Subject: Class Actions

A KIND Result After Insufficient and Biased Consumer Perception Evidence

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Consumer perception evidence is necessary for plaintiffs to survive summary judgment in a false advertising class action, but vacillating and flawed connections between the evidence and the key question of what a reasonable consumer would expect may lead to its exclusion.  The Second Circuit, in Bustamante v. KIND, LLC, 2024 WL 1917155 (2d Cir. May 2, 2024), provides an illustrative example of this, affirming the Southern District of New York’s exclusion of plaintiffs’ experts and grant of summary judgment to a snack foods manufacturer in a false advertising class action.

In Bustamante, Plaintiffs alleged they were deceived by the packaging of KIND snack bars as “All Natural” despite the inclusion of certain “non-natural” ingredients, and their lawsuit asserted warranty, unjust enrichment, negligent misrepresentation, and state consumer protection statute claims.  Although there were differing elements to Plaintiffs’ various claims, they were narrowed for the purposes of summary judgment to deception, materiality, and injury, with only the element of deception at issue on appeal.

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Enforcement of Representative Actions is Here

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It’s finally here.  Enforcement of the Collective Redress / Representative Actions Directive (RAD) in the EU has now begun.  At this time, six member states have adopted a national translation of this law and nineteen states are engaged in ongoing discussion and drafting.  The landscape is changing rapidly and our team is tracking these developments.

Are you ready for this shift in litigation culture?  Backed and supported by the growing EU third party litigation funding industry, the RAD will provide an unprecedented procedural mechanism to bring class and consumer actions on a mass scale against EU traders.  These actions can be premised upon one or more of 66+ substantive regulations that cover everything from the finance industry to environmental regulations to product and artificial intelligence liability.  If you have not prepared, now is the time.

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Class Action Filings on the Rise in Europe, Especially in Product Liability Cases Ahead of Full Implementation of the EU’s Representative Actions Directive

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Under the timeline imposed by the EU’s Directive of the European Parliament and of the Council on Representative Actions for the Protection of the Collective Interests of Consumers, the EU’s 27 member states were required to provide a collective litigation option to consumers by December 25, 2022, including by adopting or amending national law in jurisdictions where mechanisms for such litigation were not previously established. By June 25, 2023, member states are required to implement and begin applying these new mechanisms. But while that process is still ongoing, multiple EU member states have already taken legislative action to permit greater collective litigation mechanisms than previously available in their respective jurisdictions. Additionally, legal industry observers have already noted the increased presence of plaintiffs’ firms and litigation funders in the EU in response to the greater and increasing availability of representative and collective redress actions. See K. Henderson, Z. Okanyi, et al., European Class Action Report 2022, at 2, CMS (2022), available at https://cms.law/en/int/publication/cms-european-class-actions-report-2022.

In particular, one study noted that class action filings in Europe had increased more than 120% over the last five years (from 49 in 2018 to 110 in 2021), propelled by greater attention to potential mass actions by plaintiffs’ firms and increased availability of litigation funding. The data confirms what practitioners in this space already know: the plaintiffs’ bar in the EU is not waiting for the full implementation of the Representative Actions Directive. Of particular note, this rise is fueled, in significant part, by product liability, personal injury, and consumer mass actions.

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5 Major Drug and Device Developments of 2022

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As we ring in the new year, it is time once again to reflect on some of the most significant legal developments for drug and device companies this year. The list below is by no means exhaustive (who could forget the Rule 702 updates that took place this year, which will carry over into 2023?), but provides a brief recap and assessment of five of the most interesting and consequential developments affecting drug and device law in 2022.

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Listen Up Class: The Role of Daubert at the Class Certification Stage in the Ninth Circuit

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Class certification is the feature fight of any putative class action lawsuit. If granted, it can multiply the stakes of a case several hundred- or thousand-fold. If denied, it can signal the end of the litigation. Because of its importance, parties often invest heavily in the class certification fight, including by offering – and challenging – expert testimony.

As this trend has become more common, more focus has been devoted to answering a key question – to what extent should Rule 702 apply at this critical juncture? A number of circuits have held that Rule 702 applies in full force and that opinions deemed inadmissible under Rule 702 should not be considered in regard to class certification; others, such as the Ninth Circuit, have taken a somewhat different approach. Recently, the Southern District of California, in Stewart v. Quest Diagnostics Clinical Labs., Inc., 2022 WL 5236821 (S.D. Cal. Oct. 5, 2022), weighed in on this question.

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Exclusion of Damages Expert at Class Certification Stage Results in Partial Denial of Certification Motion

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Just a decade ago, it was still an open question whether parties could challenge the admissibility of expert testimony in class certification proceedings.  The United States Supreme Court recognized the issue in Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011), and suggested that experts should be scrutinized as usual, noting that “The District Court concluded that Daubert did not apply to expert testimony at the certification stage of class-action proceedings.  We doubt that this is so . . .”  Since then, multiple circuits have taken that hint and held that a court must conduct a full Rule 702 analysis before deciding whether to certify a class.  The Fifth Circuit, in Prantil v. Arkema Incorporated, 986 F.3d 570 (5th Cir. 2021), became the fourth federal court of appeal to adopt this rule expressly.  As the district court’s recent decision on remand in Prantil demonstrates, a full Rule 702 analysis can make the difference between certifying or rejecting a class.

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