Have you ever heard the phrase “A Snickers Bar a day keeps the doctor away”? Neither have we. That is because chocolate is a dessert, a luxury, and not a food with significant health benefits. Sure, chocolate can provide much needed energy, and a taste of chocolate from time to time won’t do a typically healthy person any harm. But you will forgive us for choking on the idea that anyone would rely on health and/or nutrition claims when buying a chocolate bar.
Thus the demise of most every claim in Khasin v. Hershey Co., Case No. 5:12-CV-01862 EJD, 2014 U.S. Dist. LEXIS 62070 (N.D. Cal. May 5, 2014), a putative class action that alleged eight different California state law claims allegedly arising from seven different representations on the packaging of multiple Hershey chocolates and mints. Id. at **2-3. The defendant had, for example, allegedly misstated antioxidant content, made “healthy diet claims,” suggested “unlawful” serving sizes, and failed to disclose vanillin (whatever that is; we suspect it has something to do with vanilla). An “everything-but-the-kitten-sink” complaint like this calls for a motion to dismiss, which the defendant filed, but which resulted in just one claim being dismissed. Id. at **2-3.
That’s a shame, because discovery revealed that the remaining seven claims purportedly based on seven representations were nearly a total sham. The defendant therefore moved for summary judgment based on evidence (mainly the plaintiffs’ deposition) showing that the plaintiff either did not view the alleged statements or did not rely on them, with just one exception.
We suspected the defendant had the plaintiff dead to rights when we saw the plaintiff’s first argument—that a court cannot rule on a dispositive motion in a class action until after a class is certified and notice is given to the putative class. Id. at *6. There actually is a substantial body of law on pre-certification dispositive motions, although we have always scratched our heads as to why pre-certification motions for summary judgment by defendants are the least bit controversial. The defining feature of a class action is that a judgment entered after a class is certified binds the entire class, and when money is at stake, notice and an opportunity to opt out are necessary conditions as a matter of due process. See Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (1985).
But prior to class certification, a judgment is binding only on the named parties. Every defendant knows that, and if a defendant wants to move for summary judgment as to the named plaintiffs, knowing full well that the judgment will bind only the named plaintiffs, there is no reason why the defendant should not be allowed to do that with its eyes wide open. In California state court, we have a name for it—a Fireside Bank waiver, named for the California Supreme Court case holding that a defendant has a due process right to ensure that all affected parties are bound before the merits of a class action are decided. See Fireside Bankv. Superior Court, 40 Cal. 4th 1069 (2007).
The district court in Khasin did not think the defendant’s motion was terribly controversial either, observing that “[w]here the defendant assumes the risk that summary judgment in his favor will have only stare decisis effect on the members of the putative class, it is within the discretion of the district court to rule on the summary judgment motion first.” Khasin, at *7. Of course, different considerations come into play when plaintiffs move for summary judgment prior to class certification, because then you have the specter of “one-way intervention,” i.e., absent class members using an order granting summary judgment as a sword. But the court acknowledged and dismissed that risk when the defendant is the moving party. Id.
So the district court addressed the defendant’s motion, which is where the plaintiff’s lawsuit began to melt away. To start with, because the plaintiff admitted that he had never viewed the defendant’s website or off-label advertising, he did not oppose summary judgment on all claims relating to statements made on the web and in print other than the product labels. Id. at *8. The plaintiff also did not oppose summary judgment on claims other than those under California’s Unfair Competition Law.
That’s a pretty dramatic narrowing of the claims, and all before the court even had to look at the evidence. But in addition to claims that the plaintiff conceded, the evidence further showed that “Contrary to the allegations made in the [Amended Complaint], Plaintiff’s testimony reveals that he did not, in fact, rely on most of Defendant’s representations outlined in the pleadings.” Id. at **11-12. The plaintiff “could not recall looking at Hersey’s labels”; he had “no concerns” about many of the alleged representations; and the use of other terms “did not make a difference to him.”
In other words, he is just like anyone else who buys chocolate treats, which the plaintiffs’ lawyers probably could have found out before they filed this cockamamie complaint. They could have, you know, maybe had a conversation with their client. We certainly would expect no less, but when all was said and done, the district court granted summary judgment on all but one claim: A UCL claim based on label claims regarding antioxidants because the plaintiff said that he viewed the defendant’s “antioxidant seal” and “that he would like to see certain disclosures on mint products.” Id. at *12.
To repeat, it is a shame that this case got past the pleadings intact. What started as an eight count complaint invoking numerous statutes and common-law claims over seven alleged representations in connection with multiple products wound up being one claim under one statute complaining about an “antioxidant seal” on a package of mints. This case has all the hallmarks of attorney-driven litigation that serves no end of justice. An overreaching complaint that bore little to no relation to the plaintiff’s actual experience. The plaintiffs’ lawyers abandoning multiple claims and substantially retrenching their lawsuit once confronted with their own client’s sworn testimony. A masthead of more than 15 attorneys for the plaintiff and his proposed class, which underscores that even with all that plaintiff lawyer brainpower and Internet advertising, they still could not recruit a putative class representative with viable class claims. The district court’s order left a sweet taste in our mouths, but the path beaten by this case along the way is decidedly sour.