Lawyers bringing a class of potentially tens of millions of consumers who claim they were misled about the health benefits of drinking pomegranate juice have no way to prove damages, attorneys for POM Wonderful LLC told a federal judge on Monday.
POM’s attorneys moved to decertify the nationwide class of consumers based on recent U.S. Supreme Court precedent and the asserted failure of plaintiffs attorneys to establish a valid damages model 1 1/2 years after certification.
“If you didn’t see the allegedly false ad, there’s no conceivable way you could be injured,” said T. Robert Scarborough, a partner at Chicago’s Sidley Austin.
But plaintiffs lawyer Behram Parekh, of counsel at Los Angeles-based Kirtland & Packard, argued that consumers would not have paid so much for POM’s juice but for the alleged misrepresentations that it prevents heart disease, erectile dysfunction and certain cancers.
Although he didn’t rule on POM’s motion, U.S. District Judge Dean Pregerson appeared skeptical that the plaintiffs could establish that class members bought the juice only for its various health benefits—as opposed to its taste, color, location on the shelf or other reasons. Pregerson asked both sides whether class certification was the appropriate stage in a case to consider how a potential claims process would even work.
The class action, filed under California’s consumer laws, is one of several court battles that POM faces over its health claims.
On Sept. 28, 2012, Pregerson certified a class of consumers who purchased POM’s juice between October 2005 and September 2010. POM moved to decertify the class on Nov. 8 based on the U.S. Supreme Court’s Comcast v. Behrend decision on March 27 of last year. In that case, the high court decertified an antitrust class action because its damages model wasn’t sufficient.
POM specifically challenged two plaintiffs theories on damages: One would provide full refunds to class members exposed to allegedly misleading advertisements, while the other centered on the “premium” price that consumers paid based on those advertisements.
Calling the premium price model “eighth grade math,” Scarborough argued that the price of POM’s juice was due to higher costs of production and marketing, not the claims in its advertisements. He also criticized the plaintiffs’ assumption that all class members would have been exposed to its ads or purchased POM’s juice because of them.
Parekh countered that POM’s principals, Stewart and Lynda Resnick, created the entire market for pomegranate juice through its advertising campaign.
“This is a product that did not exist for sale in the United States until POM started marketing it,” he said.
He disagreed on Pom’s interpretation of Comcast and defended both damages models. The premium price model, for instance, compares how much POM could have sold its juice for absent the health claims.
In addition to the class action, POM is set to make oral arguments on April 21 before the U.S. Supreme Court in a case against The Coca-Cola Co., whose Minute Maid subsidiary marketed a pomegranate flavored juice, in which U.S. District Judge S. James Otero in Los Angeles found POM’s federal trademark infringement claims were precluded by the U.S. Food, Drug and Cosmetic Act.
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