Less than four months after a federal court in California certified a nationwide class in litigation alleging that the makers of homeopathic products advertised as safe and effective misled consumers because “homeopathy is pseudoscience” and the products do not work, another California court has certified another nationwide class bringing essentially the same claims. Allen v. Hyland’s Inc., No. 12-1150 (U.S. Dist. Ct., C.D. Cal., order entered August 1, 2014). Information about the April ruling appears in Issue 23 of this Report. The court refused to certify the plaintiffs’ “100% Natural” theory—that is, that consumers were misled by this labeling when the products allegedly contain synthetic or artificial ingredients—because they had failed to demonstrate “that ‘natural’ has a definite meaning that would exclude any of the ingredients at issue, nor had they demonstrated that class members relied on the ‘natural’ labelling statements at issue.”
The court rejected a challenge to one of the plaintiff’s experts finding that, while he lacked expertise on homeopathy, he has substantial training and experience in medicine and the treatment of disease generally and was qualified to offer opinions as to the medical or scientific underpinnings of homeopathy in general based on a recent literature review. The court also rejected the defendants’ argument that California law could not be constitutionally applied to out-of-state class members, because they had not sufficiently briefed the matter. According to the court, they relied on conclusory statements about the “markedly different laws of the 50 states” and “also failed to provide case-specific analysis as to the second and third prongs of the governmental interest test, relying instead on Mazza. Courts in this Circuit have repeatedly rejected such wholesale reliance on Mazza as insufficient to meet the defendant’s burden under the governmental interest test.”
Rejecting the defendants’ argument that the proposed class is not sufficiently ascertainable, the court disagreed that self-identification requires corroborating evidence because “the identity of class members need not be known at the time of class certification.” The court also found persuasive the court’s ascertainability analysis in the other homeopathy product class action. The court further found that the plaintiffs met the numerosity, commonality and typicality requirements of Rule 23, with one exception. One of the plaintiffs, who was the only one to purchase two specific products, testified that she could not recall if she had seen the product labels before buying them. Thus, she was not typical of the class members with respect to these products, and the motion for class certification was denied as to ClearAc and Poison Ivy/Oak Tablets.
Regarding the adequacy of the plaintiffs to represent the class, the court rejected claims that they were inadequate because they had been solicited by counsel on a Website, some of them had sought refunds or rebates, counsel did not actually contact them about the litigation until after the defendants filed a motion to dismiss the original complaint, and most of them had not reviewed or verified the complaint’s allegations before it was filed. Counsel were deemed adequate despite claims that they lured in plaintiffs with advertising, were jockeying with other attorneys to become lead counsel, had a conflict of interest because they were representing plaintiffs in parallel litigation, had demonstrated that their “true intention is to secure a fee,” and did not conduct a sufficient pre-filing investigation
The court found that the plaintiffs had failed to demonstrate standing to seek class-wide relief for the fraud-based Unfair Competition Law claims as to two products—Colic Tablets and Leg Cramps with Quinine—due to a lack of actual reliance on the allegedly deceptive or misleading statements. But, because the “record supports a finding that all class members were exposed to the same alleged misleading statements by Defendants,” the court ruled that the plaintiffs demonstrated that these claims were subject to class-wide proof. In this regard, the court stated, “It strains credulity to suggest that a ‘significant portion of the general consuming public or of targeted consumers’ do not rely—at least in part—on representations about the products’ uses and effectiveness on product packaging when buying the products.”
The court allowed class certification of the plaintiffs’ breach of warranty and implied warranty of merchantability claims, ruling that an exception to vertical privity applied.