Greenberg Traurig’s Gene Livingston to Chair Prop 65 Clearinghouse Annual Conference

Posted in Event, Prop 65

Greenberg Traurig’s Gene Livingston, shareholder and chair of the Proposition 65 & Green Chemistry Practice, will be chairing Prop. 65 Clearinghouse’s 13th Annual Prop. 65 Conference at the Julia Morgan Ballroom in San Francisco. The Conference will take place on Monday, Sept. 24. According to the organization, attendees will be privy to hands-on advice from government, industry, and plaintiff organizations. The conference will include panels on the impact of OEHHA’s changes to the Prop. 65 warning regulations, how new chemical listings affect your business, and the use of litigation to regulate chemicals in food. Register here.

 

Standing and the Right to Sue Under Illinois’ Biometric Information Privacy Act

Posted in Class Action Suits

Greenberg Traurig Shareholder Brett M. Doran authored an article published in DRI titled “Standing and the Right to Sue Under Illinois’ Biometric Information Privacy Act.” The article examines Illinois Biometric Information Privacy Act (BIPA) class actions and how courts have treated challenges to plaintiffs’ standing or right to sue. Click here to read the full article.

Prop 65 Ruling Based on Old Science

Posted in Prop 65

Greenberg Traurig Shareholder Anthony J. Cortez and Associate Will Wagner co-authored an article in the Tea and Coffee Trade Journal titled “Prop 65 Ruling Based on Old Science,” discussing a recent Proposition 65 ruling that affects the sale of coffee in the state of California. To read the full article, please click here.

Illinois Appellate Court Recognizes Joint Defense Privilege

Posted in Litigation

An Illinois appellate court has formally recognized what both state and federal courts have already considered to be the law—that coparties to a lawsuit who agree to share information pursuant to a common interest in defeating their opponent do not waive either the attorney-client or work-product privilege when they do so.1Parties may object to disclosing these communications when sought by the opposing side in discovery.2 The necessity of this holding as a matter of first impression may come as a surprise to many practitioners who already regularly assert the joint defense privilege in Illinois state courts. The Selby court recognized that “a lot of practitioners and judges will be surprised to learn that [the joint defense privilege] has not already been recognized in Illinois.”3 The doctrine has implicitly existed in federal courts sitting in Illinois for decades, and practitioners have routinely asserted the defense in both state and federal tribunals.4 But although federal courts have conclusively stated that Illinois state law recognizes the joint defense privilege, Selby is the first Illinois appellate court case to finally do so.5

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EPA Concludes Glyphosate is Not Likely to be Carcinogenic to Humans

Posted in Consumer Safety

EPA concluded in draft risk assessments that a widely used herbicide in the United States that controls weeds and grasses— glyphosate—is “not likely to be carcinogenic to humans.”  Importantly, the assessment also “found no other meaningful risks to human health when the product is used according to the pesticide label.”  According to EPA, this finding is consistent with the 2017 National Institute of Health Agricultural Health Survey as well as conclusions by science reviews in other countries.

Use of glyphosate dates back to the 1970s and glyphosate is undergoing Registration Review—which requires EPA review of registered pesticides every 15 years.  The herbicide has been classified in multiple chemical categories since 1985.  Initially classified as a Group C Chemical (Possible Human Carcinogen) due to the discovery of kidney tumors in male mice, the agency reclassified the herbicide in 1986 as a Group D Chemical (Not Classifiable as to Human Carcinogenicity) due to equivocal data.  After additional peer review, in 1991, the agency classified glyphosate as a Group E Chemical (Evidence of Non-Carcinogenicity for Humans) based on studies of mice and rats.  In 2015, the Cancer Assessment Review Committee reevaluated prior data and classified glyphosate as “Not Likely to be Carcinogenic to Humans.”

As discussed previously by this blog (“EPA: Research Shows Herbicide Glyphosate Unlikely to Cause Cancer” and “Glyphosate Litigation Primer”), there has been significant national and international debate surrounding the use of the herbicide.  The International Agency for Research on Cancer, a subdivision of the World Health Organization (“WHO”), identified glyphosate as a probable carcinogen in March 2015.  But, in November of that year, the European Food and Safety Authority concluded the herbicide was “unlikely to pose a carcinogenic hazard to humans.”  Another subdivision of WHO reached a similar finding in 2016, concluding “glyphosate was unlikely to pose a carcinogenic risk to humans from exposure through the diet.”  While some European countries have sought to ban the herbicide, other countries have stood behind the finding that glyphosate is unlikely to cause cancer in humans.

In light of this backdrop, EPA characterized its 2017 evaluation as a more comprehensive evaluation compared to its prior 2015 human health review.  While the draft human health assessment finds the herbicide is unlikely to be carcinogenic to humans, EPA stated that the ecological risk assessment showed a “potential for effects on birds, mammals, and terrestrial and aquatic plants.”

