Topic: Consumer class actions

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Plaintiffs’ attorneys told to “get real” with fee award request

Although false advertising class action law in California is generally (and accurately) perceived as bending over backwards to advantage plaintiffs, recent fee award decisions may make plaintiffs’ lawyers more wary about bringing lawsuits that are not slam dunk victories.

This week, Judge George H. Wu out of the Central District of California slammed plaintiff attorneys by awarding them a modest $11,368.25 in fees, out of a requested $1.9 million fee award.

In Red v. Kraft Foods, Inc., plaintiff attorneys filed a class action claiming that Kraft engaged in false advertising under the CLRA, UCL and FAL by falsely … Continue Reading

California’s Made In USA standard survives another test in court

Another court in the Southern District of California has agreed that California’s Made in USA law is more stringent than the federal standard, holding that the law is not preempted by the Federal Trade Commission Act or the Textile Fiber Products Identification Act.  But the court also addressed a new claim—that the California law violates the Dormant Commerce Clause of the United States Constitution.

In Clark v. Citizens of Humanity, LLC, plaintiff alleged that defendants’ jeans were falsely labeled as “Made in USA” when they actually contained fabric, thread, buttons, rivets, or subcomponents of the zipper manufactured outside … Continue Reading

Ninth Circuit says “not so fast” for Hain Celestial dismissal

Last Friday, the Ninth Circuit reversed a holding by the District Court for Southern District of California dismissing “All Natural” false advertising claims against Hain Celestial cosmetics because they were barred by the primary jurisdiction doctrine. The Court stated that dismissal of the claims was the improper result, even if the FDA did have primary jurisdiction to handle the all natural claims. Along the way, the Ninth Circuit also managed to make plaintiff-friendly rulings regarding FDA preemption and unjust enrichment claims.

All Natural Cosmetics?

Hain Celestial markets and sells cosmetics advertised as “All Natural,” “Pure Natural,” or “Pure, Natural & … Continue Reading

Ninth Circuit says manifestation of a defect does not matter at the pleading stage

Last month, the Ninth Circuit held that a district court in the Western District of Washington erred by striking class allegations from a complaint because a product defect did not manifest in the vast majority of products purchased.

District Court Strikes Class Allegations From Complaint

In the case, several named plaintiffs filed a class action complaint alleging that a design defect in the Xbox 360 video game console gouged and scratched game disks, making the disks unplayable. Defendant argued that only 0.4% of Xbox owners reported the defect in the product and that any scratching was caused by consumer error.… Continue Reading

Lack of defendant’s consumer records may not mean a class is unascertainable

A California Court of Appeal recently held that a class is not unascertainable simply because individual class members cannot be identified from a defendant’s records so long as there is some objective means for identifying class members.

In Aguirre v. Amscan Holdings, Inc., plaintiff alleged that defendant Party America violated the Song-Beverly Credit Card Act by requesting and recording credit cardholders’ zip codes in conjunction with credit card purchase transactions.

Party America moved for an order striking and dismissing the class allegations from the complaint and denying class certification. It argued the class was not ascertainable because there were … Continue Reading

Ninth Circuit says no preemption for Benecol’s “No Trans Fat” label claims

Reversing an order from the Southern District of California, the Ninth Circuit has held that state law false advertising claims based on “No Trans Fat” statements on the butter/margarine substitute Benecol are not preempted by federal law.

Robert Reid filed class claims for violations of California’s Consumer Legal Remedies Act, Unfair Competition Law and False Advertising Law, arguing that representations on the labeling of Benecol – among them “No Trans Fat”, “No Trans Fatty Acids” and “Proven To Reduce Cholesterol” – were misleading to consumers because the product did contain trans fat (albeit a very small amount) and that … Continue Reading

Plaintiffs’ energy zapped in Redline Xtreme lawsuit

A Florida federal judge refused to certify a nationwide class of purchasers of Redline Extreme Energy Drink stating that the class lacked ascertainability (a topic we have previously addressed on this blog).

The plaintiffs claimed in Mirabella v. Vital Pharmaceuticals, Inc., S.D. Florida Case No. 0:12-cv-62086, that Vital Pharmaceuticals Inc. concealed the dangerous side effects of its Redline Xtreme energy drink, and attempted to certify a class composed of all purchasers of the approximately $3 drink since 2008.

The Court noted that ascertainability was a “threshold” requirement, such that the plaintiff must be able to demonstrate that the … Continue Reading

California court creates split of authority for class action damages modeling in the same case

Class certification is a do or die moment for class action plaintiffs. Currently, a hotly contested issue at class certification is whether or not a plaintiff can propose a damages model that is common to the putative class.

