Ninth Circuit Withdraws Opinion Upending Settlement of False-Advertising Claims Against Kellogg

The Ninth Circuit Court of Appeals has withdrawn its previous opinion
reversing an order that approved the settlement of class claims against
Kellogg Co., although it has reached the same conclusion in its new opinion.
Dennis v. Kellogg Co., Nos. 11-55674, -55706 (9th Cir., decided September
4, 2012). Information about the withdrawn opinion is included in Issue 447
of this Update. The plaintiffs claimed that Kellogg lacked supporting scientific
evidence for marketing and promotional statements that some of its cereal
products could improve children’s cognitive functions.

Apparently, the court had failed to consider the plaintiffs’ preliminary argument that it could not address the validity of the cy pres distribution of funds that remained in the settlement fund. They contended that the issue “will not be ripe until it is determined that available cash remains in that fund after the claims process has concluded.” As the court observed in a footnote to the withdrawn opinion and now includes in the body of the new ruling—the deadline for the submission of claims was more than one year ago, and the total of claims submitted amounted to some $800,000, leaving “almost $2 million in the settlement fund for cy pres distribution.” Thus, the court concluded that the issue is ripe and addressed it as it had in the withdrawn opinion.