Monday, March 13, 2023

Vanilla class action certified based on sufficient survey evidence

Vizcarra v. Unilever U.S., Inc., 2023 WL 2364736, No. 4:20-cv-02777 YGR (N.D. Cal. Feb. 24, 2023)

Hey, it’s a certified class in a vanilla case: Vizcarra alleged that Breyers Natural Vanilla Ice Cream misleadingly communicated that it contained vanilla flavor derived exclusively from the vanilla plant. The cartons “said ‘Natural Vanilla’ in large, light green letters against a black background, contained pictures of two vanilla beans and vanilla flowers and a scoop of the ice cream with noticeable specks purporting to be actual vanilla beans.” She brought the usual California claims.

Previously, the court found that Vizcarra didn’t show commonality or predominance, because her expert’s opinions were based on consumer-perception and materiality surveys that did not specifically test the effect of the vanilla representations on consumers’ beliefs and purchasing decisions, and the proposed damages model didn’t measure the resulting price premium, if any. Her expert did more surveys and returned.

Based on the results of the revised surveys, her expert concluded that (1) a reasonable consumer in California perceives the Vanilla Representations to convey that all of the vanilla flavor comes from vanilla extract made from the vanilla plant, which answers the common question of likelihood of deception that is integral to her claims under the UCL and FAL; and (2) that the Vanilla Representations were material to the purchasing decisions of a reasonable consumer in California, which answers the common question of materiality that is integral to her claim under the CLRA.

Unilever argued that the survey still didn’t do the job because it didn’t test “a stimulus that removed the Vanilla Representations but was otherwise identical to the package of the ice cream at issue.” The revised perception survey involved presenting to respondents an un-branded ice cream product that displayed only the Vanilla Representations on the front label of the product. 78.7% of respondents reported that they believed that “all of the vanilla flavor” comes from the vanilla plant; 16.6% perceived that “not all of the vanilla flavor” comes from the vanilla plant; and 4.7% were not sure. Unilever argued that this survey couldn’t distinguish the effect of the Vanilla Representations on survey respondents’ perceptions from the effect of the survey respondents’ pre-existing beliefs or biases, including about the Breyers brand and vanilla ice cream in general, and that the questions were leading. Vizcarra rejoined that the survey (including the stimuli) were designed so that the survey would measure the effect of the Vanilla Representations directly while avoiding the risk that the results of the study would be “contaminated by pre-existing beliefs” of respondents or other biases, including pre-existing beliefs associated with the Breyers brand. Vizcarra met her burden to show by a preponderance of the evidence that her expert’s opinions were capable of answering the question of whether a reasonable consumer is likely to be deceived by the Vanilla Representations. “Unilever’s criticisms boil down to a disagreement as to Dr. Dennis’ survey design choices, which go to the weight to be accorded to Dr. Dennis’ survey results and opinions when determining the merits of Vizcarra’s claims at trial.”

CLRA: “The requirements for stating a claim under the CLRA differ from those for a claim under the UCL and FAL because a CLRA plaintiff can obtain damages, as well as equitable relief and other remedies.” Thus, a CLRA plaintiff must “show not only that a defendant’s conduct was deceptive but that the deception caused them harm.” However, “[c]ausation, on a classwide basis, may be established by materiality. If the trial court finds that material misrepresentations have been made to the entire class, an inference of reliance arises as to the class.” Vizcarra’s expert’s materiality survey was also capable of answering that question on a classwide basis. The revised survey measured the extent to which a product having the Vanilla Representations is preferred over the product not having the Vanilla Representations in the context of purchasing behavior. 88.8% of respondents indicated that they would prefer to purchase the product that had the Vanilla Representations; and 11.2% indicated that they would prefer to purchase the product that did not have the Vanilla Representations. Unilever objected that they weren’t shown a real product, but the survey “does test and does speak to the effect of the Vanilla Representations on consumers’ purchasing decisions, consistent with Vizcarra’s theory of liability, … with a sufficient degree of reliability such that a reasonable factfinder at trial could find, based on Dr. Dennis’ opinions, that the Vanilla Representations were material to a reasonable consumer’s purchasing decisions.” The expert explained that he designed the survey and stimuli to measure the effect of the Vanilla Representations while minimizing the effect of potential confounding factors, such as respondents’ pre-existing beliefs and biases.

Predominance: Damages must be capable of measurement on a class-wide basis. While the model “must measure only those damages attributable to” the plaintiff’s theory of liability, the calculations “need not be exact” at the certification stage. A revised price premium model using contingent valuation, which had been proposed, but not yet studied, by Vizcarra’s expert, would suffice. Contingent valuation methodology has been widely accepted as a reliable method for calculating damages on a class-wide basis in false advertising and mislabeling cases. The expert proposed to use actual, historical pricing data for the ice cream product at issue in calculating the price premium, which serves to incorporate supply-side factors into the price premium analysis, answering one of Unilever’s key criticisms; the jury could consider the weight of these opinions.

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