Wednesday, August 08, 2018

claim that bulb lasts "up to" 25 times longer isn't puffery

Young v. Cree, Inc., 2018 WL 3659305, No. 17-cv-06252-YGR (N.D. Cal. Aug. 2, 2018)

Young alleged that Cree engaged in an “unfair and deceptive practice of ... promising consumers” that Cree’s light-emitting-diode bulbs “will last for particularly long periods of time up to 35,000 hours” with a “100% Satisfaction Guarantee” and “yearly energy cost savings ranging from around $0.60 to $2 per blub per year,” bringing the usual California claims. He alleged that, “[w]ithin months, all three [LED bulbs he bought] burned out even though [plaintiff] used them according to the instructions.” He allegedly relied on the packaging’s 10-year warranty and 10-year “100% Satisfaction Guarantee,” estimated lifetime, and estimated yearly energy cost savings, and paid a premium as a result.

Cree argued that none of its statements were false or misleading because (1) the statement regarding energy savings, as shown on the relevant packaging, contains an asterisk, which calls attention to disclosure of assumptions; (2) the statements regarding 100% satisfaction and performance as compared to other-less-expensive LED Bulbs and non-LED Bulbs couldn’t be found on the relevant packaging; and (3) the warranty was a promise to repair, replace, or refund, not a guarantee that the product will last ten years. Whether the statements were on the specific packaging Young bought, whether they would have deceived a reasonable consumer, and what reasonable consumers would have interpreted the warranty to mean were factual questions inappropriate for a motion to dismiss.

Young also challenged two internet/TV ads claiming that Cree’s LED Bulb would last “up to 25 times longer” than an incandescent bulb; and that the LED Bulb would use “a fraction of the energy of incandescent bulbs.” Cree argued that “up to” rendered first statement puffery, especially where Cree disclosed elsewhere on the product packaging exactly how long the LED Bulb was expected to last. Cree also argued that “fraction of the energy” was true because it was selling an 18-watt bulb designed to replace a 100-watt bulb. First, “up to” doesn’t automatically mean puffery. The statement at issue “relies on numerical figures with a set meaning and defines the relationship between them....” Second, whether the energy statement could have deceived a reasonable consumer was a question of fact, and Cree didn’t show that in fact the bulb was designed to replace a 100-watt bulb.

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