저희는 Pure Aura라는 sheet mask를 한국에서 생산해서 target에 소량 납품했던 적이 있던 신화라는 회사입니다.
지금은 Pure Aura라는 회사는 적자를 보고 접은 상태이고, 제품을 판매하고 있지 않은 상황입니다.
그리고 타겟을 통해 캘리포니아에 판매된 개수도 얼마되지 않구요.
그런데, Precila Balabbo라는 사람이 타켓을 통해, 저희 제품에 Prop 65에 위반되는 DEA물질이 들어있다며 Settlement Agreemnet를 보내왔습니다.(파일을 첨부할 수 없어 아래에 내용을 기재합니다.)
저희도 Prop65의 내용을 알기에 저희 제품에는 DEA가 들어가면 안되다고 공장에 얘기해서 제품 출고부터 해당원료가 들어가지 않으 제품을 생산해왔고, Ingredient에도 들어가 있지 않은데 저희 제품을 테스트한 결과 검출되었다고 해서 현재 한국 공장에 한국에서 테스트한 결과값을 보내달라고 요청 중인 상태입니다.
Precila Balabo라는 사람에 대해서 잠깐 조사를 해보니, 이거와 관련되어 엄청나게 많은 회사와 소송을 거는 사람으로 판단됩니다.
제품에 DEA관련된 물질이 함유되어있다는 사실도 믿기지 않지만, 타겟을 통해 캘리포니아에 판매된 제품 개수도 몇십개 정도 밖에 안되는 걸로 파악되며, 적자를 보고 끝낸 비즈니스에 대해 이렇게 소송을 걸어오니 어떻게 해야할지 몰라 막막한 심정에 글을 올립니다.
이 건에 관련에서 전문적으로 변호사 상담을 받아야 한다면, 대략적인 비용이나 절차등에 대해도 알고싶습니다.
email@example.com 으로 메일을 주셔도 좋습니다.
우선은 저희가 받은 Settlement Agreement에 대해서 저희가 어떤 행동을 현재 취해야하는지에 대해서 알려주시면 감사하겠습니다.(한국에서의 테스트 결과는 돌아오는 수요일쯤 나온다고 합니다.)
해당제품의 UPC 링크입니다.
제조사 명이 Pure Aura 제품명으로 되어있습니다.
1.1 The Parties. This Settlement Agreement is entered into by and between Precila Balabbo (“Balabbo”) and Shinhwa Corp. (“Shinhwa”). Together, Balabbo and Shinhwa are collectively referred to as the “Parties.” Balabbo is an individual who resides in the State of California and seeks to promote awareness of exposures to toxic chemicals and to improve human health by reducing or eliminating hazardous substances contained in consumer products. Balabbo alleges that Shinhwa is a person in the course of doing business for purposes of the Safe Drinking Water and Toxic Enforcement Act of 1986, Health & Safety Code § 25249.6, et seq. (“Proposition 65”).
1.2 General Allegations. Balabbo alleges that Shinhwa has exposed individuals to diethanolamine (“DEA”) from its sales of Pure Aura® silver foil maks, UPC # 850002134018, without first providing users and consumers of the product with a clear and reasonable health hazard exposure warning as required pursuant to Proposition 65. DEA is listed under Proposition 65 as a chemical known to the State of California to cause cancer.
1.3 Product Description. The products covered by this Settlement Agreement are Pure Aura® silver foil maks, UPC # 850002134018, (the “Products”) that Shinhwa has either imported, and/or distributed, and/or offered for sale and/or directly or indirectly sold in California.
1.4 Notice of Violation. On May 30, 2023, Balabbo served Target Corporation, Target Brands, Inc. (collectively, “Target”), Shinhwa, and various public enforcement agencies with documents entitled “Notice of Violation of California Health & Safety Code § 25249.6, et seq.” (the “Notice”). The Notice provided Shinhwa and such others, including public enforcers, with notice that alleged that Shinhwa was in violation of California Health & Safety Code § 25249.6, for failing to warn California consumers and customers that use of the Products will expose them to DEA. No public enforcer has diligently prosecuted the allegations set forth in the Notice.
1.5 No Admission. Shinhwa denies the material factual and legal allegations contained in the Notice and maintains that, to the best of its knowledge, all products that are or have been sold and distributed in California, including the Products, have been and are in compliance with all laws. Nothing in this Settlement Agreement shall be construed as an admission against interest by Shinhwa of any fact, finding, issue of law, or violation of law; nor shall compliance with this Settlement Agreement constitute or be construed as an admission against interest by Shinhwa of any fact, finding, conclusion, issue of law or violation of law, such being specifically denied by Shinhwa. However, this § 1.5 shall not diminish or otherwise affect the obligations, responsibilities and duties under this Settlement Agreement. Notwithstanding the allegations in the Notice, Shinhwa maintains that it has not knowingly manufactured, or caused to be manufactured, the Products for sale in California in violation of Proposition 65.
