On January 17, 2014, Ben Z. Halberstam filed this putative class action on his own behalf and on behalf of a class of similarly situated Californians against NJOY, Inc., and -Sottera, Inc. (collectively, “NJOY”).
On May 20, 2015, while the motion to dismiss was still under submission, plaintiff Eric McGovern filed a notice of voluntary dismissal of his individual claims pursuant to Rule 41(a)(1) of the Federal Rules of Civil Procedure.
On May 21, 2015, plaintiffs filed a motion for class certification.
I. FACTUAL BACKGROUND
A. Background Concerning Electronic Cigarettes
An electronic cigarette (“e-cigarette”) is a device that simulates a traditional tobacco cigarette.
As a result of the increasing popularity of e-cigarettes among consumers, government agencies and research facilities have conducted several studies regarding their potential health impacts and risks.
In 2009, for example, the United States Food and Drug Administration (“FDA”) conducted a study of two brands of e-cigarettes, one of which was NJOY.
In 2013, the German Cancer Research Center published á comprehensive' report on é-cigarettes that reviewed studies and literature in the field.
The World Health Organization (‘WHO”) expressed concerns regarding the presence of carcinogens and other toxic chemicals in e-cigarettes in May and July 2013,
B. Allegedly Misleading Advertisements and Representations During the Class Period
Plaintiffs allege that, during the class period, NJOY has engaged in a continuous, widespread campaign deceptively to promote > NJOY e-cigarettes as “everything you like about smoking without the things you don’t.”
In December 2012, NJOY purportedly introduced a new product — NJOY Kings.
Packaging1., Plaintiffs assert that the warnings on NJOY’s. product packaging omit material information — e.g., a list of product ingredients — and in this way conceal the health risks associated with the chemicals the product contains.
Plaintiffs contend that these' material omissions are reinforced by misleading statements on NJOY packaging inserts, such as: “The NJOY King provides everything you like about smoking without the things you don’t”; “Be sure to tell your friends and family about the positive impact that NJOY products are having on your life”;" and “the NJOY King gives you everything you love about the smoking experience.”
ÑJOY’s Advertising Campaigns: Plaintiffs allege that, beginning in December 2012 and January 2013, NJOY circulated advertisements that were false and misleading because they highlighted the positive aspects of e-cigarettes without referencing the negative side effects and health consequences associated with their use.
Plaintiffs contend that an advertisement with the caption “Resolution Solution”1 was also false and misleading because it represented that NJOY e-cigarettes are a smoking cessation aid when, in fact, they are not.
Plaintiffs concede that NJOY had modified its website as of the date of the filing of their complaint; they contend, however, that it remains deceptive.
Finally, plaintiffs assert that NJOY knew its advertising campaign would convey to reasonable consumers that its products were safer than traditional cigarettes.
C. The Individual Plaintiffs and Class Claims
Halbertstam purportedly saw NJOY’s packaging and read the warnings prior to purchasing its e-cigarettes.
Halberstam alleges two claims on his behalf and on behalf of a California class: (1) violation of the, California Consumers Legal Remedies Act (“CLRA”), California Civil Code §§ 1770(a)(5), (a)(7), and (a)(9); and (2) violation of California’s Unfair Competition Law (“UCL”), California Business and Professions Code § 17200 et seq.
Thomas purchased one NJOY “OneJoy” e-cigarette in Jacksonville, Florida, in the summer of 2012.
D. Plaintiffs’ Request for Judicial Notice
Plaintiffs filed a request for judicial notice along with their reply in support of class certification. In it, they ask the court to take judicial notice of an amicus curiae brief of economists Robert Solow and George Akerlof filed in support of plaintiffs-appellees in Price v. Philip Morris,
Under Rule 201 of the Federal Rules of Evidence, “the [c]ourt may take judicial notice of matters of public record if the facts are not subject to reasonable dispute.” Olds v. Metlife Home Loans, No. SACV 12-55 JVS' (RNBx),
II. DISCUSSION
A. Motions to Strike and Evidentiary Objection^
. Before addressing the merits of the certification motion, the court must first consider the parties’ challenges to declarations filed by their respective experts. NJOY contends that the expert declarations of Thomas Maronick and Jeffrey Harris, .which plaintiffs.submitted.in support of their motion for. class certification, should be .stricken because they are.inadmissible and unreliable. Plaintiffs counter that the Maronick and Harris declarations are admissible expert testimony. They object to the declaration of Carol Scott, NJOY’s rebuttal economic expert.
1. Motions, to Strike the Testimony of Plaintiffs’ Experts
The court first considers NJOY’s challenges to plaintiffs’ experts. While courts in this circuit previously held that expert testimony was admissible in evaluating class certification motions without conducting'a rigorous analysis under Daubert v. Merrell Dow Pharmaceuticals, Inc.,
Under Rule 702,
“[i]f scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or education, may testify thereto in the form of an opinion or otherwise, if (1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness' has applied the principles and methods reliably to the facts of the case.” Fed, R. Evid. 702.
See also United States v. Finley,
Before admitting expert testimony, the trial court must make “a prelimi
“The party offering the expert bears the burden of establishing that Rule 702 is satisfied.” Sundance Image Tech., Inc. v. Cone Editions. Press, Ltd., No. CV 02-2258 JM (AJB),
“In determining whether expert testimony is admissible under Rule 702, the district court must keep in mind [the rule’s] broad .parameters of reliability, relevancy, and assistance to the trier of fact.” Sementilli v. Trinidad Corp.,
a. Plaintiffs’ Expert Jeffrey Harris
Jeffrey Harris is plaintiffs’ economic expert. Harris is a Professor of Economics at Massachusetts Institute of Technology (“MIT”). He has been a tenured full professor since 1998, and regularly teaches courses in health economics and microeconomics.
(1) Whether Harris Can Calculate a Price Premium
Harris opines that a “reasonable consumer would be willing to pay a price premium for the perceived- value of [NJOY’s] safety claim,” and that
“[t]here are scientifically reliable methods to measure the price premium that class members - paid for the perceived value of the safety claim during the class period.... In combination with data on Defendant’s sales to class members dur- ■ ing the class period, the estimates of the price premium paid for Defendant’s safety claim can -be used to calculate class-wide damages.”86
Harris asserts it is possible to determine the damages attributable to NJOY’s purportedly false safety claims by using “conjoint analysis.”
NJOY challenges Harris’s declaration on a number of bases. First, it contends that Harris relies on a “demonstrably false factual premise,”. i.e., that NJOY’s advertising campaign began in 2007 and that the advertisements were widespread.
“Plaintiffs’ counsel have asked me to assume that beginning in 2007, and con■tinuing during the class period, [NJOY] ‘has engaged in a consistent and pervasive marketing campaign that promotes its core marketing message that NJOY E-Cigarettes are known to be safer than traditional tobacco cigarettes or generally safe.’ Prefer to this core marketing message as the [ ] safety claim.”89
NJOY asserts it “did not begin advertising its products until December 2012 (not 2007), and even • then, [its] market was disparate and the ads were limited in duration.”
NJOY is correct that Harris did not' conduct a survey to determine whether a reasonable consumer would be willing to pay a price premium for the perceived value of a ■ safety claim. This does not automatically render his opinion or" methodology unreliable,' however. “An expert is of course permitted to testify to an opinion formed on the basis of information that is handed to rather than developed by him — information of which • he lacks first-hand knowledge and which might not be admissible in evidence no matter by whom presented.” See Matter of James Wilson Associates,
Harris relies on several economic studies involving tobacco smokers, each of which found that consumers were willing to pay a price premium for purported health and safety improvements. He cites (1) a Taiwanese study that found-'cigarette smokers were willing to pay a 152% increase over the average price of a pack of cigarettes for cigarettes that had a 50% lower risk of lung cancer; (2) a Swedish study that found smokers were willing to pay the equivalent of 29% to 121% of the price of a pack of premium cigarettes for a pack of “risk-free” cigarettes; and (3) a study that found 84% of smokers were willing to pay $50 per week ($20 per week more than the price of a nicotine patch) for a treatment that offered twice as great a chance they would successfully quit smoking than a nicotine patch.
Harris also notes that NJOY’s internal records suggest it has focused its marketing of e-eigarettes on the claim that they are. “ultimately better than, a cigarette, without the harm.”
NJOY repeatedly cites Cholakyan,
In sum, Harris’s conclusion that a price premium can be calculated is not unreliable, nor is it the result; of impermissible reliance on the opinions of other experts.
(2) Whether Harris’s Conjoint Analysis and Direct Method Analysis Are Sufficiently Reliable for Purposes of Daubert
NJOY next asserts that plaintiffs’ damages model is not tied to their theory of liability, and thus runs afoul of the Supreme Court’s decision in Comcast Corp. v. Behrend, — U.S.-,
Direct method analysis is substantially similar. “In the direct method, representative members of the class are directly asked what they would be willing to pay for additional safety.” Thus, like conjoint analysis, this method employs “valuation surveys to measure .consumers’ willingness to pay for private and public goods that could improve their personal health.”
