18th Annual Workplace Class Action Report - 2022 Edition

520 Annual Workplace Class Action Litigation Report: 2022 Edition (xxviii) Consumer Fraud Class Actions Aleisa, et al. v. GOJO Industries, Inc., 2021 U.S. Dist. LEXIS 89390 (N.D. Ohio May 11, 2021). Plaintiffs, a group of consumers who purchased Defendant’s hand sanitizer in New York and California, bought a putative class action alleging violations of state marketing and consumer protection laws. Plaintiffs’ complaint alleged that there was no evidence that Defendant’s hand sanitizer prevented the flu and other viruses or reduced infection from the flu and other viruses as advertised. Plaintiffs asserted that Defendant knew or should have known that its representations were false or misleading, and claimed that they would not have purchased the hand sanitizer had they known of Defendant’s allegedly deceptive advertising. To support this allegation and their claims, Plaintiffs relied on three sets of materials, including an FDA warning letter that related to a different product line marketed for different uses that no Plaintiff claimed to have purchased. Defendant moved to dismiss pursuant to Rule 12(b)(1), on the grounds that Plaintiffs lacked Article III standing. The Court agreed with Defendant that Plaintiffs had failed to allege a particularized and concrete injury, and granted the motion to dismiss. In its ruling, the Court concluded that Plaintiffs’ attempts to re-define or re-characterize their otherwise deficient product liability claims as violations of state marketing and consumer protection laws resulted in their failure to allege an injury within the meaning of Article III. Basing their causes of action on what they claimed was false and misleading advertising touting the product as effective at killing 99.99% of germs, Plaintiffs claimed they would not have bought the product at all, and certainly not at the price they paid for it and as a result, they maintained that they were overcharged. Further, Plaintiffs sought injunctive relief. However, the Court agreed with Defendant that Plaintiffs claims as alleged did not state an injury that gave Plaintiffs standing to pursue their case. Indeed, the Court agreed that on the face of the consolidated amended complaint, Plaintiffs attempted to proceed on the basis of facts and representations that had nothing to do with the product they purchased. Instead, the Court found that they relied on regulatory action involving a different product that had, at best, a remote connection to the causes of action they asserted or the injury they claimed. Thus, taking the record in the light most favorable to Plaintiffs, the Court held that Plaintiffs failed to allege standing under Article III and, in particular, that they suffered a concrete and particularized injury on each of the three theories that they alleged. As to their request for injunctive relief, the Court found it difficult to see how Plaintiffs had standing to seek an injunction where they lacked standing to maintain a no-injury class substituting for product liability claims. Based on the allegations in the complaint, the Court opined that it was unable to identify any allegation of an actual or threatened injury that conferred standing. In sum, the Court ruled that Plaintiffs’ complaint failed to establish that Plaintiffs suffered any injury entitling them to maintain the lawsuit. For these reasons, the Court granted Defendant’s motion to dismiss pursuant to Rule 12(b)(1). Alig, et al. v. Quicken Loans Inc., 2021 U.S. App. LEXIS 6992 (4th Cir. March 10, 2021). Plaintiffs, a group of homeowners who refinanced their mortgages with Defendant Quicken Loans Inc., filed a class action alleging that Quicken Loans and Defendant Title Source, Inc. (“TSI”) conspired to pressure home appraisers to raise their appraisal values, thereby allowing Quicken Loans to obtain higher loan values. According to Plaintiffs, Quicken Loans would relay a borrower’s estimated home value to TSI, which would subsequently pass the estimate to an appraiser. If the appraiser’s value came back lower than the borrower’s estimated value, Defendants would allegedly pressure the appraiser to raise their value to Defendants’ “requested value,” i.e. , the borrower’s estimated value. Id. at *3-4. Plaintiffs asserted claims for breach of contract and unconscionable inducement under the West Virginia Consumer Credit and Protection Act. The District Court granted class certification, and then Plaintiffs moved for summary judgment on their claims. The District Court also granted this motion and awarded $9,691,500 in statutory damages and $968,702.95 in damages for breach of contract. Defendants appealed the District Court’s class certification and summary judgment orders, and the Fourth Circuit affirmed in part and vacated in part. With respect to class certification, Defendants argued that individual issues predominated over common ones, which precluded class treatment. However, the Fourth Circuit agreed with the District Court’s conclusion that the key determination in this case – whether Defendants’ value estimation practices amounted to unconscionable conduct – concerned Defendants’ behavior solely and thus implicated common questions of law and fact. Id. at *11. Defendants alternatively contended that Plaintiffs lacked Article III standing since certain class members did not suffer an injury, but the Fourth Circuit found that Plaintiffs satisfied this requirement because they paid an average of $350 for an “independent appraisal,” whereas they actually received appraisals that were “tainted” by Defendants. Id. at *13. In terms of the summary judgment order, the Fourth Circuit held that the District Court prematurely awarded summary judgment to Plaintiffs on their breach of contract claim. Specifically, the District Court found that a contractual obligation was