Antitrust Law Daily Wrap Up, ADVERTISING—2d Cir.: Clinique and Estee Lauder avoid consumer fraud claims, (Jul 11, 2014)

By Greg Hammond, J.D.

Cosmetic consumers of the “Repairwear” product line marketed by Clinique Laboratories, LLC and Estee Lauder Companies, Inc. (collectively, Clinique) have failed to state claims under Connecticut, New Jersey, and Illinois consumer fraud statutes. In affirming the district court’s decision and order dismissing the consumer’s class action complaint with prejudice, the U.S. Court of Appeals in New York determined that the consumers failed to plead their fraud claims in their fourth amended complaint with sufficient particularity (DiMuro v. Clinique Laboratories, LLC, July 10, 2014, Per Curiam).

Consumer fraud claims. Under Federal Rule of Civil Procedure 9(b), a consumer fraud claim must (1) specify the statements that the plaintiff contends were fraudulent, (2) identify the speaker, (3) state where and when the statements were made, and (4) explain why the statements were fraudulent. In this case, the consumers’ consolidated complaint was “wholly conclusory” and lacked the particularity required under Rule 9(b) to provide Clinique with fair notice of their consumer fraud claims, the court noted.

Specifically, the court determined that the consumers failed to: (1) specify any of Clinique’s alleged statements that were fraudulent and with regard to a specific product; (2) provide any factual allegation explaining how Clinique’s specific advertising claims were fraudulent; and (3) allege that any of the consumers actually used Clinique’s Repairwear products, used them as directed, or what specific benefits the consumers expected to receive from the products based on Clinique’s allegedly false advertising claims.

In addition, the court rejected the consumers’ argument that the district court erred in denying their request for leave to amend the complaint. The court concluded that the district court did not abuse its discretion because (1) the consumers failed to set forth any facts that could be alleged to cure their pleading deficiencies and (2) a fifth amended complaint would not likely cure the deficiencies.

The case number is 13-4551-cv.

Attorneys: Erin Green Comite (Scott + Scott LLP), Adam J. Levitt (Grant & Eisenhofer P.A.), and James E. Cecchi (Olstein, Brody & Agnello, P.C.) for Ellen Macklin Dimuro, Margaret Ohayon, and Dana Stein. Kenneth A. Plevan, Boris Bershteyn, and Xiyin Tang (Skadden, Arps, Slate, Meagher & Flom LLP), and David R. Schaefer and Sean M. Fisher (Brenner, Saltzman & Wallman LLP) for Clinique Laboratories, LLC and Estee Lauder Companies, Inc.

Companies: Clinique Laboratories, LLC; Estee Lauder Companies, Inc.

Cases: Advertising StateUnfairTradePractices ConnecticutNews NewYorkNews VermontNews