-NJOY asserts that courts have “rejected [Harris’s] type of methodology for calculating damages” because “it fails to incorporate data regarding market pricing of the products at issue.”
In fact, none of the cases NJOY cites find an expert’s methodology unreliable for purposes of Daubert. Two — which involve class actions — address the adequacy of the damages methodology in light of Comcast under Rule 23(b)(3). See ConAgra II,
The third decision NJOY cites concerns a preliminary injunction. See Apple, Inc. v. Samsung Electronics Co., No. CV 11-01846 LHK,
NJOY makes one further argument. It asserts that even if Harris’s opinion that consumers would pay a price premium for a healthier smoking alternative is methodologically sound, it is nonetheless unreliable because he does not account for the fact that some (or perhaps many) class members did not see or rely on NJOY’s marketing, or account for possible changes in consumer perceptions. The court does not agree that any of these alleged flaws render the methodology unreliable under Daubert.
More fundamentally, NJOY does not seriously contend that Harris’s method fails to comport with accepted principles, or that his analysis is irrelevant to the issues in the case.
For all these reasons, the court declines to strike Harris’s declaration.
b. Plaintiffs’ Expert Thomas Maronick
NJOY also contends that the declaration of plaintiffs’ expert Thomas Maronick should be stricken because it is unreliable and thus, inadmissible under Daubert. Maronick proffers opinions as to whether NJOY’s purported misrepresentations were material to a reasonable consumer.
Maronick conducted an online survey to determine what messages consumers take from NJOY’s advertising in order to assess the extent to which consumers found the safety message material.
Respondents in each of the three advertising blocks (i.e., the print advertisements and commercial) were asked an open-ended question: “What does the ad say or suggest' about NJOY E-Cigarettes?”
Respondents randomly assigned to the commercial blóek were directed to watch the video and then asked: “The NJOYad says ‘Friends don’t let friends smoke.’ Based on what is said or suggested in the ad, what is the reason why ‘Friends don’t let friends smoke?’ ” Their verbatim responses were recorded.
Respondents randomly assigned to the “package block” were shown the front and back label of an NJOY Kings package and asked: “Does the label say or suggest anything about the ingredients in NJOY [e]-[c]igarettes?’ ”
A survey is admissible provided it is: (1) “conducted according to accepted principles”; and (2) “relevant” to the issues in the case. Fortune Dynamic, Inc. v. Victoria’s Secret Stores Brand Mgmt., Inc.,
First, NJOY asserts that Maron-ick’s survey does not utilize a control group or include proper control questions to account for preconceived notions that consumers might have about NJOY’s products. It also contends that Maronick improperly defined the target audience.
NJOY’s motion to strike Maronick’s declaration really addresses the merits of plaintiffs’ certification motion rather than the motion to exclude under Daubert. Addressing questions Maronick áskfed regarding the results of NJOY’s; “Return the Favor” television advertisement, NJOY asserts that his control or validation question was wrong.' His survey design permitted respondents to answer questions concerning the advertisement only if they indicated that they had heard the phrase “friends don’t let friend’s smoke” in the commercial. NJOY ‘takes issue with Harris’s choice of a validation question because it “is spoken in under two seconds towards the latter half of the sixty-second spot, and is not displayed on screen.”
NJOY also maintains that the sample size of the televison commercial block — 91 respondents — is too small.
. The fact that NJOY has not raised a legitimate concern under Daubert is highlighted by its repeated citation of Procter & Gamble Co. v. Ultreo, Inc.,
NJOY also asserts that Maronick failed properly to disguise the survey selection criteria. Respondents were asked in an unbiased way what types of- tobacco products they used (i.e., traditional cigarettes or e-cigarettes); only those who identified e-cigarettes as a product they had used were directed to proceed. NJOY contends this is problematic because “a respondent would easily conclude.that the survey involved tobacco products and that they should check ‘yes’ to all products they purportedly used in the last three months.”
NJOY also 'complains that Maronick’s survey, although designed and analyzed by him, was carried out by a,third party survey company, Qualtrics.com. It cites no case law holding that surveys conducted by third parties are inherently “flawed” or unreliable, and the court has located none. What little case law there is on the subject in fact suggests there is nothing inherently problematic with having a survey conducted by a third party. Cf. Ortega v. Ogden Clinic Prof'l Corp., No. CV 13-0066 CW,
Finally, NJOY appears to assert that Maronick’s survey fails to demonstrate that its advertising actually caused the consumer’s to be misled. The court need not resolve whether that is the case, however. This, of course, is not a reason to strike Maronick’s declaration under Dcm-bert. Indeed, it is not even a reason to deny plaintiffs’motion for class certification. “On a motion for class certification, it is not necessary that expert testimony resolve factual disputes going to .the merits of plaintiffs’] claim; instead, the testimony must be relevant in assessing ‘whether there was a common pattern and practice that could affect the' class as a whole.’ ” In re ConAgra Foods, Inc. (“ConAgra I ”),
For these reasons, the court denies NJOY’s motion to strike Maronick’s declaration.
2. Plaintiffs’ Objection to NJOY’s Expert Carol Scott
Plaintiffs filed an objection to the declaration of Carol Scott, NJOY’s rebuttal economic damages expert.
The court -does not agree that Scott is not qualified to serve as an expert in this case. “A witness can qualify as an expert through practical experience in a particular field, not just through academic training.” Rogers v. Raymark Industries, Inc.,
Plaintiffs assert broadly that because Scott is not an “economics expert” she is barred from testifying about economic damages. Scott, however, does not act as an “economics expert” — at least not in the sense that Harris does. She offers opinions concerning Harris’ conjoint analysis, but does not offer an alternative damages calculation methodology. She simply analyzes Harris’s conjoint analysis from a marketing and business perspective, and concludes that it isolates the perceived value of NJOY’s representations, rather than actual price premium consumers paid due to the representations. As a result, she asserts, it does not capture the measure of class members’ damages.
Scott’s education and academic experience qualify her an expert in market research, and her expertise qualifies her to testify regarding the relationship of perceived value to actual price premium paid. NJOY has thus adequately demonstrated that Dr. Scott is an expert in the matters about which she opines in her expert declaration. Cf. United States v. Pritchard,
Accordingly, all of plaintiffs objections to Scott’s declaration are overruled.
B. Plaintiffs’ Motion for Class Certification
1. Legal Standard Governing Class Certification
A district court may certify a class only if:
“(1) the class is so numerous that join-der of all members is impracticable; (2) there aré questions of law or fact common to the class; (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class.” Fed. R. Civ. Prog. 23(a).
In addition, a- district court must-also find that at least one of the several conditions set forth in Rule 23(b) is met. “Rule 23(b)(1) allows a class to be maintained where ‘prosecuting separate actions by or against individual class members would create a risk of either ‘(A) inconsistent or varying adjudications,’ or ‘(B) - adjudications- ... that, as a practical matter, would be dispositive of the interests of the other members not parties to the individual adjudications or would substantially impair or impede[] their ability to protect their interests.’ ” Dukes,
Rule 23(b)(2) allows class treatment when “the party opposing the class has acted or refused to act on grounds that apply generally to the class, so that final injunctive relief or corresponding declara1 tory relief is appropriate respecting the class as a whole.” Fed. R. Civ. Proc. 23(b)(2). The Supreme Court has not yet decided whether this rule “applies only to requests for ... injunctive or declaratory relief and does not authorize the class certification of monetary claims ’ at all.” Dukes,
“Rule 23(b)(3) states that a class may be maintained where ‘questions of law or fact common to class members predominate over any questions affecting only individual members,’ and a class action would be ‘superior to other available methods for fairly and efficiently adjudicating the controversy.’ ” Id. at 2549 n. 2.-
“Rule 23 does' not set forth a mere pleading standard. A party seeking class certification must affirmatively demonstrate his .compliance with the Rule— that is, he must be .prepared to prove that there are ■in' fact sufficiently numerous parties, common questions of law or fact, etc.” Id. at 2551. Thus, “[t]he party seeking certification bears the burden of showing that each of the four requirements of Rule 23(a) and at least one requirement of Rule 23(b) have been • met.” Zinser v. Accufix Research Institute, Inc.,
Plaintiffs seeks to certify two statewide classes as follows:
“All persons, exclusive of [NJOY] and its employees, who purchased in or .from California [or Florida] one or more NJOY E-Cigarettes, sold by [NJOY] during the Class Period.145
As pled; the Class Period for the California class runs from January 17, 2010 to the date of notice,
2. Whether the Proposed Class ■ Should Be Certified
a. Standing
NJOY first argues that the named plaintiffs lack standing under the.CLRA, UCL, and FDUTPA.
