Lead Opinion
MOORE, J., delivered the opinion of the court in which COHN, D.J., joined. COHN, D.J. (pg. 527), delivered a separate concurring opinion. COOK, J. (pp. 527-29), delivered a separate dissenting opinion.
OPINION
The named plaintiffs-appellees (“Plaintiffs”) are three individuals who purchased Align, Procter & Gamble’s (“P & G”) pro-biotic nutritional supplement, and found that the product did not work as advertised — that is, it did not promote their digestive health. Plaintiffs subsequently brought suit, alleging violations by P & G of various state unfair or deceptive practices statutes because it has not been proven scientifically that Align promotes digestive health for anyone. On June 19, 2014, the district court certified five single-state classes from California, Illinois, Florida, New Hampshire, and North Carolina under Federal Rule of Civil Procedure 23(b)(3) comprised of “[a]ll consumers who purchased Align ... from March 1, 2009, until the date notice is first provided to the Class.” On appeal, P & G contends that the district court abused its discretion in granting Plaintiffs’ motion for class certification. For the reasons set forth below, we AFFIRM the district court’s judgment granting class certification to Plaintiffs.
I. BACKGROUND
A. Facts
Align contains a patented probiotic strain, Bifidobacterium infantis 3562f (“Bifantis”), which it developed in the 1990s and early 2000s in partnership with Alimentary Health, a company based in Ireland. Sealed App. at 497. According to the World Health Organization, probiot
Align is not a prescription probiotic. Instead, it is marketed to the general public as a supplement that “naturally helps build and support a healthy digestive system, maintain digestive balance, and fortify your digestive system with healthy bacteria.” Appellant Br. at 12 (alterations omitted). In addition, unlike some other nonprescription probiotics, Align is not included as an add-on ingredient to another consumer product (e.g., yogurt), but is rather sold in a capsule that is “filled with bacteria and [otherwise] inert ingredients.” R. 140 (Dist. Ct. Order at 30) (Page ID # 6444).
P & G began selling Align in various test markets in October 2005, with sales representatives dropping off samples to doctors’ offices in St. Louis, Boston, and Chicago. Sealed App. at 410. P & G was also able to sell a limited amount of product online, although “physician-driven sales outpaced internet-driven sales by about 2:1.” Id. One of the initial hurdles faced by P & G was convincing consumers of the product’s value, particularly given Align’s premium price point. See id. at 535 (company document noting that “[v]alue is a trial barrier due to the premium price point of $29.99. Probiotics on shelf at major retailers range from $9.99-$29.99. Of note, other probiotics detailed through physicians cost upwards of $45”) (emphasis added). After a successful rollout across multiple markets, P & G launched Align nationwide in 2009, promoting Align through a comprehensive advertising campaign, which included in-person physician visits, television and print advertisements, in-store displays, and product packaging. Appellant Br. at 11-12.
B. Procedural History
Dino Rikos, Tracey Burns, and Leo Jarzembrowski, the named plaintiffs-appellees, are residents of Illinois, Florida, and New Hampshire, respectively. From 2009 to 2011, Rikos, Burns, and Jarzembrowski were “exposed to and saw Procter & Gаmble’s claims by reading the Align label.” R. 85 (Second Amended Class Action Compl. ¶¶ 10-12) (Page ID # 963-64). In reliance on P & G’s claims of Align’s effectiveness, they proceeded to purchase Align at various stores in California, Illinois, North Carolina, Florida, and New Hampshire.
In their complaint, Plaintiffs allege that they “suffered injury in fact and lost money as a result of the unfair competition described [t]herein” after finding that Align did not provide them with the digestive benefits that it promised to provide. Id. Plaintiffs initially filed suit in the United States District Court for the Southern District of California, but the case was eventually transferred to the Southern District of Ohio. R. 25 (S.D. Cal. Dist. Ct. Order at 4) (Page ID # 374). In January 2014, Plaintiffs filed a motion and memorandum in support of class certification. Sealed App. at 15-63. In their motion, Plaintiffs requested that the district court certify the following five single-state
California Class (Represented by Plaintiff Dino Rikos): All consumers who purchased Align in California from March 1, 2009, until the date notice is first provided to the Class.
Rlinois Class (Represented by Plaintiff Dino Rikos): All consumers who purchased Align in Illinois from March 1, 2009, until the date notice is first provided to the Class.
Florida Class (Represented by Plaintiff Tracey Burns): All consumers who purchased Align in Florida from March 1, 2009, until the date notice is first provided to the Class.
New Hampshire Class (Represented by Plaintiff Leo Jarzenbowski [sic]]: All consumers who purchased Align in New Hampshire from March 1, 2009, until the date notice is first provided to the Class.
