Degelmann v. Advanced Medical Optics applies Kwikset to support UCL standing but finds medical device preemption applies

I've been swamped at work, so posts around here have been few and far between.  But there haven't been many class-related decisions to write about either, so maybe you didn't miss much.  Today, however, when the legal profession is repenting, I at least have some time to write.  In Degelmann v. Advanced Medical Optics (9th Cir. Sept. 28, 2011), the Ninth Circuit examined UCL standing and medical device preemption.  In Degelmann, the plaintiffs sought to represent a putative class of purchasers of contact lens solution. Their suit alleged that defendant violated California’s Unfair Competition Law (“UCL”) and False Advertising Law (“FAL”) by marketing Complete MoisturePlus (“MoisturePlus”) as a product that cleans and disinfects lenses. The district court granted defendant's motion for summary judgment, ruling that plaintiffs lacked standing.

First, the Court examined the plaintiffs' standing under the UCL:

Here, as in Kwikset, the plaintiffs allege that they paid more for a product due to reliance on false advertising. The district court in this case was likely correct that Degelmann and Lin would have bought other contact lens solution had they not purchased MoisturePlus. However, as elucidated by the Kwikset court’s discussion, it does not necessarily follow that they did not suffer economic harm. Degelmann and Lin presented evidence that they were deceived into purchasing a product that did not disinfect as well as it represented. Had the product been labeled accurately, they would not have been willing to pay as much for it as they did, or would have refused to purchase the product altogether. The district court’s reasoning—that class members would have bought other contact lens solution, and therefore suffered no economic harm— conceived of injury in fact too narrowly.

Slip op., at 18565.  In that same discussion, the Court distinguished Birdsong v. Apple, Inc.:

The inquiry into injury in fact in this case, where the class makes claims under both the UCL’s fraud prong and the FAL, is not controlled by Birdsong v. Apple, Inc., 590 F.3d 955 (9th Cir. 2009). In that case, purchasers of iPod headphones pursued a claim under the UCL’s “unfair” and “unlawful” prongs, asserting that listening to loud music on the headphones could result in hearing loss. They did not allege economic harm from having purchased headphones in reliance on false advertising, but rather claimed that the inherent risk of the headphones reduced the value of their purchase and deprived plaintiffs of the benefit of their bargain. Id. at 961. The court in that case found that the claim of economic harm was not sufficient to plead injury in fact in part because, in distinct contrast to the MoisturePlus labeling at issue in this case, Apple had not represented that the headphones were safe at high volume. Rather, “Apple provided a warning against listening to music at loud volumes.” Id. Because there is allegedly false labeling and advertising at issue in this case, Birdsong does not aid our disposition here.

Slip op., at 18565-66.  So far, so good for the plaintiffs.  But then the Court discusses preemption.  The Court found that the lens solution at issue satisfied FDA requirements for labelling contact lens solution.  The Court concluded that, having met the standard, the UCL and FAL would necessarily have to impose additional obligations in order for the plaintiffs to state any claim, which would then invoke preemption, immediately precluding the claim:

In order for the class to recover in this lawsuit, a court would have to hold that California’s UCL and FAL required something different than what the FDA required in order for AMO to label MoisturePlus a disinfectant. Those California laws would have to require that AMO test for Acanthamoeba, and show that MoisturePlus kills it in sufficient quantities. That is, California law would have a requirement that is additional to the federal requirements.

Slip op., at 18569.  And that, as they say, was that.  You have standing, but you lose.  At least it's good to have some guidance from the Ninth Circuit on the application of Kwikset to federal standing arguments.

Consumer Attorneys of San Diego present the 4th Annual Class Action Symposium

A combination of being buried at work and precious few appellate decisions filled with class action gold have made things a little slow around here.  But now I've got something for you.   The Consumer Attorneys of San Diego are presenting their 4th Annual Class Action Symposium on Friday, October 14, 2011 and Saturday, October 15, 2011, at the Hilton San Diego Bayfront, 1 Park Blvd.

The Hilton San Diego Bayfront Hotel is the newest waterfront hotel located directly adjacent to the Padre Stadium and a short walk from downtown’s Gaslamp Quarter and East Village.

Good for 10.0 General Credits and 1.0 Ethics MCLE Credit, the Symposium will include an impressive lineup of speakers.  The panel speakers will address topics such as: Class Arbitration, Dukes, Ticketmaster, and Damages and Equitable Relief, just to name a few.  Featured speakers include: Arthur Bryant of Public Justice, the nation's leading lawyer on the issue of class wide arbitration, Judge Vaughn Walker (Ret.), whose creative legal mind will help navigate emerging complex cases and activist Harvey Rosenfield, founder of Consumer Watchdog, to put it all in perspective.  I will be speaking there too, but you should sign up anyhow.

A little antitrust nugget in the movie theater business...

This one entertains me becaues it faintly evokes the studio system of the 1930's and the decades of antitrust action by the FTC, with United States v. Paramount Pictures, 334 U.S. 131 (1948) stealing a good deal of the spotlight.  It's not quite as big as Paramount, but it's what we have.  In Flagship Theaters of Palm Desert LLC v. Century Theaters, Inc. (August 31, 2011), the Court of Appeal (Second Appellate District, Division One) considered an appeal of a summary judgment ruling that ended Flagship's antitrust action.  The allegations were summarized by the Court:

Flagship filed this antitrust action against Century and two film distributors, alleging that Century has used the power deriving from both the size of its theater circuit and its many theaters in noncompetitive markets to undermine the competitive process through which theaters bid for and obtain licenses to exhibit first-run films. According to Flagship, under previous ownership the River and the Palme obtained roughly equal numbers of first-run films, but under Century the River now obtains licenses for far more first-run films than the Palme, the few that are left to the Palme are commercially inferior, and the imbalance is not based on the relative merits of the Palme's and the River's bids. On the contrary, according to Flagship, superior bids by the Palme are often rejected in favor of inferior bids by the River as a result of Century's abuse of the power of its circuit

Slip op., at 2.  I'm not going to cover the Court's interesting attempt to assess the current state of unlawful circuit dealing under the Sherman Act and the Cartwright Act.  But if you practice or dabble in antitrust law, this is like a brief history lesson centered around the movie distribution world.  I will note, however, that the Court wasn't thrilled with all of the sealed documents the Court received and later concluded were not appropriately classified as confidential.