(1) Halbertstam
“A plaintiff suffers an injury in fact for purposes of standing under the UCL when he or she has: (1) expended money due to the defendant’s acts of unfair competition; (2) lost money or property; or (3) been denied money to which he or she has a cognizable claim.” Marilao v. McDonald’s Corp.,
In Meyer v. Sprint Spectrum L.P.,
NJOY asserts Halbertstam testified that he did not suffer an injury in fact as a result of’his use of an NJOY e-cigarette. As respects his claim that NJOY’s advertising conveyed a “safety message,” Halbertstam stated that he saw NJOY’s .“Resolution Solution” and “Try Something New in Bed” advertisements, ánd specifically remembered the “Cigarettes, You’ve Met Your Match” slogan in 2012.
At the hearing, NJOY argued that the court’s conclusion was incorrect. It asserted that Halbertstam lacks standing because he admitted that he did not rely on NJOY’s advertisements in making his purchasing decision and that the advertisements were not even in his mind when he decided to buy an NJOY e-cigarette. NJOY relied on the following testimony:
“A. I was looking for an e-cig, and the brand that stood out was NJOY. I wasn’t thinking about — I mean, the advertisements, I obviously seen the advertisements, and that probably played an effect, but it wasn’t on my conscience when I bought it, like—
Q. So the only thing in your consciousness when you bought it was NJOY?
A. NJOY, like that’s the Number 1 brand.” 158
Plaintiffs countered that Halberstam states in this passage that the advertisements “probably played an effect.” Although he also states that he was not consciously thinking about the advertisements at the moment he made the purchase, he reports that the NJOY advertisement he saw conveyed the message that NJOY e-cigarettes were “a better alternative to cigarettes,” i.e., “that [they] would be safer because ...-you'don’t have the smoke.”
NJOY also asserted in its opposition that Halberstam lacks standing to assert an omissions claim based on product packaging because, although he signed a retainer agreement related to this case in November .2013, he continued to purchase NJOY e-cigarettes until sometime in December 2013. The gist of NJOY’s argument is that Halberstam could not have relied on the product packaging, because he knew of the additives in the e-cigarettes after November 2013 and continued to buy e-cigarettes.
“Q. So even if those words [ (proplyéne gylcol and glycerin) ] had been disclosed on the packaging, you would have bought the NJOY cigarette in September of 2013; correct?
A. Correct.”165
Halberstam went on to explain that “if the[ ingredients had been] disclosed ,. in sort of like a warning, [he] probably would have paid more attention to it and ... found out more about it.”
Because Halberstam admitted that he would have purchased NJOY e-cigarettes even if the packaging had disclosed that it contained propylene glycol and glycerin, he has conceded that he did not suffer injury in fact due to the alleged omission. Turcios v. Carma Labs., Inc.,
(2) Thomas
NJOY also asserts that Thomas lacks standing to bring claims under the FDUT-PA. Florida “[c]ourts have interpreted the [FDUTPA] generously, but not consistently. One line of cases — the more conservative view — extends FDUTPA protection only to persons who were deceived when buying or selling goods and services.” Democratic Republic of the Congo v. Air Capital Grp., LLC,
First, NJOY notes that the complaint does not allege that Thomas saw any NJOY advertisements, and that, because she cannot bring claims based on advertisements she did not see, she cannot assert a FDÚTPA claim concerning NJOY advertisements. In its prior order dismissing the third amended complaint, the court stated that Thomas’ claims could hot be' based on advertisements.
NJOY asserts that Thomas also lacks standing to bring a product packaging claim because she admitted that the product packing does not contain any representation^ that e-cigarettes are safer, than traditional cigarettes. This argument lacks merit. The basis of Thomas’s claim is that the packaging omits information that must necessarily be disclosed to ensure that a reasonable consumer is not misled. She contends that she purchased an NJOY e-cigarette after having used another brand of e-cigarettes that purportedly gave her headaches. She states the she “read the label” on the packaging due to the fact the prior brand had given her headaches. She observed that the label reflected that the product “only had nicotine in it,” and she thus, decided “okay, maybe the .other one. had other stuff in it I didn’t know about.” She concluded that the NJOY e-cigarette would “be better,” i.e., safer for her, “and that’s why [she] bought it.”
b. Rule 23(a) Requirements
(1) Whether Plaintiffs Have Proposed an Ascertainable Class
Although not, specifically mentioned in Rule 23, plaintiffs must, in addition to showing numerosity, commonality, typicality and adequacy, demonstrate that the members of the class are ascertainable. See, e.g., Lukovsky v. San Francisco, No. C 05-00389 WHA,
A class is sufficiently defined and ascertainable if it is “administratively feasible for the court to determine whether a particular individual is a member.” O’Connor,
Plaintiffs argue that the classes they propose are ascertainable because membership in each is governed by a single objective factor — whether an individual purchased an NJOY e-cigarette during the class period.
“The court continues to agree with those courts that have found classes, such as
NJOY contends that this is not the end of the ascertainability inquiry, however. It asserts the case is readily distinguishable from ConAgra II because the advertisements are not contained on the product packaging, like the alleged “100% Natural” misrepresentation was in ConAgra II. While Halberstam’s advertisement-based claim is arguably distinguishable, the product packaging omission claims are not. With respect to the advertisement claim's, NJOY asserts that plaintiffs’ proposed class begins two years before NJOY started advertising; as a result, it contends, many proposed class members could not possibly have relied on NJOY advertisements in purchasing the e-cigarettes during that period. The court agrees. The California class — the only class with advertising claims — begins January 17, 2010; NJOY did not begin advertising until December 10, 2012, however.
“However, an over-inclusive class definition need not defeat certification entirely. Where the court determines that the class definition is overbroad, the court has the discretion to narrow the class to bring it within the requirements of Rule 23.” National Federation of the Blind v. Target Corp., No. CV 0.6-01802 MHP,
NJOY insists that this is insufficient to make the advertisement-based class ascertainable. It asserts it is unclear that all, or even most, - class members saw the allegedly misleading advertisements, and thus that the class is not ascertainable. It is true that all of the proposed class members must have seen an advertisement to recover. See Davis-Miller v. Auto. Club of S. California,
The inclusion of uninjured class members does not necessarily render a class unascertainable. In Rodman v. Safeway, Inc., No. 11-cv-03003-JST,
Other courts in this circuit have reached similar conclusions, see Rodman,
Finally, NJOY argues that proposed omissions classes are overbroad as well. This is because NJOY disclosed the presence of the allegedly omitted "ingredients on its label starting in August 2014.
(2) Numerosity
Before a class can be certified under the Federal Rules of Civil Procedure, the court must determine, that it is “so numerous that joinder of all members is impracticable.” See Fed. R.. Civ. Proc. 23(a)(1). “Impracticability does not mean impossibility, [however,] ... only ... difficulty or inconvenience in joining all members of the class.” Harris v. Palm Springs Alpine Estates, Inc.,
(3) Commonality
Commonality requires “questions of law or fact common to the class.” See Fed. R. Civ. Proc.' 23(a)(2). The commonality requirement is construed liberally, and the existence of some common legal and factual issues is sufficient. Jordan v. County of Los Angeles,
■. That said, the putative class’s “claims must depend upon a common contention — for example, the assertion of discriminatory bias on the part of the same supervisor. That common contention, moreover, must be of such a nature that it is capable of classwide resolution — which means that the determination .of its truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke.” Dukes,
Plaintiffs argue that the commonality requirement is satisfied because all class members were exposed to NJOY’s .product packaging and because its marketing was national, and widespread. As a .Result, they maintain, their., claims arise from a common core of salient facts and pose a common question: “whether NJOY’s misleading implication that NJOY e-cigárettes were safe.or safer than cigarettes was false, unfair, deceptive, and/or misleading.”
NJOY asserts in its opposition, however, that the advertising-based claims do not raise common questions.
The common question is whether NJOY’s advertisements and product packaging were misleading to a reasonable consumer. As the Ninth Circuit has made clear, concerns as to whether absent class members saw the advertisements are relevant in assessing predominance “under Rule 23(b)(3), not ... whether there are common issues under Rule 23(a)(2).” Mazza,
(4) Typicality
Typicality requires a determination as to whether the named plaintiffs claims are typical of those of the class members he or she seeks to represent. See Fed. R. Civ. Proc. 23(a)(3). “[R]epre-sentative claims are ‘typical’ if they are reasonably co-extensive with those of absent class members; they need not be substantially identical.” Hanlon,
“The test of typicality is whether other members have the same or similar injury, whether the action is based on conduct which is not unique to the named plaintiffs, and whether other class members have been injured by the same course of conduct.” Hanon,
Typicality may be lacking “if ‘there is a danger that absent class members will suffer [because] their representative is preoccupied with defenses unique to it.’” Hanon,
Plaintiffs argue that the typicality requirement is satisfied” because the[ir claims] are based on the same deceptive conduct by NJOY that harmed [c]lass members in the same way. All [c]Iass members were exposed to the package and/or NJOY’s media advertising that conveyed the same [sjafety [mjessage,”
(a) Halberstam
NJOY argues that Halbertstam’s claims are not typical because he only viewed the “Resolution Solution” advertisement. This advertisement, it contends, was the least likely to communicate a safety message, even in the eyes of plaintiffs’ experts. NJOY’s argument misconstrues Maronick’s survey data, however. NJOY’s argument is based solely on the fact that only 4.7% of respondents in Maronick’s survey said in their answer to the initial open-ended question that the advertisement said or suggested NJOY was “safe” or “safer” or “better for health” or “risk free.”
