by Natalie Blazer, Weil, Gotshal & Manges LLP*
*Cross-posted with permission from Weil’s Product Liability Monitor
At the Product Liability Monitor, we have kept our eye on an emerging trend in product liability lawsuits: consumers seeking to bring claims based on items they never bought. As my Weil, Gotshal & Manges colleague recently reported there, courts have often had to decide this issue when faced with putative class actions. In Miller v. Ghirardelli Chocolate Company, N.D. Cal., no. 12-04936, Dec. 7, 2012, the Northern District of California adopted the reasoning of a majority of courts in its jurisdiction that have held that plaintiffs may have standing to assert claims for unnamed class members based on products they did not actually purchase, but only if the products and the alleged misrepresentations are “substantially similar.”
In Ghirardelli, the plaintiff’s central claim was that the packaging of the product he purchased, as well as that of four other products he did not purchase, contained several actionable misrepresentations. After considering the similarities and differences between all five of the products, the court concluded that while the “products have some similarities in packaging, composition, and labeling,” the products are inherently different from one another, have different target customers, and have substantial labeling differences. Thus, the plaintiff did not have standing to bring claims relating to the dissimilar products he did not purchase.
Just three weeks later, the Northern District of California ruled the other way on standing in Colucci v. ZonePerfect Nutrition Co., N.D. Cal., No. 12-2907, Dec. 28, 2012. In that case, plaintiff Kimberly Sethavanish purchased only one flavor of ZonePerfect bars, but had standing to challenge the labeling of the other 19 varieties as well because the court found that the bars are similar enough to one another. Sethavanish and her fiance James Colucci, for whom she bought the bars, sued ZonePerfect, alleging the company deceptively labeled the bars as “All-Natural,” even though all the varieties contained at least one of 10 allegedly non-natural ingredients.
Sethavanish and Colucci sought to represent a nationwide class of all persons who bought any of ZonePerfect’s nutrition bars after Sept. 14, 2007. They asserted claims for restitution and common-law fraud, and alleged that ZonePerfect violated California’s Unfair Competition Law, False Advertising Law, and Consumer Legal Remedies Act. They also raised a claim under the federal Magnuson-Moss Warranty Act. (The court dismissed only the Magnuson-Moss claim as a matter of law, holding that ingredients being synthetic or artificial is not a “defect” actionable under the MMWA.)
ZonePerfect challenged not only Colucci’s constitutional standing to bring any claim because he did not personally buy the bars, but also challenged the scope of Sethavanish’s standing because she did not buy all of the flavors at issue. The court held that Sethavanish certainly has standing to pursue claims concerning the chocolate peanut butter flavored bars she actually bought, and also has standing to challenge the labels of the flavors she did not buy, because the challenged products are similar enough to one another. Unlike in Ghirardelli, the court here found that the products are all of a single kind and share a uniform size and shape. “On casual inspection, the only obvious difference between the bars is their flavor,” the opinion said. But the court agreed with ZonePerfect that Colucci lacked standing, noting in the opinion that standing in product liability cases is predicated on the purchase of at least some product. Here, Sethavanish bought the bars to include in care packages she sent to Colucci while he was on military deployment: because he himself did not purchase any of the products, Colucci was dismissed as a party.
These cases out of the Northern District of California are yet another reminder of the omnipresence of food labeling lawsuits in the United States. Because we are unlikely to see a decline in these types of cases anytime soon, it is worthwhile to monitor the trends in courts’ reasoning and opinions, even (and especially) in the earliest stages of a lawsuit. Taken together, the Ghirardelli and ZonePerfect cases help define the dimensions of at least one court’s standing analysis when it comes to products that plaintiffs have not themselves purchased, and the facts in Ghirardelli and ZonePerfect are distinguishable enough from one another that the court’s reasoning in each of the decisions seems apt.
What will be interesting, however, is how this and other courts handle cases where the facts do not fall clearly under either end of the spectrum. In fact, the Ghirardelli court itself, after ruling the plaintiff did not have standing in that case, also said that had the “substantial similarity” between the product purchased by the plaintiff and those not purchased been a closer question, the court would have bypassed the standing analysis and saved the questions of similarity for the class certification stage. Does this mean that plaintiffs with less-clear questions of “substantial similarity” necessarily get to the class certification stage, or even the merits stage? As there will undoubtedly be clarifying developments in this area as more suits are filed, the Product Liability Monitor will continue to keep you posted.
*Ms. Blazers blog post has also been published as a Law360 commentary.