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WBK Industry News - Litigation Developments

Class Certification Denied for Alleged New Jersey Consumer Fraud Act Violations

The U.S. District Court for the District of New Jersey recently denied a motion for class certification alleging numerous common law and state consumer protection law claims, including New Jersey Consumer Fraud Act (NJCFA) violations.  The Court held that individualized showings of proof predominated over common ones.

At the core of Plaintiffs’ class certification request was the allegation that Defendant’s orange juice product, purchased by each class member, was mislabeled and misbranded because:  (i) natural flavoring is added to the product, in violation of the Food and Drug Administration’s (FDA) standard of identity for pasteurized orange juice; (ii) the product’s labeling fails to disclose all ingredients, as required by law; (iii) marketing of the product as “pure, natural and fresh from the grove” is demonstrably false given the added flavoring; and (iv) such conduct entitles Plaintiffs and all other class members to damages.  Plaintiffs contended that these allegations compelled class treatment because the product either “conforms to the [FDA’s] standard of identity or it does not, either flavors are added or they are not.”

The Court explained that class certification is permitted if:  (i) the class is so numerous that joinder of all members is impracticable; (ii) there are questions of law or fact common to the class; (iii) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and (iv) the representative parties will fairly and adequately protect the interests of the class.  Plaintiffs must establish that questions of law or fact common to class members predominate over questions affecting only individual members.  The Court denied class certification based on Plaintiffs’ failure to show that common, instead of individual, showings of proof predominated.

In relation to Plaintiffs’ NJCFA claim, the Court stated that to obtain class certification, Plaintiffs must establish:  (i) unlawful conduct by the defendant; (ii) an ascertainable loss by the plaintiff; and (iii) a causal relationship between the unlawful conduct and the ascertainable loss.  The Court held that the relevant issue in establishing a causal link was “whether class members got less than what they expected,” and that “certification of a NJCFA class is not proper when class members do not react to misrepresentations or omissions in a sufficiently similar manner.”

Plaintiffs argued that a causal link existed because each class member suffered an ascertainable loss when they purchased the product but did not receive pasteurized orange juice.  The Court disagreed, finding that the record did not reflect that each class member reacted in a sufficiently similar manner.  The Court noted, for example, that the class’s lead representative stated that she did not look at the labeling when purchasing the product and cannot credibly claim to have purchased the product with the expectation that it conformed to the FDA’s standard.  Also, Plaintiffs’ own expert conducted a study, which suggests that other class members might still purchase the product at the same price point notwithstanding knowledge of its nonconformance with FDA pasteurization standards.   Accordingly, the Court denied Plaintiffs’ NJCFA class certification request.

The case is In re: Tropicana Orange Juice Mktg. & Sales Practices Litig., Civ. No. 2:11-07382; MDL 2353.