“Once Bitten, Twice Shy” Plaintiffs May Lack Standing Because They Won’t Be Fooled Again

To have Article III standing for injunctive relief, a plaintiff must allege that a “real and immediate threat” exists that he will be wronged again. Chapman v. Pier 1 Imps. (U.S.), Inc., 631 F.3d 939, 946 (9th Cir. 2011). In cases alleging deceptive labeling of products, this requirement presents a contradiction because a consumer who was originally deceived by a product label when he bought the product must, by definition, now know that the label was deceptive to allege that fact in a complaint.

District courts in the Ninth Circuit have struggled with this issue. In Rahman v. Mott’s LLP, a food labeling case challenging the legality of a “No Sugar Added” statement on Mott’s Apple Juice, Judge Illston observed that district courts in the Ninth Circuit have basically taken three approaches to the standing analysis in cases alleging violations of California’s unfair competition laws by food and other consumer product manufacturers. See Order Granting in Part and Denying in Part Defendant’s Motion for Summary Judgment, No. CV 13-3482 SI, 2014 WL 5282106 (N.D. Cal. Oct. 15, 2014) (slip op. available here) (Mr. Rahman is represented by Capstone Law APC). “Some courts have held, on public policy grounds, that a plaintiff need not even allege that he intends to purchase the mislabeled product in the future in order to have standing for injunctive relief.” Slip op. at 8 (internal citations omitted). Other courts take a “no standing” approach, “that the plaintiff’s knowledge of the allegedly unlawful or misleading conduct precludes standing for injunctive relief under Article III,” (id. at 9 (internal citations omitted)), an unnecessarily strict approach that undermines consumer protection statutes. A third line of cases takes the “middle ground,” finding “that a plaintiff must allege an intent to purchase the challenged product in the future in order to have standing for injunctive relief.” Id.

This three-way split in authority may be resolved in Jones v. ConAgra Foods, a case before the Ninth Circuit which has been fully briefed and is awaiting oral argument. No. C 12-01633 CRB, 2014 WL 2702726 (June 13, 2014) (9th Cir. Case No. 14-16327). The Jones district court decision is a “middle ground” case: Judge Breyer noted that while “[c]ourts have rejected the argument that a plaintiff cannot establish standing if he has learned that a label is misleading and therefore will not be fooled by it again,” they “do require [that] plaintiffs . . . express an intent to purchase the products in the future.” Id. at *12 (citing Rahman v. Mott’s LLP, 2014 WL 32541 at *10 (N.D. Cal. Jan. 29, 2014)). Judge Breyer found, however, that the plaintiff did not meet that requirement. Jones at *13 (stating, “Jones could have testified, if true, that he bought the Hunt’s products in reliance on the label because he seeks out natural products, but that he might purchase Hunt’s products in the future if they were properly labeled. He did not so testify.”).

Hopefully, the Ninth Circuit will adopt a more permissive standing rule that will not bar plaintiffs in deceptive advertising cases from seeking injunctive relief in federal court. If the Ninth Circuit adopts Judge Breyer’s approach, it should reconcile it with Rahman, which is also fully briefed before the Ninth Circuit. Rahman v. Mott’s LLP (9th Cir. Case No. 15-15579) (appellant’s opening brief available here). In Rahman, the court adopted an unduly narrow approach, simultaneously acknowledging that a plaintiff must allege an intent to purchase a challenged product in the future to have standing and also finding that the plaintiff lacked standing because he could not plausibly prove that he would rely on the “No Sugar Added” label in the future. (“[T]he Court finds that introducing evidence which merely shows an intent to purchase the product in the future, where the product itself remains the same, is not sufficient to confer standing for injunctive relief.” Rahman, 2014 WL 5282106 at *6, n. 4.) Thus, contrary to Judge Breyer’s opinion, at least where the packaging itself remains the same, Rahman suggests deceptive food labeling plaintiffs will always lack standing because “they won’t be fooled again,” resulting in an absurd outcome where a consumer essentially could never seek injunctive relief.

Authored By:
Robert Friedl, Senior Counsel
CAPSTONE LAW APC