Second, NJOY contends that Halber-stam’s claims are atypical because he did not smoke traditional tobacco cigarettes. They do not identify a unique defense that would arise from the fact that Halberstam was not a traditional tobacco smoker prior to trying NJOY’s e-cigarettes, however, and the court cannot discern one. The relevant inquiry is whether NJOY used a material misrepresentation concerning the e-cigarettes’ overall safety when compared with traditional tobacco cigarettes to market its e-cigarettes. Whether the alleged misrepresentation caused a class member to trying nicotine-based products for the first time, like Halberstam, or to switch from traditional tobacco cigarettes to e-cigarettes, the result is the same — the class member was misled and induced to buy a product he or she otherwise would not have purchased. Halberstam’s interests therefore “align[] with the interests of the class.” Wolin v. Jaguar Land Rov
Whether or not they are “substantially identical,” Halberstam’s “claims are rea-, sonably co-extensive with those of the absent class members.” Hanlon,
(b) Thomas
Defendants contend that Thomas is not typical of the class because she did not rely on the product packaging when she purchased NJOY cigarettes and because she purportedly purchased an NJOY e-cigarette to quit smoking traditional cigarettes. NJOY’s arguments lack merit.
Thomas’s claims are typical- of those of the • class because she saw the same label other class members did on the product package — a label that omitted ingredients so as to render the packaging purportedly misleading — and decided to smoke NJOY e-cigarettes as a result. See Hanlon,
NJOY asserts Thomas did not rely on the product packaging because she stated in a questionnaire that she bought an NJOY e-cigarette because it was the least expensive.
(5) Adequacy
The adequacy of representation requirement set forth in Rule 23(a)(4) involves a two-part inquiry: “(1) do the named plaintiffs and their counsel have any conflicts of interest with other class members and (2) will the named plaintiffs and their counsel prosecute the action vigorously on behalf of the class?” Hanlon,
Plaintiffs contend that the class representatives and class counsel are adequate. They assert that the interests of plaintiffs and the absent class members are fully aligned; they all seek to recover damages based on NJOY’s false and/or deceptive marketing of its e-cigarettes.
c. Rule 23(b)(3)
Having concluded that plaintiffs have satisfied Rule 23(a)’s prerequisites, the court turns to Rule 23(b)(3)’s requirements.
(1) Whether Common Issues Predominate
Certifying a class under Rule 23(b)(3) requires “that the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy.” Fed. R. Civ. Proc. -23(b)(3); see Poulos v. Caesars World, Inc.,
Plaintiffs seek to certify a California class alleging violations of California’s UCL and CLRA, as well as a Florida class alleging violations of the FDUTPA. NJOY argues that individual issues predominate because each class member will
(a) Whether Reliance and Causation Can Be Shown on a Classwide Basis
(1) California Claims
Courts generally consider claims under the UCL and CLRA in tandem. See Forcellati,
Thus, a California class suing under the state’s consumer protection statutes need not show individualized reliance if it can establish the. materiality of NJOY’s purported safety message and its label omissions to a reasonable consumer. See For-cellati
(2) Florida Class Claims
Under the FDUTPA, proof of causation “does not require subjective evidence of reliance; as would be the ease with a common law action for fraud.” Davis v. Powertel, Inc.,
For the reasons stated, the court concludes that plaintiffs can prove reliance and causation on a classwide basis if they are able to show the representations and omissions were material. The court considers next whether plaintiffs can show that NJOY’s alleged misrepresentations and omissions would have been material to a reasonable consumer such that a class-wide inference of reliance could arise.
(b) Whether Plaintiffs Can Show They Were Exposed to Material Misrepresentations and Omissions on a Classwide Basis
NJOY maintains that the materiality of its purported advertising misrepresentations cannot be proved on a classwide basis because there is no evidence suggesting that members of the putative class were exposed to the same advertisements. NJOY focused primarily on this argument at the hearing. The crux of its argument is that class members were exposed to different advertisements, all conveying a different message, throughout the class "period, such that individualized inquiries would be required for each class member. See Davis-Miller v. Automobile Club of Southern California,
In deciding whether reliance could be presumed, the Ninth Circuit discussed the California Supreme Court’s decision in In re Tobacco II Cases,
The Ninth Circuit -has subsequently explained that, in reversing the district court, it relied on “two crucial facts” about Honda’s advertising program — “first,- that it ‘f[e]ll short of the extensive and longterm fraudulent advertising campaign at issue in Tobacco II”’; and second, that ‘[the] advertising materials d[id] not deny that limitations [to the brake system] exist[ed].’” Berger v. Home Depot USA, Inc.,
Plaintiffs contend that the safety message NJOY communicated was uniform, and that this makes Mazza inapposite. As-respects the omissions- claims -based on' product packaging, there is no question that Mazza is not controlling and is -distinguishable. The omissions did not occur in the context of a limited advertising campaign that reached only a small subset of the class. “Rather, the -alleged omissions ... relate to the packaging of [NJOYs e-cigarettes], which has not materially changed over the course of the [shortened c]lass [p]eriod.” Guido v. L’Oreal, USA, Inc., No. CV 11-1067 CAS (JCx),
Whether Mazza forecloses plaintiffs’ misrepresentation claims based on NJOY’s advertising campaign is a more difficult question. NJOY maintains that its advertising was limited in breadth, more so even than the advertising in Mazza) thus, it contends that “many class members were never exposed to the allegedly misleading advertisement,” and that “an individualized case [will have to] be made for each member showing reliance.” Mazza,
Plaintiffs counter that NJOY engaged in a massive advertising campaign, and that it is reasonable to presume all members of the class viewed its advertisements. See Johnson v. General Mills, Inc.,
Plaintiffs' assert that each of NJOY’s advertisements conveyed the safety message; they note that virtually every advertisement NJOY ran contains language such as “finally smokers have a real alternative,” “cigarettes you’ve met your match,” and other slogans such as “Resolution Solution” and “Everything you like about cigarettes without the things you don’t.”
This does not end the inquiry, however. The California Court of Appeal has stressed that an “inference of classwide
At the hearing, NJOY described these publications as “mostly off beat” magazines that a majority of consumers would not have seen prior to purchasing NJOY e-cigarettes. While Out Magazine, Fashion Daily, Paper Magazine,' Women’s Wear Daily, and New York Magazine circulate more narrowly than Sports Illustrated, Rolling Stone, and ESPN Magazine, their audiences are by no means insignificant. Nonétheless, NJOY is correct that its print advertising campaign was lasted less
NJOY also ran a radio advertisement from December 31, 2012 to January 13, 2013, that included a voice-over stating: “Finally smokers have a real alternative” and “Cigarettes you’ve met your match.”
NJOY’s “Amazing” commercial ran on KTLA in Los Angeles from December 3 to December 16, 2012, and again from April 18 to July 21, 2013. It also aired nationally on ESPN/ESPN2 for five day from July 29 to August 4, 2013.
Plaintiffs note that NJOY made the allegedly false and misleading statem-entsin magazine advertisements for approximately ten months; in television commercials for a total of 193 days (106 of which were solely in Los Angeles); and on the radio for a combined total of 217 days (69 of which were solely in the Los Ange-les market). The entire campaign spanned the period from December 10, 2012 to March 30, 2014 — 475 days. Assuming a notice date of August 14, 2015 (today), and taking into account the court’s decision to narrow the class period, the California Class Period is 977 days. This is more than twice as long as the entire period during which NJOY advertised. Indeed, any consumer that purchased NJOY e-cigarettes for the first time between March 30, 2014 and today might well never have seen an NJOY advertisement, since none was disseminated during that time period.
Plaintiffs contend the evidence they have proffered of mass media advertising by NJOY constitutes “substantial evidence that [NJOY] made common misrepresentations to all of the class members.” ' Makaeff
The decision of other California district courts suggest that NJOY’s advertising is not sufficiently substantial or pervasive to give rise to a presumption that all class members were exposed to the advertisements. In In re Clorox Consumer Litig.,
“proposed class — which include[d] all purchasers of Fresh Step in California over a period of almost four years— [wa]s not defined so as to include only members who were exposed to the allegedly misleading material. Without any evidence that Clorox included its superiority message on a significant portion of Fresh Step products, or that consumers actually saw it, [plaintiffs ha[d] no basis for their claim that Clorox presented a uniform message to its customers.” Id. at 445-46.
In this case, NJOY’s advertising spanned an even shorter period than sixteen months. The case is thus more analogous to Clorox than Makaeff; the Ma-kaeff court did not discuss the duration of the advertising at issue there, and it does not appear that it involved television, print, and radio advertisements such as NJOY used here. More fundamentally, a review of Mazza makes clear that NJOY’s advertising was not sufficiently pervasive to give rise to a presumption that all class members viewed advertisements with the implied safety message. As noted, the marketing campaign at issue in Mazza included a television commercial that ran for a week in November 2005 and from February to September 2006. See
(c) Whether Plaintiffs Have Demonstrated Materiality
NJOY contends finally that plaintiffs have failed to adduce evidence showing that its advertising and omissions were material.