North Carolina Class (Represented by Plaintiff Tracey Burns): All consumers who purchased Align in North Carolina from March 1, 2009, until the date notice is first provided to the Class. Excluded from each of the Classes are the defendant, its officers, directors, and employees, and those who purchased Align for the purpose of resale.
Id. at 16.
After hearing oral argument from both sides, the district court issued an order granting Plaintiffs’ motion for class certification. In its • order, the district court made clear that it was not аttempting to provide a ruling on the merits of the case (i.e., whether or not Align promotes digestive health), but was instead reviewing only whether Plaintiffs had presented sufficient evidence to satisfy Federal Rule of Civil Procedure 23. R. 140 (Dist. Ct. Order at 5-6) (Page ID # 6419-20). It then determined that class certification was proper. Id. at 1, 38 (Page ID #6415, 6452). P & G has timely appealed.
II. ANALYSIS
A. Standard of Review
“Class certification is appropriate if the [district] court finds, after conducting a ‘rigorous analysis,’ that the requirements of Rule 23 have been met.” In re Whirlpool Corp. Front-Loading Washer Prods. Liab. Litig.,
B. Rule 23(a)
1. Plaintiffs Have Sufficiently Demonstrated Commonality
Federal Rule of Civil Procedure 23(a)(2) states that “[o]ne or more mem
P & G contends that, like the plaintiffs in Dukes, Plaintiffs here have failed sufficiently to demonstrate commonality. According to P & G, Dukes requires that named plaintiffs present evidence proving that class members suffered an aсtual common injury to establish commonality. Appellant Br. at 25-26. P & G argues that Plaintiffs here have presented only anecdotal evidence that Align does not work for them—Plaintiffs have “presented no evidence that the reported consumer benefits [of Align to all purchasers] were due solely to the placebo effect.” Id. at 29. Instead, P & G claims that “consumer satisfaction—and repeat purchasing—is probative of Align’s benefits to consumers.” Id. In addition, P & G notes that at least some studies appear to conclude that Align is effective in promoting digestive health.
P & G misconstrues Plaintiffs’ burden at the class-certification stage. Whether the district court properly certified the class turns on whether Plaintiffs have shown, for purposes of Rule 23(a)(2), that they can prove—not that have already shown—that all members of the class have suffered the “same injury.” Dukes,
Since Dukes, the Supreme Court has made clear that “Rule 23 grants courts no license to ehgage in free-ranging merits inquiries at the certification stage. Merits questions may be considеred to the extent—but only to the extent—that they are relevant to determining whether the Rule 23 prerequisites for class certification are satisfied.” Amgen Inc. v. Conn. Ret. Plans & Trust Funds, — U.S.-,
A brief overview of the class claims in Dukes illustrates the Supreme Court’s more limited holding than what P & G claims. The named plaintiffs were “three current or former Wal-Mart employees who allege[d] that the company discriminated against them on the basis of their sex by denying them equal pay or promotions, in violation of Title VII of the Civil Rights Act of 1964.” Dukes,
The Supreme Court rejected this theory, finding that the plaintiffs had failed to demonstrate that “there are questions of law or fact common to the class.” Fed. R.Civ.P. 23(a)(2). After reviewing the details of Wal-Mart’s discretionary promotion policy, the Court noted that, “[i]n such a company, demonstrating the invalidity of one manager’s use of discretion will do nothing to demonstrate the invalidity of another’s.” Dukes,
Here, in contrast, Plaintiffs have identified a common question — whether Align is “snake oil” and thus does not yield benefits to anyone, Appellee Br. at 7 — that will yield a common answer for the entire class and that, if true, will make P & G liable to the entire class. The district court conducted a sufficient analysis of the record evidence in finding commonality here. It concluded that no individual would purchase Align but-for its digestive health benefits, which P & G promoted through an extensive advertising campaign. If Align does not provide any such benefits, then every class member was injured in the sense that he or she spent money on a product that does not work as advertised. No more investigation into the merits (i.e., whether Align actually works) is needed for purposes of satisfying Rule 23(a)(2)’s commonality requirement.
P & G has failed to identify a single false-advertising case where a federal court has denied class certification because of a lack of commonality. See, e.g., In re Scotts EZ Seed Litig.,
In addition, as Plaintiffs point out, every court has, when presented with the oppor
In Fitzpatrick v. General Mills, Inc.,
As the preceding false-advertising cases make clear, the district court correctly found that Plaintiffs have demonstrated that their claims share a common question — whether Align is “snake oil” and thus does not yield benefits to anyone. Appellee Br. at 7. That common question will yield a common answer for the entire class that goes to the heart of whether P & G will be found hable under the relevant
2. Plaintiffs’ Claims Are Typical Of The Class
Federal Rule of Civil Procedure 28(a)(3) requires plaintiffs to show that “the claims or defenses of the representative parties are typical of the claims or defenses of the class.” As the Supreme Court made clear in Dukes, “[t]he commonality and typicality requirements of Rule 23(a) tend to merge.”
