Morrison Foerster’s Class Dismissed blog provides insights, recommendations, and timely reports on the latest defense news, developments, and trends in the most current class actions lawsuits and product liability issues that affect consumer-facing companies. Through Class Dismissed, attorneys from our nationally recognized Consumer Class Action and Products Liability practices offer a real-time assessment of the developments in matters that are shaping the industry. This blog examines the full spectrum of consumer-related class action and product liability lawsuits ranging from false advertising, privacy, consumer product safety, ADA, food misbranding, TCPA, environment, retail, and government actions as well as nationwide and multidistrict litigation class actions.<h2>ABOUT MORRISON FOERSTER</h2>Morrison Foerster is a leading global law firm that transforms complexity into advantage for its clients. Our clients include some of the largest financial institutions, banks, consulting and accounting firms, and Fortune 100, technology, and life sciences companies. Highlighting the firm’s commitment to client service, leadership in market-changing deals and impact litigation, and values-based culture, Morrison Foerster has been repeatedly recognized as one of the top 10 firms on The American Lawyer’s A-List. Year after year, the firm receives significant recognition from Chambers and The Legal 500 across their various guides, including Global, USA, Asia‑Pacific, Europe, UK, Latin America, and FinTech Legal. Our lawyers passionately care about delivering legal excellence while living our values. Morrison Foerster has a long-standing commitment to creating a culture that respects and celebrates differences, while providing an inclusive environment. The firm has achieved Mansfield Certification Plus since 2018 as a result of successfully reaching at least 30 percent women, communities of color, and LGBTQ+ lawyer representation in a notable number of current leadership roles and committees. The firm also has a long history of commitment to the community and society through providing pro bono legal services, including litigating for civil rights and civil liberties, improving public education and fostering the wellbeing of children, advocating for veterans, promoting international human rights, enforcing the right to asylum, and safeguarding the environment.

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Partner

Julie Park protects her clients’ products no matter what kind of product issue they face—whether it is planning for new product development, recalling an existing product, or defending clients against product liability or consumer class actions. Drawing on her deep technical and legal expertise, Julie counsels clients on consumer product safety regulation and pharmaceutical and medical device preemption while also managing complex and multijurisdictional litigation both in state and federal court.

Julie Y. Park

<div class="videoWrapper"><iframe frameborder="0" class="sticky-video" allowfullscreen="1" title="Meet Penny Preovolos, Litigation Partner" src="https://www.youtube-nocookie.com/embed/hv7hYn-Bl7c?rel=0&showinfo=0;vq=hd1080" title="iframe"></iframe></div>Penelope has served as lead counsel in major consumer class actions and antitrust cases for more than 35 years, successfully representing high-profile defendants in antitrust, consumer fraud, and product defect matters. Her clients span a range of industries, including consumer electronics, technology, retail, publishing, food and beverage, cosmetics, and household products. According to Chambers USA, Penelope has a “great reputation for antitrust and product liability work” and is a “superb all-around antitrust lawyer.”Penelope was named the 2019 Antitrust Lawyer of the Year by the Antitrust, UCL, and Privacy Section of the California Lawyers Association. She was co-chair of MoFo’s antitrust practice for 14 years. She has served as chair of the Antitrust and Trade Regulation Section of the State Bar of California and as a member of the Ninth Circuit Advisory Committee on Local Rules and Operations. She is an editor of and frequent contributor to Morrison & Foerster’s <a href="https://classdismissed.mofo.com/">Class Dismissed blog</a>, as well as a frequent speaker about class action and antitrust issues.More About PenelopePenelope clerked for the Honorable Charles M. Merrill, United States Court of Appeals for the Ninth Circuit. She graduated cum laude from Harvard Law School, where she was executive editor of the Harvard Civil Rights – Civil Liberties Law Review. Penelope was a member of Phi Beta Kappa at the University of California, Berkeley. She was awarded the University Medal, the highest undergraduate honor at the university, as well as the English Departmental Citation (awarded to the outstanding graduate in that department).