The draft risk assessments and supporting documents are available on EPA’s website.  EPA will receive public comments for 60 days following the publication in early 2018 of the draft risk assessments to the glyphosate registration review docket, EPA-HQ-OPP-2009-0361.  EPA states that the agency will publish in 2019 the proposed interim registration review decision for glyphosate.  If deemed necessary, that decision would identify any proposed mitigation measures to reduce risk.

Plaintiffs Must Plead Facts Which Directly Contradict Allegedly False Statements to Plead ICFA Claims Based on Falsity

Posted in Advertising, Consumer Fraud

In a recent decision by Judge Thomas M. Durkin of the Northern District of Illinois, the Court recognized an important distinction for Illinois Consumer Fraud Act (ICFA) claims between a claim for “actual falsity” and one for “lack of substantiation.” Spector v. Mondelez Int’l, Inc., 15 C 4298, 2017 WL 4283711, at *10 (N.D. Ill. Sept. 27, 2017). In making this distinction, the Spector court has made clear that false advertising cases brought under ICFA must plead facts which directly contradict the advertising claim. Id. at *4 (holding that under Illinois law “a plaintiff may bring a lack of substantiation claim only if the defendant makes a substantiation claim in its advertisement.”). It is important to note that, in Illinois – unlike in many other states – a private plaintiff may bring a lack of substantiation claim where the advertisement included an establishment or substantiation claim (e.g., “Tests show that . . .”).

In Spector, the plaintiff alleged that the product at issue did not provide “4 hours of nutritious steady energy” as the defendant had represented. Id. at *2. In discussing the various factual allegations put forward by the plaintiff, the Spector opinion makes clear that the pleading standard for false advertising claim is a high bar. Id. at *3-10. Judge Durkin notes that “[i]n virtually all of the cases in which courts have held that the plaintiff adequately pled actual falsity in a false advertising case, the complaints in question cited to testing or studies that directly contradicted the advertising claim at issue.” Id. at *3. Factual allegations of falsity are insufficient when, as in Spector, they do not directly support a plaintiff’s allegation of falsity, but instead require the court to make a speculative leap. Id. at *7.

First, the plaintiff in Spector relied on a study which found that a 42 gram version of the product at issue was insufficient for the “4 hours of nutritious steady energy” claim and argued that, as a result, the 50 gram dose – when consumed without breakfast – must also be insufficient for that claim. Id. This argument would have required the court to make a speculative leap to allow the litigation to continue. As a result, the court found that plaintiff’s allegations were not sufficient to meet the required plausibility threshold. Id. at *9 (“While lack of substantiation evidence may be supportive of Plaintiff’s false advertising claim, it is not sufficient to give rise to a plausible claim of falsity.”).

Second, the plaintiff argued that the nutritional requirements of individuals vary based on a number of variables and as a result, “the 230 calories provided by a 50 gram serving of the Products could not guarantee 4 hours of nutritious steady energy for every consumer.” Id. at *9. The court found that this argument was also insufficient to state a claim. The court noted that “individual variations may exist but not impact the 4 hours of steady nutritious energy claim (which could be the floor below which no individual would ever fall).” Id.

Third, the plaintiff in Spector advanced the argument that “Plaintiff consumed the Products and did not herself experience 4 hours of steady energy.” Id. at 10. The court responded to this argument by quoting from Toback v. GNC Holdings, Inc., 2013 WL 5206103, at *3 (S.D. Fla. Sept. 13, 2013). The court held, in line with Toback, that an allegation that the plaintiff used the product and was not satisfied is insufficient to state a claim. Spector, 2017 WL 4283711, at *10. Instead, such allegations require “further detail or support.” Id. (quoting Toback, 2013 WL 5206103, at *3.) In addition, such an allegation is “too conclusory without further factual details to support the injury element of [the] ICFA claim.” Id. at *10 n.16.

The Spector decision provides a clear framework for analyzing whether a plaintiff has plausibly alleged a false advertising claim under ICFA or is simply attempting to cloak a claim for lack of substantiation in the language of falsity where the advertisements at issue do not include any such establishment or substantiation claim. The plaintiff in Spector is appealing the decision to the Seventh Circuit. The outcome of this appeal could have a substantial effect on which false advertising claims will survive a motion to dismiss going forward. The Spector court noted the stakes at play in resolving these issues:

it is not enough if those supportive factual allegations suggest “the mere possibility” of falsity. Otherwise, “a plaintiff with a largely groundless claim [would] be allowed to take up the time of a number of other people, with the right to do so representing an in terrorem increment of the settlement value.”

Id., at *1 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007)) (internal citations omitted).