Whether a reasonable consumer would find NJOY’s advertisements and omissions misleading is not a question that requires survey’ data solely from California and Florida. NJOY does not suggest that the materiality of its marketing varied from California to Georgia or Florida to Wisconsin, and the nature of the reasonable person inquiry is such that it did not.
(1) Misrepresentations
NJOY also asserts that Maronick’s survey is insufficient to establish materiality. Maronick concludes, however, that (1) “a significant percentage of consumers also take an implied message from. NJOY advertising that the [e]-[c]igarettes are ‘safe for your health’ and/or ‘safer for your health than traditional tobacco cigarettes,’ a message important to all such consumers”; (2) “NJOY’s claims that ‘Cigarettes, You’ve Met Your Match’ and that, with NJOY [e]-[c]igarettes, consumers have a ‘Real Alternative’ conveys, to a substantial percentage of the target market, that NJOY E-Cigarettes are =a ‘better alternative’ to traditional tobacco, cigarettes and that they are ‘safe’ and/or ‘safer’ than traditional tobacco cigarettes, factors important or very important to virtually all consumers who said the NJOY [e]-[c]igarette ads communicated that the product is ‘safe’ or ‘safer for your health’ than traditional tobacco cigarettes”; (3) “when NJOY tells consumers they can ‘keep the things they like about smoking, while losing the things they don’t,’ and when NJOY tells consum
In particular, with respect to the omissions-based claims, 91% of respondents indicated that it would have been either “Very Important” or “Important” to know that e-cigarettes contained other ingredients than nicotine.' That is sufficient to demonstrate that reasonable persons could find NJOY’s omissions on the product label were material. The same is true of the alleged misstatements in the advertisements. :Some 40.7% of respondents that viewed NJOY’s 60 second “Friends don’t let friends smoke” 'advertisement understood that it meant friends do' not let friends do things that are “bad for their health”; an- additional 17.6% of respondents said the advertisement communicated that NJOY e-cigarettes were “safer,” “better for you,” or “risk free.”
Similarly, 27.5% of respondents perceived NJOY’s claim in the “Try Something New in Bed” advertisement that “you can keep the things you like about smoking, while losing the ■ things you don’t,” to mean that they would be giving up the “harmful or bad” effects of smoking or that by giving up those “things [they didn’t] like” they would be smoking a “safe,” or “safer” cigarette or one that was “better for their health.”-
There are further statistical examples of materiality, but the court believes these more than suffice to demonstrate that a reasonable consumer could find materiality. Courts have found a representation material when significantly smaller percentages of consumers than those reflected in the surveys here. See Oshana v. Coca-Cola Co., No. 04 C 3596,
NJOY’s only attack on the actual results of Maronick’s survey evidence is to assert that “less than 5% of the respondents believed NJOY’s Resolution Solution ad — the only one Halberstam saw — conveyed the ‘[s]afety [mjessage’ when asked their perception in an open-ended question.”
To the extent NJOY contends close-ended questions are impermissible, the court cannot agree. Respondents’ answers to open-ended-questions are recorded verbatim, while respondents select from a set field of responses when answering close-ended questions. Although open-ended questions are- generally considered less, likely, to undermine "reliability, close-ended questions are not inherently suspéct, and courts frequently rely on the data obtained from- such questions. See, e.g., PBM Products, LLC v. Mead Johnson Nutrition Co., No. 3:09 CV 269,
Finally, NJOY asserts that Maronick’s survey is contradicted by a ■ survey conducted by its expert, Kent Van Liere.
Van Liere’s survey used only open-ended questions. Respondents were asked to look at the print advertisements or to watch the commercial. They were then asked a series of open-ended questions, with the advertisement still in front of them. First, they were asked “what does this commercial/advertisement convey to you?” Their verbatim responses were recorded. They were then asked “what makes you say that.” Again, their verbatim responses were recorded. Third, they were asked “If you have an opinion, does the commercial/advertisement convey or not convey any message or messages about e-cigarettes compared to traditional combustible cigarettes?”
Maronick criticizes Van Liere’s survey for a number of reasons. First, he asserts that leaving the print advertisement in front of the respondents makes the questions in the survey a “reading test” where respondents are simply reading what is expressed in the text of the advertisement, as opposed to a “memory test” where they recall what was said or may have been implied. Since the issue is whether claims such as “cigarettes you’ve met your match” may imply something about a comparison with traditional cigarettes, a reading test is unlikely to elicit responses reflecting implied claims.
Most fundamentally, Maronick contends that Van Liere did not “code all the responses” to the questions that were asked. He asserts that “by selectively coding only those respondents who gave a specific ‘health’ or ‘safe/safer’ message, Van Liere mischaracterized and underrepresented the extent to which health-related messages were conveyed by the two print advertisements. In fact, despite the fact that he asked respondents how NJOY e-cigarettes ‘compare to traditional combustible cigarettes,’ he coded only those responses that [were] health and safety responses and conveniently reported] that few respondents took a health or safety message from the advertisement].”
“Although [the Supreme Court] ha[s] cautioned that a court’s class-certification analysis must be ‘rigorous’ and may ‘entail some overlap with the merits of the plaintiffs underlying claim,’ Rule 23 grants courts no license to engage in free-ranging merits inquiries at the certification stage. Merits 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.” Amgen Inc. v. Connecticut Ret. Plans & Trust Funds, — U.S. -,
. (2) Omissions
NJOY also argued, most clearly at the hearing, that plaintiffs never tested the product packaging to determine whether it conveyed a safety message, and hence that there is no evidence to support a finding of materiality with respect to the omissions claim. NJOY, however, appears to misinterpret plaintiffs’ omission theory. Plaintiffs do not contend that the product packaging conveys the safety' message. Thomas contends that the label omits information a reasonable consumer" would deem important, i.e., that the product contains propylene‘glycol and glycerin. Hal-berstam ■ admitted at his deposition that even if the product listed propylene glycol and glycerin on the label, this would not have deterred him from buying NJOY e-cigarettes; stated differently, merely identifying the ingredients was immaterial to him. Rather, Halbertstam asserts that even with these ingredients disclosed, the packaging is misleading because it omits material information concerning the risks associated with them.
In support of Thomas’ omissions claim, plaintiffs have adduced evidence suggesting that the failure to disclose ingredients that may pose a health risk — as plaintiffs contend propylene glycol and glycerin do — is material to consumers. In the methodology section of his declaration, Maronick states that. respondents were “randomly assigned to see images of the front and back labels of an NJOY King[ e][c]igarette package.”
NJOYs expert, Van Liere, has proffered no evidence or opinions that rebut Maron-ick’s survey evidence.' Rather, consistent with NJOYs mistaken understanding of plaintiffs’ omission claim, Van Liere tested whether the product packaging conveyed an implied safety, message.
As noted, Halberstam contends that even after NJOY disclosed ingredients posing a safety risk on the product packaging, it continued to omit material information by failing to warn of risks associated with the inhalation of propylene glycol or glycerin. Plaintiffs have adduced no evidence supporting this omissions claim.
Consequently, the court concludes that plaintiffs have failed to show that they can prove on a classwide basis that NJOYs failhre to warn of the risks of propylene glycol and glycerin on the product packaging was a material omission. Because this is the only omissions claim Halberstam asserts on behalf of the California class, the court cannot certify a California omissions claim. By contrast, plaintiffs have adduced sufficient evidence demonstrating that the. materiality of NJOYs failure to disclose propylene glycol and glycerin'on the product packaging can be decided on a classwide basis; this prerequisite to certification of-a Florida class is therefore satisfied. Finally, plaintiffs have not adduced evidence showing that NJOY’s advertising campaign was so pervasive that it gives rise to a presumption that all class members were exposed to NJOYs allegedly misleading advertisements.' Consequently, plaintiffs have shown that materiality can be proved on a classwide basis only by the Florida class, which alleges that NJOYs failure to disclose that its e-cigarettes contained propylene glycol and glycerin made its packaging misleading.
(d) Whether Damages Cari be Proved on a Classwide Basis
Rule 23(b)(3) is satisfied only if plaintiffs can show that “damages are capable of measurement on a classwide basis.” Comcast,
NJOY asserts that Harris’s damages calculation methodology fails under Comcast because it does not measure the damages recoverable on plaintiffs’ legal theory. The UCL, CLRA, and FDUT-PA “authorize a trial court to grant restitution to private litigants asserting claims under those statutes.” Colgan v. Leatherman Tool Group, Inc.,
Plaintiffs’ expert, Jeffrey Harris, proposes to calculate damages using either conjoint or direct method analysis. “Conjoint analysis is a statistical technique capable of using survey data to determine how consumers value a product’s individual attributes — often called the market’s willingness to pay.” Saavedra,
Harris’s conjoint analysis does not satisfy Comcast. His conjoint methodology could quantify the relative value a class of consumers ascribed to the safety message, but it does not permit the court to turn the “relative valuation ... into an absolute valuation to be awarded as damages.” Saavedra,
Harris’s direct method fares no better. It too focuses solely on the consumer’s subjective valuation. “In the direct method, representative members of the class are directly asked what they would be willing to pay for additional safety.”
