Court Empowers “Deceived” California Nutella Purchasers to Sue as a Class

On February 2, 2011, plaintiff Athena Hohenberg filed a complaint against Ferrero U.S.A. Inc. alleging that Ferrero untruthfully promoted its product – Nutella – as a healthful product.  According to Hohenberg, advertising language such as “An example of a tasty yet balanced breakfast,” and television commercials depicting “happy children” led her to feed Nutella to her family, including a four-year-old child.  Hohenberg made this complaint despite the fact that Nutella’s nutritional information and its ingredients are visibly and accurately listed on its packaging.  Hohenberg does not deny this.

Click here to see my original post on this complaint.

New Development (Class Certified)

After a failed motion to dismiss the complaint, focus shifted to certification of the class.  Plaintiff asked that the class be extended to all consumers of Nutella in the United States since January 2000.  Judge Marilyn Huff certified the class, but she limited it to California consumers who purchased Nutella after August 2009. 

Analysis

This class certification seems to be an uncomfortable fit with the Supreme Court’s stricter class definition as outlined in last term’s Wal-Mart v. Dukes case.  In Dukes, the Court ruled the class insufficiently similar because it could not be shown that female employees at different stores throughout the country, and at different levels of employment, universally suffered the same discrimination.

Judge Huff distinguishes this case by claiming that the case is “based on a common advertising campaign, and include common questions such as whether Ferrero’s advertising campaign misrepresented that Nutella® is healthier or more nutritious than it actually is, or makes a more significant contribution to a balanced breakfast than it actually does, including for children.  Thus, Rule 23(a)(2)’s commonality requirement is satisfied.”

Judge Huff is perhaps correct that the Nutella advertising campaign is similar for each customer: there are a limited number of print and television advertisements for Nutella, and they share common characteristics.  Almost all, if not all, customers will view a similar advertisement.

What Judge Huff fails to take into account, however, is that the individual’s reaction to the advertisement, and his future consumption choices, can differ greatly.  This is the argument that Russell Jackson makes at Consumer Class Actions & Mass Torts and Mark Sanchez makes at Food Court:

One of the fundamental questions that remains unaddressed in the district court’s opinion is the obvious overbreadth of the class definition. … This, of course, sweeps into the class everyone, even those who used and enjoyed the product and would purchase it again and again.  Like me.  Or like plaintiff Hohenberg, who testified at her deposition that she ‘does not regret buying Nutella and continued using the spread after she learned about its sugar content.’ Slip op. at 8-9.” – Jackson

 The Supreme Court in Dukes sought to limit class actions to cases through a strict analysis of commonality.  The district court instead loosely finds commonality based on the defendant’s advertising.  It ignores, and leaves unanswered a fundamental question, what happens if a consumer didn’t feel mislead or would still buy Nutella?” – Sanchez

In addition to these questions, others have raised the question:  “How is the court supposed to redress the grievances?”  This is a critical part of a class action suit – providing recompense to the injured parties instead of just the plaintiff’s attorneys.  Millions of Californians have bought consumed Nutella – how is the Court going to track down each of these allegedly injured people?

Justifiable Reliance

I’ll end this update the way Jackson started his:  “I like Nutella.  I like peanut butter better … But sometimes I like to switch it up with Nutella.”

But I also know that pieces of toast slathered with Nutella aren’t exactly carrot sticks.  And so do all of my friends.  If I met somebody who didn’t know (like meeting a purple unicorn?), I would suggest that he simply rotate the Nutella package 180 degrees and find ALL of the nutritional information – fat and sugar content included – which makes quite clear that Nutella isn’t a “health food.”

And this raises the issue of justifiable reliance: “To bring a private cause of action under the [Consumer Protection Law], a plaintiff must show that he justifiably relied on the defendant’s wrongful conduct or representation and that he suffered harm as a result of that reliance” (quoting Hunt v. US Tobacco Co., from Kennerly).

Unfortunately for Ferrero, as Kennerly points out, “California … has a lot of exceptions to the rule [of justifiable reliance], including an exception that presumes consumers rely, to some extent, on written advertising.  Hence the Nutella suit being brought in California first.”

This means Ferrero could get hit with a big penalty (or settlement) for “deceiving” consumers despite the fact that all Nutella packages have their full nutritional facts conspicuously displayed.  Deceptive and conspicuous…an odd combination, and seemingly a bit of a stretch of the imagination.

One thought on “Court Empowers “Deceived” California Nutella Purchasers to Sue as a Class

  1. Pingback: Nutella Class Action Settlement: Not Part of a Balanced Civil Justice System « The Legal Pulse

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