Hunter v. Nature's Way Products, LLC

          ORDER

          Hon. William Q. Hayes, United States District Court Judge.

         The matter pending before the Court is the Motion for Settlement Final Approval, and for Attorneys' Fees, Costs, and Incentive Award filed by Plaintiff Sherry Hunter. (ECF No. 116).

         PROCEDURAL BACKGROUND

         On January 28, 2016, Plaintiffs Sherry Hunter and Malia Levin, on behalf of herself and all others similarly situated and the general public, initiated this action by filing a Class Action Complaint against Defendants Nature's Way Products, LLC (“Nature's Way”) and Schwabe North America, Inc. (“Schwabe”) in the Superior Court of California, County of San Diego. (ECF No. 1-5 at 2-3). Plaintiff alleges that Defendants misleadingly market Nature's Way coconut oil products as inherently healthy and healthy alternatives to butter, margarine, shortening, and other cooking oils. (ECF No. 1-5 at 3; ECF No. 96 at 2). Plaintiff alleges that Nature's Way coconut oil products are inherently unhealthy and less health options compared to the alternatives. (ECF No. 1-5 at 3; ECF No. 96 at 2). Plaintiff alleges that she was harmed as a result of her reliance upon Defendants' misleading and unlawful claims when purchasing Nature's Way coconut oil products. (ECF No. 1-5 at 3; ECF No. 96 at 2). Plaintiff brings claims for violations of the California Consumer Legal Remedies Act (Cal. Civ. Code § 1750), violations of Unfair Competition Law (Cal. Bus. & Prof. Code § 17200), violations of False Advertising Law (Cal. Bus. & Prof. Code § 17500), breach of express warranties (Cal. Com. Code § 2313(1)), and breach of implied warranty of merchantability (Cal. Com. Code § 2314). (ECF No. 1-5 at 3; ECF No. 96 at 2). Plaintiff seeks an order compelling Defendants to cease marketing Nature's Way coconut oil products using allegedly misleading and unlawful tactics; to destroy all allegedly misleading, deceptive, and unlawful materials; to conduct a corrective advertising campaign; to restore amounts by which Defendants have been unjustly enriched; and to pay restitution, damages, and attorneys' fees. (ECF No. 1-5 at 3; ECF No. 96 at 2).

         On March 2, 2016, Defendants removed the action to this Court. (ECF No. 1).

         On August 12, 2016, this Court issued an Order granting in part and denying in part Defendants' Motion to Dismiss (ECF No. 12) and denying Defendants' Motion to Strike (ECF No. 13). (ECF No. 28).

         On September 2, 2016, Defendants filed an Answer to the Complaint. (ECF No. 31).

         On March 23, 2017, this Court issued an Order dismissing Plaintiff Malia Levin's individual claims without prejudice. (ECF No. 49).

         On January 9, 2018, this Court issued an Order denying Plaintiff's Motion for Class Certification (ECF No. 60) as moot; granting Plaintiff's Motions to File Documents Under Seal (ECF Nos. 61 and 77); and granting Plaintiff's Motion for Reconsideration (ECF No. 85). (ECF No. 90).

         On January 30, 2018, Plaintiff filed the First Amended Complaint (“FAC”). (ECF No. 95). On February 12, 2018, Plaintiff filed the Second Amended Complaint (“SAC”). (ECF No. 96).

         On February 21, 2018, the Court held an Early Neutral Evaluation during which the parties reached a settlement. (ECF No. 97).

         On February 26, 2018, Defendants filed an Answer to Plaintiff's SAC. (ECF No. 98).

         On July 3, 2018, this Court issued an Order granting the parties' Joint Motion to Stay (ECF No. 103). (ECF No. 104). On June 27, 2019, this Court issued a Minute Entry lifting the stay. (ECF No. 110).

         On August 30, 2019, this Court issued an Order granting Plaintiff's Motion for Preliminary Approval of Class Settlement (ECF No. 111). (ECF No. 113). On September 5, 2019, this Court issued an Amended Order granting Plaintiff's Motion for Preliminary Approval of Class Settlement. (ECF No. 115). In the Amended Order, this Court preliminarily approved the settlement agreement; provisionally certified the Class; appointed Plaintiff as Class Representative; appointed The Law Office of Paul K. Joseph, PC, and The Law Office of Jack Fitzgerald, PC as Class Counsel; approved RG2^[1] to act as Claims Administrator; and approved the form and content of the Class Notice in the form attached to the Settlement Agreement as Exhibit A. Id. at 2-3.

         On November 15, 2019, Plaintiff filed a Motion for Settlement Final Approval, and for Attorneys' Fees, Costs, and Incentive Award. (ECF No. 116). On December 2, 2019, Plaintiffs filed a Supplemental Declaration. (ECF No. 117). RG/2 states that it has received zero valid requests to opt-out as of December 2, 2019. Id. at 5. RG/2 states that “both RG/2 and the attorneys of record have not received or been made aware of any objections to the settlement” as of December 2, 2019. Id. On December 5, 2019, Defendants filed Notice of Non-Opposition. (ECF No. 118). On December 13, 2019 this Court held a final approval hearing. (ECF No. 119). No Class member appeared.