“Dr. Jeffrey Harris, proponent of the loss of value theory, asked survey respondents to ‘make binary comparisons between a ‘genuine’ light cigarette that reduced risk ... and a ‘misrepresented’ light cigarette that was no less harmful than conventional cigarettes.’ He concluded that ‘virtually all* respondents reported a non-zero loss in value.’ While the district court is quite correct that ‘damages need not [usually] be demonstrated with precision,’ plaintiffs’ theory is pure speculation.” Id.
Harris does not dispute that both his conjoint and direct method analyses provide only a model for testing what a consumer is willing to pay, without considering other factors in a functioning marketplace.
In their opposition, plaintiffs attempt to distinguish Saavedra, asserting that it is a “benefit-of-the-bargain” case. They contend their damages theory is restitutionary in nature, and hence the case, is distinguishable. The court finds this argument unpersuasive, as the theory of liability and damages methodology in ..Saavedra were both remarkably similar to those at issue here. The named plaintiffs in Saavedra sought to'certify, inter alia, a California UCL and CLRA class. Id. at *2. Plaintiffs alleged that Eli Lilly misrepresented the risk 6f experiencing withdrawal symptoms from its prescription antidepressant Cym-balta. The drug’s warning label indicated that withdrawal occurred “at a rate greater than or equal to 1% and at a significantly higher rate in duloxetine [ (Cymbalta’s chemical name) ]-treated patients compared. to those discontinuing from placebo.” Id. at *1. Plaintiffs argued that the risk of withdrawal was “in fact approximately 44%.” Id. Addressing whether individual issues predominated, the court noted that the named plaintiffs, like plaintiffs here, argued that class members were harmed because they purchased a product that was represented as having a certain attribute, i.e.,. a roughly 1% risk of withdrawal side effects, but that in fact had a different attribute altogether, i.e., an approximately 44% risk of withdrawal side effects. Id. To calculate damages, plaintiffs proposed using conjoint analysis to identify the “benefit that consumers believe[d] they w[ould] obtain by using or owning [the] product,” i.e., isolating the relative, value consumers, placed on “a drug with a withdrawal risk of ‘greater than or equal to 1%’ compared to a drug whose risk is ‘at least 44%.’ ” Id. at *4. Plaintiffs’ expert proposed to take the relative value ascertained by conjoint analysis and develop a “refund ratio,” which he would then apply to each class member’s out-of-pocket costs to determine damages. Id. (“Thus, if the value of a drug with a 1% withdrawal risk is 30% higher than a drug with a 44% withdrawal. risk, then a class . member’s damages would be equal to 30% of her out-of-pocket costs”). Harris proposes to use precisely this methodology here.
The Saavedra court found the methodology insufficient under Comcast, because it offered no way to “turn the relative valuation ascertained via conjoint analysis into an absolute valuation to be awarded as damages.” Id. It found plaintiffs’ damages methodology highly flawed given that it ignored the supply side of the market equation. Id. at *5. (“By looking only to consumer demand while ignoring supply,
Plaintiffs contend that, notwithstanding Saavedra, courts have permitted classes to calculate damages using conjoint analysis only. They contend this case is most analogous to Guido, a case that involved alleged omissions concerning the flammability of L’Oreal hairstyling serum. There, the court concluded that calculating damages using conjoint analysis only satisfied Comcast. See
' "Finally, plaintiffs’ attempt to analogize this case to ConAgra II is unavailing. In ConAgra II, the court found that the use of conjoint analysis in conjunction with a proposed hedonic regression that accounted for “supply and market factors,” was sufficient to permit certification under Comcast. ConAgra raised the same concerns that NJOY raises; it was only because the ConAgra II plaintiffs proposed to use a “hybrid damages methodology” whereby a conjoint analysis was used in addition to a hedonic regression that the court was able to certify a class. See ConAgra II,
In sum, damages under the UCL, CLRA, and FDUTPA are determined'’by taking “the difference between the market price actually paid by consumers and the true market price that reflects the impact of the unlawful, unfair, or fraudulent business practices.” See Werdebaugh,
. (e) Conclusion Regarding Predominance
For the reasons stated, the eourt concludes that plaintiffs have not shown that common questions predominate over individualized questions. It therefore finds that certification of the putative classes under Rule 28(b)(3) is inappropriate.
(2) Superiority
The second requirement imposed by Rule 23(b)(3) is that a class action be superior to other methods of resolving class members’ claims. “Under Rule 23(b)(3), the court must evaluate whether a class action is superior by examining four factors: (1) the interest of each class member in individually controlling the prosecution or defense of separate actions; (2) the extent and nature of any litigation concerning the controversy already commenced by or-against the class; (3) the desirability of concentrating the litigation of the claims in a particular forum; and (4) the difficulties likely to be encountered in the management of a class action.” Edward v. City of Long Beach,
“Where damages suffered by each putative class member are not large, th[e first] factor weighs in favor of certifying a class action.” Zinser,
(3) Conclusion Regarding Rule 23(b)(3)
Because plaintiffs have not proffered a method of calculating damages tied to their theory of liability, they have not demonstrated that common questions predominate over individual issues, and have not satisfied Rule 23(b)(3).
III. CONCLUSION
For the reasons stated, the court denies plaintiffs’ motion for certification o'f a Rule 23(b)(3) class without prejudice. Although plaintiffs have satisfied the Rule 23(a) requirements, they have failed to tie their damages calculation methodology to their theory of recovery. Because they have not demonstrated that damages can be calculated on a- classwide basis, individualized issues predominate. If plaintiffs can address the deficiencies noted in this order, they can file an amended motion for class certification within forty (40) days of the date of this order.
. Joint Stipulation to Consolidate Cases as to 14-00428, 14-00427, Docket No. 41 (Apr. 25, 2014).
. Order Consolidating Actions, Docket No. 50 (Apr. 29, 2014).
. First Amended Consolidated Complaint ("FAC”), Docket No. 58 (May 30, 2014).
. Second Amended Consolidated Complaint ("SAC”), Docket No. 66 (July 9, 2014).
. Motion to Dismiss Second Amended Consolidated Complaint, Docket No, 72 (Aug. 1-1, 2014).
. Order Granting Defendant’s Motion to Dismiss, Docket No. 81 (Oct. 20, 2014),
. Third Amended Consolidated Complaint ("TAC”), Docket No. 82 (Nov. 10, 2014).
. Motion to Dismiss Third Amended Consolidated Complaint ("Motion”), Docket No. 84 (Dec. 10, 2014) at 1.
. Notice of Dismissal by Eric McGovern, Docket No. 114 (May 20, 2015).
. Order Granting in Part and Denying in Part Motion to Dismiss, Docket No. 119 (May 27, 2015).
. Id. at 42.
. Id.
. Fourth Amended Consolidated Complaint (“FAC”), Docket No. 127 (June 16, 2015).
. Answer to Fourth Amended Consolidated Complaint, Docket No. 151 (July 6,. 2015).
. Motion For Class Certification ("Certification Motion”), Docket No. 115-1 (May 21, 2015).
. Opposition to Motion for Class Certification ("Certification Opposition”), Docket No. 130 (June 22, 2015).
. Motion to Strike Declaration of Jeffrey Harris ("MTS Harris”), Docket No. 138 (June 29, 2015); Motion to Strike Declaration of Thomas Maronick ("MTS Maronick”), Docket No. 140 (June 29, 2015).
. Opposition to Motion to Strike Declaration of Thomas Maronick ("MTS Maronick Opposition”), Docket No. 156 (July 10, 2015); Opposition to Motion to Strike Declaration of Jeffrey Harris ("MTS Harris Opposition”), Docket No. 157 (July 10, 2015).
. FAC, II 23.
. Id.
. Id.,n 24-27.
. Id., ¶ 27.
. Id., ¶ 22.
. Id., ¶ 30.
. Id.
. Id., ¶ 31. ■
. Id., ¶ 32.
. Id., ¶33.
. Id., ¶42.
. Id., ¶40.
. Id.
. Id.,n 40-41.
. Id., ¶¶ 3.7-38.
. Id., ¶ 43.
. Id.,n 44-45.
. Id., ¶46.
. Id., ¶ 47.
. Id., ¶ 58.
. Id.
. Id.
. Id.
. id.
. Id., ¶ 65,
. Id.
. Id., ¶¶ 66-67.
. Id., ¶59.
. Id., ¶63.
. Id., ¶ 62.
. Id., ¶¶ 81-82.
. Id., ¶74.