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Senior Counsel

Penelope has served as lead counsel in major consumer class actions and antitrust cases for more than 35 years, successfully representing high-profile defendants in antitrust, consumer fraud, and product defect matters. Her clients span a range of industries, including consumer electronics, technology, retail, publishing, food and beverage, cosmetics, and household products.

Penelope A. Preovolos

Claudia focuses her practice on the defense of consumer class actions and on complex commercial litigation, including unfair business competition, false advertising, product liability, and privacy matters. She is currently representing numerous consumer goods manufacturers and retailers in false advertising and mislabeling class action lawsuits. Claudia also regularly counsels clients in the food, cosmetics, retail, and technology industries. She represents companies in false advertising disputes before the National Advertising Division (NAD) of the Council of Better Business Bureaus, Inc.<h5>More about Claudia</h5>Claudia is active in MoFo’s pro bono efforts, and recently traveled to El Paso, Texas, to work with families separated and detained at the border. She is also supervising a pro bono collaboration with Equal Rights Advocates, a nonprofit fighting for gender justice in work places and schools across the country. The initiative will help students who have been victims of sexual assault, attempted assault, or harassment find support and seek justice. Claudia is also a board member of Bay Area Legal Aid and a former board member of Equal Rights Advocates. Claudia is an editor and frequent contributor to MoFo’s <a href="https://classdismissed.mofo.com/">Class Dismissed</a> blog, which provides reports about the latest defense news, developments, and trends in class action lawsuits and product liability issues that affect consumer-facing companies. Her perspectives are also respected in the larger legal community: Claudia has published articles about class action and false advertising issues, and is a co-author of Chapter 7 — “Unfair Competition in California Business Litigation 2016” — of The Recorder. She also regularly speaks at conferences on class action and advertising trends. Claudia is currently serving as a Lawyer Representative for the Northern District of California. She received her J.D. degree in 2004 from Berkeley Law (Boalt Hall School of Law), where she was an associate editor of the Berkeley Technology Law Journal.

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Claudia focuses her practice on the defense of consumer class actions and on complex commercial litigation, including unfair business competition, false advertising, product liability, and privacy matters. She is currently representing numerous consumer goods manufacturers and retailers in false advertising and mislabeling class actions.

Claudia M. Vetesi

Alexandra Barlow is a partner in the Litigation Department of Morrison Foerster’s San Diego office.Alexandra litigates product liability matters involving medical devices, pharmaceuticals, consumer products, automobiles, and AI. Alexandra's litigation expertise spans the entire case life cycle in both state and federal courts. She handles all phases of discovery, including fact investigation and expert discovery. Alexandra has taken over twenty-five depositions, including experts, plaintiffs, treating physicians, and third-party witnesses. She drafts and argues motions of all types, including motions for summary judgment, motions to quash, and motions for preliminary injunction.Alexandra has significant trial experience. She has first-chaired a one-week jury trial and second-chaired a five‑week jury trial, both involving multiple claims and witnesses. She also has extensive experience in alternative dispute resolution, representing clients at mediations, mandatory settlement conferences, and early neutral evaluations.Alexandra enjoys tracking developments and keeping her clients updated on product liability and personal injury claims, frequently writing or presenting on emerging areas such as autonomous vehicles and smart devices. Alexandra’s experience also extends to professional liability, warranty claims, eminent domain, and construction law.Alexandra earned her J.D. from the University of San Diego School of Law. While in law school, the San Diego Law Review published her comment on the recovery of damages by plaintiffs in a persistent vegetative state, and she also served as a comment editor. She received her B.A. from the University of California, Los Angeles, where she majored in Political Science and minored in Spanish. A San Diego native, she attended a Spanish immersion school through the eighth grade. Alexandra is active in the San Diego community, advising students at a local college. She is also a member of several legal organizations in San Diego, including Lawyer’s Club, the Association of Business Trial Lawyers, and Wallace Inn of Court.

