“Natural” Consumer Fraud Claims Against Arizona Beverages Trimmed

A federal court has agreed to certify a class of California consumers allegedly misled by representations that AriZona Iced Tea® is “Natural” because it contains the processed, man-made ingredients high-fructose corn syrup (HFCS) and citric acid. Ries v. Arizona Beverages USA LLC, No. 10-01139  (N.D. Cal., order entered November 27, 2012). But the court granted the certification motion “for the purpose of injunctive and declaratory relief only” thus foreclosing the recovery of “monetary damages, including restitution, refund, reimbursement and disgorgement.”

The named plaintiffs had sought certification under Federal Rule of Civil
Procedure 23(b)(2), which “does not authorize class certification when each
class member would be entitled to an individualized award of monetary
damages.” According to the court, the claim for monetary relief predominates
the complaint, and the plaintiffs “seek individualized awards of monetary
restitution which would require individualized assessments of damages based
on how many products the class member had bought,” making the damages
calculations “unmanageable under Rule 23(b)(2).”

The court also granted in part and denied in part the defendants’ motion
for summary judgment, finding that (i) the plaintiffs sufficiently pleaded
economic injury under California’s consumer fraud laws despite lacking
receipts to document their losses, (ii) the plaintiffs’ multiple reasons for buying
the products did not abrogate their claim that they relied on the defendants’
“all natural” product labeling to purchase the products, (iii) the plaintiffs have
standing to pursue injunctive relief even if they now know that the products
contain HFCS, and (iv) the named plaintiff who purchased the product in
2006 and threw it away after reading the ingredients list was time-barred
from pursuing relief under the Consumers Legal Remedies Act and the False
Advertising Law.