P & G does appear to make a slight variation of its consumer-satisfaction argument by contending that “many of the unnamed class members have no interest in pursuing restitution, nor in crippling the product. Indeed, this lawsuit may be antithetical to their interests.” Id. at 31. The district court considered and rejected this argument in its order granting class certification. See R. 140 (Dist. Ct. Order at 19) (Page ID # 6433) (“Defendant advertised to all that the proprietary probiotic bacteria in Align provides proven digestive health benefits. The question is not whether each class member was satisfied with the product, but rather whether the purchaser received the product that was advertised.”). The district court’s conclusion is consistent with those of other district courts who have reviewed similar arguments. See, e.g., Johnson,
C. Rule 23(b)(3): Plaintiffs Have Demonstrated That Common Questions Will Predominate Over Individualized Inquiries In Assessing the Merits of Their Claims
“[E]ach class meeting [the] prerequisites [of Rule 23(a) ] must also pass at least one of the tests set forth in Rule 23(b).” Sprague v. Gen. Motors Corp.,
1. Actual Exposure
According to P & G, “significant numbers of consumers became aware of and purchased Align based on sources of information unrelated to the advertising at issue,” and thus individual proof that class members purchased Align because of its advertising will be necessary, thereby defeating predominance. Appellant Br. at 40. P & G contends that “[d]octors do not simply rеcommend Align based on P & G’s professional marketing. Doctors make independent decisions based on their review of the science, experience, and expertise.” Appellant Reply Br. at 25. In support of its point, P & G relies on Minkler v. Kramer Laboratories, Inc., No. 12-9421,
These cases are, however, readily distinguishable from the case at hand. In In re American Medical Systems, we made clear that our decision to vacate the district court’s conditional certification order was based “on the extraordinary facts of [the] case.”
Minkler — an unpublished district court decision from a court outside of the Sixth Circuit — involvеd a plaintiff seeking certification of a class consisting of “[a]ll persons domiciled or residing in the State of California who ha[d] purchased a Fungi-Nail anti-fungal product.”
The facts in this case paint a far different picture. Unlike the plaintiff in American Medical Systems, Plaintiffs here do not take aim at a panoply of P & G products. They focus their attention on Align. Plaintiffs all purchased Align because it allegedly promoted digestive health. That is the only reason to buy Align. In' addition, Plaintiffs here have produced evidence showing that P & G undertook a comprehensive marketing strategy with a uniform core message, even if its packaging has changed somewhat over time: buy Align because it will help promote your digestive health. See Sealed App. at 253-55. That marketing campaign focused , on physician recommendations, with many sales representatives dropping off samples in various doctors’ offices over a multi-year period. Id. at 255.
The district court’s decision tо certify the proposed class is also in accord with the decision of courts in other consumer-products class action cases. In Johnson, for instance, the plaintiff — like Plaintiffs here — “presented evidence demonstrating that Defendants marketing campaign was prominent and not limited to statements made on the YoPlus packaging.”
The facts at issue in Johnson and Wiener are identical to the ones at issue here. Regardless of how customers first heard about Align — whether through P & G’s direct advertising campaign, through a physician who had learned about Align through a P & G sales representative, or
2. State Laws
On a related point, P & G also claims that Plaintiffs cannot prove reliance and causation, which P & G claims are required by the false-advertising laws at issue, on a classwide basis. Appellant Br. at 41. We examine each of these false-advertising laws below. We conclude that, under each of the five laws, Plaintiffs can prove causation and/or reliance on a class-wide basis provided that (1) the alleged misrepresentation that Align promotes digestive health is material or likely to deceive a reasonable consumer, and (2) P & G made that misrepresentation in a generally uniform way to the entire class.
a. California
Rikos seeks “certification of claims arising under Cal. Bus. & Prof.Code § 17200 (California’s Unfair Competition Law or ‘UCL’), Cal. Civ.Code § 1750 (Californiа’s Consumers Legal Remedies Act or ‘CLRA’), and breach of express warranty.” Sealed App. at 19-20. None of these causes of action require individualized proof of reliance or causation such that classwide proof will never suffice.
