The plaintiffs’ bar often uses adventuresome choice-of-law arguments to attempt to grease the skids towards certification of nationwide classes.  Earlier this year, in a blockbuster decision, the Ninth Circuit rejected one of plaintiffs’ key arguments in Mazza v. American Honda Motor Co. (pdf), 666 F.3d 581 (9th Cir. 2012).  In that case, the plaintiffs had argued that California consumer-protection law should apply to the claims of all putative class members nationwide because the alleged wrongdoing supposedly emanated from that state.  The Ninth Circuit held that the plaintiffs’ approach would contravene fundamental principles of federalism by ignoring the materially different consumer protection laws of the other states where the challenged transactions actually occurred.  (Mayer Brown represented defendant Honda; here is our report on the decision.)

Since then, plaintiffs in consumer false advertising cases have scrambled to find ways to answer Mazza. One tactic—used frequently against food companies—is to bring nationwide class claims under the federal Magnuson-Moss Warranty Act (MMWA), 15 U.S.C. §§ 2301 et seq. Plaintiffs assumed that the existence of a federal claim—allowing the entire nationwide class’s claims to be evaluated under federal law—would do the trick. Plaintiffs thus often allege that statements on a product label, such as “All-Natural Ingredients,” constitute a written warranty by the manufacturer under the MMWA and that a breach of that warranty occurred when consumers did not realize the advertised benefits.

Several cases alleging MMWA claims in false advertising consumer class actions are now at the motion-to-dismiss stage, and so far, courts are dismissing the MMWA claims. Courts explain that, in contrast to some state warranty laws, the MMWA covers only narrowly-defined written warranties that a product will be “defect free or will meet a specified level of performance over a specified period of time.” In an unbroken series of decisions in the last few months, federal courts have held that the challenged statements on product labels are merely product descriptions that do not trigger MMWA warranties or liability. For example, in one case an MMWA claim was alleged regarding an “all natural” label statement on various Trader Joe’s products. The Northern District of California held that the statements did not guarantee that the products would be “defect-free,” noting that the plain meaning of “defect” suggests an “aberration or omission,” neither of which comport with Trader Joe’s presumably deliberate use of synthetic ingredients in the products in issue. Larsen v. Trader Joe’s Co., No. 11-05188 (N.D. Cal. Jun 14, 2012); see also Hairston v. South Beach Bev. Co., No. 12-1429, 2012 WL 1893818 (C.D. Cal. May 18, 2012) (“all natural” statement on SoBe drinks constitutes a product description, not a warranty under MMWA); Littlehale v. The Hain Celestial Group, Inc., No. 11-6342 (N.D. Cal. Jul. 2, 2012) (“The court is unpersuaded by plaintiffs’ argument that the statements “Pure Natural” and “All Natural” are affirmations or promises that the products are defect free. Instead, the court finds that the statements are mere product descriptions.”); Astiana v. Dreyer’s Grand Ice Cream, Inc., No. 11-2910 (N.D. Cal. Jul. 20, 2012) (plaintiffs unable to support position that ice cream products with “all-natural” statement on labels violate MMWA due to inclusion of allegedly artificial and/or synthetic ingredients).

A recent class action in which the MMWA claim was not dismissed reinforces the point by showing exactly what has been missing in the food false-advertising class actions. In Humphrey v. Electrolux Home Products Inc., No. 12-157 (E.D. Ark. Aug. 9, 2012), the plaintiff’s MMWA claim rested on allegations that the defendant’s clothes dryers were defective and prone to fires because lint collected in inaccessible places, making the dryers too hazardous to use. The court denied defendant’s motion to dismiss the MMWA claim, holding that the plaintiff plausibly had pled that there was a defect in the product and that the defendant had warranted, through statements made in the product literature, that the dryer would be defect-free.

As Humphrey shows, there is a marked difference between a product that is defective (such as an exploding clothes dryer) versus a product that merely does not meet the expectations of the purchaser (such as a food product labeled “all-natural” containing allegedly synthetic ingredients). Courts are recognizing that the “warranty” concept cannot be stretched so far.

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