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Conde v. Sensa

United States District Court, S.D. California

September 10, 2019

JOSE CONDE, et al., Plaintiffs,
v.
SENSA, et al., Defendants.

          ORDER DENYING PLAINTIFF'S RENEWED MOTION FOR CLASS CERTIFICATION, (ECF No. 134)

          HON. JANIS L. SAMMARTINO UNITED STATES DISTRICT JUDGE

         Presently before the Court is Plaintiff Susan Grace Stokes' Renewed Motion for Class Certification (“Renewed Mot., ” ECF No. 134). Also before the Court is Defendants IB Holding, LLC (“IBH”) and TechStyle, Inc.'s (“TSI”) Opposition to (“Opp'n, ” ECF No. 139) and Plaintiff's Reply in Support of (“Reply, ” ECF No. 140) the Motion. The Court took the matter under submission without oral argument pursuant to Civil Local Rule 7.1(d)(1). See ECF No. 142. Having carefully considered the Parties' arguments, the relevant evidence, and the law, the Court DENIES Plaintiff's Renewed Motion.

         BACKGROUND

         On January 7, 2014, several complaints were filed against Sensa Products, LLC (“Sensa”) regarding its marketing of a line of weigh loss products that consumers were instructed would result in weight loss if sprinkled on their food.

         First, the Federal Trade Commission (“FTC”) filed a complaint against Sensa Products, LLC (“Sensa”); Adam Goldenberg; and Dr. Hirsch (collectively, the “FTC Defendants”) alleging unfair or deceptive practices and false advertisements. Third Consolidated Amended Class Action Complaint (“TAC, ” ECF No. 76) ¶¶ 13, 107. The FTC and the FTC Defendants entered into a stipulated judgment for $46.5 million, id. ¶¶ 13, 109; see also Id. Ex. I, later reduced to $26.5 million because of Sensa's “deteriorating financial condition.” Opp'n at 3 (citing Def.'s First Request for Judicial Notice (“1st RJN, ” ECF No. 119-3) Ex. 8 at 13). As part of the settlement, the FTC Defendants also were restrained from, among other things, falsely representing that any product causes weight loss. TAC Ex. I at 8. Following extensive publicization of the FTC settlement on national television; in national print publications; and on international, national, and local news websites, see Decl. of Jeffrey L. Richardson in Support of Opp'n (“2nd Richardson Decl., ” ECF No. 139-2) ¶ 5, the FTC mailed over 477, 000 refund checks totaling over $26, 000, 000 to consumers who had bought Sensa's products. 1st RJN Ex. 10.

         Second, on the same date that the FTC filed its complaint, José Conde filed the instant putative class action, Conde v. Sensa, No. 14-CV-51 JLS (WVG) (S.D. Cal. filed Jan. 7, 2014), against Sensa, alleging causes of action for violation of California's False Advertising Law (“FAL”), California Business and Professions Code §§ 17500 et seq.; violation of California's Unfair Competition Law (“UCL”), California Business and Professions Code §§ 17200 et seq.; and violation of the Consumers Legal Remedies Act (“CLRA”), California Civil Code §§ 1750 et seq. ECF No. 1. Two related cases were filed subsequently: Delaney et al. v. Sensa, No. 14-CV-2120 JLS (WVG) (S.D. Cal. filed Sept. 8, 2014); and Stokes v. Sensa, No. 14-CV-2325 JLS (WVG) (S.D. Cal. filed Oct. 1, 2014).

         On October 17, 2014, Sensa filed for bankruptcy. TAC ¶ 110. Nonetheless, on November 3, 2014, the Delaney Plaintiffs moved the Court for an order consolidating the three cases. See ECF No. 17.[1] The Court granted the motion on April 13, 2015, and consolidated the cases. See ECF No. 32.

         After consolidation, on May 13, 2015, Plaintiffs filed an amended complaint against Sensa; Dr. Alan Hirsh; and General Nutrition Corp. and General Nutrition Centers, Inc. (together, “GNC”), alleging causes of action for violation of the Magnuson-Moss Warranty Act, 15 U.S.C. §§ 2301 et seq.; breach of express warranty; breach of implied warranties; violation of the CLRA; violation of the FAL; violation of the unlawful, unfair, and fraudulent/deceptive prongs of the UCL; violation of Florida's Deceptive and Unfair Trade Practices Act (“FDUTPA”), Florida Statutes §§ 501.201 et seq.; violation of Pennsylvania's Unfair Trade Practices and Consumer Protection Law, 73 Pennsylvania Statutes §§ 201-1 et seq.; and negligent misrepresentation. See ECF No. 33. On September 11, 2015, the Delaney Plaintiffs and GNC settled, and Ms. Delaney dismissed without prejudice the class claims against GNC. See ECF Nos. 53, 54.

