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Korolshteyn v. Costco Wholesale Corp.

United States District Court, S.D. California

March 16, 2017

TATIANA KOROLSHTEYN, on behalf of herself and all others similarly situated, Plaintiff,


          Hon. Cathy Ann Bencivengo United States District Judge.

         This matter is before the Court on Plaintiff's motion for class certification. The motion has been fully briefed, and the Court deems it suitable for submission without oral argument. As discussed below, the motion is granted.

         I. Background

         This case arises out of Defendants' alleged false statements about the health benefits of TruNature Gingko Biloba with Vinpocetine (“TruNature Gingko”), which is manufactured by Defendant NBTY, Inc. (“NBTY”) and sold at the stores of Defendant Costco Wholesale Corporation (“Costco”). The labels of TruNature Gingko represent that the product “supports alertness & memory, ” that “Gingko biloba can help with mental clarity and memory, ” and that “[i]t also helps maintain healthy blood flow to the brain to assist mental clarity and memory, especially occasional mild memory problems associated with aging.” [Doc. No. 100 at ¶ 1.] According to the TAC, these representations are false because studies show that gingko biloba and vinpocetine do not provide any mental clarity, memory or mental alertness benefits. [Id. at ¶ 2.] Plaintiff Tatiana Korolshteyn alleges she bought a bottle of TruNature Gingko based on the allegedly false representations on the product label and filed this lawsuit on behalf of herself and a putative class of consumers who purchased TruNature Gingko in California. The TAC asserts two claims: (1) violation of California's unfair competition law (the “UCL”), California Business & Professions Code § 17200 et seq.; and (2) violation of California's Consumer Legal Remedies Act (“CLRA”), California Civil Code § 1750 et seq. The prayer for relief asks for restitution and disgorgement of Defendants' revenues, actual, statutory and punitive damages, and attorneys' fees and costs. [Id. at p. 15.] She now moves to certify a class.

         II. Legal Standard for Class Certification

         “The class action is an exception to the usual rule that litigation is conducted by and on behalf of the individual named parties only.” Wal-Mart v. Dukes, 564 U.S. 338, 348 (2011) (internal quotation marks omitted). “Parties seeking class certification must satisfy each of the four requirements of [Federal Rule of Civil Procedure] 23(a) . . . and at least one of the requirements of Rule 23(b).” Briseno v. ConAgra Foods, Inc., 844 F.3d 1121, 1124 (9th Cir. 2017). “Rule 23(a) states four threshold requirements applicable to all class actions: (1) numerosity (a class so large that joinder of all members is impracticable); (2) commonality (questions of law or fact common to the class); (3) typicality (named parties' claims or defenses are typical of the class); and (4) adequacy of representation (representatives will fairly and adequately protect the interests of the class). Amchem Prods, Inc. v. Windsor, 521 U.S. 591, 613 (1997) (internal quotation marks, brackets, and ellipses omitted).

         Plaintiff here contends that in addition to satisfying these four Rule 23(a) requirements, class certification is warranted under Rule 23(b)(3). Rule 23(b)(3) “requires that common questions of law or fact found under Rule 23(a)(2) ‘predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy.'” Torres v. Mercer Canyons Inc., 835 F.3d 1125, 1132 (9th Cir. 2016).

         In considering class certification, district courts must engage in “a rigorous analysis” to determine whether “the prerequisites of Rule 23(a) have been satisfied.” Dukes, 564 U.S. at 350-51 (citing Gen. Tel. Co. of the Sw. v. Falcon, 457 U.S. 147, 161 (1982)). “[T]he merits of the class members' substantive claims are often highly relevant when determining whether to certify a class.” Ellis v. Costco Wholesale Corp., 657 F.3d 970, 981 (9th Cir. 2011). Thus, “a district court must consider the merits if they overlap with the Rule 23(a) requirements.” Id. (emphasis in original). At the same time, courts “consider merits questions at the class certification stage only to the extent they are relevant to whether Rule 23 requirements have been met.” Torres, 835 F.3d at 1133 (emphasis added). “While some evaluation of the merits frequently cannot be helped in evaluating commonality, that likelihood of overlap with the merits is no license to engage in free-ranging merits inquiries at the certification stage.” Stockwell v. City & Cty. of San Francisco, 749 F.3d 1107, 1111 (9th Cir. 2014) (internal quotation marks and citation omitted). “A court, when asked to certify a class, is merely to decide a suitable method of adjudicating the case and should not turn class certification into a mini-trial on the merits.” Edwards v. First Am. Corp., 798 F.3d 1172, 1178 (9th Cir. 2015).