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Alexandra Barlow is a partner in the Litigation Department of Morrison Foerster’s San Diego office. Alexandra litigates product liability matters involving medical devices, pharmaceuticals, consumer products, automobiles, and AI. Alexandra’s litigation expertise spans the entire case life cycle in both state and federal courts. She handles all phases of discovery, including fact investigation and expert discovery. Alexandra has taken over twenty-five depositions, including experts, plaintiffs, treating physicians, and third-party witnesses. She drafts and argues motions of all types, including motions for summary judgment, motions to quash, and motions for preliminary injunction.

Alexandra Barlow is a partner in the Litigation Department of Morrison Foerster’s San Diego office. Alexandra litigates product liability matters involving medical devices, pharmaceuticals, automobiles, AI, and robotics. Alexandra's litigation expertise spans the entire case life cycle in both state and federal courts. She handles all phases of discovery, including fact investigation and expert discovery. Alexandra has taken over twenty-five depositions, including experts, plaintiffs, treating physicians, and third-party witnesses. She drafts and argues motions of all types, including motions for summary judgment, motions to quash, and motions for preliminary injunction.

Alexandra Barlow

Adam J. Hunt is a partner in the Litigation Department of Morrison Foerster’s New York office. His practice focuses on complex litigation, with an emphasis on class action and commercial litigation.Mr. Hunt has extensive experience representing consumer products companies, financial institutions, and technology firms in class action cases and complex commercial disputes before state and federal trial courts, as well as in arbitrations. Clients seek Mr. Hunt’s counsel for his creative, strategic thinking in high-stakes, high-profile matters. He has represented clients facing claims under false advertising, antitrust, and privacy laws throughout the country, securing wins at the pleading stage, summary judgment, and trial, in addition to negotiating favorable settlements, often early in the case. Representative experience includes successfully securing rulings dismissing two putative false advertising class action cases against one of the best-known consumer electronics companies in the world; obtaining a complete win on summary judgment for a major shipping and logistics company in a multimillion-dollar commercial dispute; appearing as counsel at trial for a leading financial institution in a $100 million commercial dispute, winning a bench trial verdict; and prevailing on motions to dismiss false advertising class actions against a leading Greek yogurt company.Mr. Hunt is also an editor of the firm’s <a href="https://classdismissed.mofo.com/" target="_self">Class Dismissed blog</a>, which provides insights, recommendations, and timely reports on the latest defense news, developments, and trends in the most current class action lawsuits that affect consumer-facing companies.Mr. Hunt maintains an active pro bono practice and is the recipient of the New York State Bar Association’s 2017 President’s Pro Bono Service Award for the First Judicial Department, the 2018 Public Service Award from New York University School of Law, and Morrison Foerster’s Kathi Pugh Award for Pro Bono Services.Mr. Hunt received his B.A. with honors from Swarthmore College and his J.D. cum laude from New York University.

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Adam Hunt is a partner in the Litigation Department of Morrison Foerster’s New York office. His practice focuses on complex litigation, with an emphasis on class action and commercial litigation.

Adam Hunt

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Alexandra Preece Barlow

Adam J. Hunt

The Future of Section 230: Protection Against Product Liability Claims?

New Wave of PFAS Legislation Aimed at Consumer Products

CPSC Releases Annual Report on Deaths and Injuries Involving Nursery Products

CPSC Proposes New Safety Rules for Infant Rockers

CPSC Commissioners Abstain from Retracting Infant Sleep Product Statements

After months of anticipation, the U.S. Senate finally confirmed Dana Baiocco as a Commissioner of the U.S. Consumer Product Safety Commission (CPSC) on May 22, 2018. President Trump first <a href="https://classdismissed.mofo.com/cpsc/trump-to-nominate-new-commissioner-to-cpsc/">nominated Commissioner Baiocco</a> on September 21, 2017. As a former Jones Day partner in the firm’s Business & Tort Litigation Practice, Commissioner Baiocco joins CPSC with experience in both consumer product safety litigation and regulation.Had former Commissioner Joseph Mohorovic completed his term and not departed early from the Commission last October, CPSC would currently sit with a 3‑2 Republican majority. Instead, Commissioner Baiocco will join an evenly split 2‑2 Commission. Commissioner Baiocco joins President Trump’s appointee Acting Chairman Ann Buerkle and two President Obama‑appointees, Commissioner Elliot Kaye and Commissioner Robert Adler.Without a party majority, CPSC will likely be limited to non‑polarizing rulemaking and regulatory activity. For example, as previously <a href="https://classdismissed.mofo.com/consumer-products/cpsc-heating-up-before-new-commissioner-appointed-approves-a-petition-for-rulemaking-to-ban-an-entire-class-of-flame-retardants/">reported</a>, the Commissioners have been known to vote along party lines with regard to pro‑regulatory activity. In 2017, the three Democratic appointees voted to adopt a petition for rulemaking that sought to prohibit a flame retardant from certain consumer products, and the two Republican appointees voted against.Commissioner Baiocco’s seven‑year term will run through October of 2024, as she replaces former Commissioner Marietta Robinson, whose term expired in October of 2017.