         Following the settlement and dismissal of GNC, only Ms. Stokes moved on November 16, 2015, to file an amended complaint. See ECF No. 56. The Court granted the request on December 28, 2015, see ECF No. 59, and, on January 14, 2016, Ms. Stokes filed an amended complaint against Sensa and various other companies and individuals, dropping the cause of action under Pennsylvania law and adding a cause of action for alter ego/veil piercing to hold other Defendants liable for the conduct of Sensa. See ECF No. 60. On November 1, 2016, Ms. Stokes filed the operative Third Consolidated Amended Class Action Complaint (“TAC”) against Sensa Products, LLC; Sensa, Inc. (f/k/a Intelligent Beauty, Inc.); IB Holding, LLC (a/k/a Intelligent Beauty Holding, LLC); TechStyle, Inc. (f/k/a JustFab, Inc. and Just Fabulous, Inc.); Dr. Alan R. Hirsch; Don Ressler; Adam Goldenberg; Kristen Chadwick; TCV VI, L.P; TCV Technology Crossover Ventures; and John Drew. See generally ECF No. 76.

         Generally, Ms. Stokes alleges that Sensa produced various weight-loss products, which were “tastant crystals” or “sprinkles” that users would sprinkle on their food. TAC ¶ 2. As marketed by Sensa, when the users smelled and tasted the crystals, the crystals would trigger the user's “I feel full” signal and the user would therefore eat less food. Id. ¶ 3. Originally, Sensa marketed that the products would allow users to “lose up to 30lbs or more in just 6 months” without requiring the user to diet or exercise. TAC ¶¶ 4-5. In connection with the FTC action, in late 2013 or early 2014, “Sensa Products changed the ‘lose up to 30lbs or more in just 6 months' statement to ‘9.5 pounds in 6 months' and/or ‘10 pounds in 3 months.'” Decl. of Kristin Chadwick (“Chadwick Decl., ” ECF No. 119-1) ¶ 6. Specifically, the three products at issue are Sensa Weight-Loss System, Sensa for Men Weight-Loss System, and Sensa Advanced Weight-Loss System (the “Class Products”). See Renewed Mot. at 1 n.1. Plaintiff states she relied on the labeling for the Class Products and alleges the Products are ineffective, the Products have not been “clinically shown” to cause weight loss, and the system is not “supported by impressive clinical results.” TAC ¶¶ 7-8. Ms. Stokes further alleges Sensa, IBH, and TSI operated as a single enterprise. Id. ¶¶ 134-35. Ms. Stokes therefore seeks to recover against IBH and TSI, who remain solvent. Id. ¶ 136.

         On February 9, 2018, Ms. Stokes sought certification of a nationwide class defined as “[a]ll persons in the United States who purchased Defendants' Sensa Weight-Loss System, on or after August 22, 2012.” See ECF No. 115. Following a hearing on September 4, 2018, see ECF No. 127, the Court denied without prejudice Ms. Stokes' motion, see generally ECF No. 128, finding that Ms. Stokes had “not met her burden in establishing that: (1) the class is ascertainable, (2) common issues predominate over individual issues, and (3) the class action is superior to other methods.” See Id. at 31. Because the Court concluded that the identified deficiencies might be curable, it granted Ms. Stokes leave to file a renewed motion.

         Ms. Stokes filed the instant motion on February 21, 2019. See generally ECF No. 134. She now seeks to certify a nationwide class defined as “[a]ll persons in the United States who purchased the Sensa Weight-Loss System on or after August 22, 2012 excluding purchases made directly from Sensa, Inc. and Sensa Products, LLC.” Not. of Renewed Mot. at 1 (footnote omitted). Alternatively, Ms. Stokes seeks to certify a Florida class comprised of “[a]ll persons who purchased the Sensa Weight-Loss System in Florida on or after August 22, 2012 excluding purchases made directly from Sensa, Inc. and Sensa Products, LLC.” Id.

