We recently read an editorial in The New York Times advocating lawsuits as a means of regulating an industry. Politicians are gripped by paralysis – so the argument goes – thus we must entrust the issue to litigators, smart judges, and good-hearted jurors. After all, hadn't years of product liability litigation resulted in safer products?
Well, ... no. Data doesn't show that litigation leads to safer products. Fewer products, probably. More expensive products, definitely. But litigation is a perfectly awful way to impose safety regulations on an industry. Say what you will about politicians, but at least they are somewhat representative of people's will. Say what you will about regulators, but at least they possess some expertise. If there is paralysis in the halls of a legislature or government agency, that paralysis reflects a lack of consensus, a clash of passions, or a genuine conflict in the science. Litigation is an eccentric means of ruling on general issues – it is off-center. The peculiarities of one lawyer's eloquence, or one judge's bent for social engineering or twelve jurors' emotions can produce a verdict with profoundly puzzling and profoundly enormous implications. It is a rotten way to lay out general safety rules. (Mind you, we are not talking about constitutional issues that may require judicial intervention.) The various say-sos of jurors or even judges can be unpredictable, unbalanced, and inconsistent. Lawsuits are not designed to determine safety science or policy. Instead, they resolve disputes between parties.
Enter the judicial doctrine of standing. You cannot pursue a lawsuit merely because you are sure you have the right idea of How It's Got to Be. Rather, you must be actually injured in fact. Injured sensibilities are not enough. Not every Nosy Nellie qualifies as a plaintiff. The doctrine of standing means that lawsuits pertain to actual disputes. Courtrooms are not debating societies. If there are judges anywhere in the land, say, in Brooklyn or Boston or Los Angeles or anywhere else who think they have a great idea about how to regulate consumer products, great; write a letter or comment to a legislator or regulator, but don't glom onto a lawsuit as a way of playing the role of Philosopher King. Maybe the judiciary is not always the "least dangerous branch," but limiting doctrines such as standing are intended to make it so.
Standing is the key issue in today's case, Debernardis v. IQ Formulations, LLC, 2018 U.S. Dist. LEXIS 52445 (S.D. Fla. March 29, 2018). Debernardis was a purported class action alleging that certain dietary supplements contained a stimulant that was unlawful and, therefore, rendered the supplements "adulterated" or "misbranded." The plaintiffs parsed the FDCA regulations to justify this allegation. While the FDCA does not provide for a private right of action, there are a number of state consumer protection laws that incorporate FDCA labelling provisions and provide a mechanism for private suits. Accordingly, the plaintiffs in Debernardis contended that the makers of the supplements had violated Florida, Illinois, and New York deceptive practices acts and other laws. The plaintiffs alleged that they suffered economic injury because they would not have purchased the supplements had they known that one of its ingredients had not been approved by the FDA. Importantly, the plaintiffs did not allege that they had suffered any physical harm or that the supplements did not work as advertised.
The defendants moved to dismiss the class complaint, arguing, inter alia, that the plaintiffs lacked standing to bring the action. The Debernardis court began with an overview of the standing requirement, describing the actual injury requirement, as well as the need for plaintiffs to demonstrate "a causal connection between the injury and the conduct complained of." As we argued in a recent post, it is remarkable how many cases come down to the issue of causation. The Debernardis court also mentioned the requirement that plaintiffs must show "a likelihood that a court ruling in [the plaintiff's] favor would remedy [his] injury." These standing requirements are in no way relaxed for class actions. The named plaintiffs still must still allege that they personally have been injured such as to satisfy the test for standing.
We are pleased to report that the key standing cases cited by the defendants in Debernardis were three cases residing within the Third Circuit. One in particular, Hubert v. Gen. Nutrition Corp., 2017 WL 3971912 (W.D. Pa. Sept. 8, 2017), was very similar to Debernardis and arrived at a dismissal for want of standing. In Hubert, the plaintiffs offered only a "threadbare allegation" that they paid more for supplements than they would have if the supplements had been accurately labeled. Without supporting factual allegations, such conclusory statements did not establish injury in fact. Moreover, the Hubert court rejected a benefit-of-the-bargain theory because the plaintiffs alleged no adverse health consequences nor that the supplements failed to perform as advertised. Exactly the same weaknesses bedeviled the Debernardis complaint. No actual, concrete injury was set forth in the complaint. (The plaintiffs in Debernardis relied on two cases from the Eleventh Circuit. That circuit was the winner of a big, fat No-Prize from us last year, as it generated the most cases in our Bottom Ten list. In any event, the Eleventh Circuit cases had some meat to their price differential theories – something wholly lacking in Debernardis.)
The Debernardis court confronted the issue of standing squarely and concluded that the plaintiffs did not have it: "The broad claim that they would not have purchased the Supplements at all had they known that [the defendant] had failed to follow the FDA's approval procedure regarding an ingredient is insufficient to confer standing." Similar reasoning might apply to some of the drug and device cases we encounter.
This article is presented for informational purposes only and is not intended to constitute legal advice.
