Last month in Update: Frequent Flier Plaintiff in Food Court Crashes Again with Denial of Class Certification, we discussed the need for judges in food “mislabeling” lawsuits to closely scrutinize whether a feasible method exists for the court to identify who is a member of the putative class (i.e. who bought the allegedly mislabeled product). We applauded Judge Phyllis Hamilton’s application of such an “ascertainability” test to deny class certification in Astiana v. Ben & Jerry’s, but we also bemoaned that her rationale was too narrow.
Another Northern District of California decision last week addressed ascertainability, and it did so in the broader way we had advocated. Judge Samuel Conti’s February 13 order denying class certification in Sethavanish v. ZonePerfect Nutrition Co. exacerbates a split on ascertainability within the Ninth Circuit, and could have a major impact well beyond food-oriented consumer class actions.
Ms. Sethavanish’s claims mimic those in countless other mislabeling suits: that the use of “all-natural” on ZonePerfect nutrition bar labels is false and misleading and led her to buy those products rather than less expensive ones. She sought to certify a class of consumers under Federal Rule 23(b)(3). After rejecting ZonePerfect’s arguments that the plaintiffs lacked standing, Judge Conti turned to whether Sethvanish was required to offer a feasible method for the court to identify class members.
Judge Conti acknowledged the split among the Ninth Circuit’s district courts and also noted the Third Circuit’s Carrera v. Bayer Corp. ruling from last year, which held that class membership could not be ascertained through self-serving affidavits in situations where consumers could not produce sales receipts. He concluded that while Sethavanish did not have a duty to identify all class members at the certification stage, she did have to present an objective, administratively feasible method to do so. Because Sethavanish had not offered any method, let alone a feasible one, to “determine who purchased ZonePerfect bars . . . or how many,” or how she “intends to weed out inaccurate or fraudulent claims,” Judge Conti denied class certification. He did so without prejudice, thus offering Sethavanish a chance to address his ascertainability concerns. Given the skepticism expressed in the opinion, however, it appears unlikely she can succeed.
For such an important decision, we’d have preferred that Judge Conti’s analysis were a bit more extensive. There is no lack of supporting caselaw within the Ninth Circuit and from other federal courts. The defendants in a labeling class action in the Central District of California, Forcellati v. Hyland’s Inc., for instance, provided a wealth of references which back their ascertainability arguments in recently filed supplemental briefs (here and here). That court had ordered briefing focused solely on ascertainability, so there could be another decision forthcoming on the issue.
Sooner rather than later, the Ninth Circuit will have to address this growing district court split on ascertainability in consumer class actions. We approach this inevitable review with some trepidation given the leanings of that court, but the current state of disarray on the issue is not sustainable indefinitely.
Would a Ninth Circuit affirmance of Sethavanish result, to paraphrase Northern District of California Judge Seeborg’s lament in his 2012 Ries v. AriZona Beverages opinion, in the end of consumer class actions as we know them? That is certainly what we’ll hear from the Food Court Bar, plaintiffs’ lawyers in general, and self-appointed consumer advocates. But what would we hear from actual consumers, especially in California, the epicenter of the food-labeling regulation-by-litigation crusade? Consider that in 2004, that state enacted—by popular vote—Proposition 64, which required that only actually injured parties could sue under California’s Unfair Competition Act (aka §17200).
Californians understood that §17200 had become more a “standardless, limitless attorney fee machine,” as one California Supreme Court Justice put it, than a law that protected consumers. Consumers would similarly understand that in the food-labeling class actions, they are merely along for the ride (or perhaps the coupon), unwittingly assisting profit-seeking lawyers and public health activists. They would recognize that when manufacturers have to pay multi-million dollar settlements, they don’t eat those costs; they pass them on to the consumers who are eating their products. So if requiring that a class be “ascertainable”—that actual “injured” people can be identified—means the end of these sorts of lawsuits, then so be it.
This post also published at WLF’s Forbes.com contributor page