In 2013, the U.S. Supreme Court held in Comcast v. Behrend that at the class certification stage, plaintiffs must present a damages model that is consistent with their liability case, and that courts “must conduct a rigorous analysis to determine whether that is so.”

Following Comcast, class action defendants have seized every opportunity to attack plaintiff’s damages models to avoid class … Continue Reading

Making online terms and conditions stick

Because the interaction between online retailers and their customers is limited, online retailers have little choice but to present terms and conditions of sale on their websites. These online terms and conditions present concepts important to online retailers, including arbitration and choice of law provisions. The way in which online retailers present these terms and conditions to customers, and the way in which the customers manifest assent, is crucial to determining whether these terms and conditions are enforceable. Here are some key considerations in presenting online terms and conditions that may help to avoid court when you’re expected to be … Continue Reading

California court certifies “100% Natural” class for GMO cooking oil

Last week, a court in the Central District of California certified classes in eleven states over claims that Wesson Oil products are not “100% Natural.” In the lawsuit, plaintiffs claim that ConAgra misled them by labeling Wesson cooking oil “100% natural,” even though the oils contain genetically modified organisms, or GMOs.

 No receipts required

Strongly on one side of the split in the Ninth Circuit, Judge Margaret M. Morrow rejected defendant’s argument that the class—who largely has no records of even purchasing the oil—would not be ascertainable.

Judge Morrow found that, even if they had no record of purchase, … Continue Reading

UPDATE: Ninth Circuit briefing in ConAgra ascertainability appeal complete

As we recently posted, the Ninth Circuit will finally tackle the circuit split on ascertainability, agreeing to hear the appeal of a class certification denial in the case Jones v. ConAgra.

ConAgra’s answering brief has now been filed, in addition to amicus briefs filed by Public Citizen, Inc. and Center for Science in the Public Interest (in support of Levi Jones’s appeal) and the Washington Legal Foundation and The Chamber of Commerce of the United States (in support of appellee ConAgra).

ConAgra first laid out the reasons why ascertainability is important in response to Mr. Jones’s argument that … Continue Reading

UPDATE: No Appeal In Jeans “Made In USA” Claim

We previously posted about the case Paz v. AG Adriano Goldschmied, in which the Southern District of California denied a motion to dismiss a complaint alleging violations of California’s “Made in the USA” standard. In denying the motion, the court held that California’s stricter standard (i.e., all components of a product, even a screw, must be made “entirely or substantially” in the United States) was not preempted by more lenient standards set forth by the Federal Trade Commission Act and the Textile Fiber Products Identification Act.

Attempting to counter the ruling, defendants filed a request for interlocutory … Continue Reading

Class certified in EZ Seed case in New York and California

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.”  … Continue Reading

Ninth Circuit says plaintiff naysaying not enough to challenge CAFA removal

The Ninth Circuit recently interpreted the Supreme Court’s newly minted decision in Dart Cherokee Basin Operating Co., LLC v. Owens, holding that plaintiffs seeking remand of actions removed to federal court pursuant to the Class Action Fairness Act must present evidence when mounting challenges to a defendant’s evidentiary showing that the $5 million jurisdictional threshold has been met.

Case background

In Ibarra v. Manheim Investments, Inc., plaintiff filed a class action asserting violations of the California labor code for failure to pay minimum wages and overtime, provide meals and rest periods, furnish compliant wage statements, and pay timely … Continue Reading

Ninth Circuit finally poised to decide ascertainability split

At long last, the Ninth Circuit has heard the cries of confused class action litigants and will be weighing in on whether self-identification of class members (without the benefit of a receipt or other indicia of purchase) is enough to pass the implicit ascertainability requirement of Rule 23.

As we have often commented on this blog, the split in treatment of purchasers of small-ticket items (the issue most notably addressed by the Third Circuit in Carrera) by district courts has resulted in disparate ascertainability rulings, and there is no certainty how courts (even within the same circuit) will come … Continue Reading

Circuit split settled – notice of removal under CAFA does not require evidence

Class action litigators have long faced the unsettled question of what amount of evidence is necessary to support the removal of a state court action to federal court under the Class Action Fairness Act, the answer often changing depending on the specific jurisdiction. No longer.

On December 15, 2014, in a 5-4 decision, the United States Supreme Court set the record straight, ruling that a notice of removal under CAFA does not need to be initially supported by evidence, but only plausibly allege the jurisdictional elements.

Under CAFA, a defendant may remove a class action to federal court if … Continue Reading

“All natural” claims against Dole nixed; no deception if synthetics expected in food

As we previously posted in “All natural: FDA silence continues to create problems for false advertising defendants”,  the Food and Drug Administration’s failure to provide a definition of what a “natural” ingredient is makes it difficult for companies defending against false advertising claims based on allegations that food products are marketed as “natural” when the product allegedly contains an artificial or synthetic product because there is no governing standard.