Fertility Center Litigation

Fitbit

MicroPort

Leading Healthcare, Pharmaceutical, and Medical Device Company

Lethal Injection Matters – Major Pharmaceutical Company

Pain Pump Matters – Large Pharmaceutical Company

Major Technology Company

Leading Chemical Company

Security Device Company

In re Air Crash Near Peixoto de Azevedo, Brazil

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Erin Bosman is chair of MoFo’s Class Actions and Mass Torts Practice Group and is a founder and co-head of the Artificial Intelligence Group. Clients value her business strategy, seeking her comprehensive counsel throughout the product life cycle, especially in high-stakes litigation and product recalls.

Erin M. Bosman

Erin Bosman is chair of MoFo’s Class Actions and Mass Torts Practice Group and is a founder and co-head of the Artificial Intelligence Group. Clients value her business strategy, seeking her comprehensive counsel throughout the product life cycle, especially in high-stakes litigation and product recalls.

Erin Bosman

An orthopedic implant company

A children&rsquo;s monthly subscription service product

A fertility company

A major technology company

A smart fitness equipment company

Julie Park provides analytic and strategic counsel for issues in product life cycle, product liability and defective products, consumer class actions, and more.

Julie Park

Julie Park | Product Liability Lawyer

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Baiocco Confirmed as CPSC Commissioner

Nevada Enacts CCPA-Style Opt-Out Right for Consumers—but Similarities Are Few

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After months of anticipation, the U.S. Senate finally confirmed Dana Baiocco as a Commissioner of the U.S. Consumer Product Safety Commission (CPSC) on May 22, 

Baiocco Confirmed as CPSC Commissioner

Last week, the Federal Communications Commission (“FCC”) issued a public notice (the “Notice”) seeking comment on key aspects of the Telephone Consumer Protection Act (“TCPA”) that were addressed in the recent decision in ACA International, et al. v. FCC, 885 F.3d 687 (D.C. Cir. 2018).  As we noted in our Client Alert on the decision, the court in ACA set aside portions of the FCC’s 2015 Order interpreting, among other things, the definition of an automatic telephone dialing system (“ATDS”) and the applicability of the TCPA to reassigned numbers.More specifically, the Notice seeks comment on:<ul><li>What constitutes an “automatic telephone dialing system”? Under the TCPA, an ATDS is defined as equipment with the capacity to store or produce telephone numbers to be called. In ACA, the Court found that the FCC significantly overreached in its interpretation of “capacity.” The Notice thus seeks comment on how to interpret “capacity,” including how much user effort should be required to enable the device to function as an ATDS. The notice also seeks comment on what functions a device must be able to perform to qualify as an ATDS. For instance, to be “automatic,” must an ATDS dial numbers without human intervention? Must the ATDS dial thousands of numbers in a short period of time? What if a system has ATDS functionality, but the caller does not use the ATDS functionality when making a call?</li></ul><ul><li>How should calls to reassigned wireless numbers be treated? The TCPA exempts from liability certain calls made with prior express consent of the called party. A key issue in the ACA decision was interpretation of the term “called party” and how it applies to reassigned numbers. For instance, what happens if a business has obtained consent from the caller it is trying to call, but the wireless number associated with the person who provided consent is “reassigned,” and the business calls someone who did not consent to be called? The FCC’s answer to this issue in its 2015 Order was a “one-call safe harbor” for callers to detect reassignments. The Court in ACA, however, struck down this approach as arbitrary and capricious. The FCC’s notice thus seeks comment on how to interpret the term “called party” for reassigned numbers. For instance, does “called party” refer to “the person the caller expected to reach” or “the person actually reached”?</li></ul><ul><li>How may a called party revoke consent? In its 2015 Order, the FCC determined that consent may be revoked “at any time and through any reasonable means,” including orally or in writing, that “clearly expresses a desire not to receive further messages.” The Court in ACA left the ruling in place but suggested that a business could avoid TCPA liability by making available “clearly-defined and easy-to-use opt-out methods.” The FCC notice thus seeks comment on what opt-out methods would be sufficiently clear such that opt-outs outside of those methods would not constitute a “reasonable means.”</li></ul><ul><li>Pending petitions: The FCC notice also seeks comment regarding pending petitions for reconsideration, including the FCC’s Broadnet Declaratory Ruling as well as the 2016 Federal Debt Collection Rules.</li></ul>Comments on the FCC’s notice are due on June 13, 2018, with reply comments due on June 28, 2018. In the meantime, and as we noted in our Client Alert, businesses should continue to evaluate whether particular devices may be considered an ATDS as well as whether they have processes in place to provide a reasonable means of revoking consent.

