Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—S.D. Ill.: Packaging of Grove Square individual coffee servings was not designed to mislead consumers, (Nov 22, 2013)

By Peter Reap, J.D., LL.M.

Reconsideration of the denial of class certification of various state consumer protection law claims brought by individuals who purchased Grove Square individual coffee cartridges against coffee manufacturer Sturm Foods, Inc. and its parent company, Treehouse Foods, Inc. (collectively, “Sturm”) was denied by the federal district court in East St. Louis, Illinois (Suchanek v. Sturm Foods, Inc., November 20, 2013, Murphy, G.). In addition, the claims of the individual plaintiffs that Sturm misrepresented the qualities of its coffee product were without merit because none of the plaintiffs demonstrated that their pecuniary loss was caused by Sturm’s fraud, deceit, or mislabeling. Thus, Sturm’s motion for summary judgment on the claims was granted.

Class certification. The crux of the plaintiffs’ request for reconsideration of the denial of certification was the Seventh Circuit Court of Appeal’s opinion in Butler v. Sears, Roebuck and Co., 727 F.3d 796 (7th Cir. 2013), the court noted. In Butler, the plaintiffs sought to certify classes bringing breach-of-warranty claims for defective washing machines. In finding class certification appropriate, Judge Posner wrote that common proof of damages amongst class members is not required to satisfy Rule 23(b).

In Butler, however, there was one “single, central, common issue of liability: whether the Sears washing machine was defective,” the court noted. Here, as discussed in the order denying class certification, the issue of liability required individualized inquiry. The problem here was not that proof of damages requires looking at each individual class member, for, as Butler made clear, that does not preclude predominance. The problem with the proposed class here was that showing reliance or causation—as required to establish liability—requires an investigation of each purchaser, the court explained. That problem would remain regardless of any subclass division.

Legal inquiries required to determine liability must predominate. They did not here, the court held. After considering all of the plaintiffs’ grounds for reconsideration of the order denying class certification, the court agreed with the reasoning and outcome of the order.

Summary judgment. Sturm asked the court to find that the Grove Square coffee packaging was not deceptive and did not injure the nine individually named plaintiffs. Sturm also argued that the plaintiffs could not prove successful claims under the state fraud laws. To this end, Sturm proceeded to challenge the claims of each plaintiff.

For example, according to Sturm: Charles Cardillo did not read the packaging prior to purchase or rely on packaging when he chose the product; Linda Suchanek read the term “soluble” on the package and understood that term meant the product dissolved in water; and Edna Avakian was not motivated to purchase the product because of any representation on the packaging.

The plaintiffs argued in response that Sturm mischaracterized their rationales for purchase by cherry-picking statements from their depositions. According to the plaintiffs:

“Defendants attempt to focus the Court’s attention on each purchasing decision of the individual consumer and thereby deflect the inquiry away from the central issue before the Court: under each states’ consumer protection statute, from an objective standpoint of a reasonable consumer, is the packaging of the Grove Square Coffees…deceptive or misleading, or did it have the capacity, likelihood or tendency to mislead the public?”

Therein lies the plaintiffs’ problem, the court commented. Each plaintiff did indeed need to show that he or she was deceived and that he or she suffered some injury from the misleading packaging, according to the court.

For example: Linda Suchanek must show some deceptive practice by the defendants, that the defendants intended her to rely on that deception, and that she incurred damages proximately caused by the deception. However, she understood the terms on the packaging and bought the product because of the price, the court noted. Edna Avakian thought the product was ground coffee, not instant, because it could be used in a Keurig brewing machine, but she stated in her deposition that she was motivated by the price and her desire to try new products. Thus, she could not prove the requisite causation or reliance, the court explained.

Summary judgment is “the ‘put up or shut up’ moment in a lawsuit, when a party must show what evidence it has that would convince a trier of fact to accept its version of events,” the court reasoned. Johnson v. Cambridge Indus., Inc., 325 F.3d 892, 901 (7th Cir. 2003). The court must, and did, look at any evidence in the light most favorable to the plaintiff, but when Sturm pointed out that there was an absence of evidence to support the nonmoving party’s case then summary judgment was appropriate. The plaintiffs did not show evidence to support their claims.

The court saw the packaging at issue—the plaintiffs brought it to each hearing—and determined that it was not designed to mislead consumers. It said what it was. Thus, judgment was proper as a matter of law because none of the plaintiffs showed their pecuniary loss was caused by the Sturm’s fraud, deceit, or mislabeling.

The case is Civil No. 11-565-GPM.

Attorneys: Randy L. Gori (Gori Julian and Associates P.C.) for Linda Suchanek. Michael M. Conway (Foley & Lardner) for Sturm Foods, Inc. and Treehouse Foods, Inc.

Companies: Sturm Foods, Inc.; Treehouse Foods, Inc.

Cases: StateUnfairTradePractices Advertising IllinoisNews