As we have blogged before, the food and beverage industry is facing a tidal wave of class action litigation alleging false advertising under state consumer protection laws. We monitor hundreds of these cases, which often present a similar standing issue – the class representative has purchased one product, say Ben & Jerry’s All Natural Chunky Monkey Ice Cream, which he says was falsely advertised as “all natural,” but seeks to represent a nationwide class of consumers challenging all varieties of Ben & Jerry’s ice cream marketed as “all natural,” including, for example, Chubby Hubby.
One of the latest decisions on this standing issue is Lanovaz v. Twinings North America, Inc., 2013 WL 2285221 (N.D. Cal. May 23, 2013). The plaintiff in that case was suing over the phrase “a natural source of antioxidants” on the label of 53 tea products sold by Twinings. But the plaintiff herself had bought only six of those products. Because she obviously wasn’t deceived by the labels on the other 47 products she never bought, Twinings moved to dismiss the claims with respect to those products for lack of standing.
Judge Whyte denied the motion (in large part), which he said raised a close question that has “divided” courts and for which “the Ninth Circuit has not provided guidance.” In Judge Whyte’s view, “courts should not be too rigid in applying standing requirements to proposed classes.” For that reason, he noted, the “deciding factor is whether the products are sufficiently similar.” If the products are “nearly identical” and involve identical challenged advertising, the named plaintiff will have the requisite “sufficient ‘personal stake’ in the litigation.”
Judge Whyte then held that because 51 varieties of the tea in question were made from the same plant as the varieties plaintiff purchased, the named plaintiff had standing to assert class claims as to them all. But the remaining two types of tea came from a different plant (i.e., a different source of the “natural antioxidants” touted on the label). Judge Whyte concluded that the plaintiff could not bring class claims with respect to these products because they were “significantly different” from the ones the plaintiff had purchased.
We think Judge Whyte chose the wrong side of this split in authority. Just as class actions can’t be used to transform the substantive law, the Supreme Court has similarly made clear that plaintiffs cannot clothe themselves with standing they would otherwise not possess merely by suing in the name of a putative class. E.g., Lewis v. Casey, 518 U.S. 343, 357 (1996).
As we’ve covered on the blog, the Supreme Court recently denied review of a related standing issue in the context of a securities fraud claim in which the plaintiff had purchased only some of the securities as to which he sought to bring class claims. Hopefully the Court will step in soon to resolve the disagreement by lower courts over so-called “class standing”—a divide that Lanovaz demonstrates is deepening.
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