In In re Tobacco II Cases,
It is true that, “[u]nlike the UCL, ... plaintiffs in a CLRA action [must] show not only that a defendant’s conduct was deceptive but that the deception caused them harm.” Mass. Mut. Life Ins. Co. v. Superior Court,
Finally, proof of individualized reliance or causation is not necessary under California law to establish breach of an express warranty. Under California law, “[a]n express warranty is a term of the parties’ contract.” In re ConAgra Foods,
b. Illinois
Rikos also seeks “certification of claims arising under the Illinois Consumer Fraud and Deceptive Business Practices Act (‘ICFA’).” Sealed App. at 20. A claim under the ICFA requires: “(1) a deceptive act or practice by the defendant, (2) the defendant’s intent that the plaintiff rely on the deception, (3) the occurrence of the deception in a course of conduct involving trade or commerce, and (4) actual damage to the plaintiff that is (5) a result of the deception.” De Bouse v. Bayer AG,
It is true that courts have denied class certification of ICFA claims on the grounds that individual issues of proving proximate causation predominate over common issues. See, e.g., Siegel v. Shell Oil Co.,
As Plaintiffs note, ICFA claims do not necessarily require individualized proof of causation such that class certification is never proper. Appellee Br. at 40 n. 5. Rather, “where the representation being challenged was made to all putative class members, Illinois courts have concluded that causation is susceptible of classwide proof and that individualized inquiries concerning causation do not predominate if plaintiffs are able to adduce sufficient evidence that the representation was material.” In re ConAgra Foods,
c. Florida
Burns seeks “certification of claims arising under the Florida Deceptive and Unfair Trade Practices Act, Fla. Stat. § 501.201 et seq. (‘FDUTPA’)”. Sealed App. at 20. “A claim under FDUTPA has three elements: (1) a deceptive or unfair practice; (2) causation; and (3) actual damages.” Siever v. BWGaskets, Inc.,
Many courts have held that the FDUTPA does not require proof of actual, individualized reliance; rather, it requires only a showing that the practice was likely to deceive a reasonable consumer. In re ConAgra Foods,
If the defendants did not make a generally uniform material misrepresentation to the entire class, other courts have held that plaintiffs do need to show individualized causation. The sole case cited by P & G, Appellant Br. at 39 n. 6, falls into this camp. Miami Auto. Retail, Inc. v. Baldwin,
d. New Hampshire
Jarzembrowski seeks “certification of claims arising under the New Hampshire Consumer Protection Act, N.H.R.S.A. 358-A et seq. (the ‘New Hampshire CPA’).” Sealed App. at 20. Very few New Hampshire cases are on point, but the limited case law indicates that proof of individual reliance or causation is not required under the New Hampshire CPA.
In Mulligan v. Choice Mortgage Corp. USA a federal district court explained that:
New Hampshire courts use an objective standard to determine whether acts or practices are unfair or deceptive in violation of the CPA. In order to come within the CPA, [t]he objectionable conduct must attain a level of rascality that would raise an eyebrow of someone inured to the rough and tumble of the world of commerce. For such conduct to be actionable, the plaintiff need not show that he or she actually relied on the deceptive acts or practices.... Rather, a CPA plaintiff need only establish a causal link between the conduct at issue and his or her injury.
No. CIV. 96-596-B,
Greater clarity on the proof necessary to establish causation can be found in decisions from Massachusetts courts interpreting its analogous consumer fraud statute, to which “the New Hampshire Supreme Court frequently looks for guidance.” Id. at *11 n. 7. The Massachusetts Court of Appeals has held that causation under its consumer fraud statute “is established if the deception could reasonably be found to have caused a person to act differently from- the way he [or she] otherwise would have acted,” and “can also be established by determining whether the nondisclosure [or misrepresentation] was of a material fact” because “Materiality ... is in a sense a proxy for causation.” Casavant v. Norwegian Cruise Line, Ltd., 76 Mass. App.Ct. 73,
Finally, Burns also seeks certification of claims arising under North Carolina’s Unfair and Deceptive Trade Practices Act, N.C. Gen.Stat. § 75-1.1 et seq. (“UDTPA”). Sealed App. at 20. “To state a claim under the UDTPA, a claimant must allege (1) an unfair or deceptive act or practice (2) in or affecting commerce (3) which proximately caused injury to the plaintiff or his business.” Rahamankhcm Tobacco Enters. Pvt. Ltd. v. Evans MacTavish Agricraft, Inc.,
The issue, therefore, is whether North Carolina recognizes any circumstances under which classwide proof might suffice to show reliance. In Bumpers, which did not involve the issue of class certification, the North Carolina Supreme Court did describe the evidence necessary to prove reliance as focused on the mental state of the plaintiff and his/her decision-making procéss, which would seem to be difficult to prove on a classwide basis. Bumpers,
However, the North Carolina Supreme Court has held that reliance can be proved circumstantially, not just from direct testimony from the plaintiff.- Rowan Cnty. Bd. of Educ. v. U.S. Gypsum Co.,
f. Summary of State Laws
As this survey of the relevant state laws demonstrates, Plaintiffs can prove causation and/or reliance on a class-wide basis provided that (1) the alleged misrepresentation that Align promotes digestive health is material or likely to deceive a reasonable consumer, and (2) P & G made that misrepresentation in a generally uniform way to the entire class. As previously discussed, both factors are met here. The first factor is met — there is only one reason to buy Align, to promote digestive health, and thus the alleged misrepresentation would be material to or likely to deceive a reasonable consumer. As to the second factor, P & G undertook a comprehensive marketing strategy with a generally uniform core message such that all class members were likely exposed to the alleged misrepresentation. At a minimum, all class members saw P & G’s advertising on Align’s packaging.