. Id., ¶ 67. Plaintiffs assert this advertisement ran in the June 2013 edition of Out Magazine. (Id., ¶ 68.)
. Id., ¶ 68.
. Id., ¶ 70. Plaintiffs contend this statement ran in USA Today in April 2013 and Out Magazine in May 2013. (Id., ¶ 70.)
. Id., ¶ 64.
. Id., ¶ 68. Plaintiffs allege this statement ran in New York Magazine in February 2013. (Id., ¶ 69.)
.. Id., ¶ 72. Plaintiffs assert this statement , ran in at least two editions of New York Magazine in September 2013. (Id.)
. Id., ¶¶ 74-77. Pontiffs contend this advertisement ran in Sports Illustrated in December 2012 and January 2013, and in Rolling Stone in January 2013. (Id., ¶ 77.)
. Id., ¶ 88.
. Id., ¶ 89. Plaintiffs allege that the product description for NJOY Kings on NJOY’s website states: "It provides everything you like about smoking without the things you don’t.” (Id., ¶ 85.)
. Id., ¶¶ 89-94. Plaintiffs contend that the frequently asked questions page of NJOY’s website states the following: "Nicotine — is an alkaloid found in certain plants, predominately tobacco, and in lower quantities, tomatoes, potatoes, eggplants, cauliflower, bell-peppers, and some teas.” (Id., ¶ 91.)
. Id., ¶¶ 95-96.
. Id., ¶ 102
. Id.
. Id., ¶ 103.
. Id., ¶ 104.
. Id., ¶ 106.
. Id., ¶ 108.
. Id., 11109.
. Id.
. Id., ¶ 17.
. Id. ¶ 110.
. Id., ¶¶ 106, 110.
. Id., ¶¶ 123-154.
. Id., ¶ 18.
. Id., ¶ 111.
. Id.
. Id., ¶¶ 155-163.
. Plaintiffs’ Request for Judicial Notice, Docket No. 149-4 (July 6, 2015).
. Plaintiffs object to Scott's declaration, asserting that she is not qualified under Daubert to opine on economic damages methodologies, and that she does not provide any foundation to support her conclusions. (Objections to the Testimony of Carol A. Scott, Docket No. 162 (July 10, 2015).) The court addresses these objections infra.
. This showing must be by a preponderance of the evidence. See Daubert,
. Certification Motion, Exh. 14 (Declaration of Jeffrey Harris ("Harris Decl.”)), ¶ 1.
. Harris Decl., Exh. A (Currivulum Vitae).
. Id., ¶ 3.
. MTS Harris at 6 — 11. NJOY proffers the declaration of its expert, Carol Scott, in support of its motion to strike Harris’s declaration. (Declaration of Carol Scott ("Scott Deck”), Docket No. 130-6 (June 22, 2015).)
. Id., ¶¶ 17(a)-(c).
. Id. A 30.
. MTS Harris at 4-5.
. Harris Deck, ¶ 14 (citing FAC, ¶ 10).
. Id. at 5 (citing Declaration of Francesca Vaccari ("Vaccari Deck”), Docket No. 130-2 (June 22, 2015), ¶¶2-9).
. MTS Harris at 6.
. Harris Decl., ¶¶ 23.-24,
. Id.,n 27-29.
.. Id., ¶ 37.
. Id., ¶40.
. Harris Decl., ¶ 45.
. Id., ¶ 52.
. Id.
. Id., n 54-55.
; Id., ¶58.
. Id., ¶ 59.
. Id., ¶ 61.
. MTS Harris at 11.
. NJOY also cites In re Zyprexa Products Liab. Litig.,
. See, e.g., Certification Motion at 10 ("The Safety Message pervaded Defendants’ marketing. It was uniform in substance, regardless of the exact words used or the form that the marketing took”).
. Harris Deck, ¶ 14 ("Plaintiffs’ counsel have asked me to assume that beginning in 2007, and continuing during the class period, Defendant NJOY, Inc. 'has engaged in a consistent and pervasive marketing campaign that promotes its core marketing message that NJOY E-Cigarettes are known to be safer than traditional tobacco cigarettes or generally safe.’ I refer to this core marketing message as the Defendant’s safety claim”).
. Although not raised by NJOY, the court notes that the fact Harris has not yet collected the survey data he will use in his conjoint analysis does not render his method unreliable. See ConAgra II,
. At the hearing, NJOY did not raise the issue of Harris’s declaration.
. Declaration of Thomas Maronick ("Mar-onick Deck”), Docket No. 115-13 (May 21, 2015), ¶ 3.
. Id., ¶ 1.
. Id. ■
. Id.
. Id., ¶ 19.
. Id., ¶22.
. Id.
. Id., ¶ 23.
. Id., ¶-24.
. Id.
.Id.
. Id.
. Id., ¶ 25.
. id.
. Id., ¶26.
. Id.
. Id.
. Id., ¶ 28.
. MTS Maronick at 5-14.
. Maronick Deck, ¶ 53.
. MTS Maronick at 18.
. Id.
. Id. at 5, 8, 12, 20.
. Id. at 16.
. Declaration of Kent Van Liere ("Van Li-ere Decl.”), Docket No. 130-7 (June 22, 2015), ¶ 19 ("Interviews were conducted by
. Maronick Deck, ¶ 21.
. Maronick Deck, ¶ 13.
. Id. See also id., Table 3 (at 14).
. At the hearing, NJOY. did not raise the issue of Maronick’s declaration.
. Objection to Carol Scott Declaration, Docket No. 162 (July 10, 2015).
. Id. at 1-2.
. Scott Decl., ¶ 1.
. Id. A 2.
. Id., ¶ 60 ("Conjoint analysis, which measures perceived value, cannot accurately or reliably measure what consumers actually paid, and it cannot be used as a source of data on the prices of alternative products that were considered, and it cannot be used to measure class members’ willingness to pay at the time they made their purchases during the class period. It can be used to estimate willingness to pay for an attribute as of the time of the study, but it cannot tell us what prices consumers actually paid for the product, and cannot tell us if their willingness to pay has varied or remained constant over the class period”).
. Id., ¶¶ 60-61.
. Plaintiffs did not address Scott’s declaration at the hearing.
. Certification.Motion at 7.
. FAC, ¶ 114.
. Id., ¶115.
. Certification Opposition at 15.
. FAC, ¶ 64.
.Id., . ¶ 62 ("by omitting the ingredients from the labels, Defendant denied consumers at the point of sale the opportunity to decide for themselves whether the chemicals used are substances they are willing to risk inhaling. For example, by omitting the ingredients, Defendant hid the fact that NJOY E-Cigarettes contain propylene glycol, a product
. Id., ¶ 63 ("By warning of certain risks relating to nicotine, and the risks that may arise if the concentrated contents of the cartridge are swallowed without being vaporized, this packaging implied that those are the only significant health-related risks related to NJOY E-Cigarettes. This is deceptive and misleading, as the package omitted reference to the other carcinogens, toxins and impurities, including ... the potentially harmful effects of propylene glycol”).
. Declaration of Janine., Pollack in Support of Plaintiffs' Reply ¡(“Pollack Reply Deck”), Docket No. 149-3 , (July 6, 2015), Exh., H ("Halberstam Depo.’’) at 50:5-13 ("Q. And you have interrogatory answers that reflect the phrase, 'Cigarettes, You’ve Met Your Match.' Is that something that you remem
. Id. at 53:7-15. See also id. at 54:1-10 ("Q. So when you said that you thought it would be safer because you don't have the smoke, what — what do you mean by safer? A. Well, when you say — like traditional cigarettes, not — it harms other people by — with the secondhand smoke, so obviously smoke is a big thing there. So if you're eliminating that, I think — you would think that you would be eliminating most of the unsafe things about — about a cigarette”).
. Id. at 26:18-21. NJOY asserts that Hal-berstam purchased NJOY e-cigarettes not be'cause of the advertising, but because of the NJOY brand name. Halberstam did not say this at his deposition, however. His reference to NJOY being the brand that stood out was inextricably linked to” the advertisements[ he had] obviously seen,” which "played an effect” on his decision. (Id. at 43:13-18.)
. Id. at 103:23-104:1 ("Q. When your brother told you that there were additives that were not disclosed in the warning label, did you feel deceived at that moment? A. Yes”); id. at 107:15-17 ("Q. So you were deceived by the packaging and anything else? A. The advertising”).
. Id. at 79:18-25 ("Q. So if you had known everything that you say was not disclosed to you by NJOY, would you still have purchased an NJOY electronic cigarette? ... A. If everything was disclosed to me ... and made aware to me that it could be doing more harm and, in effect, it could be, you know, not safer than traditional cigarettes, I probably wouldn't have”); id. at 81:7-9 ("It’s not just knowing the ingredients. It’s probably knowing what the ingredients would do to me”).
. Id. at 86:22-25 ("I wasn't the only one ■ that suffered — suffered that — the false advertising. Everybody who bought an NJOY is entitled to a refund. It’s not just me”).
. Halberstam Depo. at 43:4-21.
