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CBS2 Investigates: Customers Pay The Price For Prop. 65 Lawsuits Against LA Restaurants

LOS ANGELES ( — Customers are ultimately paying the price for lawsuits against some Los Angeles-area restaurants, according to CBS2 investigative reporter David Goldstein.

In the past six months, artist Raphael Delgado has had his attorney write letters to 20 restaurants, including California Pizza Kitchen, Maria's Italian Kitchen and Big Daddy's Fire Grill, in which he claims he's documented violations of Proposition 65, which requires businesses to warn residents about possible exposures to chemicals.

Goldstein reported that Delgado is following the letter of the law, which states that "any individual acting in the public interest may enforce Prop. 65 by filing a lawsuit against a business."

In January, the owner of Big Daddy's, Dennis Constanzo, said he was threatened with legal action for supposedly not posting warning signs.

"(Delgado) indicated he wanted to settle the matter. And that is what it's all about," he said.

Three restaurants have settled with Delgado, paying penalties and legal fees that added up to more than $15,000, according to the California Attorney General's website. Those costs could end up being passed on to customers in the form of higher food prices.

Constanzo claims his warning signs were always up, but said restaurant owners shouldn't have to pay, regardless.

"The question I would say is how was he harmed? There is no harm to Mr. Delgado. He is using the system to his advantage. It is legal extortion," said Constanzo.

When confronted by Goldstein, Delgado claimed he isn't making any money and quickly called his attorney, Miguel Custodio.

Custodio, who has written 67 threatening letters to restaurants on behalf of just five clients, admitted he's known Delgado since high school and they even had a business together, but said the Prop. 65 violations are valid.

Asked how Delgado found 20 restaurants in violation of Prop. 65, Custodio said, "You know, he goes to eat out just like, I think, anybody else does and he finds that these establishments don't have these notices."

State Assemblyman Mike Gatto, of Burbank, said the lawsuits have led to higher food costs and restaurants are being forced to leave California.

He's authored a bill that would give restaurants a 14-day grace period to correct any problems.

"If the goal of Prop. 65 was to make sure that warning signs were put up in businesses, then let's give businesses two weeks or so to put up a warning sign without facing very, very punitive lawsuits," said Gatto.

Gatto's proposed legislation is making its way through the state Senate and should be on the governor's desk in a few weeks.

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