“Ascertainability” in the context of civil litigation involves the identification of individuals who qualify for membership in a putative class action. Although not an explicit requirement under Rule 23, since …

Continue Reading Will Ninth Circuit Class Actions Force Resolution of Ascertainability Circuit Split?

On May 20, 2016, the FDA announced that it finalized changes to the Nutrition Facts panel on the labels of packaged foods and beverages, as well as changes to the…
Continue Reading FDA Announces Changes to the Nutrition Information on the Labels of Food, Beverages, and Dietary Supplements

Plaintiffs in consumer data breach class actions have struggled to establish Article III standing. Article III standing requires an alleged ‘‘concrete and particularized injury that is fairly traceable to the…
Continue Reading Seventh Circuit Revives Another Data Breach Suit — Lewert v. P.F. Chang’s China Bistro, Inc.

A California federal court recently relied on the so-called “pass-on defense” to deny class certification in a lawsuit asserting claims under California’s Unfair Competition Law (UCL).  Elite Logistics Corp. v. MOL Am., Inc., No. CV1102952DDPPLAX, 2016 WL 409650, at *3 (C.D. Cal. Feb. 2, 2016). Consumer products companies will want to take note of this decision and determine whether it can help them in defending similar UCL claims.

What is the pass-on defense?

“Passing on” describes the action of an overcharged buyer who passes the extra expense on to those who buy from it.  54 Am. Jur. 2d Monopolies and Restraints of Trade § 396.  In many cases, defendants have argued that the plaintiff does not have standing or any injury because it passed any unlawful charge on to others, thus eliminating any harm.

California Supreme Court limits pass-on defense

In Clayworth v. Pfizer, Inc., 49 Cal. 4th 758 (2010), the California Supreme Court limited the pass-on defense in a case asserting claims for violation of the Cartwright Act and for restitution and injunctive relief under the UCL.  Defendant argued that the plaintiffs did not have standing under the UCL because they were able to pass-on any overcharges to their ultimate customers.  The Court rejected this argument, concluding that it “conflates the issue of standing with the issue of the remedies to which a party may be entitled. “  Id. at 789.Continue Reading Pass-On Defense Still Alive and Well

On March 14, 2016, Ageas (formerly, Fortis Bank) and several foundations representing the Fortis shareholders announced a EUR 1.204 billion settlement of shareholder claims and they are now seeking to…
Continue Reading The Dutch Act on Collective Settlement of Mass Claims (WCAM) Goes Global Again: A Forum Outside the United States to Resolve Mass Claims Disputes Internationally

Despite positive reviews from the EPA and European Food Safety Authority, Bisphenol A (BPA), a synthetic compound used to line canned goods and other consumer products, was added to the…
Continue Reading BPA Regulation Will Soon Affect Consumer Products Distributed in California – Comments on Regulation due April 29, 2016

Since 2010, California has required that certain companies provide information regarding their efforts to eradicate slavery and human trafficking from supply chains. Similar legislation is now popping up across the pond with the United Kingdom recently passing a law that calls for the reporting of steps taken to prevent slavery and human trafficking from entering supply chains. This is a clear sign that companies must continue their endeavors to both know their supply chains and report on what they are doing to help fight the exploitation of men, women, and children in countries throughout the world.

The U.K. Modern Slavery Act of 2015

California is no longer alone in its fight to eradicate human trafficking through supply chain monitoring. This year, the United Kingdom proposed a new law aimed at ending human trafficking that substantially overlaps with the California Transparency Act. Titled the U.K. Modern Slavery Act of 2015 (the U.K. Act), it received Royal Assent March 26, 2015 and is now an Act of Parliament. Reporting obligations under the U.K. Act should come into force later this month.

The U.K. Act broadly requires that any company that “supplies goods or services” and “carries on a business, or part of a business, in any part of the United Kingdom” publically disclose the steps it is taking to ensure slavery or human trafficking is not taking place in its business and supply chains. A slavery and human trafficking statement is either a statement of the steps the organization has taken during the financial year or a statement that the organization has taken no such steps. Similar to California, the U.K. Act requires that if the organization has a website, it must publish the slavery and human trafficking statement on the website and include a link to the slavery and human trafficking statement in a “prominent place on that website’s homepage.”
Continue Reading Transparency in Supply Chains Acts in the United Kingdom and California