Unreasonable Second Circuit Decision Sets Daunting Precedent for Packaged-Food Makers

cheez itA decision this month from the U.S. Court of Appeals for the Second Circuit reunites us with an old friend, The Reasonable Consumer. As we’ve discussed in previous posts here and in Washington Legal Foundation publications, The Reasonable Consumer has figured prominently in consumer class-action lawsuits that allege harm from supposedly deceptive or misleading food labels. That’s because the question at issue in the Second Circuit case, Mantikas v. Kellogg Company, is a common one in Food Court litigation: would a reasonable consumer interpret the relevant information on the food package the same way the plaintiff claims to have read it, and be similarly misled? Continue reading “Unreasonable Second Circuit Decision Sets Daunting Precedent for Packaged-Food Makers”

Kimberly-Clark Seeks Supreme Court Review in “Flushable” Wipes Case

roibal_lucia_webGuest Commentary

By Lucía Roibal, an Associate with Morrison & Foerster LLP in the firm’s San Francisco, CA office. This commentary is reposted with permission, originally appearing on November 30, 2018 in the firm’s Class Dismissed  blog.

On September 6, 2018, Kimberly-Clark and affiliates filed a petition for writ of certiorari in Kimberly-Clark, et al. v. Davidson, No. 18-304, following a decision in the Ninth Circuit denying Kimberly-Clark’s motion to dismiss.  As noted in previous posts (here and here), the Ninth Circuit had resolved a split among district courts in the circuit and held that a previously deceived consumer may have standing to seek an injunction against false advertising or labeling if he or she sufficiently alleges intent to repurchase the product in the future.  In Kimberly-Clark’s petition, the companies ask the Supreme Court to resolve the issue of whether a consumer, who after using a product and determining that a representation concerning that product is allegedly misleading, can plausibly allege a “real and immediate threat” that she will be deceived by the same representation in the future so as to establish standing to seek an injunction. Continue reading “Kimberly-Clark Seeks Supreme Court Review in “Flushable” Wipes Case”

Finally Fed Up with Private Plaintiffs Litigating over Empty Space, California Amends Slack Fill Law

Guest Commentary

By Robert S. Niemann, a Partner with Keller and Heckman LLP in the firm’s San Francisco, CA office, and Jill M. Mahoney, an Associate in the firm’s Washington, DC office.

Editor’s note: This blog is an update to the February 2, 2018 WLF Legal Backgrounder, “Litigating over Empty Space: Public and Private Plaintiffs Target Consumer Class Actions at “Slack Fill.”

Defendants of would-be “slack fill”1 lawsuits may have found some reprieve from litigation in California. On September 19, 2018, California Governor Jerry Brown signed into law Assembly Bill 2632, which amends the state’s slack fill law2 to provide manufacturers facing nonfunctional slack fill allegations with additional safe harbors. While specious slack fill lawsuits have been on the rise in recent years, the amendment is a step forward for the food manufacturing industry and demonstrates that California, the home to many slack fill suits,3 may also be growing tired of such claims. Continue reading “Finally Fed Up with Private Plaintiffs Litigating over Empty Space, California Amends Slack Fill Law”

Courts Reject Buyers’ Remorse and Wasted Time as Redressable Class-Wide Injuries

article IIIWe return once again (click here for past posts) to the seemingly banal legal doctrine of standing to sue—a subject that few, if any, likely contemplated when celebrating Constitution Day this week. This doctrine does, however, arise from the Constitution’s ingenious separation of powers among the three branches of government. Article III limits the judiciary’s role to resolving “cases” and “controversies.” From that the U.S. Supreme Court derived the standing doctrine as a way to test whether plaintiffs’ claims are fit for judicial resolution. A key part of the test is whether a plaintiff can factually establish that she suffered a concrete “injury in fact” that can be traced to the defendant’s conduct and can be redressed by a judicial remedy.

Legal claims based on conjectural or hypothetical harm, therefore, should not be inundating federal courts’ dockets. Unfortunately, too many no-injury class actions are passing the standing test, thanks in part to broadly worded state consumer-protection laws (and judges’ reluctance to reject jurisdiction). Just last week, for instance, a federal court ruled that state fraud laws are so broad that consumers who purchased vehicles with faulty ignition switches can recover damages even if the defect never manifested itself. And earlier this year, the Supreme Court refused to review an appellate court decision that allows eye-drop users to sue based on the speculative theory that eye-drop producers would charge the same price for a vial with a smaller dispensing hole.

