Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—M.D. Fla.: ‘Flushable’ wipes consumers’ damages theory too speculative, (Feb 23, 2016)

By Greg Hammond, J.D.

Consumers lacked standing to bring a Florida Deceptive and Unfair Trade Practices Act (FDUTPA) claim based on their purchase of “flushable” wipes that they contended were not actually flushable. Noting that the consumers continued to purchase the wipes for “esthetic” reasons after learning that the wipes were not flushable, the federal district court in Tampa concluded that the consumers’ theory of damages was too speculative to satisfy the requirements of Article III because the court would have to calculate the hypothetical price at which the “flushable” wipes should sell, absent the representation that they were “flushable.” Summary judgment was therefore granted with regard to the FDUTPA claim (Sweeney v. Kimberly-Clark Corp., February 22, 2016, Kovachevich, E.).

The consumers filed a class action against Kimberly-Clark Corp., Wal-Mart Stores, Inc., and Rockline Industries, Inc., alleging that they made several purchases of Cottonelle and Equate brand “flushable” wipes, but that the wipes clogged their pipes. Nevertheless, the consumers continued to purchase the flushable wipes because they were “smaller and more esthetically pleasing.” The defendants moved for dismissal or, in the alternative, for summary judgment on the FDUTPA and other claims.

Treating the motion as a motion for summary judgment, the court concluded that the consumers lacked standing to prosecute their FDUTPA claim under a “price premium” theory of damages. The plaintiffs claimed that, absent and but for the defendants’ false and deceptive representations, they would not have purchased the defendants’ flushable wipes, or paid a higher price for the flushable wipes rather than purchasing lower cost wipes not marketed, labeled, and represented to be flushable. However, the fact that the consumers continued to purchase and use the defendants’ “flushable” wipes made the consumers’ theory of damages too speculative to constitute an actual injury under Article III, the court concluded.

The consumers were not actually seeking damages under a “price premium” theory, the court noted. Rather, they appeared to believe that they should pay less for the flushable wipes because they were paying for, but not receiving, the attribute of “flushability.” Under this theory, the consumers’ measure of damages was the hypothetical price that the flushable wipes should sell for if marketed as non-flushable. The court concluded that it would have to quantify how much of the wipes’ value was attributable to their flushability versus how much of their value was attributable to esthetics, which was too speculative to be the premise of an actual injury under Article III.

The case is No. 8:14-cv-3201-T-17EAJ.

Attorneys: Anthony Garcia (AG Law, Inc.) for Dennis Patrick Sweeney, Jr. Chris S. Coutroulis (Carlton Fields Jorden Burt, PA) for Kimberly-Clark Corp. Gregory W. Kehoe (Greenberg Traurig LLP) for Wal-Mart Stores, Inc. Douglas B. Brown (Rumberger, Kirk & Caldwell, PA) for Rockline Industries, Inc.

Companies: Kimberly-Clark Corp.; Wal-Mart Stores, Inc.; Rockline Industries, Inc.

Cases: Advertising StateUnfairTradePractices FloridaNews