The Northern District of Illinois recently waded into the conflict between standing and class certification when it held that a putative class representative must demonstrate standing to assert each claim before the motion for class certification. In the case, plaintiff Michael Muir filed a putative class action against herbal supplement manufacturer Nature's Bounty for claims related to an alleged misrepresentation regarding an ingredient's prevalence in the supplement. Muir proposed three distinct classes: (1) a nationwide class of every consumer who had purchased the supplement within the last four years; (2) purchasers in states with similar consumer fraud statutes allegedly violated by the misrepresentation; and (3) Illinois purchasers of the supplement. The court dismissed the proposed nationwide and multi-state consumer classes.
The court dismissed the nationwide class claims because Muir could not maintain a nationwide class applying the law of Illinois. As a federal court sitting in Illinois, the court applied Illinois choice of law rules, which are based on a "most significant relationship" test. In consumer fraud actions, where a plaintiff purchases a product in his home state based on representations he received in his home state, the test directs application of the home state's substantive law. Here, that test required application of the law of the state where the consumer purchased the herbal supplement because the "representation" that the supplement contains a certain percentage of an ingredient occurs on the bottle, which was located in the state where the consumer purchased the supplement. The court also ruled that a potential conflict existed among the various states' substantive laws on unjust enrichment claims because some states required a "direct benefit" to the defendant from a plaintiff's purchase.
Next, the court dismissed the multi-state consumer class because Muir lacked standing to assert claims pursuant to non-Illinois state consumer fraud laws. The court acknowledged that other Northern District of Illinois judges have split on the question of whether a named plaintiff must demonstrate his or her own standing under various states' laws identified in a complaint, or whether the unnamed class members' standing suffices. It analyzed Supreme Court precedent in Amchem and Ortiz, as well as Seventh Circuit precedent in Payton v. County of Kane, before reaching this conclusion. It read Amchem and Ortiz as consistent with the "ordinary primacy of the standing question" and the "general rule that a plaintiff must establish her own standing." And while Payton lends some support to the argument that standing questions may be delayed until class certification, the court distinguished that case on its facts. Whereas in Payton the named plaintiffs had the very same claims as unnamed class members and sued pursuant to the same state statute, Muir's individual claim under the Illinois Consumer Fraud Act was different from those unnamed class members' claims under their respective state consumer fraud laws. Because Muir could not demonstrate standing under the non-Illinois state consumer fraud laws, the court dismissed the multi-state class claims without prejudice.
Muir v. Nature's Bounty, Inc., Case No. 15-9835 (N.D. Ill. Sept. 28, 2017)
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
