California Code of Regulations
Title 11 - Law
Division 4 - Proposition 65 Private Enforcement
Chapter 3 - Settlement Guidelines
Section 3203 - Reasonable Civil Penalty

(a) A settlement with little or no penalty may be entirely appropriate or not, based on the facts or circumstances of a particular case.

(b) Recovery of civil penalties (75% of which must be provided to the Office of Environmental Health Hazard Assessment) serves the purpose and intent of Proposition 65. Accordingly, civil penalties shall not be "traded" for payments of attorney's fees.

(c) Where a settlement provides that certain civil penalties are assessed, but may be waived in exchange for certain conduct by the defendant, such as, for example, reformulating products to reduce or eliminate the listed chemical, the conduct must be related to the purposes of the litigation, provide environmental and public health benefits within California, and provide a clear mechanism for verification that the qualifying conditions have been satisfied.

(d) Where a settlement requires the alleged violator to make any Additional Settlement Payments to the plaintiff or to a third party, such Additional Settlement Payments are viewed as an "offset" to the civil penalty. The plaintiff must demonstrate to the satisfaction of the court that it is in the public interest to offset the civil penalty required by statute.