1.6 Effective Date. For purposes of this Settlement Agreement, the term “Effective Date” shall mean the date that both Parties are have notice that this Agreement is fully executed.
2. INJUNCTIVE RELIEF: WARNINGS
2.1 Clear and Reasonable Warning. As of the Effective Date, or within ninety (90) days after the Effective Date, and continuing thereafter, a clear and reasonable exposure warning as set forth in this §§ 2.1 and 2.2 must be provided for all Products that Shinhwa manufacturers, imports, distributes, sells, or offers for sale in California. The warning shall consist of either the Warning or Alternative Warning described in §§ 2.1(a) or (b), respectively:
(a) Warning. The “Warning” shall consist of the statement:
WARNING: This product can expose you to chemicals including diethanolamine (DEA), which is known to the State of California to cause cancer. For more information go to www.P65Warnings.ca.gov.
(b) Alternative Warning: Shinhwa may, but is not required to, use the alternative short-form warning as set forth in this § 2.1(b) (“Alternative Warning”) as follows:
WARNING: Cancer - www.P65Warnings.ca.gov.
2.2 A Warning or Alternative Warning provided pursuant to § 2.1 must print the word “WARNING:” in all capital letters and in bold font, followed by a colon. The warning symbol to the left of the word “WARNING:” must be a black exclamation point in a yellow equilateral triangle with a black outline, except that if the sign or label for the Products does not use the color yellow, the symbol may be in black and white. The symbol must be in a size no smaller than the height of the word “WARNING:”. The Warning or Alternative Warning shall be affixed to or printed on the Products’ packaging or labeling, or on a placard, shelf tag, sign or electronic device or automatic process, provided that the Warning or Alternative Warning is displayed with such conspicuousness, as compared with other words, statements, or designs as to render it likely to be read and understood by an ordinary individual under customary conditions of purchase or use. The Warning or Alternative Warning may be contained in the same section of the packaging, labeling, or instruction booklet that states other safety warnings, if any, concerning the use of the Product and shall be at least the same size as those other safety warnings.
In addition to affixing the Warning or Alternative Warning to the Product’s packaging or labeling, the Warning or Alternative Warning shall be posted on websites where Shinhwa offers Products for sale to consumers in California. The requirements of this Section shall be satisfied if the Warning or Alternative Warning, or a clearly marked hyperlink using the word “WARNING,” appears on the product display page, or by otherwise prominently displaying the warning to the purchaser prior to completing the purchase. To comply with this Section, Shinhwa shall (a) post the Warning or Alternative Warning on its own website and, if it has the ability to do so, on the websites of its third-party internet sellers; and (b) if it does not have the ability to post the Warning or Alternative Warning on the websites of its third-party internet sellers, provide such sellers with written notice in accordance with Title 27, California Code of Regulations, Section 25600.2. Third-party internet sellers of the Product that have been provided with written notice in accordance with Title 27, California Code of Regulations, Section 25600.2 are not released in Section 5 of this Agreement if they fail to meet the warning requirements of this Section.
2.3 Compliance with Warning Regulations. The Parties agree that Shinhwa shall be deemed to be in compliance with Proposition 65 and this Settlement Agreement by either adhering to § 2 of this Settlement Agreement or by complying with warning requirements adopted by the State of California’s Office of Environmental Health Hazard Assessment (“OEHHA”) applicable to the Product and the exposures at issue that are in effect after the Effective Date, or within 90 days after the Effective Date.
3. PENALTIES PURSUANT TO HEALTH & SAFETY CODE § 25249.7(b)
In settlement of all the claims referred to in this Settlement Agreement, Shinhwa shall pay $______.00 as a Civil Penalty in accordance with this Section. The Civil Penalty payment shall be allocated in accordance with California Health & Safety Code §§ 25249.12(c)(1) and (d), with 75% of the Penalty remitted to OEHHA and the remaining 25% of the Penalty remitted to Balabbo. The Civil Penalty payment(s) shall be delivered to the addresses identified in § 3.2, below. For all amounts due and owing that are not sent within the payment times set forth below, Shinhwa shall pay a late civil penalty payment fee equal to $100/day to be allocated in accordance with California Health & Safety Code § 25249.12(c)(1) and (d).
