Speak of the Devil and he doth appear. Today, it’s just a figure of speech. In medieval England, by contrast, people meant it literally—as a warning that uttering the Prince of Darkness’s name would conjure his evil presence. Maybe those Anglo-Saxons had a point. A few weeks ago, we wrote a post about a remarkable string of defense victories in “slack-fill” cases—i.e., lawsuits complaining of too much empty space in product packaging. In particular, we noted that “every slack-fill case to reach the class-certification stage ha[d] flunked Rule 23’s rigorous test for certification,” and we wondered aloud “how a slack-fill class could ever be certified.” Well, speak of the Devil: just four days later, a California court certified a class in a slack-fill case for the first time ever. We apologize for any causal role we may have had in this truly diabolical development. The good news is that the decision may not stick—and even if it does, it’s likely to remain an outlier.
As we observed in our prior post, slack-fill claims are uniquely unsuited to class treatment. Among other things, this is because the deception in such a case—if any—is self-limiting. You could buy some mislabeled products indefinitely without getting wise to the mislabeling, but with a slack-filled product, after you purchase it once, you are inherently immune to further deception or injury. The fact that so many consumers buy the same slack-filled products time and again—often for years or decades on end—means that any putative class of “all purchasers” is rife with individuals who could not possibly have been taken in. Slack-fill cases, therefore, pose a welter of individualized issues with respect to overbreadth, deception, materiality, causation/reliance, injury, damages quantification, and statutes of limitations.
Until now, courts have uniformly agreed. For example, last year, a Missouri district court denied class certification in a case involving Mike & Ike and Hot Tamales candies, which are sold in opaque cardboard boxes that contain some empty space. See White v. Just Born, Inc., 2018 U.S. Dist. LEXIS 132466 (W.D. Mo. Aug. 7, 2018). The plaintiff in White alleged that this “slack-fill” violated Missouri’s consumer-protection statute and the common law of 29 states. The court observed that countless consumers “knew what [they were] getting before [they] purchased”—a slack-filled box of candy—“but chose to purchase it anyway.” Those knowing purchasers “suffered no injury” and “cannot establish that [the manufacturer’s] retention of [their purchase price] is unjust.” And locating any naïve buyers amid the masses of knowing purchasers “w[ould] involve predominantly individual inquiries.” Q.E.D., cert denied. See also Spacone v. Sanford, L.P., 2018 U.S. Dist. LEXIS 153916, at *28-29 (C.D. Cal. Aug. 9, 2018) (denying certification in slack-fill case, where survey showed that over 75% of class members were “repeat … purchasers,” and “separat[ing] repeat purchasers … from first-time [buyers] who could assert … injury” would take individualized inquiry).
As luck would have it, the devilish new decision we referred to earlier involves the exact same products—Mike & Ikes and Hot Tamales—and essentially identical allegations. See Escobar v. Just Born, Inc., No. 17-cv-01826 (C.D. Cal. removal filed Mar. 7, 2017). Plaintiff Stephanie Escobar alleged that she “made a one-time purchase of a box of Mike & Ike … during a visit to the Cinemark Cinemas movie theatre in in Los Angeles,” purportedly “rel[ying] on the … size of the box” as an implicit “representation by Defendant as to the amount of candy contained” inside. “Once [Escobar] took her seat in the movie theatre,” she “discover[ed]—to her disappointment—that the Product’s box was only roughly half full.” As any reasonable consumer would do, Escobar left the theatre and filed a lawsuit, invoking the usual troika of California consumer-protection statutes and seeking to represent a class of “all persons who purchased” Mike & Ikes or Hot Tamales in the Golden State since 2013.
The manufacturer made several compelling arguments against class certification, including:
- Assessing whether there was excessive slack-fill would require individualized inquiry because the record evidence showed that the fill level in boxes of Mike & Ikes and Hot Tamales varies considerably.
- Assessing materiality would require individualized inquiry because survey results showed that most consumers do not expect the level of package fill that Escobar claims to have expected.
- Escobar, a “one-time” buyer, was not a typical class member because most consumers of Mike & Ike and Hot Tamales are repeat buyers who enter into the transaction with full awareness of the empty space in the package.
