Settlement requires notification about lead-tainted casino chips

By Liz Benston

Monday, Aug. 4, 2008 | 8:16 p.m.

Rarely does a company that is sued compliment the plaintiff on a deserved victory – especially if the company believes it has a solid defense.

But that’s what happened last week when the Center for Environmental Health, a nonprofit that has sued numerous companies over lead content in consumer products, declared victory in a legal settlement with Gaming Partners International, the world’s largest manufacturer of casino chips.

The settlement of a lawsuit the center brought under California’s Proposition 65, a 1986 consumer notification law, requires California card rooms to post signs stating that chips on the premises contain lead, a material known to cause cancer and other health problems. Gaming Partners also must manufacture chips that contain no more than .005 percent lead.

The Las Vegas-based manufacturer says its chips already contain a negligible amount of lead that’s of a similar percentage to that reached in the settlement.

While a predecessor company once used a significant amount of lead, which gave chips heft, that company began phasing out the metal from its chips in part because other materials were cheaper and easier to use and because of some concern for workers who mix powdered ingredients, including lead composite, in the manufacturing process, executives say.

So why didn’t the company fight the lawsuit in court?

In California, where hundreds of companies have been sued over Proposition 65, it’s easier for businesses to settle a lawsuit rather than to disprove, beyond a reasonable doubt, harmful levels of exposure to commonly found substances such as lead, Gaming Partners’ attorney John Allen said.

Threshholds of toxic substances published by the state of California relate to exposure rates, which are difficult to measure and would still be subject to endless legal debate, he said.

“Nobody knows what that (safe) level should be because people don’t eat poker chips, just like they don’t eat glassware or raincoats,” among the many other consumer products that contain trace amounts of lead, Allen said.

California’s Attorney General has acknowledged that unscrupulous nonprofits, which can collect damages from complaints, are exploiting the law for financial gain. The Center for Environmental Health is not one of them, Allen said.

“I respect what they’re trying to do,” he said. The center, which has forced numerous companies to reformulate lead-tainted products, says the warning is valid because some older chips are still in circulation and because children, especially babies developing in the womb, are especially succeptible to lead poisoning.

The nonprofit also praised the Las Vegas company for establishing a low-lead threshhold for its chips, which goes beyond the scope of Proposition 65 and is lower than the threshhold Congress has proposed for children’s jewelry.

In 2006, the group reached a settlement with 71 retailers who agreed to stop selling lead-tainted children’s jewelry in California.