3.1 Civil Penalty. Within ten (10) business days of the Effective Date, Shinhwa shall issue two (2) separate checks for the Civil Penalty payment: (a) one to “OEHHA” in the amount of $______.00; and one to (b) “Brodsky Smith in Trust for Balabbo” in the amount of $_____.00. The Civil Penalty payment(s) shall be delivered to the addresses identified in § 3.2, below.
3.2 Payment Procedures.
(a) Issuance of Payments. Payments shall be delivered as follows:
(i) All payments owed to Balabbo, pursuant to § 3.1 shall be delivered to the following payment address:
Evan J. Smith, Esquire
Two Bala Plaza, Suite 805
Bala Cynwyd, PA 19004.
(ii) All payments owed to OEHHA (EIN: 68-0284486), pursuant to § 3.1 shall be delivered directly to OEHHA (Memo Line “Prop 65 Penalties”) at the following addresses:
For United States Postal Service Delivery:
Fiscal Operations Branch Chief
Office of Environmental Health Hazard Assessment
P.O. Box 4010
Sacramento, CA 95812-4010.
For Non-United States Postal Service Delivery:
Fiscal Operations Branch Chief
Office of Environmental Health Hazard Assessment
1001 “I” Street
Sacramento, CA 95814.
(b) Copy of Payments to OEHHA. Shinhwa agrees to provide Balabbo’s counsel with a copy of the check payable to OEHHA, simultaneously with its penalty payment to Balabbo, to be delivered to the address provided in § 3.2(a)(i), as proof of payment to OEHHA.
(c) Tax Documentation. Shinhwa agrees to provide a completed IRS 1099 for its payments to, and Balabbo agrees to provide IRS W-9 forms for, each of the following payees under this Settlement Agreement:
(i) “Precila Balabbo” whose address and tax identification number shall be provided within five (5) calendar days of the Effective Date;
(ii) “Brodsky Smith” (EIN: 23-2971061) at the address provided in Section 3.2(a)(i); and
(iii) “Office of Environmental Health Hazard Assessment” 1001 “I” Street, Sacramento, CA 95814.
4. REIMBURSEMENT OF FEES AND COSTS
The Parties acknowledge that Balabbo and her counsel offered to reach preliminary agreement on the material terms of this dispute before reaching terms on the amount of fees and costs to be reimbursed to her. The Parties thereafter reached an accord on the compensation due to Balabbo and her counsel under general contract principles and the private attorney general doctrine and principles codified at California Code of Civil Procedure § 1021.5, for all work performed through the Effective Date. Under these legal principles, Shinhwa shall reimburse Balabbo’s counsel for fees and costs incurred as a result of investigating and bringing this matter to the attention of Shinhwa, and negotiating a settlement in the public interest. Within ten (10) business days of the Effective Date, Shinhwa shall send a check payable to “Brodsky Smith” in the amount of $______.00 for delivery to the address identified in § 3.2(a)(i), above.
5. RELEASE OF ALL CLAIMS
5.1 Release of Shinhwa and Upstream and Downstream Customers and Entities. This Settlement Agreement is a full, final and binding resolution between Balabbo, acting on her own behalf, and Shinhwa, of any violation of Proposition 65 that was or could have been asserted by Balabbo or on behalf of her past and current agents, representatives, attorneys, successors, and/or assigns (“Releasors”) for failure to provide warnings for alleged exposures to DEA from use of the Products, and Releasors hereby release any such claims against Shinhwa and its parents, subsidiaries, affiliated entities, shareholders, marketplaces, directors, officers, agents, employees, attorneys, successors and assignees, and each entity to whom Shinhwa directly or indirectly distributes or sells the Products, including but not limited to, downstream distributors, wholesalers, customers, retailers, including but not limited to Target, and its respective subsidiaries, affiliates and parents, franchisees, cooperative members and licensees (collectively, the “Releasees”), from all claims for violations of Proposition 65 through the Effective Date, or within 90 days after the Effective Date, based on exposure to DEA from use of the Products.
In further consideration of the promises and agreements herein contained, and for the payments to be made pursuant to §§ 3 and 4 above, Balabbo, on behalf of herself, her past and current agents, representatives, attorneys, successors and/or assignees, hereby covenants not to sue and waives any right to institute, participate in, directly or indirectly, any form of legal action and releases all claims that she may have, including without limitation, all actions and causes of action in law and in equity, all obligations, expenses (including without limitation all attorneys’ fees, expert fees, and investigation fees, and costs), damages, losses, liabilities and demands against any of the Releasees of any nature, character, or kind, whether known or unknown, suspected or unsuspected, limited to and arising out of the alleged or actual exposure to DEA from use of the Products.
