Cross-posted by Forbes.com at WLF’s contributor site
In September 2012, we commented on Northern District of California Judge Phyllis Hamilton’s rejection of a settlement of the food labeling class action Astiana v. Ben & Jerry’s Homemade (Update: Judge Rejects Settlement in Ben & Jerry’s “Natural” Class Action). Last January, she requested briefs on class certification. On Tuesday, January 7, Judge Hamilton rejected class certification.
Ms. Astiana, a Food Court frequent flier, has had a rough go of it lately in her role as a named class action plaintiff. We noted here six months ago that Southern District of California Judge Marilyn Huff denied certification of Astiana’s lawsuit against Kashi.
In the suit against Ben & Jerry’s Ms. Astiana argued the company’s labeling of certain ice cream pints as “all natural” misled her into paying a premium for the product and “disrupted my vibe” (her words, not ours). The ice cream, she alleges, is not natural due to the presence of synthetic alkalized cocoa. Judge Hamilton rejected class certification on two grounds.
Ascertainability. Though not a formal part of Federal Rule of Civil Procedure 23, which governs federal class actions, courts have found that the class must be ascertainable—that is, it “must be sufficiently definite so that it is administratively feasible to determine whether a particular person is a class member.” The U.S. Court of Appeals for the Third Circuit enraged the plaintiffs’ bar last summer with two rulings on ascertainability, Hayes v. Wal-Mart Stores and Carrera v. Bayer Corp. In those cases, the defendants, both consumer product makers, argued that because the class members offered no reliable and administratively feasible way to prove they had purchased the targeted product (such as sales receipts), the class was not ascertainable. The court agreed, ruling that reliance upon a consumer’s “say so” that they purchased the product did not permit defendants an opportunity to challenge the evidence used to prove class membership.
Defendants in food labeling class actions routinely argue in opposition to class certification that the only way to ascertain whether a consumer is in the class is to take his or her word for it, and that such “say so” is insufficient. Federal judges, especially in the Food Court, have mostly slapped such arguments aside. For instance, Judge Richard Seeborg wrote in a 2012 motion certifying Ries v. AriZona Beverages as a class action that if courts required proof of purchase or a feasible substitute “there would be no such thing as a consumer class action.”
Not surprisingly, then, Judge Hamilton in Astiana did not focus her ascertainability analysis on whether consumers could prove they bought the ice cream in question. Instead, she found that the plaintiffs offered no feasible way to distinguish between class members who purchased ice cream containing cocoa that had been “naturally” alkalized, and those who had bought pints with “artificially” alkalized cocoa.
Commonality. Judge Hamilton also found that questions of law or fact common to class members did not predominate over individual questions, an inquiry required by Rule 23(b)(3). Ms. Astiana failed to meet her burden “of showing that there is a classwide method of awarding relief that is consistent with her theory of deceptive and fraudulent business practices, false advertising, or common law fraud (or the alternative theory of restitution based on quasi-contract).” She in fact offered no damages evidence whatsoever.
Take the Next Step on Ascertainability. Judge Hamilton’s rejection of class certification on the grounds that the class was not ascertainable is a welcome development. We hope it encourages other judges to more seriously consider similar arguments, especially those which raise the plaintiffs’ lack of proof of purchase as an incurable flaw. There is authority on this point in the Northern District of California, a 2011 decision, Xavier v. Philip Morris USA. In that case, Judge William Alsup denied class certification in part because the members of the proposed class could not be objectively ascertained. A method that relied upon a consumer’s subjective memory of purchases, rather than objective proof (such as receipts), is “unreliable,” the court found.
Judge Alsup stated very clearly why ascertainability is a critically important class action requirement for both plaintiffs and defendants:
Ascertainability is needed for properly enforcing the preclusive effect of final judgment. The class definition must be clear in its applicability so that it will be clear later on whose rights are merged into the judgment, that is, who gets the benefit of any relief and who gets the burden of any loss. If the definition is not clear in its applicability, then satellite litigation will be invited over who was in the class in the first place. Indeed, courts of appeals have found class certification to be inappropriate where ascertaining class membership would require unmanageable individualized inquiry.
The American judicial system endorses class actions as a tool which can, when used properly, efficiently resolve claims where numerous people suffered the same harm allegedly caused by the same source. Those who file such lawsuits are not, however, relieved of basic legal requirements such as the need to prove injury. Purchasers who claim to be harmed by misleading food labels should embrace this requirement. Otherwise, uninjured consumers can siphon off damages from those who were truly harmed. Plaintiffs’ lawyers who have brought the wave of food labeling class actions may cry foul if other judges follow Judges Hamilton and Alsup on the issue of ascertainability. But judges should be unconcerned with that possibility.