Given the current trend on standing, it is critical to highlight positive outcomes in this area. We discuss two encouraging decisions here, one from the court that allowed the aforementioned eye-drop suit to proceed, the U.S. Court of Appeals for the Third Circuit, and the second from a federal court in California, a state with perhaps the nation’s most permissive consumer-protection laws. Continue reading “Courts Reject Buyers’ Remorse and Wasted Time as Redressable Class-Wide Injuries”

Judge’s Deference to FDA’s Interpretation of “Added Sugar” Regulation Secures Win for Food-Labeling Suit Defendant

GLFoodCourtWhen judges defer to an administrative agency’s interpretation of its own rule, targets of government regulation normally lose out. Private enterprises and organizations like Washington Legal Foundation have been urging the U.S. Supreme Court to reconsider Auer v. Robbins, the precedent that unleashed this doctrine that allows the proverbial fox to guard the hen house. We also routinely criticize class action lawsuits alleging that true statements on food labels are unlawfully false, misleading, unfair, or illegal.

It is not without a sense of irony, then, that we applaud a July 30, 2018 Central District of California opinion in Wilson v. Odwalla, which relied on “Auer deference” in granting the defenant’s motion for summary judgment in a consumer class action suit. The district court faithfully applied Auer to reach the correct decision. The Food and Drug Administration rule at issue in Wilson is clearly ambiguous—a key factor in the Auer analysis. Continue reading “Judge’s Deference to FDA’s Interpretation of “Added Sugar” Regulation Secures Win for Food-Labeling Suit Defendant”

Demands for On-Label Disclosure of Possible Supply-Chain Abuses Fail in Ninth Circuit

GLFoodCourtA little over two years ago on this site, we discussed a new strain of food-labeling class action lawsuits quite unlike the run-of-the-mill “Food Court” litigation. Instead of complaining that consumers had been misled by a food label’s use of a term such as “natural,” these suits claimed harm from a company’s failure to disclose possible human-rights abuses in its supply chain. Products such as animal food and processed chocolate, which include ingredients from foreign locations where forced child labor is prevalent, have been popular targets.

As we noted in the 2016 post, these supply-chain suits found far less success in California federal district courts than have other food-labeling claims. Undeterred by the losses, the plaintiffs’ lawyers appealed to the U.S. Court of Appeals for the Ninth Circuit, forcing the victorious defendants to invest millions more in attorneys’ fees. In a series of opinions issued over the past two months, the appeals court has uniformly affirmed the suits’ dismissals. Continue reading “Demands for On-Label Disclosure of Possible Supply-Chain Abuses Fail in Ninth Circuit”

Trio of Soda Cases Test the Limits of Attorney-Driven Class Action Lawsuits

marguliesGuest Commentary

By Jeffrey B. Margulies, Partner-in-Charge of the Los Angeles, CA office of Norton Rose Fulbright US LLP.

The approach of many plaintiff consumer class-action lawyers is not difficult to discern: Concoct a factual theory to support a claim under California’s consumer-friendly laws that survives a motion to dismiss and a motion for class certification. Even if the liability case is highly improbable, the economics of the exposure to a certified class of consumers will compel all but the bravest of defendants to settle, handsomely rewarding the plaintiffs’ lawyers with fees. District courts in the Northern District of California, home to a surfeit of cases over alleged mislabeling of foods and beverages, have allowed many dubious factual claims to proceed.

Yet, even as (or perhaps because) the Ninth Circuit has removed obstacles to consumer class actions such as ascertainability (Briseno v. ConAgra Foods, Inc.) and standing to pursue injunctive relief (Davidson v. Kimberly-Clark Corporation), a trio of recent district court decisions over sodas appears to signal either that the Food Court is growing less tolerant of factually implausible claims, or that the plaintiff’s bar has gone a bridge too far. Continue reading “Trio of Soda Cases Test the Limits of Attorney-Driven Class Action Lawsuits”