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After ACA International, FCC Seeks Comment on Autodialer Definition

After ACA International, FCC Seeks Comment on Autodialer Definition

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Last week, the Federal Communications Commission (“FCC”) issued a public notice (the “Notice”) seeking comment on key aspects of the Telephone Consumer Protecti

While companies are focusing on compliance with the EU’s General Data Protection Regulation requirements, Californians will be given the option to impose a sweeping, GDPR-like privacy regime that also deserves attention. On May 3, 2018, proponents of the California Consumer Privacy Act announced they had collected the signatures needed to qualify the act for the Nov. 6, 2018 ballot. If approved by voters in November, the California Consumer Privacy Act would require businesses to disclose the categories of personal information they collect, sell or share about California consumers, and gives consumers a right to say “no” to the sale of their information. The act would also allow consumers to sue for violations (which include data breaches resulting from failure to maintain “reasonable security procedures and practices”) without suffering any loss of money or property, and would impose stiff penalties for noncompliance. Please see our full article as published on <a href="https://media2.mofo.com/v3/assets/blt5775cc69c999c255/blt2c316c0ac1b243ec/627315290d4d8e1d7f10f226/180517-california-pass-gdpr.pdf" target="_blank" rel="noopener">Law360</a>.

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Purvi G. Patel is the former managing partner of the Los Angeles Office. She represents retail, e-commerce, and other businesses in significant advertising, unfair competition, consumer fraud, and privacy 

Purvi G. Patel

Purvi G. Patel defends retail, e-commerce, and other businesses in significant advertising, unfair competition, consumer fraud, and privacy matters. She has built a robust practice defending household names in complex and class action litigation in federal and state courts across the country, winning motions to dismiss, defeating class certification, and securing summary disposition in several multi-million dollar lawsuits. Purvi is a strategic and practical thinker who is in tune with her clients’ priorities, which leads to successful outcomes both inside and outside the courthouse.

Purvi Patel

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California May Pass Its Own GDPR

California Attorney General Holds Public Hearing in Los Angeles on Draft CCPA Regulations

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While companies are focusing on compliance with the EU’s General Data Protection Regulation requirements, Californians will be given the option to impose a swee

