The Ninth Circuit recently held that a class could be certified with class members who lost less than a penny of interest. But it also held that where some class members may have lost nothing at all, the district court must take a hard look at whether the predominance requirement has been met.
If a tree falls in the forest but no one is around to hear it, did it make a sound? Philosophers disagree. If a product contains a contaminant but no one gets sick, did it cause an injury? Judges disagree.
In the 2000s, enterprising plaintiffs’ attorneys attempted to push the boundaries of existing tort law by arguing that plaintiffs are entitled to damages for defects even when they cause no physical injury. These so-called “no-injury” theories of liability were largely rejected by courts. E.g., Rivera v. Wyeth-Ayerst Lab’ys, 283 F.3d 315, 320–21 (5th Cir. 2002) (dismissing “no-injury products liability law suit”); Johnson v. Bankers Life & Cas. Co., 2014 WL 4494284, at *7 (W.D. Wis. Sept. 12, 2014) (recognizing that in the “consumer product context, courts routinely find lack of standing where—while a product may have been defective in the hands of others—the individual plaintiffs did not suffer the defect and, therefore, suffered no injury”).
While these cases closed the door on “no-injury” product liability claims, they left open the possibility of other “no-injury” claims, such as claims that a manufacturing defect breached a warranty or constituted fraud. E.g., Cole v. Gen. Motors Corp., 484 F.3d 717, 723 (5th Cir. 2007) (“Notably in this case, plaintiffs may bring claims under a contract theory based on the express and implied warranties they allege.”).
Whether and when “no-injury” claims are viable is a hotly debated question. As more fully discussed below, courts disagree on whether a plaintiff who has purchased a contaminated or defective product—but who has successfully used the product for its intended purpose while suffering no physical injury—can maintain a claim.
In Campbell-Ewald Co. v. Gomez, 577 U.S. 153, 163 (2016), as revised (Feb. 9, 2016), the Supreme Court held that an unaccepted offer of judgment cannot moot a plaintiff’s claims. While that decision left some questions unanswered, recent Court of Appeals decisions have applied its reasoning to broader situations, such as holding that an unaccepted refund offer made prior to litigation does not deprive a plaintiff of standing to sue. Adam v. Barone, 41 F.4th 230, 234 (3d Cir. 2022).
Another court recently added a twist to the analysis, holding that offering a full refund may make dismissal appropriate under the prudential mootness doctrine. See Sharp v. FCA US LLC, 2022 WL 14721245 (E.D. Mich. Oct. 25, 2022).
Continue Reading Even After Campbell-Ewald, a Refund Offer Can Still Sometimes Moot a Case
Last September, we reported on a 2-1 Ninth Circuit decision holding that even if an arbitration clause appears to be unenforceable under the prospective waiver doctrine, a delegation provision requiring the arbitrator to decide that issue in the first instance is still enforceable. Brice v. Haynes Invs., LLC, 13 F.4th 823 (9th Cir. 2021). This decision reversed the district court’s order denying defendants’ motion to compel arbitration. Because the district court action was not stayed pending the appeal, it proceeded through class certification and pretrial motions. The Ninth Circuit now has vacated the panel decision and decided to rehear the case en banc.
A consumer purchases a product and later finds out that the product was contaminated with a toxic substance. Was the consumer injured? Without knowing more, the answer is “no”—at least for the purposes of establishing standing in the Third Circuit. In Koronthaly v. L’Oreal USA, Inc., 374 F. App’x 257, 259 (3d Cir. 2010), the court held that mere exposure to lead in lipstick was not sufficient to support standing. Years later, in In re Johnson & Johnson Talcum Powder Prods. Mktg., Sales Practice & Liability Litigation, 903 F.3d 278, 289, 290 n. 15 (3d Cir. 2018), the court held that mere exposure to a carcinogen in talcum powder is likewise not enough to establish standing.
Following this trend, District Judge Chesler in the District of New Jersey recently dismissed a case where plaintiffs alleged they purchased baby food contaminated with heavy metals. See Kimca v. Sprout Foods, Inc. d/b/a Sprout Organic Foods, 2022 WL 1213488 (D.N.J. Apr. 25, 2022).
The Seventh Circuit recently gave defendants another arrow in their quiver to use when arguing that plaintiffs lack Article III standing to assert claims for violations of federal laws, even when the plaintiff demonstrated that she suffered emotional distress as a result of those violations.
Continue Reading Emotional Distress Is Not Good Enough for Standing in the Seventh Circuit