Wednesday, September 30, 2020

inability to rely on claims provides standing to seek injunctive relief in 9th Circuit

Milan v. Clif Bar & Co., 2020 WL 5760450, No. 18-cv-02354-JD (N.D. Cal. Sept. 28, 2020)

Plaintiffs brought the usual California claims against the “health and wellness message[s]” on defendant Clif Bar & Company’s “Kid Zbars” and “ ‘Classic’ Clif Bars,” alleging that they were “deceptive because they are incompatible with the dangers of the excessive sugar consumption to which the Products contribute.” Clif moved to dismiss (after losing a previous motion to dismiss on failure to state a claim), arguing that (1) plaintiffs lacked Article III standing for injunctive relief, and (2) the governing choice-of-law analysis didn’t permit application of California law to a nationwide class. The court denied the motion.

Even assuming that Clif was ok to raise (1) now, after a previous motion to dismiss, which the court deemed “questionable litigation conduct,” the argument failed on the merits. Under Davidson v. Kimberly-Clark Corp., 889 F.3d 956 (9th Cir. 2018), plaintiffs had standing to seek injunctive relief. Clif relied on the following statement from Davidson:

In some cases, the threat of future harm may be the consumer’s plausible allegations that she will be unable to rely on the product’s advertising or labeling in the future, and so will not purchase the product although she would like to. In other cases, the threat of future harm may be the consumer’s plausible allegations that she might purchase the product in the future, despite the fact it was once marred by false advertising or labeling, as she may reasonably, but incorrectly, assume the product was improved.

This quote, however, did not set out “a two-test method,” but rather “two illustrations of how a plaintiff who has learned the hard way that a company’s statements were deceptive can have standing under Article III to enjoin the deceptive practice.” The question was still whether plaintiffs adequately alleged future injury. The complaint alleged that plaintiffs “continue to desire to purchase healthy nutrition bars, and continue to see the Clif Products when they shop”; plaintiffs “would purchase the challenged Clif Products in the future if they were in fact healthy”; and they “would likely purchase the challenged Clif Products if they could trust that the health and wellness claims were not false or misleading.” This was “indistinguishable” in substance from the acceptable Davidson allegations.

Clif suggested that, knowing the truth, named plaintiffs can now just read the nutrition label. “The problem for Clif Bar is that plaintiffs have called into plausible question all of its health and nutrition representations, and have alleged that they ‘will be unable to trust the representations on the Clif Products’ absent an injunction. Consequently, the Court declines at this pleadings stage of the case to conclude that plaintiffs cannot, as a matter of law, ever be deceived again by Clif Bar.”

What about (2), the rule of Mazza v. American Honda Motor Co., Inc., 666 F.3d 581 (9th Cir. 2012), on nationwide classes? This challenge was premature. The court would wait for certification briefing, which was well underway.


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