Ohio Federal Court Dismisses Several Claims in Tito’s “Handmade” Suit

An Ohio federal court has dismissed fraud and consumer-protection
claims against Fifth Dimension, maker of Tito’s Handmade Vodka®, in
a putative class action alleging the beverage company misrepresents the
process of making its vodka by calling the product “handmade.” Terlesky
v. Fifth Dimension, No. 15-0374 (S.D. Ohio, order entered
November 17, 2015).

The court analyzed each claim, first finding that the plaintiff did not have
standing to sue under the Ohio Deceptive Trade Practices Act. Turning
to the Ohio Consumer Sales Protection Act, the court determined that
plaintiffs bringing class claims must show the alleged violation was
declared to be deceptive by the attorney general or a court before the
transaction. Finding no such facts in the case, the court dismissed the
class claim but allowed the individual claim to proceed. The court also
allowed the plaintiff’s promissory estoppel claim to continue.

Turning then to the negligent misrepresentation claim, the court
agreed with Fifth Dimension in its argument that a plaintiff “may not
maintain an action for negligent misrepresentation when the alleged
misrepresentation is intended to reach an extensive, unresolved class of
persons” rather than a limited class. The court also dismissed the fraud
claim because the plaintiff alleged an economic harm only, not a physical
or psychological injury. Quoting a 2003 decision, the court found that “to
allow such claims to proceed would be to eradicate the viability of the tort
system by overcompensating buyers and creating inefficient incentives
for manufacturers.”

Issue 585