Tuesday, July 18, 2017

9th Circuit burps up a correction to recent Gerber case

Bruton v. Gerber Prods. Co., No. 15-15174, 2017 WL 3016740, -- Fed. Appx. --- (9th Cir. Jul. 17, 2017)

On a petition for rehearing, the previous panel opinion and partial dissent were withdrawn and replaced with the following, still partially reviving plaintiff’s consumer protection class action but getting rid of a deception theory, as the dissent had wanted.

Bruton filed a putative class action against Gerber, alleging that labels on certain Gerber baby food products included claims about nutrient and sugar content that violated FDA regulations as incorporated into California law.

Again, the court of appeals rejected the district court’s ruling that the class wasn’t ascertainable. There is no separate “administrative feasibility” requirement for class certification.

However, there was no genuine dispute of material fact on Bruton’s claims that the labels were deceptive in violation of the UCL, FAL, and CLRA.  Her theory of deception was that the combination of “healthy” claims on Gerber’s products, in violation of FDA regulations, and the lack of claims on legally compliant competitors’ products made Gerber’s labeling likely to mislead the public into believing that Gerber’s products were of a higher quality than its competitors’ products.

This theory “may be viable,” since even technically correct labels can be misleading under California law.  However, Bruton didn’t produce enough evidence to survive summary judgment; her own vague, uncorroborated, and self-serving testimony was insufficient.  Further, the record included Gerber’s and some competitors’ labels, but it showed that those competitors made many of the same allegedly illegal claims. “A reasonable jury comparing the labels side by side could not rationally conclude that Gerber’s labels were likely to deceive members of the public into thinking that Gerber’s products were of a higher quality than its competitors’ products that made the same type of claims.”  Likewise, FDA warning letters (informal and non-binding) didn’t indicate that competitors complied with the law.

However, the district court erred in granting summary judgment to Gerber on Bruton’s claims that the labels were unlawful under the UCL. The unlawfulness prong “borrows” predicate legal violations and treats them as independently actionable under the UCL. “The best reading of California precedent is that the reasonable consumer test is a requirement under the UCL’s unlawful prong only when it is an element of the predicate violation.” The predicate violation here was of California’s Sherman Law, which itself incorporates standards set by FDA regulations, and those standards didn’t include any requirement of likely deception. (Though query how that works with modern First Amendment jurisprudence.)

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