         LEGAL STANDARD

         Motions for class certification proceed under Rule 23(a) of the Federal Rules of Civil Procedure. Rule 23(a) provides four prerequisites to a class action: (1) the class is so numerous that joinder of all members is impracticable (“numerosity”), (2) there are questions of law or fact common to the class (“commonality”), (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class (“typicality”), and (4) the representative parties will fairly and adequately protect the interests of the class (“adequate representation”). Fed.R.Civ.P. 23(a).

         A proposed class must also satisfy one of the subdivisions of Rule 23(b). Here, Plaintiff seeks to proceed under Rule 23(b)(3), which requires that “the court find[] that the [common questions] predominate over any questions affecting only individual members [‘predominance'], and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy [‘superiority'].” The relevant factors in this inquiry include the class members' interest in individually controlling the litigation, other litigation already commenced, the desirability (or not) of consolidating the litigation in this forum, and manageability. Fed.R.Civ.P. 23(b)(3)(A)-(D).

         “In determining the propriety of a class action, the question is not whether the plaintiff or plaintiffs have stated a cause of action or will prevail on the merits, but rather whether the requirements of Rule 23 are met.” Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 178 (1974) (internal quotations omitted). “Rule 23 does not set forth a mere pleading standard.” Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 350 (2011). Rather, “[a] party seeking class certification must affirmatively demonstrate his compliance with the Rule- that is, he must be prepared to prove that there are in fact sufficiently numerous parties, common questions of law or fact, etc.” Id. The court is “at liberty to consider evidence which goes to the requirements of Rule 23 even though the evidence may also relate to the underlying merits of the case.” Hanon v. Dataproducts Corp., 976 F.2d 497, 509 (9th Cir. 1992). A weighing of competing evidence, however, is inappropriate at this stage of the litigation. Staton v. Boeing Co., 327 F.3d 938, 954 (9th Cir. 2003).

         ANALYSIS

         I. Standing

         In their opposition to Plaintiff's initial motion for class certification, Defendants contested Ms. Stokes standing in various regards: (1) Ms. Stokes is a Florida resident who neither purchased any Class Products in California during the class period nor visited or purchased Class Products from the Sensa websites; (2) Ms. Stokes did not suffer an injury because she was happy with the products and accomplished her goal of maintaining her weight; and (3) Ms. Stokes never purchased two of the Class Products, Sensa for Men and Sensa Advanced. ECF No. 119 at 7-10. The Court rejected Defendants' arguments and concluded that Ms. Stokes has standing to bring this action. See ECF No. 128 at 5-10.

         Defendants have incorporated their previously rejected arguments into their Opposition to Ms. Stokes' Renewed Motion. See Opp'n at 7 n.3. The Court again rejects Defendants' arguments for the same reasons as in its September 10, 2018 Order.

         II. Rule 23(a) Requirements

         Ms. Stokes must establish that the proposed class satisfies the four requirements of Rule 23(a). In their opposition to Ms. Stokes' initial motion for class certification, Defendants challenged Ms. Stokes' typicality on the grounds that she: (1) purchased the Class Products to maintain-rather than to lose-weight, (2) experienced side effects from use of the Class Products, (3) expressed satisfaction with the Class Products, (4) used only one of the three Class Products, and (5) did not see and rely on all representations by Sensa.[2] See ECF No. 119 at 10-13. Defendants also argued that Ms. Stokes could not adequately fulfill her duties as class representative because of her health issues and unfamiliarity with this action. See Id. at 13. The Court rejected each of these arguments and determined that Ms. Stokes had met her burden as to each of the Rule 23(a) requirements. See ECF No. 128 at 10-18.

         Again, Defendants have incorporated their previously rejected arguments into their Opposition to Ms. Stokes' Renewed Motion. See Opp'n at 7 n.3. The Court again rejects Defendants' arguments for the same reasons as in its September 10, 2018 Order and concludes that Ms. Stokes has satisfied the requirements of Rule 23(a).

         III. Rule 23(b)(3) Requirements

         Rule 23(b)(3) states that a class may be maintained if the requirements of Rule 23(a) are fulfilled and if “the court finds that the questions of law or fact common to the class members 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.” Fed.R.Civ.P. 23(b)(3).

         The Court previously determined that Ms. Stokes had failed to satisfy either of these requirements because individual issues concerning the arbitration provision applicable to purchases of the Class Product through Sensa's website and application of non-California law would overshadow common issues and because a class action might not be superior given the prior FTC settlement. See ECF No. 128 at 18-29. Ms. Stokes' attempts to remedy these deficiencies by ...


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