Responding to Consumer Demand Letters Under the Massachusetts Consumer Protection Act

Posted in Class Action Litigation, Consumer Protection

The Massachusetts Consumer Protection Act (Chapter 93A, Section 9) prohibits a business from engaging in unfair or deceptive acts or practices. Chapter 93A litigation usually is time consuming, expensive, and exposes a company to mandatory multiple damages (if the act or practice was a knowing and willful violation of Chapter 93A) and attorneys’ fees. These provisions provide a consumer’s counsel significant leverage when litigating and attempting to settle Chapter 93A claims – particularly when brought in a class-action setting. Chapter 93A, however, affords a business an opportunity to gain that leverage back and limit exposure to the statute’s mandatory multiple damages and fee shifting provisions as well as foster more meaningful settlement discussions, if appropriate. Taking advantage of this opportunity, which occurs usually only once and before the litigation begins, can be beneficial for a company.

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Massachusetts Businesses Face Consumer Class Actions Alleging Improper Product Substitution

Posted in Alert, Class Action Litigation, Class Action Suits, Food & Beverage Industry, Product Safety

The Massachusetts Consumer Protection Act (Chapter 93A) protects consumers against unfair or deceptive business practices and allows consumers, under certain circumstances, to bring class actions against businesses to stop such practices and seek damages. Generally, unless a business responds to a presuit demand letter with a reasonable settlement tender, violation of Chapter 93A requires payment of actual or statutory ($25.00) damages, whichever is greater, and attorneys’ fees as well as exposes a business to double or treble damages. In a class action setting, the aggregation of such damages produces significant risk and potential exposure.

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Northern District of Illinois Employs the “Substantially Similar” Test to Decide Whether a Plaintiff Has Standing to Assert Claims for Products He Did Not Purchase

Posted in Food Litigation, Litigation

The question of whether, and under what circumstances, a plaintiff can represent a class as to products he or she did not purchase, remains a vexing one for courts.  Judge St. Eve of the Northern District of Illinois recently weighed in on this issue.  In Wagner v. General Nutrition Corp., (No. 16-cv-10961, July 19, 2017), Judge St. Eve concluded that Plaintiff had adequately alleged standing for claims based on products that he had not purchased given that he alleged the products were materially the same.

Some courts have held that a plaintiff lacks standing to assert claims as to products that he or she did not purchase.  See, e.g., Allen v. Hylands, Inc., 2012 WL 1656750, at *5 (C.D. Cal.  2012) (plaintiffs lacked standing to assert claims about homeopathic products that plaintiffs have not purchased). Other courts employ a “substantially similar” test, under which standing exists if the products and alleged misrepresentations are substantially similar. Courts applying the  “substantially similar” test have mostly done so in cases asserting food-misbranding or mislabeling claims.  See, e.g., Miller v. Ghirardelli Chocolate Co., 912 F. Supp. 2d 861 (N.D. Cal 2012) (compiling cases and finding products not substantially similar).

In Mednick v. Precor, Inc., 2014 WL 6474915 (N.D. Ill. Nov. 13, 2014), for example, the court explained that the majority of courts that have considered the issue “hold that a plaintiff may have standing to assert claims for unnamed class members based on products he or she did not purchase so long as the products and alleged misrepresentations are substantially similar.” Id. at *3 (citing Quinn. v. Walgreen Co., 958 F. Supp. 2d 533, 541 (S.D.N.Y. 2013)).

In Wagner, Plaintiff claimed that he purchased and consumed a glutamine supplement “because [he] believed, based upon the misleading labels, that they enhanced muscle growth, provided faster recovery, and had anti-catabolic properties.”  The Defendant, a retailer of dietary supplements, markets at least four glutamine supplements.  The Defendant argued that, because the Plaintiff purchased only one of these four supplements, he lacked standing to assert claims on behalf of putative class members who purchased the remaining three supplements.  In denying the Defendant’s motion to dismiss, the Court noted that the products have the same key ingredient of glutamine and Plaintiff alleged that all of the products contain misrepresentations for the same reason: “glutamine supplements do not have the benefits indicated on the products’ labels.”  According to the Court: “nothing in the complaint or the parties’ briefs suggest that any differences in the product are material.”  Accordingly, the Court concluded that the case was similar to Mednick in that Plaintiff’s claims target a siyengle aspect present in an array of different products.

Anthony Cortez to Participate on AHPA’s California Prop 65 Webinar

Posted in Event, Prop 65

Global law firm Greenberg Traurig, LLP’s  Anthony J. Cortez will participate on the American Herbal Products Association’s (AHPA) webinar panel, “CA Prop 65: Regulatory, Compliance and Litigation Developments,” July 25.

The webinar will discuss the recent developments related to Prop. 65 and the current litigation and regulatory environment. With his fellow panelists, Cortez will explain the finalized changes and status of new chemical listings, as well as steps companies should take to ensure compliance prior to the Aug. 30, 2018 implementation date. Additional information on the 2-hour live panel – including details on how to listen – can be found here.

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