Consumer Fraud Class Action, Vol. 2, No. 2

House Passes Fairness in Class Action Litigation Act of 2017 H.R.985 — 115th Congress

In March 2017, the House passed the Fairness in Class Action Litigation Act of 2017 by a vote of 220-201. If it is enacted in its present form, a number of reforms will apply to all pending cases, including the requirement that a class seeking monetary relief for personal injury or economic loss cannot be certified unless the court determines, after a rigorous analysis of the evidence, that each member of the proposed class suffered the same “type and scope of injury as the named class representative.” Parties seeking to maintain a class action to recover economic loss must also prove that there is a reliable and administratively feasible method for identifying class members and “distributing directly to a substantial majority of class members any monetary relief secured for the class.” Among other additional reforms, parties would be statutorily entitled to appeal class certification decisions as a right. Track the legislation here.

Ninth Circuit: Plaintiffs Need Not Prove Administratively Feasible Method of Identifying Class Members to Establish Ascertainability

Briseno v. ConAgra Foods, Inc., 844 F.3d 1121 (9th Cir. 2017)

In Briseno, the court held that a plaintiff need not proffer a reliable and administratively feasible method of identifying class members to satisfy an ascertainability requirement. Such feasibility concerns, the court held, are encompassed by the manageability criterion of the Rule 23 analysis. The Ninth Circuit stopped short of rejecting an implied ascertainability requirement outright, holding only that to the extent Rule 23 contains such a requirement, administrative feasibility concerns form no part of it. View the decision.

Second Circuit Affirms Denial of Class Certification Where Plaintiff Fails to Establish Administratively Feasible Method of Identifying Class Members

Leyse v. Lifetime Entm’t Services, LLC, Nos. 16-1133-cv, 16-1425-cv, --- F. App’x ---, 2017 WL 659894 (2d Cir. Feb. 15, 2017) (Summary Order)

In contrast to Briseno, the Second Circuit affirmed an order denying class certification on ascertainability grounds where plaintiff proposed to identify class members by soliciting individual affidavits but adduced no evidence that such method was administratively feasible and “sufficiently reliable . . . to avoid mini-hearings on the merits of each case[,]” as mandated by its recent decision in Brecher v. Republic of Argentina, 806 F.3d 22 (2d Cir. 2015). View the decision.

Disclaimer Accurately Qualified Ads for Beer

Bowring v. Sapporo U.S.A., Inc., --- F. Supp. 3d ---, No. 16-CV-1858 (ILG) (SMG), 2017 WL 902151 (E.D.N.Y. Feb. 10, 2017)

The court dismissed plaintiffs’ putative class action claims alleging that Sapporo beer was falsely advertised as “The Original Japanese Beer” and “Japan’s Oldest Brand” when in fact it is not a Japanese import. The court held that “Sapporo’s use of the term ‘Imported’ is a truthful statement, and qualified by the visible disclosure statement specifying the beer’s origin in Canada.” While Sapporo’s marketing and slogans allude to the company’s actual Japanese heritage, they were “clearly qualified by the disclaimer.” View the decision.

Seventh Circuit Rejects Class Alleging That ‘Unnecessarily Large’ Eye Drops Were Premium Priced

Eike v. Allergan, Inc., 850 F.3d 315 (7th Cir. 2017)

The Seventh Circuit vacated an order granting certification and remanded with directions to dismiss the case with prejudice, rejecting plaintiff’s claims that glaucoma eye drops that were “unnecessarily large” resulted in a price premium in the amount of the difference between the price per drop of the eye drops at their present size and the presumably lower price if the drops were smaller. Judge Posner observed, “The fact that a seller does not sell the product that you want, or at the price you’d like to pay, is not an actionable injury.” View the decision.

Ninth Circuit: Consumers Cannot Be Misled Into Believing That Bud Light Lime-A-Rita Is a Low-Calorie Beer

Cruz v. Anheuser-Busch Cos., LLC, --- F. App’x ----, No. 15-56021, 2017 WL 1019084 (9th Cir. Mar. 16, 2017) (unpublished)

The Ninth Circuit affirmed dismissal of a putative class of Anheuser-Busch consumers who alleged the labeling of the high-sugar Bud Light Lime-A-Rita deceived consumers into thinking Lime-A-Rita is comparable to Bud Light Lime, when it actually contains nearly three times as many calories. While the beverage may not be low in calories, the Ninth Circuit said the “light” label is not deceptive because it does have fewer calories than a traditional margarita. The Plaintiffs had argued that the FDA generally considers products to be “light” if they have no more than two-thirds the calories of a comparable product, but the court ruled that “no reasonable consumer” would confuse Lime-A-Rita with a low-calorie option that has fewer calories than a regular beer. “It is clear from the label that the beverage is not a normal beer . . . in addition to describing the product prominently as a ‘Margarita With a Twist,’ the Lime-A-Rita label pictures a bright green drink, served over ice, in a margarita glass.” View the decision.