California May Pass Its Own GDPR

On May 9, 2018, the Ninth Circuit issued an Opinion amending its previous decision in Davidson v. Kimberly-Clark Corp., 873 F.3d 1103 (9th Cir. 2017).  As we noted in our December 4, 2017 post on the 2017 decision, the Ninth Circuit had held that the fact that a plaintiff now knows the “truth” of an allegedly false advertisement does not foreclose injunctive standing.  (See <a href="https://classdismissed.mofo.com/consumer-products/ninth-circuit-finds-lower-court-erred-in-flushing-flushable-wipes-false-advertising-claims/">https://classdismissed.mofo.com/consumer-products/ninth-circuit-finds-lower-court-erred-in-flushing-flushable-wipes-false-advertising-claims/</a>.)In its amended Opinion, the panel clarifies its decision and refines the requirements for injunctive standing in the misbranding context in three ways: (1) it confirms that Article III injunctive standing requires plaintiffs to allege an intent to repurchase the product at issue; (2) it changes its previous stance that consumer protection laws would be gutted without injunctive relief; and (3) it holds that Plaintiff sufficiently alleged a “concrete and particularized” injury as well as redressability.Case Background and the 2017 OpinionAs we noted in our December post, Plaintiff in this case alleged that Kimberly-Clark and affiliate’s pre-moistened wipes were misleadingly labeled as “flushable.”  Plaintiff sought restitution and damages based on the price premium resulting from the “flushable” label, as well as an injunction requiring Kimberly-Clark to discontinue using the “flushable” label.The Court’s opinion addressed the split in district court decisions as to whether understanding the truth of an alleged misrepresentation precludes injunctive standing.  In Davidson I, the Ninth Circuit answered in the negative.  The panel held that even if a consumer is aware that a label is falsely advertised, she or he may still suffer a threat of future harm necessary for Article III standing because, without an injunction, she or he may be unable to rely on the label in the future or might incorrectly believe the product has improved.  Davidson I thus clarified what does not preclude standing.  But it left open the question of what exactly is required.Davidson II Key HoldingsWhile the key holdings in Davidson II remain largely the same, the panel’s decision answers the question left open in Davidson I of what a Plaintiff must allege for Article III injunctive standing.  The panel’s decision also changes course from Davidson I by finding that a plaintiff’s inability to pursue injunctive relief would not gut consumer protection laws because the claims could be remanded to state court.  Finally, the panel expands its Article III Standing analysis and holds that Plaintiff demonstrated a “concrete and particularized” injury as well as redressability.<ul><li>Plaintiff Must Allege an Intention to Repurchase the Product at Issue.</li></ul>Although the majority of the Court’s October 2017 Opinion remains unchanged, the key differences on injunctive standing requirements lie in the footnotes.  In particular, the Court addresses other circuit decisions to assuage concerns that its decision conflicts with other circuits holding a deceived consumer does not have standing to seek injunctive relief.  As the Court notes, the facts in Davidson were distinguishable from these cases because the plaintiffs there had not sufficiently alleged intent to repurchase the product at issue.  One plaintiff, for instance, had alleged they may, one day, purchase the product.  See McNair v. Synapse Grp. Inc., 672 F.2d 213 (3d Cir. 2012).  Plaintiff, on the other hand, alleged that she would purchase truly flushable wipes.  Consistent with the Court’s prior decision in Bigelow (see <a href="https://classdismissed.mofo.com/consumer-products/reading-the-tea-leaves-ninth-circuit-further-clarifies-injunctive-standing-issues-in-bigelow-tea-cases/">https://classdismissed.mofo.com/consumer-products/reading-the-tea-leaves-ninth-circuit-further-clarifies-injunctive-standing-issues-in-bigelow-tea-cases/</a>), the Court’s revisions in Davidson II confirm that intent to purchase is a necessary element of injunctive standing.<ul><li>The Inability to Get Injunctive Relief Does Not Gut Consumer Protection Laws.</li></ul>In its previous decision, the Ninth Circuit expressed concern that California’s consumer protection laws would be effectively gutted if injunctive relief were unavailable to a consumer who learned post-purchase that a product’s label was false.  In its Amended Opinion, the Ninth Circuit notes to the contrary that “risks to plaintiffs . . . are occasionally overstated” because the proper course for a district court confronted with an Article III standing problem in a removed case is to remand for adjudication in state court.  Thus the issue of the “perpetual loop” of plaintiffs filing in California state court, defendants removing the case to federal court, and the federal court dismissing injunctive relief claims “should not occur.”<ul><li>Other Standing Requirements Are Met Based on the Inability to Rely on Advertisements.</li></ul>The Ninth Circuit’s Amended Opinion also adds an analysis on redressability and whether Plaintiff’s injury was “concrete and particularized.”  The Ninth Circuit answered in the affirmative: the alleged injury was concrete based on her allegations that she would purchase truly flushable wipes.  Finally, a favorable ruling would likely provide redress for her alleged injury because the injunction Plaintiff sought would prohibit Kimberly-Clark from using “flushable” until the product was truly flushable.Takeaways The Amended Opinion makes clear that its decision in Davidson is cabined to the facts and does not entirely foreclose the argument that a plaintiff lacks injunctive standing because he or she now knows the truth about an allegedly false advertisement.  Instead, a plaintiff only has standing in this situation if she or he sufficiently alleges intent to repurchase the product in the future.  Even more, a plaintiff’s inability to get injunctive relief due to lack of standing does not spell the end: the court should simply remand to state court.  And a threat of future harm is not enough:  a court must confirm the plaintiff has met each of Article III’s requirements.

