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Ninth Circuit Confirms that Class Action Plaintiffs Must Plausibly Establish Future Intent To Re-Purchase To Maintain Claims for Injunctive Relief

The ruling in Lanovaz v. Twinings N. Am., Inc., 2018 U.S. App. LEXIS 15248 (9th Cir. June 6, 2018), settles what was arguably an open issue among district courts within the Ninth Circuit. A plaintiff must have an intent to re-purchase a product alleged to be falsely advertised in order to maintain an action for injunctive relief.

Twinings’ labels on its green, black, and white tea products stated that the teas were a “Natural Source of Antioxidants”. Plaintiff Lanovaz asserted that the labels amounted to “nutrient content claims,” which are regulated by the FDA (the term “antioxidant” is also subject to regulation). The plaintiff alleged that Twinings’ labels did not satisfy FDA regulations, and therefore were unlawful, misleading consumers.

Plaintiff sought injunctive relief under California’s Unfair Competition Law (“UCL”), False Advertising Law (“FAL”), and Consumers Legal Remedies Act (“CLRA”). Twinings moved for summary judgment, in part, because plaintiff testified that she would not purchase a Twinings tea product again.

While the U.S. Supreme Court has long noted that Article III standing for injunctive relief requires a showing of “real or immediate threat that the plaintiff will be wronged again—a likelihood of substantial and immediate irreparable injury,” (City of Los Angeles v. Lyons, 461 U.S. 95, 111 (1983)), the California Supreme Court subsequently ruled that a showing of lost money or property was sufficient to establish statutory standing to pursue injunctive relief under the UCL and FAL (Kwikset Corp. v. Superior Court, 51 Cal.4th 310, 336-337 (2011)).

Consequently, the district courts have split over what standard to apply in these injunctive relief cases. In October 2017, the Ninth Circuit partially resolved this question, setting forth the standard that courts should apply at the pleading stage. See Davidson v. Kimberly-Clark Corp., 873 F.3d 1103 (9th Cir. 2017). In reversing a motion to dismiss, the court ruled that a previously deceived consumer may have standing to seek an injunction against false advertising or labeling, even though the consumer now knows or suspects that the advertising was false at the time of the original purchase, because,

“Knowledge that the advertisement or label was false in the past does not equate to knowledge that it will remain false in the future. In some cases, the threat of future harm may be the consumer’s plausible allegations that she will be unable to rely on the product’s advertising or labeling in the future, and so will not purchase the product although she would like to. […] In other cases, the threat of future harm may be the consumer’s plausible allegations that she might purchase the product in the future, despite the fact it was once marred by false advertising or labeling, as she may reasonably, but incorrectly, assume the product was improved.”

Id., at 1115.

Consistent with Davidson, the district court in Lanovaz had previously ruled that the plaintiff had standing to seek injunctive relief. Lanovaz v. Twinings North Am., Inc., 2016 U.S. Dist. LEXIS 119281 (N.D. Cal. Sept. 2, 2016).

On summary judgment, however, the Lanovaz court reconsidered the issue: “numerous courts in this district have rejected the precedents relied on by this court and reached the opposite conclusion as to Article III standing where plaintiff does not allege future intent to purchase the products.” Id., *11-12 (citing cases). Accordingly, the court granted summary judgment because the undisputed evidence showed that plaintiff had no intention to buy the product again. Perhaps even more notably, the Ninth Circuit affirmed this result, confirming that the plaintiff must have evidence of intention to purchase a product in the future to survive summary judgment when pursuing injunctive relief in UCL, FAL, and CLRA actions. Lanovaz, 2018 U.S. App. LEXIS 15248.

Despite the Ninth Circuit’s decision at the pleading stage in Davidson, a plaintiff must have evidence of actual or imminent injury to maintain UCL, FAL and CLRA claims. As noted by the Ninth Circuit, merely stating that plaintiff would “consider buying” the offending product in the future will not suffice. Id., *2-3. “[A] profession of an intent … is simply not enough to satisfy Article III. A ‘some day’ intention – without any description of concrete plans, or indeed even any specification of when the some day will be – does not support a finding of the ‘actual or imminent’ injury that Article III requires.” Id. Absent such evidence, dismissal of UCL, FAL and CLRA claims is appropriate at the summary judgment phase.

Copyright © 2019, Sheppard Mullin Richter & Hampton LLP.

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About this Author

Robert Guite, business litigation attorney, Sheppard Mullin law firm, San Francisco office
Partner

Rob Guite is a partner in the Business Trial Practice Group in the firm's San Francisco office.

Areas of Practice

Mr. Guite focuses his litigation practice on class actions, involving ERISA, insurance, false advertising, commercial, construction and products liability matters. He regularly represents employers/plan sponsors, plan administrators and insurers in ERISA and fiduciary litigation involving health and welfare benefits, retirement benefits and compensation plans defending claims brought by individual participants or beneficiaries. In addition, Mr....

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Meyer, associate, orange county, construction, litigation
Associate

Abby Meyer is an associate in the Business Trial Practice Group in the firm’s Orange County office, and a member of the firm’s Construction, Food & Beverage, and Consumer Class Action teams.

Ms. Meyer represents clients facing or pursuing complex litigation arising from software implementations, construction, and real estate projects, including alleged construction defect and business disputes. These matters have included claims for breach of contract, lender liability, fraud, and misrepresentation, among other claims. Ms. Meyer has represented software companies, software developers, energy companies, and financial institutions on such matters.

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