A federal court in Illinois has denied the motion for class certification filed by the lead plaintiffs in multidistrict litigation (MDL) seeking damages and injunctive relief against the manufacturer, distributor and three major retailers of a children’s toy product that was recalled after it was found to be tainted with the “so-called date rape drug GHB.” In re Aqua Dots Prods. Liab. Litig., MDL No. 1940 (U.S. Dist. Ct., N.D. Ill., E. Div., decided October 4, 2010).
Noting a split in authority among the courts that have considered the matter, the court decided to adopt a “policy approach” in analyzing the superiority requirement of Federal Rule of Civil Procedure 23, in the context of whether “a defendant-administered refund program may be found superior to a class action.” The court discussed how nearly half the products purchased had been returned after the Consumer Product Safety Commission announced that it had been recalled and also noted “at least 513,869 consumers managed to procure refunds—all without the assistance of counsel or the court.” The court found it significant that “[n]ot one lead plaintiff, however, has ever tried to return an Aqua Dots toy to Spin Master or to the store from which it was purchased.”
According to the court, “At bottom, this is a suit to recover the purchase price of tainted Aqua Dots. Since the defendants will provide a refund—without needless judicial intervention, lawyer’s fees, or delay—to any purchaser who asks for one, there is no realistic sense in which putative class members would be better off coming to court.” Thus, the court refused to certify any of the proposed classes, which included a nationwide class and several combinations of state subclasses.
The court also discussed the difficulties of certifying the unjust enrichment subclasses because they “are fraught with procedural and choice-of-law problems that further preclude certification.” The court addressed them separately, finding “they provide the most vivid illustration of the generally unwieldy and slipshod state of the lead plaintiffs’ proposed class action” and that “the case law is replete with recent efforts by class-action attorneys to certify multistate unjust enrichment subclasses. The recurring problems with this strategy therefore warrant analysis.” In light of these issues, the court found an alternative ground for denying class certification.