Emily Franco
Emily Franco is a Resident Forum Blogger bringing insight to class action law and policy regarding consumer, product, and commercial fraud litigation.
Since 2012, an influx of food and beverage consumer class action litigation suits claiming food packaging advertising allegedly misleading health benefits has violated FDA consumer protection laws. Terms such as “100% Natural”, “Anti-oxidant”, and “Sugar Free” to name a few have been under review for potential misbranding. The preferred venue for these claims is the seemingly plaintiff-friendly U.S. District Court for the Northern District of California, cheekily dubbed the “Food Court”. However, in 2014 Northern District courts have now altered how FRCP 23(a) and 23(b)(3) claims pertaining to ascertainability and predominance are reviewed, effecting whether or not claims succeed past class certification. In an effort to make a class manageable, FRCP 23(a) is widely interpreted to require class parameters to be adequately defined by objective and verifiable criteria, and clearly ascertainable. Regarding questions of law and fact, FRCP 23(b)(3) explicitly requires predominance of both over the class as a whole, and not affect merely a select few individuals. A handful of recent decisions in the Northern District of California demonstrate that the “Food Court” split regarding these pertinent trends of class certification strategy in food labeling matters.
Although there is no explicit ascertainability requirement in FRCP Rule 23, courts have normally required plaintiffs to demonstrate ascertainability within the bounds of Rule 23(a). The Northern District initially utilized a more liberal application of the ascertainability requirement, as seen in Werdebaugh v. Blue Diamond Growers, 2013 WL 5487236 (N.D. Cal. Oct. 2, 2013) (“Blue Diamond”). In this earlier matter, despite a majority of courts having held a class to not be ascertainable without corporate records naming product purchasers, presiding U.S. District Judge Koh rejected a more detailed discovery review in the preliminary stages. Rather, the court solely relied on the fact that those who had purchased the almond milk product were within the class definition, being all cartons of the product displayed the labeling in question.
Despite the Northern District’s broad ascertainability standard set before with cases such as Blue Diamond, there now has been a shift within the District in how the FRCP’s Rule 23(a) requirement is approached. In the case of Astiana v. Ben & Jerry’s Homemade, Inc., 2014 WL 60097 (N.D. Cal. Jan. 7, 2014) (“Ben & Jerry’s”), the court held that separate from the requirements of Rule 23, class certification must also demonstrate that an ascertainable and clearly identifiable class exists. In an early discovery review during the pre-certification stage, parties discovered the manufacturer acquired cocoa powder from fifteen different suppliers, and therefore a lack of acertainability was upheld. By looking beyond whether or not potential class members simply purchased the product, the Northern District is now seen delving deeper into the product origination and eliminating any potential ambiguities.
The Northern District has exhibited another split, this time pertaining to the FRCP 23(b)(3) predominance requirement. It has been hotly debated in the Northern District, which proposed damages model could reliably, effectively, and accurately measure class wide damages. It has been no secret the regression analysis was widely favored as the “workable” damages model in the Northern District, as seen in cases such as Brazil v. Dole, 935 F.Supp.2d 947 (N.D. Cal. 2013) The model was initially proposed to isolate the ratio between the price of the product, and the alleged mislabeling. Calculating the difference between the dependent and other variables naturally requires accounting for regional price changes, or rather the price movement that occurred after defendants ceased using the labels in question. However, the defendants in prior Food Court litigation like Blue Diamond did not introduce expert testimony about regional price differences to calculate these changes. In Blue Diamond, the court instead distinguished between models used at the certification stage that work, and models that are potentially “workable.” Despite the expert not having yet run the regression model, the court found that defendants did not have grounds to question the tool of regression analysis in theory.
But in light of recent Supreme Court changes in approach, the once “workable” model is now far more scrutinized, proving some difficulties meeting the predominance requirement in the class certification stage. Based on this recent Comcast v. Behrend, 133 S.Ct. 1426 (2013) (“Comcast”) decision, the Supreme Court held that the predominance requirement is satisfied if the plaintiff presents a model that names damages caused by the defendant’s alleged marketing misconduct, and is measurable across the entire class. Applying Comcast, the court in Ben & Jerry’s relied on this Supreme Court’s ruling, holding that plaintiff’s claim did not meet FRCP 23(b)(3)’s predominance requirement because plaintiff’s proposed damages model failed to reliably measure damages across the board. Here, the lack of cohesion among the class members was due to the exposure to label statements printed on assorted product sizes, varieties, ingredient lists, and within differing time periods, and further failed to factor in consumers’ purchase decision per the alleged misbranding.
February 4, 2015