On November 9, 2020, Judge Jeffrey Miller of the Southern District of California certified a class of California citizens alleging that Kroger violated various California consumer protection laws by mislabeling its breadcrumbs. The court rejected Kroger’s numerous arguments against certification, including its assertion that the Plaintiff could not show typicality because of unique reliance issues.

• Plaintiff Shavonda Hawkins purchased Kroger breadcrumbs about six times per year from 2000 to July 2015. According to the complaint, during much of that period the breadcrumbs were made with partially hydrogenated oil (“PHO”)—an ingredient that contains trace levels of trans fat—but were labeled on the front label as “0g Trans Fat” beginning in 2008. Plaintiff alleged violations of California’s False Advertising Law, Unfair Competition Law, and Consumer Legal Remedies Act, and she also asserted breach of warranty claims. She ultimately moved for class certification under Rule 23(b)(3).
• Kroger raised a number of challenges to certification. The first focused on Plaintiff’s proposed class of “[a]ll citizens of California who purchased, between January 1, 2010 and December 31, 2015, Kroger Bread Crumb containing [PHO] and the front label claim 0g Trans Fat.” That definition was substantially narrower than the two proposed nationwide classes that Plaintiff asserted in her complaint. Despite Plaintiff’s lack of any explanation as to why she waited four years to assert a narrower class, the court accepted this definition because courts in the district typically permit plaintiffs to narrow—but not broaden—a class definition without seeking leave to amend, and Kroger failed to establish any prejudice.
• The court then addressed whether Plaintiff satisfied Rule 23(a)’s requirements. The parties primarily disputed the typicality requirement. Kroger argued that the Plaintiff’s claims were not typical of those she sought to represent because she was subject to unique defenses related to reliance/causation and the statute of limitations. The court agreed with Plaintiff on both arguments.
  • As for reliance and causation, Plaintiff admitted that her buying habits “pretty much” remained the same between 2000 and 2015. Kroger asserted that this admission proved that she did not actually rely on the allegedly false “0g Trans Fat” representation when making her purchase, as she began purchasing the product eight years before the “0g Trans Fat” representation was added to the product label. The court rejected that argument, crediting Plaintiff’s sworn statements that she relied on the label and that the “0g Trans Fat” representation was a material factor in her purchase decisions. The court also found that many class members would likely be subject to the same defense because they would not have spent much time contemplating the label when making a purchasing decision.
  • The court also rejected Kroger’s statute-of-limitations argument, which focused on Plaintiff’s purported admission that she knew or should have known as early as 2005 that the breadcrumbs contained trans fats. The court found that Plaintiff did not actually admit this point during her deposition.
• In concluding that the Rule 23(b)(3) requirements of predominance and superiority were also satisfied, the court permitted the Plaintiff’s “full restitution” damages model to proceed. Kroger argued that predominance is not satisfied in “full restitution” cases if the named plaintiff or class members received some value from the product. The court nevertheless accepted Plaintiff’s argument that the breadcrumbs were “so dangerous” that “any value she obtained by consuming the breadcrumbs was erased when she found out they contained trans fat,” and “any value class members received will be erased when they find out the same.”
• The court’s typicality analysis provides an example of the low evidentiary bar sometimes imposed in consumer fraud cases in which a plaintiff contends that an allegedly misleading representation was a “material” factor in his or her purchase decision (even if the facts of their purchase suggest the opposite). Indeed, in support of its ruling, the court cited “100% Natural” caselaw in which plaintiffs were found to have adequately alleged reliance and injury even though they continued to purchase the product after they filed suit (i.e., after they learned “the truth” about the allegedly deceptive labeling).
• The court’s embrace of a “full restitution” model is even more noteworthy because it cuts against a long line of cases rejecting identical models where, as here, the deceptively labeled product was consumed (or otherwise used) without incident and otherwise provided at least some value to the plaintiff. Not only does this flawed damages model dramatically increase the amount of damages, it also eliminates a significant obstacle to class certification by providing an easy-to-calculate and “uniform” measure of class-wide damages.
• The case is Hawkins v. Kroger Company, No. 15-cv-2320, and you can read more here.