With Circuits Mis-Aligned, Sixth Circuit Stays Class Certification Pending Appeal
As our readers may remember, Procter & Gamble (“P&G”) stomached a loss last August when the Sixth Circuit affirmed certification of a false advertising class action regarding P&G’s Align probiotic supplement. But on October 27, the Sixth Circuit stayed its decision pending P&G’s petition for certiorari to the Supreme Court. As discussed below, P&G contends that plaintiffs have not sufficiently demonstrated a common injury.
P&G began to sell Align in 2005, mainly through doctor-driven sales. In 2009, it launched a widespread promotional campaign. Plaintiffs alleged Align was “snake oil” that produced only a placebo effect rather than true digestive health benefits. The three named plaintiffs had purchased the supplements in several different states, including California, Florida, Illinois, New Hampshire and North Carolina. The suit was originally filed in California federal court before it was moved to Ohio federal court, where U.S. District Judge Timothy S. Black granted a motion to certify the suit as five single-state class actions. A split three-judge panel for the Sixth Circuit upheld this decision.
In its opposition to class certification, P&G argued that there was insufficient evidence of a common injury incurred by class members, and indeed, that the named plaintiffs had not shown that they suffered any injury at all, because they presented only anecdotal claims that the product was ineffective. In her dissent from the majority decision affirming class certification, Sixth Circuit Judge Deborah Cook agreed with P&G, writing that the class should not have been certified because they had not presented sufficient evidence of Align’s alleged ineffectiveness. According to Judge Cook, plaintiffs claimed Align produced only a placebo effect, but they “offer no proof in support of this argument, and all the available evidence tends to show the opposite: that consumers benefit more or less from Align based on their individual gastrointestinal health.” However, the Sixth Circuit glossed over this, ruling that at the class certification stage, plaintiffs must show only that they can eventually prove a common injury, not that they have already done so.
On October 6, P&G moved to stay this ruling, arguing that the Sixth Circuit had upheld certification despite a lack of evidence that consumers were actually harmed. The stay motion pointed out that Judge Cook’s dissent highlighted the “substantial dispute that exists on these issues” and argued that the “certify first, ask for proof later approach” endorsed by the Sixth Circuit conflicted with the Seventh Circuit’s decision in Szabo v. Bridgeport Machs., Inc, 249 F.3d 672 (7th Cir. 2001). In Szabo, the Seventh Circuit held that “certifying classes on the basis of incontestable allegations in the complaint moves the court’s discretion to the plaintiff’s attorneys — who may use it in ways injurious to other class members, as well as ways injurious to defendants.” Thus, P&G claimed, this ruling deepened the circuit split over common injury requirements at the certification stage. Consequently, it argued, the Supreme Court is likely to consider the issue by granting certiorari in either this case or the Seventh Circuit’s Mullins v. Direct Digital decision, which implicates similar issues. 795 F.3d 654 (7th Cir. 2015).
P&G additionally argued that the case involves similar issues to two other cases for which certiorari already has been granted: Tyson Foods Inc. v. Bouaphakeo, No. 14-1146, cert. granted 135 S. Ct. 2806 (2015), which raises the issue of standing for unnamed class members; and Spokeo, Inc. v. Robins, No. 13-1339, cert. granted 135 S. Ct. 1892 (2015), concerning whether statutory violations alone can confer standing in civil suits. Certiorari was granted in both of these cases, and both were argued earlier this month.
In response to P&G’s motion, the Sixth Circuit temporarily stayed its mandate to allow P&G to file its cert petition and for the Supreme Court to rule on it.