On March 25, 2014, Judge Dean Pregerson, of the U.S. District
Court, Central District of California, decertified a nationwide
class of consumers in a class action brought against POM Wonderful
LLC over allegedly false and misleading health claims related to
its pomegranate juice. Judge Pregerson's decertification order
is significant because it makes class certification more difficult
for plaintiffs, requiring that: 1) Plaintiffs comport with the
rigorous analysis of class-wide damages set forth in the recent
U.S. Supreme Court decision of Comcast Corp. v. Behrend,
133. S. Ct 1426 (2013); and 2) Plaintiffs demonstrate that the
putative class is ascertainable, which has been the recent focus of
many courts, many of whom have denied class certification on that
basis. See, e.g., Carrera v. Bayer Corp., 727 F. 3d 300
(3d Cir. 2013).
First, Judge Pregerson found that the two damages models offered
by Plaintiffs' experts failed to support a class action, as the
models failed to show that Plaintiffs' damages stemmed from the
defendant's actions that created the legal liability, as
required by the Supreme Court's rigorous analysis in
Comcast. The first damages model – the "Full
Refund" model – assumed that consumers purchased
POM's juice solely based on their alleged health benefits and
therefore used the full retail price paid as the measure of
damages. The Court found that this model could not accurately
measure class-wide damages because it ignored any benefit or value
consumers may have gotten from drinking POM's juice. The second
damages model – the "Price Premium" model –
quantified damages by comparing the price of POM with other
refrigerated juices of the same size because it assumed that demand
for POM would have been less and the POM market price would have
been lower if not for the alleged misrepresentations. In rejecting
this damages model, the Court found that it failed to explain how
POM's health claims caused any damages or comport with
Comcast's requirement that class-wide damages be tied
to a legal theory.
Second, consistent with the recent trend of federal decisions,
such as Carrera, recognizing plaintiff's burden to
show an "ascertainable" class for certification, Judge
Pregerson raised concerns about the practical effects of proceeding
as a class action, finding that the class was unascertainable:
"based on the volume of product sold, every adult in the
United States is a potential class member...These millions of
consumers paid only a few dollars per bottle, and likely made their
purchases for a variety of reasons. No bottle, label, or package
included any of the alleged misrepresentations. Few, if any,
consumers are likely to have retained receipts during the class
period, which closed years before the filing of this action."
Judge Pregerson concluded by stating "there is no way to
reliably determine who purchased Defendant's products or when
they did so."
This decision will most certainly be widely cited by defendants
embroiled in class action litigation, as it gives them additional
ammunition in their fight to defeat class certification.
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