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Solus Industrial Innovations LLC makes plastics at an Orange County manufacturing facility. Solus had moved some production to Rancho Santa Margarita, Calif., from Aston, Pa., in 2007 and was in a hurry to begin production. The company purchased a water heater for $541.66 from a Lowe’s home improvement store to avoid the cost and permitting requirements of a proper installation. Use of an industrial water heater would have required permits and the installation of a natural gas line, and it would have delayed the start of the Rancho Santa Margarita extrusion of plastic components for conveyor chains and sprockets. In March 2009, that water heater exploded, killing two workers instantly in what district attorney refers to as an “untimely and horrific death.”

Solus former plant manager Carl E. Richardson and former maintenance supervisor Roy Faulkinbury were responsible for removal of an automatic safety shut-off protection and installation of a temperature control device to force the heater to operate above its capacity. The heater had leaked often and blown a safety valve but was kept in service. On March 19, 2009 the water heater exploded killing two an injuring a third employee. The tank pierced the 30-foot-high roof and landed about 25 feet from its original location. The blast hurled other equipment and materials against the concrete-block walls causing extensive damage and effectively destroying the facility, which never resumed operations.

The two pleaded guilty on Feb. 14 to two felony violations of California Labor Code section 6425, subdivision (a). They agreed to collectively pay $450,000 to families of the victims and individually do 250 hours of community service. (See People v. Faulkinbury, (Super. Ct. Orange County, 2012, No. 12CF0698).) No party challenged the district attorney’s standing to bring these or other appropriate criminal prosecutions.

The district attorney’s office also filed a civil lawsuit against Solus, Emerson and subsidiary Emerson Power Transmission Corp. The complaint contains four causes of action, all based on the same worker health and safety standards placed at issue in the administrative proceedings. The third cause of action alleges that Solus’s failure to comply with workplace safety standards amounts to an unlawful, unfair and fraudulent business practice under Business and Professions Code section 17200, and the district attorney requests imposition of civil penalties as a consequence of that practice, in the amount of up to $2,500 per day, per employee, for the period from November 29, 2007 through March 19, 2009. The fourth cause of action alleges Solus made numerous false and misleading representations concerning its commitment to workplace safety and its compliance with all applicable workplace safety standards, and as a result of those false and misleading statements, Solus was allegedly able to retain employees and customers in violation of Business and Professions Code section 17500. Again, the district attorney requests imposition of civil penalties as a consequence of this alleged misconduct, in the amount of up to $2,500 per day, per employee, for the period from November 29, 2007 through March 19, 2009.

Solus demurred to these two causes of action, contending they were preempted under Fed/OSHA, because a prosecutor’s pursuit of civil penalties under the UCL is not part of California’s workplace safety plan approved by the Secretary. The trial court disagreed, and overruled the demurrer to the district attorney’s two causes of action based on violations of the UCL. The Court of Appeal reversed in the published opinion of Solus Industrial Innovations LLC v The Superior Court of Orange County.

Under the supremacy clause of the United States Constitution (art. VI, cl. 2), Congress has the power to preempt state law concerning matters that lie within the authority of Congress. On the matter of workplace safety regulation, the federal government’s intent to preempt is clear: However, “Congress expressly saved two areas from federal pre-emption. . . . [T]he Act does not ‘supersede or in any manner affect any workmen’s compensation law [and] the Act does not ‘prevent any State agency or court from asserting jurisdiction under State law over any occupational safety or health issue with respect to which no [federal] standard is in effect.’” Moreover, Congress also gave states the option of side-stepping federal preemption entirely, by allowing any state which “desires to assume responsibility for development and enforcement therein of occupational safety and health standards relating to any occupational safety or health issue [to] submit a State plan for the development of such standards and their enforcement.”

After a review of the facts and law on preemption, the Court of Appeal concluded that state regulation of workplace safety standards is explicitly preempted by federal law under the OSH Act, and that consequently California is entitled to exercise its regulatory power only in accordance with the terms of its federally approved workplace safety plan. Thus the district attorney cannot presently rely on the UCL to provide an additional means of penalizing an employer for its violation of workplace safety standards.