Although a somewhat closer call, we believe that this classwide proof — that the alleged misrepresentation is material and was made in a generally uniform manner to all class members — would also suffice in North Carolina to show actual reliance such that individual issues would not predominate. The Eleventh Circuit’s discussion in Klay v. Humana, Inc.,
Echoing its commonality argument, P & G claims that it has put forth unrebutted evidence that Align actually works — that it provides digestive health benefits for at least some of its consumers — and thus Plaintiffs will not be able to prove injury on a classwide basis. Appеllant Br. at 33-37. The dissent also focuses on this argument. Even if P & G had not produced such proof, P & G argues that scientific evidence might establish that Align “provides benefits for some purchasers, but not all — the exact middle ground Plaintiffs ignore,” and thus it would still be necessary to determine whether Align works for each individual class member to prove injury, such that common issues do not predominate. Appellant Reply Br. at 7. P & G cites several cases in which it claims that courts required class plaintiffs to provide some evidence of actual class-wide injury to establish predominance at the class certification stage. Appellant Br. at 34-36.
As an initial matter and as already discussed, Plaintiffs contest whether the studies produced by P & G actually demonstrate that Align works for some individuals. Contrary to what the dissent claims, Plaintiffs have not tacitly conceded that Align works for individuals with IBS. Plaintiffs point to methodological flaws and problems with the studies on the effectiveness of Align for individuals with IBS to question the scientific validity of the studies in their own right, in addition to questioning whether those studies can be used to claim Align works for healthy individuals. See, e.g., R. 9 (Amended Compl. ¶¶ 36-37) (Page ID # 73-74) (for example, noting that in one study of women with IBS cited by P & G on its website, “the study tested Bifidobacterium infantis 3562 4 at amounts (referred to as ‘colony-forming units’ or ‘CFUs’) different than what is present in Align® probiotic supplement” and “[t]he study authors expressly emphasized the variability of results depending on the amount of CFUs”). Although P & G and the dissent claim that Plaintiffs’ own expert appeared to concede, in his deposition, that Align might have worked for one of his patients having digestive health issues, Dr. Komanduri stated later in the deposition that he did not know whether Align was helpful for his patient because it actually worked or because of a placebo effect. See R. 133 (Dep. of Srinadh Komanduri at 29-30, 58) (Page ID # 5748, 5755).
More fundamentally, however, P & G’s and the dissent’s argument attacks a theory of liability that Plaintiffs have not actually presented — that Align is not effective unless it works for 100% of consumers who take it. Appellant Br. at 32. However, what Plaintiffs actually argue is that it has not been shown that Align works for anyone, i.e., that Align is “snake oil.” Appellee Br. at 7. Thus, under Plaintiffs’ theory of liability, P & G’s claim that Align works for some individuals goes solely to the merits; it has no relevance to the class certification issue. In re Scotts EZ Seed Litig.,
Plaintiffs have presented sufficient evidеnce in the form of testimony from Dr. Komanduri that their theory of liability— that Align is worthless — is capable of resolution through classwide scientific proof such that common issues predominate. R. 108-8 (Komanduri Decl. at 2-4) (Page ID # 1596-98). Specifically, Dr. Komanduri attested that whether Align works for anyone can be tested by “correctly designed randomized, double-blind and placebo controlled clinical trials testing relevant outcomes.” Id. ¶ 15 (Page ID # 1597). The studies that P & G’s own expert cites and the dissent highlights as allegedly demonstrating that Align in fact has been proven to work for some individuals (such as those with IBS) are of a similar kind. R. 115 (Merenstein Decl. at 12-16) (Page ID # 4302-06). At the merits stage, Plaintiffs will have the opportunity to put forth their own scientific evidence on Align’s efficacy and to present expert testimony more fully contesting the accuracy of these studies and others P & G may produce. The key point at the class-certification stage is that this kind of dueling scientific evidence will apply classwide such that individual issues will not predominate. In other words, assessing this evidence will generate a common answer for the class based on Plaintiffs’ theory of liability — whether Align in fact has been proven scientifically to provide digestive health benefits for anyone. That common answer, of course, may be that Align does work for some subsets of the class. That does not transform this classwide evidence into individualized evidence that precludes class certification, however. Neither P & G nor the dissent has articulated how evidence that Align might work for some sub-populations actually would necessitate individualized mini-trials that should preclude class certification. Rather, the more straightforward impact of this evidence is simply that it may prevent Plaintiffs from succeeding on the merits.