         TERMS OF THE PROPOSED SETTLEMENT

         I. The Class

         The proposed settlement class (the “Class”) consists of “all persons in the United States who purchased during the Class Period, for personal or household use, any Nature's Way coconut oil product bearing at least one of the challenged labeling claims, and including specifically the 16-ounce or 32-ounce jar of Nature's Way Extra Virgin Coconut Oil, and any bottle of Nature's Way Liquid Coconut Oil, including the 10-ounce and 20-ounce bottles.” (ECF No. 116-1 at 9) (citing Settlement Agreement ¶¶ 1.3, 1.10, Ex. 1 to Fitzgerald Decl., ECF No. 111-2 at 8, 9-10). The Class Period began on January 18, 2012 to August 30, 2019, the date this Court issued preliminary approval. Id.

         II. Class Benefits

         “For a period of five years following Final Approval, Defendants will not advertise (including in print, online, on Coconut Oil Product labels or packaging, and in sales pitches or public statements) the Nature's Way Coconut Oil Products using the following terms and phrases, or substantially similar terms or phrases: ‘Healthy'; ‘Ideal for Exercise and Weight Loss Programs'; ‘Recommendation: Take 1 tablespoon (14 g) up to 4 times daily'; ‘Non-hydrogenated, no trans fat' (unless the statement is made with the disclosures required by the FDA).” Id. at 9-10 (citing Settlement Agreement ¶ 2.2; Ex. 1 to Fitzgerald Decl., ECF No. 111-2 at 11). “Defendants have established a non-reversionary $1, 850, 000 common fund to pay Class Member claims and all Settlement expenses, namely notice and administration, and any incentive award and attorneys' fees and costs awarded by the Court. Id. at 10 (citing Settlement Agreement ¶ 2.3; Ex. 1 to Fitzgerald Decl., ECF No. 111-2 at 11-12).

         III. Class Notice

         “On July 31, 2019, RG/2 caused to be served by Federal Express or Certified Return Receipt Requested First-Claim mail, where applicable, a Notice of Proposed Settlement to the United States Attorney General and 57 State and Territory Attorney Generals.” (Boub Decl. ¶ 4, ECF No. 116-5 at 2; Ex A. to Boub Decl., ECF No. 116-5 at 7-193).

         On September 16, 2019, the website www.natureswaycoconutoilsettlement.com went live. (Boub Decl. ¶ 5, ECF No. 116-5 at 3). “The ‘Homepage' contains a brief summary of the Settlement and advises potential Class Members of their rights under the Settlement.” Id. “The ‘Notice/Claim Form' page contains a pdf copy of the Court-Ordered Notice and Settlement Claim Form.” Id. “The ‘File a Claim' page [] [sic] contains a link to the Claims online filing portal.” Id. “The ‘Court Documents' page contains[: the] [sic] Initial Complaint, [t]he First Amended Complaint, [t]he Second Amended Complaint, [t]he Stipulation of the Class Action Settlement, the Order Granting Motion for Preliminary Approval, and the Amended Order Granting Motion for Preliminary Approval.” Id. “The ‘Contact' page contains the contact information of the Claims Administrator and Plaintiffs' Counsel.” Id.

         On September 16, 2019, RG/2 arranged for the launching of a 29-day media campaign. Id. at ¶ 6, ECF No. 116-5 at 3. The media plan consisted of

a) A Facebook campaign where potential Class Members could click on ads posted in Facebook and associated platforms, such as Instant Articles and Messenger. The clicked ad is linked to the case website;

b) A banner ad campaign in which banner ads were created and appeared on various sites based on topics being searched. Class Members who saw the ads were able to click on the ad and be linked directly to the case website;

c) Bing and Good Adwords pay per click campaigns in which various search words/phrases produced an ad in which Class Members could click and be linked to the case website.

Id., ECF No. 116-5 at 3-4; Ex B. to Boub Decl., ECF No. 116-5 at 194-209.

         RG/2 also arranged for the Short Form Notice to be published in the San Diego Union-Tribune. (Boub Decl. ¶ 7, ECF No. 116-5 at 4; Ex C. to Boub Decl., ECF No. 116- 5 at 211-12). “The Short Form Notice was published on September 16, 2019; September 23, 2019; September 30, 2019; and October 7, 2019.” (Boub Decl. ¶ 7, ECF No. 116-5 at 4).

         IV. Opt-Outs and Objections to Settlement

         “The Short Form Notice advised Class Members of their right to exclude themselves from the Settlement, provided that their request be postmarked by October 31, 2019.” (Boub Decl. ¶ 8, ECF No. 116-5 at 4). As of December 2, 2019, “RG/2 has received 0 valid requests” to opt-out. Id. (Boub Decl. ¶ 4, ECF No. 117 at 5).

         “The Short Form Notice advised Class Members of their right to object to the Settlement, provided that their objection be filed with the Court by November 25, 2019.” (Boub Decl. ¶ 9, ECF No. 116-5 at 4). As of December 2, 2019, “both RG/2 and the attorneys of record have not received or been ...