. Id. at 53:7-15. See also id. at 54:1-10 ("Q. So when you said that you thought it would be safer because you don’t have the smoke, what — what do you mean by safer? A. Well, when you say — like traditional cigarettes, not — it harms other people by — with the secondhand smoke, so obviously smoke is a big thing there. So if you're eliminating that, I think — you would think that you would be eliminating most of the unsafe things about — about a cigarette”).
. Scott Deck, ¶ 62.
. Certification Opposition at 2, 16.
. Halberstam Depo. at 100:17 — 18.
. Id. at 104:9-12.
. NJOY contends, in a footnote, that Hal-bertstam lacks standing to bring a UCL or
. Halberstam Depo. at 74:23-752
. Id. at 75:2-5.
. Id. at 75:7-11.
. He lacks Article III standing to bring an omissions claim on this theory for the same reason. See Wilson v. Frito-Lay N. Am., Inc., 961 F.Supp.2d 1134, 1140 (N.D.Cal.2013) ("Plaintiffs in a case like this one can show Article III standing by alleging that they pur
. Order at 15 n. 77.
. Thomas Depo. at 25:3-20.
. NJOY argues, in a footnote, that Article III standing is lacking for the same reasons statutory standing is lacking. It is well settled that "the irreducible constitutional minimum of standing contains three eleménts. First, the plaintiff must have suffered an injury in fact — an invasion of a legally protected interest which is (a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical. Second, there must be a causal connection between the injury and the conduct complained of — the injury has to be fairly ... trace[able] to the challenged action of the defendant, and not ... th[e] result [of) the independent action of some third party not before the court. Third, it must be likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.” Lujan v. Defenders of Wildlife,
. Pollack Reply Deck, Exh. I (Thomas Depo.”) at 25:3-20.
. Certification Motion at 8-9.
. Declaration of Francesca Vaccari ("Vac-cari Decl.”), Docket No. 130-2 (June 22, 2015), ¶ 2 ("In December 2012, NJOY launched a new product called the NJOY King. Based on my knowledge, NJOY did not do any traditional advertising such as television commercials, print advertisements, radio advertisements, internet advertisements, or billboards prior to the launch of the King in December 2012.' The OneJoy was out prior to the King, and to my knowledge,-NJOY did not do any such advertising for the OneJoy”).
. Vaccari Decl„ ¶ 10 ("Starting in approximately August 2014, NJOY did a complete redesign of its packaging and added the full list of ingredients to its product packaging for the NJOY King. NJOY also introduced several new product lines at that time (NJOY Recharge, Vape Pen, e-liquids, and flavor chambers), all of which included an ingredient list from their inception”). ' ‘
. Id., ¶63.
. Id.
. As discussed infra, plaintiffs have adduced no evidence concerning the materiality of NJOY's failure to include a warning concerning propylene glycol and glycerin. As a result, based on the present record, the court concludes that materiality cannot be shown on a classwide basis.
. Certification Motion at 6.
. Certification Motion at 6.
. Certification Opposition at 24.
. NJOY also asserts that the advertisements were "perceived in multiple ways.” (Id.) Whether or not this is true, it does not defeat commonality. See Ries,
. Certification Motion at 7.
. Maronick Deck, ¶ 30.
. Id., ¶ 32 ("Importantly, as noted in Table 3, 43% of respondents seeing each of the ads took an implied ‘credence’ claim that NJOY E-Cigarettes are ‘safer for your health than traditional tobacco cigarettes' while between one-quarter (24%) and one-third (33%) of respondents across the two NJOY print ads said NJOY E-Cigarettes are 'safe for your health.’ Importantly, 12 of the 41 respondents who had seen the 'Resolution Solution’ ad said or suggested that NJOY E-Cigarettes were ‘safe’ but not ‘safer for your health.’ Thus, 85 of the 170 respondents (i.e., 73 + 12) seeing the ‘Resolution Solution’ ad (50%) said NJOY E-Cigarettes were either 'safe for your health,' 'safer for your health than traditional tobacco cigarettes’ or both ‘safe’ and ‘safer for your health.' Moreover, among respondents seeing the ‘Try Something New in Bed' ad, 56.7% of respondents said the ad said or suggested that NJOY E-Cigarettes were either ‘safe for your health,’ ‘safer for your health,’ or both ‘safe’ and ‘safer for your health than traditional tobacco cigarettes’ ”),
.Id., ¶ 44.
. NJOY asserts that Halberstam is subject to unique defenses because he suffered no injury as a result of its alleged misconduct (and hence lacks standing), and because he viewed the allegedly misleading advertisements while living in New York. The court has addressed these-arguments above.
. NJOY's Appendix of Exhibits in Opposition to Class Certification, Docket No. 131 (June 22, 2015), Exh. 13 (Questionnaire) at 1.
. Thomas Depo. at-99:7-100:8-14 ("Q. If NJOY's packaging had listed all of the chemicals that the complaint says were not listed and should have been listed, how would you have known whether those chemicals would have caused you concern? ... A. I would have -taken it like — any list of chemicals was what I was trying to avoid. Any amount of anything that I didn’t want to go into my body because I was trying to get away frmo that. I would have taken it as it would have had an effect on me, the same that regular cigarettes were having. I would have understood it could be the same as regular cigarettes.”).
. Although NJOY disputed whether the class representatives were typical in its opposition, it did not challenge the court's finding that typicality was satisfied at the .hearing.
. Certification Motion at 7.
. Id. at 7. See also Pollack Deck ¶ 3 ("Defendant has served notices of deposition on each of the proposed class representatives in this litigation, and each is scheduled to sit for deposition prior to the hearing on this motion”).
.Declaration of Janine Pollack in Support of Appointment of. Interim Class Counsel, Socket No. 36-1 (Apr. 2, 2014), ¶3 ("Wolf aldenstein, proposed as Interim Co-Class Counsel here, is a highly experienced class
. Plaintiffs move to certify only a Rule 23(b)(3) damages class; they do not seek to certify an injunctive/declaratory relief class under Rule 23(b)(2).
. The complaint also asserted a claim under the False Advertising Law and an unjust - enrichment claim under California law. The fact that California law could not be applied to the claims of all class members nationwide was an independent reason the Ninth Circuit concluded that common questions did not predominate. Mazza,
. Certification Motion Reply at 3-4.
.The same is true of the FDUTPA claim, as that statute employs substantially the same test for causation and materiality. See Keegan,
. ’ Vaccari Decl., ¶ 2.
. Id., ¶ 3.
. Id.
. Id.
. Id.
. Id.
. Id.
. Reply Declaration of Janine Pollack (“Pollack Reply Deck”), Docket No. 149-3 (July 6, 2015), ¶ 2; see also id., Exh. A.
. Certification Reply at 5.
. Pollack Reply Deck, Exh. A.
. Id.
. Certification Opposition at 26-27.
. Id. at 26.
. Bruce v. Teleflora, LLC, No. 13 CV 03279 ODW,
. Maronick Decl., .1111.44-47.
. Id., ¶ 38.
. Id., ¶ 36.
.Id., ¶ 35; id., Table 6.
.Id., Tables.
. Certification Opposition at 26.
. ' Maronick Deck, ¶ 32.
.Maronick Reply Declaration, Docket No. 149-2 (July 6, 2015), ¶ 22.
. Id.., ¶ 22 ("This gives the respondents the opportunity to report not only the top of mind express claims they saw in the ad but also any implied messages they took from it.").
. Certification Opposition at 10.
. Declaration of Kent Van Liere, Docket No. 130-7 (June 22, 2015), ¶ 14.
. Id.
. Van Liere Deck, ¶¶ 25-27.
. Maronick Reply Deck, ¶ 19.
. Id.A 20.
. Id., ¶ 22.
. Id., ¶ 21.
. Id.
. Id.., Table 2.
. Halberstam Depo. >at 75:2-5 (stating “if the[ ingredients had been] disclosed ... in sort of like a warning, [he] probably would have paid more attention to it and ... found out more about it.”).
. Maronick Decl., ¶ 42.
. Id. See also id., Table 12.
. Id., ¶ 43.
. Id. See also id., Table 14.
. Van Liere Decl., ¶ 26.
. FAC, ¶ 63.
. Harris Decl., ¶ 45.
. Id., ¶52.
. id.
. Id., ¶ 54.
. Id., ¶ 59.
. Id., ¶54.
.Id., Í123 (“Economists have used the concept of willingness to pay to measure the price premium that consumers would be willing to pay for improved products or product attributes”). See also id,, ¶¶ 25-28, 55-60 (discussing willingness to pay).
. Id., ¶ 61 (“The price premium attributable to the Defendant’s safety claim would then'be computed as the average discount among all respondents. Since the direct method survey would likewise include class members from both California and Florida, one would be able to compute the price premium attributable to the Defendant’s safety claim separately for each state”).
. Expert Report of Sanjog Misra, Case No. CV 11-01067-CAS-JCx, Docket No. 128 (Jan. 8, 2014), ¶¶ 21-22.
. Id., ¶ 22.