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Challenging Price Premium Allegations Can Pay Off for Defendants

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Motions to dismiss in consumer fraud cases often focus on the element of deception—whether a reasonable consumer would be deceived by the statement or practice at issue. But there is another element of statutory consumer fraud claims that deserves closer scrutiny at the pleading stage—injury. Where plaintiffs claim that they were injured because they paid a “price premium” but do not allege facts to support that claim, defendants should consider moving to dismiss for failure to adequately plead injury.

State consumer protection statutes typically include injury as a required element for a private cause of action. New York General Business Law Sections 349 and 350, for example, require a plaintiff to establish that she purchased a product because of the allegedly deceptive business practice and did not receive the full value of the purchase. Similarly, plaintiffs suing under California’s Unfair Competition Law, False Advertising Law, or Consumer Legal Remedies Act must establish that they suffered an “economic injury” caused by the practice or advertising at issue.

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A Bridge Too Far: Reliance on Malfunction Theory Rejected When the Alleged Failure is a Known Risk of the Product

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In some circumstances, a plaintiff lacking direct evidence of an identifiable, specific defect may be permitted to use circumstantial evidence to prove that a product malfunctioned and create a triable inference of a product defect. Some courts may treat proof of a product malfunction as circumstantial evidence of a product defect because a product will not ordinarily malfunction (or perform outside the reasonable safety expectation of the consumer) in the absence of a defect. This circumstantial evidence doctrine, commonly known as the “malfunction theory,” may provide plaintiffs with a pathway to establish a prima facie case of a product defect.

While the malfunction theory sometimes allows plaintiffs to bring a claim for a product defect where the product is no longer available or a specific defect cannot be identified, plaintiffs often attempt to stretch the theory beyond its logical bounds. In a recent case from Idaho, Black v. DJO Global, Inc., the Idaho Supreme Court rejected use of the malfunction theory when the alleged product “failure” (or malfunction) was the occurrence of a known risk, i.e., one that could occur even when the product performs as intended. Black v. DJO Glob., Inc., 488 P.3d 1283, 1288 (Idaho 2021).

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The Culpable Co-Defendant Problem: How to Preserve Your Client’s Defenses After a Culpable Co-Defendant Files a Motion for Summary Judgment in California State Court

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Defense attorneys involved in California multi-defendant product liability lawsuits are familiar with the challenge of properly balancing the need to preserve their clients’ defenses with the strategic importance of maintaining cooperation among co-defendants.  In many cases, co-defendants’ interests are aligned, and they find the strategic benefits of cooperation outweigh any benefits of finger-pointing amongst one another.  Indeed, co-defendant infighting is risky on several fronts—it can help the plaintiffs, increase defense costs, create animosity among possible business partners, and chill future cooperation with defendants who regularly blame their co-defendants.  Inevitably, however, cases arise that involve a culpable co-defendant and a client wants to preserve its ability to attribute fault to the co-defendant at trial.  This issue becomes complex and the specific language of California Code of Civil Procedure Section 437c(l) comes into play when the co-defendant seeks no-fault summary judgment.

Section 437c(l) operates to limit the extent to which defendants can attribute legal fault at trial to defendants who were dismissed through no-fault summary judgment.  Specifically, Section 437c(l) provides that “if a motion for summary judgment is granted on the basis that the defendant was without fault, no other defendant during trial, over plaintiff’s objection, may attempt to attribute fault to, or comment on, the absence or involvement of the defendant who was granted the motion.”  Cal. Civ. Proc. Code § 437c(l).  In other words, remaining defendants cannot assert the empty chair defense to attribute legal fault to co-defendants who obtained summary judgment.

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FDA Releases Draft Guidance for Sponsors on How to Comply with Study Data Standards When Submitting RWD-Sourced Study Data

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The U.S. Food and Drug Administration (FDA) issued a draft guidance titled Data Standards for Drug and Biological Product Submissions Containing Real-World Data on October 21, 2021. The guidance provides the Agency’s thoughts on how sponsors can comply with the Federal Food, Drug and Cosmetic Act (FDCA) when submitting “certain” applications that contain study data derived from real-world data (RWD) sources. The FDA acknowledges that its current study data standards do not necessarily reflect a process derived from RWD sources. However, sponsors will need to convert RWD into established study data standards when submitting this information as part of a regulatory application (a process called “mapping”).

For context, study data standards are documented guidelines to help with the exchange of clinical and nonclinical study data between computer systems. They are used to provide a consistent framework for organizing study data (such as templates for datasets, standard names for variables, how to do calculations with common variables, and so on).

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