After Church &
Dwight successfully attacked Clorox’s Fresh Step ads (settled before
resolution of the appeal), plaintiffs filed a putative nationwide class action
alleging that Clorox falsely advertised that (1) Fresh Step is more effective
at eliminating cat odors than products that do not contain carbon, and (2) cats
choose Fresh Step over these other cat litters.
The first relevant ads showed several cats jumping into a
Fresh Step litter box, after some of them examined and apparently rejected a
Super Scoop litter box. Supers said “dramatization”
and “based on lab tests,” while the voiceover said: “Cats like boxes. Big ones.
Little ones. And ones with Fresh Step litter inside. That's because Fresh
Step's scoopable litter with carbon is better at eliminating odors than Arm
& Hammer's Super Scoop. Fresh Step. Cats know what they like.” Then Clorox ran an ad showing cats opening
jars of cat food, unlocking doors, thwarting a dog from entering a house, etc.,
and finally choosing a box of Fresh Step over a box of Super Scoop. Voiceover:
“Cats are smart. They can outsmart their humans. Their canines. And locked
doors. They're also smart enough to choose the litter with less odors. That's
because Fresh Step Scoopable Litter with carbon is better at eliminating litter
box odors than Arm & Hammer Super Scoop. Fresh Step, cats know what they
like.” Church & Dwight’s study in
response showed that 6 of 158 studied cats rejected a Super Scoop box, while 8
rejected a Fresh Step box.
Clorox’s next set of ads kept up the playful theme, and
showed two beakers, one filled with a black substance labeled “carbon” and the
other filled with a white substance labeled “baking soda.” Green gas floated
through the beakers, rapidly dissipating in the carbon beaker but not reacting
much in the baking soda beaker.
Voiceover: “That's why Fresh Step Scoopable has carbon, which is more
effective at absorbing odors than baking soda.” The super said: “Dramatization
of cat waste malodor after 1 day. Based on sensory lab test.” Church & Dwight commissioned an
independent lab to do a ten-day sensory study using people trained in odor
evaluation. On every day and overall,
the panel’s average rating for Church & Dwight’s baking soda-based litter
was lower (more palatable) than the average rating for Fresh Step.
Plaintiffs sued under the usual California statutes and, in
the alternative to a nationwide class, asserted consumer protection claims on
behalf of five subclasses in California, Florida, New Jersey, New York, and
Texas. They also brought causes of action for breach of express warranty and
unjust enrichment.
Clorox argued that the claims failed because they were based
on allegations that its ads lacked substantiation. Such claims aren’t cognizable under
California law when brought by private parties, though the law allows certain
government authorities to demand substantiation. Plaintiffs responded that their argument was
not that the claims were unsubstantiated, but that they were provably
false. The court agreed. Plaintiffs alleged that the two claims (carbon-based
cat litter’s greater effectiveness on odors than non-carbon brands, and cat
preference) were contradicted by scientific studies. This was more than an allegation that
scientific evidence in support of the claims was lacking.
Clorox also moved to dismiss the claims to the extent they
were based on the ads’ statements that cats “like” or “are smart enough to
choose Fresh Step.” Whether an alleged
misrepresentation is puffery, the court said, was a question of law that could
be answered on a motion to dismiss.
(Always? That seems
unlikely. Or very confident.) Plaintiffs argued that claims that cats “like”
and “choose” particular litter brands are measurable. One of Church & Dwight’s studies measured
such preferences by looking at cats’ rejection of litter. Similarly, the ads themselves depict
preferences, thus allegedly giving the impression that the claims were based on
scientific testing.
The court agreed that the first set of ads conveyed a
preference message, but found that they provided no basis for the claim. “[T]he depiction of four or five cats
choosing to playfully jump into a litter box of Fresh Step rather than a litter
box of the competitor's brand does not give the impression of scientific
testing—especially since this demonstration follows several videos of cats
playing with boxes.” These ads didn’t
make quantifiable claims that could be proved or disproved; no reasonable
consumer would consider the message that cats prefer Fresh Step because they
are “smart enough to choose the litter with less odors” to be a statement of
fact. (The judge is not a cat person, I
see. If humans are smart enough to do
that, why not cats?)
