Antitrust Law Daily Wrap Up, ADVERTISING—N.D. Ill.: Class action against supplement manufacturer dismissed for lack of standing, (Sep 11, 2025)

By Kenneth H. Ryesky, M.B.A., J.D.

Complaint included screenshots of Instagram posts by paid influencers that did not disclose the influencers' economic relationship with the manufacturer.

The federal district court in Chicago, Illinois has granted dismissal of a putative class action brought against a nutritional supplement manufacturer and the social media influencers the manufacturer allegedly pays to promote its wares to the public. The individual bringing the complaint was found to lack the requisite Article III standing because she did not plausibly allege actual or prospective injury in purchasing products that were promoted on social media by influencers who had been remunerated to do so by the manufacturer, notwithstanding that the economic relationship between the manufacturer and the influencers arguably was required by regulation to be disclosed on social media. Having found that the plaintiff lacked standing to bring the lawsuit, the court had no jurisdiction to hear the case and thus concluded its analysis. Over the defendants' objections, the court nevertheless granted the individual leave to amend the complaint because an amendment of course to the original complaint had not been made [Fed. R. Civ. P. 15(a)(1) and the individual was entitled to "at least one opportunity to amend a complaint" (Simoni v. Hi-Tech Pharmaceuticals, Inc., No. 1:25-cv-00795 (N.D. Ill. Sept. 10, 2025)).

Background. Internet social media has become the primary source of information and communication for billions of individuals. Meta Platforms, Inc. (Meta) has emerged as a giant social media conglomerate; one of Meta's social media operations is Instagram, which has more than one billion users worldwide. Some individual social media users have managed to attract large audiences who follow their social media accounts; such users are often referred to as "influencers" because they exert significant sway in their specific topic, ideology, or industry niche. Such influencers are often remunerated to promote the products or services of various entrepreneurs.

The FTC has promulgated regulations that are relevant to influencers on social media, including a rule requiring clear and conspicuous disclosure of "a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement" that might otherwise not be obvious to the targeted audience.

Related companies Hi-Tech Pharmaceuticals, Inc. and Hi-Tech Nutraceuticals, LLC (collectively, Hi-Tech) manufacture and distribute pharmaceuticals and nutritional supplements. Hi-Tech has no brick-and-mortar stores; its sales are totally done via the Internet. Hi-Tech engages influencers to promote its products on social media.

An individual Instagram user (Simoni) who had purchased three Hi-Tech products filed a putative class action lawsuit in federal district court against Hi-Tech and ten Instagram influencers engaged by Hi-Tech, alleging that the economic relationship between Hi-Tech and each respective influencer was not disclosed in the Instagram posts that induced Simoni to purchase the Hi-Tech nutritional products. Simoni's complaint alleged (1) unfair methods of competition under the FTC Act; (2) violation of the Illinois Consumer Fraud and Deceptive Business Practices Act (ICFA); (3) violation of the Illinois Uniform Deceptive Practices Act (DTPA); (4) unjust enrichment; and (5) negligent misrepresentation. Hi-Tech and the influencers moved to dismiss the complaint.

Analysis. The judge ruled that Simoni failed to plausibly allege standing to bring the lawsuit. Specifically, Simoni did not allege that she had been harmed by the actions or inactions of Hi-Tech or the influencers. Simoni alleged that from viewing the Instagram posts, she "was unable to discern the fact that those posts were paid endorsements, rather than organic, honest recommendations by the Influencers" and that she and the proposed class members "paid more than what they would have otherwise paid had they know [sic] the true nature of the product." This did not constitute an allegation of economic harm because Simoni did not allege that the products she purchased were defective or substandard, or functioned in any manner below her expectations when she purchased the products. Buyer's remorse, without more, does not constitute economic harm upon which to base Article III standing to bring the lawsuit.

As for the defendants' alleged failure to comply with the FTC regulation, this does not in and of itself amount to the concrete, particularized injury necessary to confer Article III standing.

The Case is No. 1:25-cv-00795.

Judge: Jenkins, L.

Attorneys: Keith L. Gibson (Keith Gibson Law, P.C.) for Jennifer Simoni. John T. Gabrielides (Barnes & Thornburg LLP) for Hi-Tech Pharmaceuticals Inc.

Companies: Hi-Tech Pharmaceuticals Inc.

Cases: Advertising StateUnfairTradePractices IllinoisNews