- Escobar was not a typical class member because she purchased at a movie theatre, whereas most buyers purchase Mike & Ikes and Hot Tamales at a grocery store or similar retail establishment. Escobar’s liability theory placed great weight on the fact that “[a]t the time [she] purchased” Mike & Ikes, they were “in a glass showcase, behind a concession counter,” so she “did not have the opportunity to inspect” or “shake” the box before making her purchase decision. Consumers who purchase at grocery stores, convenience stores, etc. do not have the same limitation.
- Escobar lacked standing to represent a class seeking injunctive relief under Rule 23(b)(2) because she is now aware of the empty space in boxes of Mike & Ikes and cannot possibly be deceived again in the future.
The court’s order granting certification did not discuss any of these arguments, let alone explain why it was rejecting them. Indeed, it is one of the most skeletal class-certification decisions we’ve ever seen, weighing in at just three-and-a-half double-spaced pages and containing less than one page of analysis of the Rule 23 factors. Since the order does not appear to be available on Lexis, here is the court’s substantive Rule 23 analysis, in its entirety:
In Bradach v. Pharmavite, LLC, 735 F. App’x 251 (9th Cir. 2018), the Ninth Circuit held that the numerosity, commonality, predominance, and superiority elements of Rule 23 are satisfied in certain consumer protection class actions, including those asserting CLRA [Consumers’ Legal Remedies Act] and UCL [Unfair Competition Law] claims, because the issue is “whether members of the public are likely to be deceived.” 735 F. App’x at 254. The Ninth Circuit noted that CLRA and UCL claims are “ideal for class certification because they will not require the court to investigate class members’ individual interaction with the product.” Bradach, 735 F. App’x at 254-255. Based on Bradach, Escobar has established the numerosity and commonality prerequisites of Fed. R. Civ. P. 23(a), and that class issue [sic] predominate over individual issues under Fed. R. Civ. P. 23(b)(3).
Further, typicality is established, here, because Escobar purchased at least one box of either Mike and Ikes or Hot Tamales; her claims are reasonably coextensive with those of the absent class members. See Hanlon v. Chrysler Corp., 150 F. 3d 1011, 1020 (9th Cir. 1998).
Finally, the adequacy prerequisite is satisfied because, inter alia, Escobar’s claim is typical. There were no arguments that the proposed class counsel is inadequate.
That’s all. No reference to the 750 pages of combined briefing and exhibits submitted by the parties, including expert reports and consumer surveys. Just a summary citation to an unpublished Ninth Circuit decision, in a non-slack-fill case, containing a generic statement about “certain” consumer-protection claims. The manufacturer has since filed a motion for reconsideration, arguing that the court did not “rigorously analyze” the evidence and arguments, as precedent requires.
Perhaps we should refrain from any further predictions, lest we jinx the defendant again. Still, we’ll hazard a guess that the Escobar court’s class-certification order is unlikely to survive, at least in its present form. The “rigorous analysis” mandated by the Supreme Court “requires a court to do more than offer brief and conclusory statements establishing the Rule 23 prerequisites.” Slaven v. BP Am., Inc., 109 F.R.D. 649, 651 (C.D. Cal. 2000). At minimum, the court must engage with the evidence and arguments offered by both sides and explain its reasons for accepting or rejecting them “in terms specific enough for meaningful appellate review.” Keil v. Lopez, 862 F.3d 685, 694 (8th Cir. 2017); see also Red Barn Motors, Inc. v. Nextgear Capital, Inc., 915 F.3d 1098, 1101-02 (7th Cir. 2019) (vacating conclusory order on class certification that “lack[ed] sufficient reasoning” for the circuit court “to ascertain the basis of [the] decision”). And in the unlikely event the Escobar order survives intact, its lack of any meaningful analysis of the issues should minimize its persuasive value with other courts, as compared with White and other decisions denying class certification in slack-fill cases.
We’ll keep an eye out for further developments in Escobar and the slack-fill arena generally. In the meantime, for the reasons we detailed in our earlier post, we’re still bearish on these cases. Perhaps we’ll just be a bit more careful next time we speak of the Devil.