The court also relied on the super, without assessing
whether consumers were likely to perceive it as part of the message (which I
would argue shouldn’t be done on a motion to dismiss anyway). The “dramatization” disclaimer undercut the
plaintiffs’ arguments, while “based on lab tests” “[had] the potential to cut
the other way,” but since the ads didn’t clearly identify which representations
were based on lab test, that didn’t help.
The court thought “based on lab tests” was intended to convey “better at eliminating odors,” given its placement
against the voiceover. (Again, if it’s
not clear, why does that hurt
plaintiffs on a motion to dismiss? If “based
on lab tests” could plausibly refer to cat preference, that should matter at
this stage of the case.)
So the claims were dismissed to the extent they were based
on statements that cats “like” or “are smart enough to choose Fresh Step.”
Clorox next argued that plaintiffs failed to satisfy Rule
9(b) by failing to allege the content of the alleged misrepresentations, when
they saw them, or where. Without contesting that the fraud pleading
requirements applied, plaintiffs argued they’d met them, and the court agreed. Rule 9(b) has three functions: to provide
defendants with adequate notice/deter fishing expeditions, to protect
reputations against fraud charges, and to keep plaintiffs from taking up
resources on litigation without a factual basis. Here, requiring pleading of additional facts
wouldn’t advance any of these goals. The
complaint identified each ad on which the plaintiffs allegedly relied and
described their contents. It alleged
when the commercials aired and provided storyboards for each. Plaintiffs alleged that they bought Fresh
Step in reliance on the ads. That was
enough to put Clorox on notice and showed that plaintiffs weren’t on a fishing
expedition. Indeed, Clorox had located
and produced videos of the ads.
On to substance: Breach of express warranty under California
law requires a plaintiff to allege the exact terms of the warranty, reasonable
reliance thereon, and a breach proximately causing injury. Plaintiffs identified two alleged warranties:
(1) carbon-based Fresh Step is better at eliminating and absorbing odors than
baking soda-based cat litters, and (2) cats “are smart enough to choose”
carbon-based Fresh Step over baking soda-based cat litters. The second was
puffery and nonactionable. Also, vague
allegations about “product labels” couldn’t support the claim, since plaintiffs
didn’t specify what the labels said. But
the claim based on the first alleged warranty was properly pled.
Clorox argued that its statements weren’t actionable because
they were “highly subjective product superiority claims.” No, reasonable consumers are likely to
consider “Fresh Step ... is better at eliminating litter box odors than Arm
& Hammer Super Scoop” a statement of fact. This was neither “vague” nor
“highly subjective.” “Clorox identifies both a point of comparison—Arm &
Hammer Super Scoop—and a metric for comparison—elimination of cat odors.
Further, the beaker comparison depicted in the Second Commercials gives the
impression that this representation is based on the results of a scientific study. Clorox's apparent representation that this
beaker test is '[b]ased on [a] sensory lab test’ furthers this impression.” (The court also rejected Clorox’s argument
that there was no privity—there’s an exception when the consumer relies on labels
or ads from the manufacturer, and Clorox provided no warrant for the idea that
the exception is limited to written
warranties.)
Clorox also moved to strike the class allegations. Motions to strike are disfavored, but
occasionally granted when it’s clear that class claims can’t be sustained. Clorox said this was true here given Mazza’s holding that California's
consumer protection laws cannot be applied nationwide. But Mazza
was decided on a motion for class certification, not a motion to strike. “At
this stage of the instant litigation, a detailed choice-of-law analysis would
be inappropriate. Since the parties have yet to develop a factual record, it is
unclear whether applying different state consumer protection statutes could
have a material impact on the viability of Plaintiffs' claims. Further, unlike
the defendant in Mazza, Clorox has
not explained how differences in the various states' consumer protection laws
would materially affect the adjudication of Plaintiffs' claims or otherwise
explained why foreign laws should apply.”
Clorox contended that out-of-state plaintiffs lacked
standing to sue under California law.
But California remedies can be invoked by out-of-state parties harmed by
wrongful conduct occurring in California. Plaintiffs alleged that Clorox
conducts substantial business in California and has its principal place of
business and corporate headquarters in the state, decisions regarding the
challenged representations were made in California, Clorox's marketing
activities were coordinated at its California headquarters, and a significant
number of class members reside in California. This was enough for purposes of
the present motion.
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