Consumer Products: Class certified in EZ Seed caseEarly this week, Judge Vincent Briccetti in the Southern District of New York certified classes of consumers in New York and California who purchased the product Scotts Turf Builder EZ Seed. In re Scotts EZ Seed Litigation.

The lawsuit alleges violations of the UCL, FAL, CLRA and New York’s General Business Law based on sales of the product 

Plaintiffs allege that the EZ Seed is falsely advertised because:“EZ Seed,” a grass seed product combined with a fertilizer. Among other things, Scotts advertises EZ Seed as growing grass “50% thicker with half the water,” as compared to “ordinary seed.”  The packaging of the product offers a “No Quibble Guarantee” that allows consumers to get their money back. Plaintiffs allege that the EZ Seed is falsely advertised because:

  1. it does not grow grass at all, or in the alternative,
  2. the grass grown is not 50% thicker than other grasses.

In his order, Judge Briccetti certified classes in both New York and California, finding Rule 23 factors satisfied.

Notably, the court held that the class was readily ascertainable, rejecting arguments that classes cannot be certified when members are unlikely to retain receipts or other records of purchase. Citing the Ries decision out of Northern California, the court held that “if proof of purchase was required to satisfy the ascertainability requirement, ‘there would be no such thing as a consumer class action,’ especially with respect to low-cost products.’”

It will be interesting to see what the Ninth Circuit has to say on this issue in the coming months, and whether Ries remains citable for this proposition.

Judge Briccetti also held that the “No Quibble Guarantee” was not superior to a class action as a means of resolution. The court made broad strokes, expressing doubt that a “non-adjudicative” form of redress could even be considered as part of a superiority analysis and ultimately concluded that because the money-back guarantee was not publicized in the same manner as a class notice, it could not be superior to a class action.

Plaintiffs, however, did not get everything they asked for. Judge Briccetti declined to grant a class for injunctive relief because Scotts had already removed the “50% thicker” claim from EZ Seed packaging.

The court also declined to certify a damages class for the plaintiffs’ profit disgorgement theory, applying Comcast to find that the model did not fit the theory of liability in the case. Based on plaintiffs’ liability theories, the class is either entitled to a complete refund of the purchase price (if EZ Seed does not grow grass at all) or the price premium paid based on the 50% thicker claim (to the extent consumers were enticed to pay more for the product than they would have based on a false claim of thicker grass).

Because the disgorgement of profit model (essentially, awarding the class Scotts’ profits from the sale of the products), did not fit either theory, the court found that it had not satisfied Comcast.

Of course, this was a Phyrric victory for the defense, as the court certified damages classes based on the other two models proposed by plaintiffs.