A recent decision from the U.S District Court for the District of New Jersey denied certification of a nationwide class of rental car customers, holding that common questions did not predominate within the class because of variations in the applicable law. In Dawn Valli v. Avis Budget Rental Car Group, LLC, No. 14-6072, 2023 WL 6579150 (D.N.J. Oct. 10, 2023), the court held that, where the laws of “all fifty states” could govern the claims of class members, the court could not properly instruct a jury on the applicable law, and as a result choice of law issues “swallowed” any common issues. Id. at *6.
Third Circuit
Third Circuit Flirts with Narrow View of Warranties Based on Third-Party Certification
By Jonah Panikar on
False labeling class actions are often mired in debates about how a reasonable consumer would understand a product’s label. In many cases, the fight is centered on what third-party certification marks warrant to reasonable consumers. In Dzielak v. Whirlpool Corporation, — F.4th —, No. 20-2551, 2023 WL 6331102 (3rd Cir. Sept. 29, 2023), the Third Circuit articulated powerful arguments against finding that these marks create broad warranties.…
Third Circuit Defends Ascertainability Requirement in Affirming Denial of Class Certification
By Brandon Gould on
The Third Circuit recently affirmed the denial of class certification to end-payor health plans that alleged that the defendant’s “pay-for-delay” settlement of patent infringement litigation inflated prices on a prescription drug. In doing so, the court reaffirmed that named plaintiffs must present an administratively feasible mechanism to ascertain whether putative class members fall within the proposed class definition and thus took sides in a growing circuit split on that issue. See In re Niaspan Antitrust Litig., — F.4th –, 2023 WL 3243532 (3d Cir. 2023).…
Tenth Circuit Permits District Courts to Rely on Third and Seventh Circuit Ascertainability Precedent
By Isaac Chaput on
The Tenth Circuit recently affirmed an order denying class certification, in an unpublished decision holding that district courts may rely on out-of-circuit precedent in deciding whether a proposed class is ascertainable.…
A Closer Look: Does Purchasing a Defective or Contaminated Product Always Cause an Article III Injury?
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.…
District of New Jersey Continues Third Circuit Trend of Finding Mere Exposure to Toxic Substances in Consumer Products Insufficient for Standing
By Kaixin Fan & Ashley Simonsen on
The District Court for the District of New Jersey recently dismissed a putative class action alleging that defendants sold baby foods with high levels of heavy metals, holding that plaintiffs failed to plead an injury sufficient to support standing. In re Plum Baby Food Litigation, No. 1:21-cv-02417-NLH-SAK, 2022 WL 16552786 (D.N.J. Oct. 31, 2022). This decision adds to the list of cases in the Third Circuit holding that merely alleging exposure to toxic substances in consumer products, without more, is insufficient to establish Article III standing. See Covington’s prior blog post on the trend in the Third Circuit here.…
Third Circuit Confirms Invalidly Assigned Arbitration Agreements May Still Be Enforceable
By Andrew Soukup & Kanu Song on
A recent decision by the Third Circuit examined the circumstances under which an arbitrator must decide gateway questions of arbitrability in cases involving challenged loan assignments. In Zirpoli v. Midland Funding, LLC, the plaintiff took a loan pursuant to a contract that contained an arbitration agreement with a delegation clause. The lender then assigned…
Third Circuit Further Refines Its Ascertainability Requirement
By Sylvia Huang on
Posted in Class Action Procedure, Third Circuit
The Third Circuit recently vacated an order denying class certification, and in the process provided more clarity on what plaintiffs must do to satisfy Rule 23’s predominance and ascertainability requirements.
In Kelly v. RealPage Inc., — F.4th —, 2022 WL 3642113 (3d Cir. Aug. 24, 2022), the plaintiffs alleged that their rental applications were…
Data Breach and the Dark Web: Third Circuit Allows Class Action Standing With Sufficient Risk of Harm
By Kathryn Cahoy on
The Third Circuit recently reinstated the putative class action Clemens v. ExecuPharm Inc., concluding there was sufficient risk of imminent harm after a data breach to confer standing on the named plaintiff when the information had been posted on the Dark Web.…
Third Circuit Adopts “Reasonable Reader” Standard to Evaluate FCRA Claims.
By Marianne Spencer on
Banks, lenders, and other financial institutions who submit information to credit reporting agencies should take note of a recent Third Circuit decision adopting a “reasonable reader” standard for evaluating whether a credit report was inaccurate or misleading under Fair Credit Reporting Act (“FCRA”).…
Continue Reading Third Circuit Adopts “Reasonable Reader” Standard to Evaluate FCRA Claims.