A Point Loma grocery store is among hundreds of California businesses now facing a lawsuit alleging their receipt paper contains a toxic chemical, and its owner says he's refusing to pay a settlement over something he believes isn't even in his paper. Jensen's owner Adam Zack says the boxes his receipt paper comes in are labeled BPS- and BPA-free, and that his supplier's own lab testing backs that up.
Lawsuit Targets Hundreds of Businesses Statewide
The lawsuit, filed in San Francisco Superior Court by the nonprofit Environmental Health Advocates, alleges that retailers and restaurants across California put consumers in harm's way through a toxic chemical in their receipt paper, according to 10News.com. The group claims defendants knew or should have known their products contained bisphenol S, known as BPS, and alleges the conduct was deliberate rather than accidental. The suit seeks at least $1 million in damages. BPS functions as an almost invisible ink used to make words appear on thermal receipt paper, per the outlet's reporting.
Zack is among the businesses named in the lawsuit, and he told the station he and his store were not in the wrong and did not want to settle. Environmental Health Advocates sent Zack a Prop 65 violation notice, signed by attorneys from Entorno Law, a San Diego firm the station reports shares a downtown San Diego office with the nonprofit. Zack said he believes the notice was sent in error, since his store's receipt paper boxes were marked BPS- and BPA-free, and his supplier confirmed through lab testing that the paper did not contain the chemical.
Grocer Questions the Motive Behind Enforcement
Zack has refused to pay a settlement and told the station he questions whether this kind of enforcement serves the public's benefit or is really about generating settlements. He's not alone in that suspicion. An anonymous small business owner told the station that Entorno Law offered to settle a separate matter outside of court for no less than $20,000, and said they feared a lawsuit could wipe their business out. The station reported that some business owners said they received violation notices despite using receipt paper marked BPS-free, and that Entorno Law attorneys asked them to sign NDAs before they could even see the test results behind the claims.
Other business owners reported being asked to pay thousands of dollars in settlements just to avoid a lawsuit, the station's reporting found. The station also noted that statewide businesses received a flood of violation notices last year after a grace period ended. State records cited by the outlet showed more than 600 California businesses had received BPS-related Prop 65 violation notices from Entorno Law in a single year.
How Prop 65 Settlements Work
California law allows private groups and individuals to enforce Proposition 65 and collect attorney fees and other costs, and the statute requires businesses to warn customers before exposing them to listed toxins. Under the law, settlements split 75 percent to the state and 25 percent to the private enforcer, with attorney fees and costs collected on top of those penalties, per the station's account. Rubio's Restaurant Group paid a $3,000 civil penalty and $24,000 in attorney's fees and costs, for a total settlement of $27,000, to resolve a claim that its receipts contained BPS. In a separate case described in the station's earlier coverage, Princess Polly agreed to pay Environmental Health Advocates $18,000 for attorney fees and costs plus another $2,000 in state civil penalties.
Environmental Health Advocates' new CEO, Alfredo Duran, who replaced Allan Cate atop the organization in January, defended the group's process to the station. He said the group always obtains laboratory testing results from an accredited lab and files a notice of violation only after an environmental health expert certifies in writing that a product violates Prop 65 for reproductive and developmental toxicity. Duran said the group provides test results and expert reports to the California Attorney General for review, and that the Attorney General reviews notices, lab results, expert analysis, and settlements. He added that the group will produce test results without a nondisclosure agreement once litigation is underway, even though it does ask businesses to sign confidentiality agreements beforehand. Per Duran, the organization is focused primarily on major U.S. retailers, restaurants, banks, and grocery chains, and said it files notices only against businesses with multiple locations and more than 10 employees. He said settlements must include a binding retailer commitment to switch to BPS-free paper, and that funds the group receives are designated exclusively for public health initiatives.
Wider Wave of BPS Notices Across California
The Jensen's case fits into a much broader surge of BPS-related enforcement activity across the state. A legal analysis from Buchalter found more than 325 BPS-related Proposition 65 notices had been filed as of July 21, 2025, with filings increasing dramatically by the day, targeting a wide range of businesses including retailers, restaurants, gas stations, cafes, and service businesses. Sources differ on when the chemical was formally added to the Prop 65 list: 10News reported California added BPS to its list of chemicals known to cause reproductive harm in 2023, while Buchalter's analysis says the listing took effect December 29, 2024, with enforcement beginning January 1, 2025.
Separately, the Office of Environmental Health Hazard Assessment has said it added a developmental-toxicity endpoint to BPS's reproductive-toxicity listing, effective December 8, 2025. The chemical has also drawn national attention beyond California's courts: a 2025 study reported by The Guardian found that holding some U.S. retailers' paper receipts for as little as 10 seconds could expose skin to enough BPS to exceed California's own safety threshold. That same reporting noted the nonprofit Center for Environmental Health had sent similar violation notices to roughly 50 major retailers nationwide, including Burger King, Chanel, Dollar General, AMC Theaters, GameStop, Subway, Foot Locker, and Ace Hardware.
For now, the underlying allegations against Jensen's and the other named businesses remain just that: allegations. Zack maintains his paper tested clean, and he's standing his ground rather than writing a settlement check.
