Combating Damages Models In Food, Cosmetic Class Actions

A bread manufacturer promises "natural whole-grain goodness," but the bread contains some white flour to help it rise. A cosmetic manufacturer promises "longer-lasting" nail polish and, while resistant to chipping, the polish "lasts" no longer than other polishes.

Food and cosmetic marketing and mislabeling class actions have proliferated recently, even against the backdrop of the savvy consumer accustomed to sweeping changes in nutrition and the next age-defying cosmetic breakthrough. No one knows for sure what "natural whole-grain goodness" means, and ultimately nail polish will "last" only as long as the nail grows. In all likelihood, these purchases stem from a myriad of reasons other than marketing representations, such as individual preferences, sale prices, brandy loyalty or simply to placate a misbehaved child in a shopping cart. Presenting a damages model that both integrates these reliance questions and complies with the U.S. Supreme Court's ruling in Comcast Corp. v. Behrend has made certification in food and cosmetic marketing class actions increasingly difficult.

Comcast was an antitrust class action premised on the acquisition of competitor cable providers and "swapping" cable systems for that of the acquired provider in a designated market area. As the dissent pointed out, certiorari was granted on the Daubert-related issue of "[w]hether a district court may certify a class action without resolving whether the plaintiff class has introduced admissible evidence, including expert testimony, to show that the case is susceptible to awarding damages on a classwide basis." However, the court actually determined that Rule 23(b)(3) requires a "rigorous analysis" showing that common questions of fact and law relating to injury and damages predominate. The damages model must "measure only those damages attributable to" the proposed plaintiff class's theory of liability. The court insisted on a methodology that calculates damages that result from the wrong alleged even if the proof overlaps with a "merits" determination.

Presenting a cogent damages model in food and cosmetic labeling and marketing class actions can be challenging. In many cases, the consumer has received some value from his or her purchase, unlike the purchase of products that fail of their essential purpose. When products do provide some value, a damages model must be established at the class certification stage that "teases out" the value received by a consumer from the amount paid by the consumer for the item. As Comcast instructs, the damages model must measure damages related to the plaintiff's theory of liability. Thus, the reduction in product value must be related to the misrepresentation allegedly made in marketing or labeling.

Regardless of the damages model employed, plaintiffs seeking class certification also face challenges in showing the number of products purchased and identifying the purchase price. (See Ackerman v. Coca- Cola Co. (beverage was sold in different sizes, in different sales units, such as individually, in a six-pack, or case, and through different sales channels); Astiana v. Ben & Jerry's Homemade Inc.; and Pagan v. Abbott Labs. Inc.) This is particularly difficult where the defendant is a manufacturer that does not sell the product at retail, and at best, retail pricing information would need to be subpoenaed from retailers. (See Carrera v. Bayer Corp.; and Astiana.) But...