5.2 Shinhwa’s Release of Balabbo. Shinhwa, on behalf of itself, its past and current agents, representatives, attorneys, successors and/or assignees, hereby waives any and all claims against Balabbo, her attorneys and other representatives, for any and all actions taken or statements made by Balabbo and/or her attorneys and other representatives, whether in the course of investigating claims or otherwise seeking to enforce Proposition 65 against it in this matter or with respect to exposure to DEA from use of the Products through the Effective Date, or within 90 days after the Effective Date.
5.3 California Civil Code § 1542. It is possible that other claims not known to the Parties arising out of the facts alleged in the Notice and relating to the Products will develop or be discovered. Balabbo, on behalf of herself only, on the one hand, and Shinhwa, on the other hand, acknowledge that this Agreement is expressly intended to cover and include all such claims up through the Effective Date, or within 90 days after the Effective Date, including all rights of action therefor. The Parties acknowledge that the claims released in §§ 5.1 and 5.2, above, may include unknown claims, and nevertheless waive California Civil Code § 1542 as to any such unknown claims. California Civil Code § 1542 reads as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.
Balabbo and Shinhwa each respectively acknowledge and understand the significance and consequences of this specific waiver of California Civil Code § 1542.
5.4 Deemed Compliance with Proposition 65. The Parties agree that compliance by Shinhwa with this Settlement Agreement constitutes compliance with Proposition 65 with respect to exposure to DEA from use of the Products.
5.5. Public Benefit. It is the Parties’ understanding that the commitments Shinhwa has agreed to herein, and the actions to be taken by Shinhwa under this Settlement Agreement, including payment of a civil penalty, would confer a significant benefit to the general public, as set forth in Code of Civil Procedure § 1021.5 and Cal. Admin. Code tit. 11, § 3201. As such, it is the intent of the Parties that, to the extent any other private party initiates an action alleging a violation of Proposition 65 with respect to Shinhwa’s failure to provide a warning concerning exposure to DEA prior to use of the Products it has manufactured, distributed, sold, or offered for sale in California, or will manufacture, distribute, sell, or offer for sale in California, such private party action would not confer a significant benefit on the general public as to those Products addressed in this Settlement Agreement, provided that Shinhwa is in material compliance with this Settlement Agreement.
If, subsequent to the execution of this Settlement Agreement, any of the provisions of this Settlement Agreement are deemed by a court to be unenforceable, the validity of the enforceable provisions remaining shall not be adversely affected but only to the extent the deletion of the provision deemed unenforceable does not materially affect, or otherwise result in the effect of the Settlement Agreement being contrary to the intent of the Parties in entering into this Settlement Agreement.
7. GOVERNING LAW
The terms of this Settlement Agreement shall be governed by the law of the State of California and apply within the State of California. In the event that Proposition 65 is repealed or is otherwise rendered inapplicable or limited by reason of law generally, or as to the Products, or if DEA is delisted, Shinhwa shall provide written notice to Balabbo of any asserted change in the law, and shall have no further obligations pursuant to this Settlement Agreement with respect to, and to the extent that, a Product is so affected. This Settlement Agreement is enforceable solely by the Parties hereto.
Unless specified herein, all correspondence and notices required to be provided pursuant to this Settlement Agreement shall be in writing and personally delivered or sent by: (i) first-class (registered or certified mail) return receipt requested; or (ii) overnight or two-day courier on any Party by the other Party to the following addresses:
3435 Wilshire Blvd., #2310
Los Angeles, CA 90010
Evan J. Smith
Two Bala Plaza, Suite 805
Bala Cynwyd, PA 19004
Either party, from time to time, may specify in writing to the other party a change of address to which all notices and other communications shall be sent.
9. COUNTERPARTS: SIGNATURES
This Settlement Agreement may be executed in counterparts and by facsimile or .pdf signature, each of which shall be deemed an original, and all of which, when taken together, shall constitute one and the same document.
10. COMPLIANCE WITH HEALTH & SAFETY CODE § 25249.7(f)
Balabbo agrees to comply with the reporting requirements referenced in Health & Safety Code § 25249.7(f).
This Settlement Agreement may be modified only by a written agreement of the Parties.
12. ENTIRE AGREEMENT
This Settlement Agreement contains the sole and entire agreement of the Parties and any and all prior negotiations and understandings related hereto shall be deemed to have been merged within it. No representations or terms of agreement other than those contained herein exist or have been made by any Party with respect to the other Party or the subject matter hereof.
The undersigned are authorized to execute this Settlement Agreement and have read, understood and agree to all of the terms and conditions contained of this Settlement Agreement.
AGREED TO: AGREED TO:
By: ____________________________ By: ______________________________
Precila Balabbo Shinhwa Corp.
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