         III. Motions to Exclude or Strike Declarations and Expert Reports

         “On a motion for class certification, the Court makes no findings of fact and announces no ultimate conclusions on Plaintiffs' claims.” Keilholtz v. Lennox Hearth Prod. Inc., 268 F.R.D. 330, 337 (N.D. Cal. 2010). Thus, at the class certification stage, “the Court may consider evidence that may not be admissible at trial.” Aguirre v. Genesis Logistics, No. SACV1200687JVSANX, 2016 WL 6573986, at *2 (C.D. Cal. July 20, 2016). One court even noted that a “district court may certify a class without supporting evidence.” Dominguez v. Schwarzenegger, 270 F.R.D. 477, 483 n.5 (N.D. Cal. 2010) (citing Hanon v. Dataproducts Corp., 976 F.2d 497, 509 (9th Cir. 1992)). “Accordingly, the court need not address the ultimate admissibility of the parties' proffered exhibits, documents and testimony at this stage, and may consider them where necessary for resolution of the motion for class certification.” Aguirre, 2016 WL 6573986, at *2 (internal quotation marks and brackets omitted).

         Here, in conjunction with the motion, the parties have combined to submit numerous declarations and expert reports and dozens of exhibits that they claim support their arguments for or against class certification. Perhaps unsurprisingly, these voluminous evidentiary submissions have yielded three separate motions to exclude the reports or declarations of four different experts or witnesses purportedly offering expert testimony. That the evidence does or does not support the putative class' claims is a separate question from whether a plaintiff may assert those claims on behalf of a class. The parties may disagree about the admissibility various expert reports and other declarations, but the admissibility of this testimony is largely inconsequential to the Court's current task of determining whether Plaintiff's claims are appropriate for determination on a classwide basis. Accordingly, the motions to exclude or strike the declarations, testimony or reports of Richard Bazinet, Beth Snitz, Susan Mitmesser, and Edward Rosick are all denied without prejudice. The parties are welcome to re-file these motions in connection with summary judgment motions or as motions in limine consistent with the deadlines set by the applicable case management orders and local rules.

         IV. Discussion

         A. The Proposed Class(es)

         Plaintiff seeks certification of a California-only UCL Class and a California-only CLRA Class, but the classes are identical: “All California consumers who, within the applicable statute of limitations, purchased TruNature Gingko Biloba with Vinpocetine until the date notice is disseminated.” [Doc. No. 107 at 20.] “For purposes of class certification, the UCL . . . and CLRA are materially indistinguishable.” Forcellati v. Hyland's, Inc., No. CV 12-1983-GHK (MRWx), 2014 WL 1410264, at *9 (C.D. Cal. Apr. 9, 2014). “[C]lass certification of UCL claims is available only to those class members who were actually exposed to the business practices at issue.” Berger v. Home Depot USA, Inc., 741 F.3d 1061, 1068 (9th Cir. 2014).

         “To state a claim under the UCL . . . ‘based on false advertising or promotional practices, it is necessary only to show that members of the public are likely to be deceived.'” Pulaski & Middleman, LLC v. Google, Inc., 802 F.3d 979, 985 (9th Cir. 2015) (quoting In re Tobacco II Cases, 46 Cal.4th 298, 312 (2009)). “This inquiry does not require ‘individualized proof of deception, reliance and injury.'” Id. (quoting In re Tobacco II Cases, 46 Cal.4th at 320). “Thus, a court need not make individual determinations regarding entitlement to restitution. Instead, restitution is available on a classwide basis once the class representative makes the threshold showing of liability under the UCL.” Id. at 986.

         Meanwhile, “[u]nlike the UCL, the CLRA demands that each potential class member have both an actual injury and show that the injury was caused by the challenged practice. However, if a material misrepresentation has been made to the entire class, an inference of reliance arises as to the class.” Berger, 741 F.3d at 1069-70 (internal citation and quotation marks omitted). “As a general rule, materiality may be established by common proof ‘[b]ecause materiality is judged according to an objective standard, ' and so ‘[t]he alleged misrepresentations and omissions, whether material or immaterial, would be so equally for all [consumers] composing the class.'” Mullins v. Premier Nutrition Corp., No. 13-cv-1271-RS, 2016 WL 1535057, at *5 (N.D. Cal. Apr. 15, 2016) (quoting Amgen Inc. v. Conn. Ret. Plans and Trust Funds, 133 S.Ct. 1184, 1191 (2013)); see also McCrary v. Elations Co., LLC, No. EDCV 13-00242 JGB OP, 2014 WL 1779243, at *14 (C.D. Cal. Jan. 13, 2014) (“[T]he determination of materiality, and thus reliance, is determined using objective criteria that apply to the entire class and do not require individualized determination.”); In re Steroid Hormone Prod. Cases, 181 Cal.App.4th 145, 157 (Cal.Ct.App. 2010) (“Materiality of the alleged misrepresentation generally is judged by a ‘reasonable man' standard.”).

         Here, the only alleged misrepresentations in question appeared on the labels of the products purchased by class members. Whether these representations were material to a reasonable person can be determined on a classwide basis. Therefore, the different requirements for UCL and CLRA claims do not warrant different outcomes in the class certification analysis. For this reason, and because neither party makes arguments unique to either proposed ...

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