The possibility that, at a later point in the litigation, the district court may choose to revisit the issue of class certification rather than dismiss the case if assessment of the fully developed evidence presented by both parties suggests Align actually works for some sub-populations is hardly as unprecedented or problematic as the dissent suggests. “Federal Rule of Civil Procedure 23 provides district courts with broad discretion to determine whether a class should be certified, and to revisit that certification throughout the legal proceedings before the court.” Armstrong v. Davis,
Moreover, the cases P & G cites do not hold that establishing predominance means that named plaintiffs must produce actual proof at the class-certification stage of classwide injury, here that Align is “snake oil.” On predominance specifically, we emphasized in In re Whirlpool that “the [Am-gen] Court repeatedly emphasized that the predominance inquiry must focus on common questions that can be proved through evidence common to the class.” In re Whirlpool,
The two cases cited by P & G are better characterized as holding that the plaintiffs had not demonstrated that the alleged injuries were capable of resolution by class-wide proof that would predominate over individual issues. Pilgrim v. Universal Health Card, LLC involved a class action claiming health care programs were falsely advertised as providing “consumers access to a network of healthcare providers that had agreed to lower their prices for members.”
Similarly, the decision in Phillips v. Philip Morris Cos.,
In the other two eases cited by P & G, the courts denied class certification because there was a disconnect between the class’s theory of liability and the class’s damages model, not because the named plaintiffs had not conclusively proved injury to the entire class at the class-certification stage, as P & G claims. As discussed in the next subsection, there is no similar disconnect here.
In In re Rail Freight Fuel Surcharge Antitrust Litigation — MDL No. 1869, for example, the D.C. Circuit denied class certification because the damages model presented by the plaintiffs could not reliably prove classwide injury in fact, i.e., it would “detect[ ] injury where none could exist.”
Similarly, in Parko v. Shell Oil Co., the Seventh Circuit held that the district court abused its discretion in certifying a class because of a disconnect between the class’s damages model and its liability theory.
4. Whether Plaintiffs’ Damages Model Is Consistent With Their Liability Theory
Finally and relatedly, P & G claims that Plaintiffs have “failed to provide any viable method to determine or award classwide damages, as required by Comcast Corp. v. Behrend, — U.S. -, 133 S.Ct. [1426,] 1433,
The premise of this argument suffers from the same problems with P & G’s preceding argument. Plaintiffs are claiming that Align works for no one, and if they are correct, all class members suffered from the same injury, buying a product that does not work as advertised. If Align in fact is proven scientifically to work for some individuals, Plaintiffs will lose on the merits.
Moreover, Plaintiffs’ damages model — a full refund of the purchase price for each class member — satisfies Comcast. In that case, the Supreme Court held that courts must conduct a “rigorous analysis” to ensure at the class-certification stage that “any model supporting a plaintiffs damages case [is] consistent with its liability case,” i.e., that the model “measurefs] only those damages attributable to that theory” of liability. Comcast,
in sum, the district court did not abuse its discretion in determining that common issues will predominate over individual issues in resolving the key merits issue of this case — whether Align promotes digestive health for anyone.
D. Standing
P & G also contends that the class is overbroad and thus raisеs Article III standing issues because Plaintiffs have failed to produce evidence that most of the class suffered an injury, i.e., that Align did not work for them. Appellant Br. at 45-47. This argument again misconstrues the basic theory of liability at issue in this case. Under Plaintiffs’ theory of liability, P & G falsely advertised to every purchaser of Align. As the district court put it, there is no reason to purchase Align except for its promised digestive health benefits. If Align does not work as advertised for anyone, then every purchaser was harmed, and a direct line can be drawn from P & G’s advertising campaign and the decision to buy Align.
E. The Proposed Class is Sufficiently Ascertainable
Finally, P & G contends that the proposed class is not ascertainable because “Plaintiffs have failed to demonstrate that there is a ‘reliable’ and ‘administratively feasible’ method for identifying the class members.” Appellant Br. at 50. Most consumers do not buy Align directly from P & G. Instead, they purchase the product from a commercial retailer, either in stores or online. This circumstance, P & G contends, makes ascertainability impossible— there is no plausible way to verify that any
The district court did not abuse- its discretion in holding that the class is sufficiently ascertainable. In our circuit, the aseertainability inquiry is guided by Young v. Nationwide Mutual Insurance Co.,
In Young, the named plaintiffs sued their respective insurance companies, alleging “that their insurer charged them a local government tax on their premiums when either the tax was not owed or the tax amount owed was less than the insurer billed.”