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Update: Ninth Circuit Softens Its Decision In Flushable Wipes Case

Update:  Ninth Circuit Softens Its Decision In Flushable Wipes Case

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On May 9, 2018, the Ninth Circuit issued an Opinion amending its previous decision in Davidson v. Kimberly-Clark Corp., 873 F.3d 1103 (9th Cir. 2017).  As we no

On April 17, 2018, the Northern District of New York dismissed a false advertising case against the Hain Celestial Group, Inc. based on the allegedly misleading packaging of Hain’s “Garden Veggie Straws.” Solak v. Hain Celestial Group, Inc., Case No. 3:17-cv-00704 (N.D.N.Y).  In particular, plaintiff took umbrage with depictions on the product’s packaging, including images of fresh vegetables and the use of the words “garden” and “veggie.”  These depictions, plaintiff claimed, misled consumers into believing the straws contained “significant” amounts of whole vegetables and were healthful and nutritious.  Not so, held the court.  The court found that the challenged statements and images were not misrepresentations and would not mislead a reasonable consumer.In its opinion, the court noted that the images of the Straws themselves made it sufficiently clear to consumers the nature of the product they bargained for. As the court described, the images depicted a “processed, unnaturally-colored ‘straw’ snack resembling a chip or crisp.”  A reasonable consumer would be familiar with the “fact of life” that a chip-like snack was not composed primarily of fresh vegetables.  Even more, a reasonable consumer need only refer to the ingredient list on the package to resolve any ambiguity about the vegetable content of the product.The court also dismissed plaintiff’s express warranty claim. The court reasoned that defendant’s representations, even when considered collectively, were insufficient as a matter of law to mislead a reasonable consumer, and therefore could not be relied upon by plaintiff as grounds for asserting a breach of express warranty under New York or California law.

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The Last Straw: Northern District of New York Chucks “Garden Veggie Straws” Case

The Last Straw:  Northern District of New York Chucks “Garden Veggie Straws” Case

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On April 17, 2018, the Northern District of New York dismissed a false advertising case against the Hain Celestial Group, Inc. based on the allegedly misleading