Although the FDA has not promulgated a formal definition, the FDA maintains a policy that “natural” in food products means “nothing artificial or synthetic (including all color additives regardless of … Continue Reading

San Bernardino judge finds homeopathic drug labelling is not false or misleading

On November 25, 2014, just in time for Thanksgiving, Judge Bryan Foster in San Bernardino Superior Court tentatively entered a judgment in favor of Green Pharmaceuticals, following a week-long bench trial.

The case, filed on June 28, 2011 by plaintiff Rachel Rosendez, brought claims against Green Pharmaceuticals stemming from its manufacture and sale of the product SnoreStop. Plaintiff argued that the over-the-counter homeopathic product was not effective in stopping snoring, based on both her own experience and a lack of scientific evidence demonstrating the effectiveness of its ingredients.

Based on these allegations, Plaintiff argued violations of the California … Continue Reading

Class claims certified for Hain Celestial Organic Cosmetics

Last week, Magistrate Judge Beeler in the Northern District of California certified a class of purchasers of cosmetics marketed as “organic” by The Hain Celestial Group, Inc.

In so doing, Judge Beeler weighed in on several hot spot issues for class certification, including ascertainability, consumer reliance and class-wide damages models. Her determinations seem generally in keeping with the plaintiff-happy class action climate in California, as courts recently seem reticent to deny class certification.

Background

On June 22, 2011, plaintiffs Rosminah Brown and Eric Lohela filed a lawsuit alleging that several different Avalon Organics and Jason cosmetic products (manufactured and marketed … Continue Reading

One plaintiff not enough to prove advertising likely to deceive reasonable consumers

It seems that lately, all it takes to bring a false advertising class action regarding “all natural” or “no sugar added” representations on product packaging is the say-so of one consumer who claims the representations are misleading (even though they might not be technically “false”).

Indeed, at the motion to dismiss stage, courts tend to be quite consumer friendly, many times finding that bare allegations of deception are enough to move the case into discovery.

While this may be frustrating for many defendants who believe they have done nothing wrong, there is light at the end of the tunnel. Despite … Continue Reading

Certification of damages class denied in “All Natural Fruit” false labeling suit

Updating our previous post, another federal district court has interpreted Comcast Corp. v. Behrend to require plaintiffs to demonstrate a viable “means of showing damages on a classwide basis through common proof,” and denied certification of a damages class based on a challenge to the validity of the regression model offered by the plaintiff’s expert. At least in California courts, the recent trend appears to be strict adherence to the “viable class-wide damages methodology,” which could be good news for consumer class action defendants.

In Brazil v. Dole Packaged Foods, plaintiff alleged that Dole packaged fruit products were … Continue Reading

Jamba Juice class deemed ascertainable; Skinnygirl class is not

Federal courts continue their divide on ascertainability requirements for small-ticket items in the wake of Carrera v. Bayer.

Just recently, district courts in California and Illinois (neither of which are bound by Carrera), took opposite stances in applying the 3rd Circuit decision, leaving litigants to wonder when or if the Supreme Court is going to weigh in on the decision.

Until clarification from a higher authority comes, a decision on class certification based on ascertainability can vary wildly, depending on where the case is and, frankly, the personal proclivities of the judge assigned to the case.

Lilly v.

Continue Reading

UPDATE: Recent jeans case confirms harsher “Made In USA” standards exist in California

A California federal district court judge recently provided some clarity on the apparent disparity between California’s “Made in the USA” law and the standard set forth by the Federal Trade Commission.

The Southern District Court of California’s recent decision in Paz v. AG Adriano Goldschmied confirms that California’s “Made in the USA” standard sets forth more stringent requirements than the FTC standard.

In Paz the plaintiff filed a class action complaint against AG Adriano Goldschmied and retailer Nordstrom, alleging that AG falsely labeled its jeans “Made in USA.” The plaintiff alleged that AG’s jeans actually contained fabric, thread, buttons, rivets, … Continue Reading

No more rubber stamps: courts critical of class action settlements

A number of recent cases show courts taking a more active role in approving class action settlements, more closely scrutinizing settlements meant to benefit class members.

Just last month in Redman v. RadioShack Corporation the Seventh Circuit rejected a class action settlement providing for dissemination of $10 coupons to class members and $1 million in attorneys’ fees to class counsel.

Although there were an estimated 16 million RadioShack customers in the class, notice of the proposed settlement was sent to less than 5 million. Of those receiving notice, only 83,000 submitted claims for the coupon—about one half of one percent … Continue Reading

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