Code Section 1714.45 was poorly drafted and provides an unconditional immunity to tobacco products. 4) States, in Richards v. Owens Corning, Inc. (1997) by the SB 67 Page 2 California Supreme Court, that Civil Code Section 1714.45 negates liability to voluntary users due to the voluntariness of a smoker's use of the product. Thus under our Supreme Court's most recent interpretation of Civil Code Section 1714.45, tobacco companies are immune from tort liability against knowing and voluntary smokers. FISCAL EFFECT : Unknown COMMENTS : This bill was previously passed by the Assembly on July 3, 1997, and sent to the Governor on July 10, 1997. The Governor thereafter stated that he would sign the bill if it were amended to retain the product liability immunity provided by Civil Code Section 1714.45 for tobacco distributors and retailers. These amendments were added to the bill on the Assembly Floor on July 24, 1997. With the latest amendments, the bill is intended to restore product liability law as it relates to tobacco products prior to the enactment of Civil Code Section 1714.45 for actions against tobacco manufacturers, and their successors in interest. Pursuant to these amendments, all other sellers of tobacco products, including but not limited to retailers and distributors, would retain the immunity shield from product liability actions. This bill would not appear to effect the traditional liability defenses available to the tobacco companies in fighting actions against them. Common law defenses, such as assumption of the known risk, will continue to be available to tobacco manufacturers even in suits brought by public entities to recover tobacco-related costs. Opponents of this bill assert that Civil Code Section 1714.45 provides tobacco manufacturers appropriate protection from lawsuits from individuals who choose to use an inherently dangerous product. Similar legislation, AB 1603 (Bustamante - Ch. 25, Stats. 1997) does not address suits by private parties. AB 1603 specifically underscores the past and present viability of suits by public entities, and the Attorney General, on behalf of public entities. That legislation and SB 67 are complimentary. SB 340 (Sher), currently on the Assembly Third Reading file, targets suits brought by plaintiffs claiming injuries caused by second-hand smoke. Analysis prepared by : Drew Liebert / ajud / (916) 445-4560 FN 034165