For the second time, an Illinois federal judge powered down a proposed class action against VTech Electronics following a 2015 data breach of its internet-connected digital learning toys. The data breach also triggered separate allegations by the Federal Trade Commission (FTC) that VTech violated federal children’s privacy laws.Both developments illustrate the increasing exposure that the Internet of Things brings when consumer product manufacturers collect and store consumers’ personal data with connected devices. They also demonstrate how the need to address these issues upfront is imperative.VTech Toy Data Breach Class Claims Dismissed AgainIn In re VTech Data Breach Litigation, Case No. 1:15-cv-10889 (N.D. Ill. 2018), Plaintiffs sought to represent a class of consumers who purchased VTech’s digital learning devices.  Their claims arose after a hacker lifted personally identifiable information affecting 4.8 million adult accounts and 6.3 million child profiles linked to the devices.  Plaintiffs alleged that VTech broke promises to consumers because of its inadequate data-protection measures and subsequent suspension of online services accompanying the devices.The court disagreed. It had dismissed the suit once before on multiple grounds, including lack of standing to show future harm and failure to state a claim.  In granting VTech’s motion to dismiss for the second time, the court rejected Plaintiffs’ arguments that VTech spurned any implied promises it made to consumers at the time of purchase.The court reasoned that the alleged promises must be controlled by the express terms and conditions consumers agreed to when first using VTech’s online services post-sale. However, Plaintiffs failed to allege that VTech breached the express online service terms or the incorporated Privacy Policy that governed the device’s internet features.Plaintiffs also asserted that VTech’s online service suspension rendered the toy devices essentially useless in breach of the implied warranty of merchantability. VTech countered that Plaintiffs could not show that anything was actually wrong with the toys themselves or that users could never access the online services.  The court agreed with VTech, finding these pleading defects fatal to Plaintiffs’ claim.Finally, the court dismissed without prejudice Plaintiffs’ remaining allegations for unfair and deceptive business practices for failing to meet the heightened pleading requirement for fraud-based claims and dismissed the unjust enrichment claims on choice-of-law grounds.FTC Brings First Enforcement Action Under COPPA Involving Children’s IoT DevicesWhile the proposed class action sat in Illinois district court, the FTC filed a complaint against VTech in the FTC’s first children’s privacy case involving IoT toy products under the Children’s Online Privacy Protection Act (COPPA).Under COPPA, companies that collect personal information online from children under 13 must take reasonable steps to protect children’s data, including providing direct notice to parents that the device collects such information and obtaining their consent. The FTC claimed VTech failed to take these steps.The FTC also alleged that VTech’s Privacy Policy falsely stated that consumers’ personal information would be encrypted when in fact it was not.VTech settled with the FTC for $650,000 and agreed to implement a comprehensive data security program to ensure future compliance with COPPA and to protect consumers’ personal information.Implementing Effective Cybersecurity MeasuresVTech’s case—albeit a favorable result compared with its potential exposure—highlights the importance of implementing sound data privacy and security measures in consumer IoT devices as courts, federal regulators, and industry leaders grapple with <a href="https://classdismissed.mofo.com/consumer-products/connected-devices-bring-new-product-liability-challenges/">the interplay between cybersecurity and product liability</a>.For example, the Consumer Product Safety Commission (CPSC) will hold a <a href="https://classdismissed.mofo.com/consumer-products/cpsc-will-sharpen-its-focus-on-iot-in-upcoming-public-hearing-about-internet-connected-devices/">public hearing</a> on May 16, 2018, to discuss potential safety issues and hazards associated with IoT consumer products.As they continue to churn out internet-connected consumer products, IoT companies face increasing litigation risk from data breaches, privacy-related claims, and regulatory enforcement actions. Bringing in specialists to address these issues before they arise will reduce the inherent risks associated with IoT consumer products.

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Digital Toy Product Company Ducks Data Breach Class Action

Thank You, Next Enforcement: Music Video App Violates COPPA, Will Pay $5.7 Million

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For the second time, an Illinois federal judge powered down a proposed class action against VTech Electronics following a 2015 data breach of its internet-conne

Digital Toy Product Company Ducks Data Breach Class Action

On June 19, 2017, the U.S. Supreme Court issued a decision that has the potential to reshape the way class actions are litigated in courts throughout the country. In Bristol-Myers Squibb Co. v. Superior Court of California,[1] or BMS, the court clarified the scope of specific personal jurisdiction in the context of a mass tort action brought in California state court. Since that decision, some defendants have attempted to use BMS as a sword in response to putative nationwide class actions, with varying levels of success. No circuit court has yet to weigh in on the question of whether BMS applies in the class action context. But even if courts begin to consistently dismiss putative nationwide classes on BMS grounds, filing a motion to dismiss for lack of personal jurisdiction may not always be the best strategic and business decision for defendants.Please see our full article as published in <a href="https://media2.mofo.com/v3/assets/blt5775cc69c999c255/blt42545a4026ffe024/6273152b4d9f892971290137/180425-law360-bristol-myers-squibb.pdf">Law360</a>.