Thursday, January 09, 2014

Inability to determine who bought what dooms class certification

Astiana v. Ben & Jerry’s Homemade, Inc., 2014 WL 60097, No. C 10-4387 (N.D. Cal. Jan. 7, 2014)

The court denied certification to a proposed class who bought ice cream from Ben & Jerry’s that contained alkalized cocoa and were labeled “all natural.” Astiana, bringing the usual California claims, contended that the packaging and ads were deceptive and misleading because the cocoa was alkalized with a “synthetic” agent.  After Dennis v. Kellogg, the initial proposed class settlement fell apart, and they proceeded to the class certification motion, which sought to cover California purchasers of “ice cream products that were labeled ‘All Natural’ but contained alkalized cocoa processed with a synthetic ingredient.”

The court found a lack of ascertainability and a lack of typicality/predominance.  Ben & Jerry’s argued that, because cocoa can be alkalized using one of several alkalis – some of which are “natural” and some of which are “non-natural” – and because Ben & Jerry’s is a wholesaler and didn’t keep records about which consumers bought which products, class membership couldn’t be determined.  Astiana didn’t provide evidence about which products included the allegedly synthetic ingredient, or evidence that there was a way to identify the alkali in ice cream purchases. “The packaging labels say only ‘processed with alkali,’ because that is all the FDA requires,” and Ben & Jerry’s uses cocoa from as many as 15 different suppliers.  Although one supplier was the only supplier who provided cocoa for use in ice cream with a chocolate base, the supplier’s designee testified that he didn’t know which alkalizing agent was used in every instance, and other sources provided Ben & Jerry’s with mix-in ingredients made from alkalized cocoa, without identifying the alkalizing agent.

Ben & Jerry’s also challenged Astiana’s standing, because she testified in deposition that the price had no bearing on her purchase decisions, so she couldn’t have suffered an injury from paying a premium for the ice cream.  But she also testified that she’d paid a premium for all-natual products and refrained from buying products that weren’t all natural, and also that she lost money because of the purchase.  The arguments here were sufficient for standing at this stage.

On commonality, Ben & Jerry’s argued that (1) “all natural” has no common meaning; (2) there was no evidence that the term was likely to deceive, such as consumer surveys or expert evidence suggesting that consumers would expect a non-synthetic alkali; (3) its survey evidence showed that there was no common understanding of “all natural.”  Ben & Jerry’s expert showed 400 consumers a “Cherry Garcia®” cartoon with either the words “all natural” or “Vermont’s Finest” on the label. “More than half the respondents had no expectation that the ice cream contained alkalized cocoa (although both packages included ‘cocoa (processed with alkali)’ as an ingredient; only 13% shown the ‘all natural’ label expected that the alkali would be ‘natural,’ and of that group, only 3% said that would make them more likely to buy.” (It’d be interesting to see the exact questions asked/how much attention was directed to the label claim, especially given the inattention to the ingredient lists.) 

Its other expert found no evidence that consumers of Ben & Jerry’s ice cream gave significant consideration to the “all natural” label but instead were motivated by many other factors; Ben & Jerry’s didn’t charge more for ice cream with the “all natural” label.  Moreover, when Ben & Jerry’s removed the “all natural” label, the retail and wholesale prices did not decrease.

A single significant common issue can establish commonality.  But Ben & Jerry’s provided evidence that consumers weren’t likely to be deceived, while Astiana presented no evidence in opposition, preventing a finding of commonality on that question.  However, the court found that the question whether there was a common or accepted meaning of “all natural” was arguably sufficient to establish commonality.

Ben & Jerry’s used the same evidence to fight typicality.  Astiana testified that she relied on “all natural,” but 97% of consumers in the survey responded that it did not matter if the product contained cocoa processed with a synthetic alkali.  The court found that she hadn’t shown typicality, in part because she hadn’t identified an ascertainable class.

Also, Astiana sought damages, but hadn’t established that common issues predominate such that there was a classwide method of granting relief.  She hadn’t offered expert testimony demonstrating that the market price of Ben & Jerry’s ice cream with the “all natural” designation was higher than the market price without it. Further, she had no testimony demonstrating a gap between the market price of Ben & Jerry’s “all natural” ice cream and the price it should have sold for, or any evidence demonstrating that consumers were willing to pay a premium for “all natural” ice cream made with cocoa alkalized with a natural alkali.  Ben & Jerry’s doesn’t set retail prices, and such prices differ by nature and location of sales outlets.  Plus, individualized restitution would require individualized consideration of how many packages a customer bought.  Plaintiffs are required to provide “evidentiary proof” showing a classwide method of awarding relief consistent with their theory of liability. That didn’t happen here.

No comments: