Unfair Competition Law

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The California Court of Appeal recently made it more difficult for plaintiffs to certify class actions based on false advertising or fraud.  In Downey v. Public Storage, Inc., Case No. B291662, ___Cal.App.5th___ (Feb. 6, 2020), the Court of Appeal affirmed an order denying class certification on the grounds that issues of deception and reliance were not susceptible to common proof.

In March 2015, several plaintiffs filed a class action against Public Storage, alleging that its $1 promotional rate was deceptive, violated California’s Unfair Competition Law (Bus. & Prof. § 17200 et seq.), and constituted a false advertisement.  In particular, the plaintiffs alleged that the $1 promotional rate was deceptive because customers had to pay more than $1 for their first month of storage due to (1) having to pay for a new account fee, (2) being charged for a second month’s rent on the first day of the next calendar month, (3) having to pay for a lock for their storage unit, and (4) having to pay for insurance coverage. 
Continue Reading California Court Sets High Bar For Class Certification In False Advertising Cases

In the last few months, a handful of class actions have been filed challenging label claims regarding the treatment of the animals providing the food item in question. This appears to be a new food litigation trend, as plaintiffs’ attorneys invoke the purchasing public’s apparent concern for “clean”, “pure”, “healthy”, and “organic” food items.
Continue Reading Spate of Recent False Advertising Class Actions Take On Animal Treatment Label Claims

Challenges based on lack of standing can be brought at any time and, in Friends of the Earth v. Sanderson Farms, Inc., 2019 U.S. Dist. LEXIS 127964 (N.D. Cal. July 31, 2019), the court dismissed a putative class action for lack of standing pursuant to Rule 12(h)(3) after Plaintiffs supplemented discovery responses and depositions were taken. Although it had earlier denied motions to dismiss brought pursuant to Rule 12(b)(6), the district court concluded that Plaintiffs failed to produce evidence in discovery to establish their injury in fact and, accordingly, lacked standing under Article III.  
Continue Reading Lack of Standing Dooms Organizational Plaintiffs’ False Advertising Claims; Such a Challenge Can Be Brought at Any Time

The Ninth Circuit’s recent decision in Sonner v. Schwabe N. Am., Inc. et al.,[1] resolves a split among district courts evaluating the standard that applies to false labeling claims brought under California’s Unfair Competition Law and Consumers Legal Remedies Act on summary judgment. The Ninth Circuit confirmed that plaintiffs can survive summary judgment by supplying a conflicting expert report, invalidating a line of cases that required plaintiff’s expert to also entirely undermine defendant’s expert.
Continue Reading Ninth Circuit Confirms Plaintiffs Are Not Required to Undermine Defendant’s Evidence to Withstand Summary Judgment in False Labeling Class Actions

Following the denial of a petition for rehearing en banc, over a spirited dissent, a Ninth Circuit panel issued its amended order on November 27, 2018 in Sali v. Corona Regional Medical Center, holding that evidence need not be admissible to be considered at the class certification stage. The panel held: “Inadmissibility alone is not a proper basis to reject evidence in support of class certification.” 
Continue Reading Ninth Circuit Panel Affirms Inadmissibility Alone is Not a Proper Basis to Reject Evidence in Support of Class Certification

In Durnford v. MusclePharm Corp., plaintiff Durnford asserted that the company’s “Arnold Schwarzenegger Series Iron Mass” supplements are falsely labeled because the protein content of the supplements is misstated. Durnford brought claims under California’s Unfair Competition Law (“UCL”), False Advertising Law (“FAL”) Consumer Legal Remedies Act (“CLRA”) and for breach of express warranty. The district court dismissed these claims, finding them preempted by federal law. However, the Ninth Circuit affirmed in part and reversed in part the district court’s dismissal of Durnford’s claims effectively reviving them, albeit on a narrower basis. Durnford v. MusclePharm Corp., No. 16-15374, __ F.3d __ (9th Cir. 2018), 2018 U.S. App. LEXIS 28771.
Continue Reading “I’ll Be Back;” Ninth Circuit Gives Arnold Schwarzenegger-Branded Supplement Purchasers Another Shot to Pursue UCL, FAL, CLRA and Warranty Claims

In a recent decision, the California Court of Appeal reaffirmed and clarified how the “reasonable consumer” standard must be applied at the pleadings stage to mislabeling claims. In simplest terms, if the packaging makes a definitive statement on the front that suggests one thing, but fine print on the back contradicts that statement, the defendant cannot rely on the fine print to escape a mislabeling claim. In reaching that conclusion, however, the Court of Appeal appears to have laid a roadmap for how to defeat class certification.
Continue Reading One A Day Will Not Keep Plaintiffs Away

In In re Hyundai & Kia Fuel Economy Litigation, No. 15-56014, 2018 WL 505343 (9th Cir. Jan. 23, 2018), the Ninth Circuit vacated a nationwide class action settlement, concluding that the district court’s failure to conduct a choice-of-law analysis precluded a finding that common issues predominated.
Continue Reading Ninth Circuit Slams the Brakes on Nationwide Class Action Settlement; Choice of Law and Reliance Are Bumps in the Road

Deciding an issue of first impression, the California Court of Appeal issued a writ of mandate confirming that there is only one standard for the admissibility of expert opinion in California, and that standard applies when considering a motion for class certification. Apple, Inc. v. Superior Court of San Diego County, 2018 Cal. App. LEXIS 69 (Cal. Ct. App. Jan. 29, 2018).   Accordingly, the Court of Appeal issued a peremptory writ of mandate directing the trial court to vacate its order granting Plaintiffs’ motion for class certification for reconsideration in light of the standards for the admission of expert testimony set forth in Sargon Enters., Inc. v. Univ. of S. Cal., 55 Cal.4th 747 (2012).
Continue Reading California Court of Appeal Confirms that There is Only One Standard for the Admission of Expert Testimony and that Expert Opinion Must Be Admissible to be Considered on a Motion for Class Certification

Over the past two years, class actions have been filed against nearly every major retailer challenging various sales and pricing practices. Many of these have focused on outlet stores (sometimes called “factory” stores). These cases have generally claimed that selling product made only for the outlet or factory store, where that product was never sold in mainline channels (e.g., in regular stores, boutiques, department stores or online), is deceptive, particularly product if the store suggests that the made-for-outlet was previously sold in mainline channels for a higher price. In many states, the trend has been to dismiss the case on the pleadings, holding that plaintiffs, who purchased a product for the price advertised, were not injured, especially if they cannot allege that the product was worth less than what they paid. In California, with the expansive reach of the Unfair Competition Law (UCL), False Advertising Law (FAL), and Consumer Legal Remedies Act (CLRA), courts have generally permitted these claims to proceed beyond the pleadings.
Continue Reading Outlet And Factory Class Actions Take A Hit: California Court of Appeal Confirms Companies Can Sell Made-For-Outlet Product At Outlet Or Factory Stores