We rejected this argument. We noted that “[f]or a class to be sufficiently defined, the court must be able to resolve the question of whether class members are included or excluded from the class by reference to objective criteria.” Id. (internal quotation marks omitted). The plaintiffs had presented such a class, because class membership could be determined by reviewing factors such as “the location of the insured risk/property” and “the local tax charged and collected from the policyholder.” Id. at 539. Unlike the Third Circuit in Carr-era, we considered — and rejected — the defendants’ claim “that the class properly could [not] be certified without ... 100% acсuracy.” Id. Instead, we agreed with the district court’s conclusion that “the subclasses can be discerned'with reasonable accuracy using Defendants’ electronic records and available geocoding software, though 'the process may require additional, even substantial, review of files.” Id. (emphasis added) (internal quotation marks omitted). The court added that “[i]t is often the case that class action litigation grows out of systemic failures of administration, policy application, or records management that result in small monetary losses to large numbers of people. To allow that same systemic failure to defeat class certification would undermine the
This same reasoning applies to the instant case. The proposed class is defined by objective criteria: anyone who purchased Align in California, New Hampshire, Illinois, North Carolina, or Florida. As in Young, these single state sub-classes can be determined with reasonable — but not perfect — accuracy. Doing so would require substantial review, likely of internal P & G data. But as the district court pointed out, such review could be supplemented through the use of receipts, affidavits, and a special master to review individual claims. R. 140 (Dist. Ct. Order at 13-15) (Page ID # 6427-29).
Even if we were to apply Carrera, there are significant factual differences that make this class more ascertainable. In Carrera, the plaintiff brought a class action against Bayer Corporation, “claiming that Bayer falsely and deceptively advertised its product One-A-Day WeightS-mart.”
First, Carrera proposed “using retailer’s records of sales made with loyalty cards ..., and records of online sales.” Id. at 308. The Third Circuit rejected this approach. It noted that “there is no evidence that a single purchaser of WeightS-mart could be identified using records of customer membership cards or records of online sales.” Id. at 309 (emphasis added). Still, the court maintained that, “[depending on the facts of a case, retailer records may be a perfectly acceptable method of proving class membership.” Id. at 308-09. Second, Carrera proposed taking affidavits from various class members, the veracity of which could be assessed by a private firm tasked with administering class settlements. The Third Circuit likewise rejected this approach. It noted that this method “does not show [that] the affidavits will be reliable,” thereby undercutting Bayer’s due-process interests. Id. at 311.
Here, in contrast, there is “evidence that a single purchaser [in the proposed class] ... could be identified using records
In sum, the district court did not abuse its discretion in finding the proposed class to be sufficiently ascertainable. As the district court pointed out, there is significant evidence that Plaintiffs could use traditional models and methods to identify class members. See R. 140 (Dist. Ct. Op. at 12-15) (Page ID #6426-29). These methods satisfy Young.
Ill CONCLUSION
For the foregoing reasons, we AFFIRM the district court’s judgment granting class certification.
Notes
. P & G has not challenged on appeal two other requirements of Federal Rule of Civil
. Although not relevant to the commonality inquiry, Plaintiffs point to flaws in the scientific studies relied upon by P & G that Plaintiffs claim mean that it has not been proven with proper scientific analysis that Align works for anyone who takes it. See, e.g., Sealed App. at 42-44.
. Neither FTC v. Pantron I Corporation,
. The Eleventh Circuit ultimately vacated the district court’s decision and remanded the case to the district court, but for a reason unrelated to its commonality findings. The district court’s "class definition limit[ed] the class to those who purchased YoPlus ‘to obtain its claimed digestive health benefit,' which takes into account individual reliance on the digestive health claims.”
. P & G has not challenged on appeal the district court's holding that the other element of Rule 23(b)(3) is met, "that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy.” Fed.R.Civ.P. 23(b)(3).
. The case cited by P & G that states that reliance is required cites a decision that predates California’s Uniform Commercial Code ("UCC”). Williams v. Beechnut Nutrition Corp.,
. Further evidence that the plaintiffs' failure to prove that the groundwater was in fact contaminated was immaterial to the Seventh Circuit's decision is found in the case that the Seventh Circuit cites as properly granting class certification, Mejdreck v. Lockformer Co., No. OI C 6107, 2002 WL 1838141 (N.D.Ill. Aug. 12, 2002). Parko,
. P & G also argues in its reply brief that Plaintiffs have at most presented evidence that P & G’s claims about Align are unsubstantiated, but false advertising claims require affirmative proof of falsity, not just lack of substantiation. Appellant Reply Br. at 16-19. P & G argues that lack of substantiation claims are within the sole province of the Federal Trade Commission and other regulatory agencies. Id. at 17. P & G’s argument goes to the merits of the case, not to whether class certification is proper. Indeed, all of the cases cited by P & G involve discussions of the merits of false advertising claims and do not indicate that this distinction is at all relevant to whether a class should be certified. Whether the standard is affirmative proof of falsity or lack of substantiation, the evidence necessary to prove this issue will be the same for the entire class such that individual issues will not predominate.
. P & G urges us to enter a сircuit split over whether it is sufficient that the named class plaintiff has standing, regardless of whether unnamed class members do. Appellant Br. at 48-50. Because reaching this argument requires accepting P & G’s inaccurate characterization of Plaintiffs’ theory of liability in this case, we do not find it necessary to evaluate this claim.
. It is worth noting that the Third Circuit subsequently has cautioned against a broad reading of Carrera. In Byrd v. Aaron’s Inc.,
Dissenting Opinion
dissenting.
Recent Supreme Court precedent clearly holds that “plaintiffs wishing to proceed through a class action must actually prove — not simply plead — that their proposed class satisfies each requirement of Rule 23.” Halliburton Co. v. Erica P. John Fund, Inc., — U.S. -,
Plaintiffs proclaim that Align is “snake oil” that produces nothing more than a placebo effect. But Plaintiffs 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. P & G’s scientific studies and anecdotal evidence tend to show, at the very least, that patients suffering from irritable bowel syndrome (IBS) benefit from Align. Plaintiffs tacitly acknowledge as much in their amended complaint, challenging the design of these studies and arguing that P & G relies on an impermissible string of inferences to conclude that Align also benefits “healthy” people.
Plaintiffs’ attempt to distinguish Align’s impact on IBS sufferers from its effect on the general population exposes the flaw in their proposed class definition. At this stage, Plaintiffs must demonstrate that they can disprove Align’s efficacy for every member of the class at one time. The class certified by the district court includes all consumers who purchased Align, IBS patients and “healthy” consumers alike. Because the evidence tends to show that these two groups respond differently to Align, Plaintiffs have failed to meet their burden of showing that their theory of liability lends itself to common investigation and resolution. See Dukes,
Furthermore, Plaintiffs offer no proof that the benefits associated with Align result solely from a placebo effect. Their expert, Dr. Komanduri, expressed no opinion on the question and declined to confront any of P & G’s studies directly. He dismissed all these trials as too unscientific, although he has yet to study the product himself and acknowledges that the IBS symptoms of at least one of his patients improved after taking Align. In lieu of an expert opinion, Dr. Komanduri promised to design and conduct a clinical trial that will prove definitively whether Align works as advertised, notwithstanding the experts who already conclude that it works for at least some consumers. With nothing more than that promise, the district court certified a class of millions across five states. In doing so, the court impermissibly shifted the burden to P & G, forcing it to disprove the commonality and predominance elements of Rule 23.
To avoid confronting these flaws, the majority quotes Amgen’s admonition that “[m]erits questions may be considered to the extent — but only to the extent — that they are relevant to determining whether the Rule 23 prerequisites for class certification are satisfied.”
By discounting the evidence presented at the certification stage, moreover, the majority affirms a class definition that includes a clutch of members without standing. E.g., Kohen v. Pac. Inv. Mgmt. Co. LLC,
For these reasons, the Supreme Court requires plaintiffs to affirmatively prove that common questions both exist and predominate. Though Plaintiffs artfully frame the question in a binary fashion, a rigorous analysis of their evidence shows that resolution of the Plaintiffs’ question cannot apply universally to all class members. Plaintiffs offer nothing in support of their claim that Align benefits no one. Instead, they nitpick P & G’s competent evidence, trot out an expert without any opinion as to the supplement’s efficacy, and promise to conduct the definitive trial of Align that accounts for all variables of human physiology. Dukes and its progeny teach us that this is insufficient to justify class certification. I must dissent.
Concurrence Opinion
concurring.
I concur in the lead opinion and have this to add. As I read Plaintiffs’ false-advertising claims, they are predicated on the proposition that Align has no digestive health benefits to anyone, and that there is no reason to purchase Align other than for its promised digestive health benefits. On return to the district court, given the disagreements between the lead opinion and dissent, I believe the district judge, before proceeding further, should consider bifurcation under Fed. R. Civ. P. 42(b) the issue of the digestive health benefits of Align. If, as Plaintiffs claim, there is no scientific evidence that Align promotes digestive health for anyone, the case can proceed in the regular course. If, on the other hand, Plaintiffs’ proofs fail to establish that Align has no digestive health benefits, the case should be dismissed. See, e.g., Gillie v. Law Office of Eric A. Jones, LLC, No. 2:13-CV-212,