After purchasing three clothing items from Target Corporation's Web site that were misidentified as made in the United States, Raymundo B. Sevidal brought a class action against Target, alleging fraud and violation of unfair competition and false advertising laws, and seeking injunctive and restitutionary relief. Sevidal then moved to certify a class of California consumers who bought imported items from Target's Web site that were similarly misidentified. Sevidal argued that under the California Supreme Court's recent decision in In re Tobacco II Cases (2009) 46 Cal.4th 298 [93 Cal.Rptr.3d 559, 207 P.3d 20] (Tobacco II), the class could be certified on his unfair competition claim even if most of the proposed class members never relied on the "Made in USA" designation in deciding to make their online purchases.
The trial court agreed with Sevidal's interpretation of Tobacco II on the reliance element, but declined to certify the class because it found Sevidal did not meet his burden to establish other necessary elements of a class action, including that the proposed class was ascertainable. The court additionally
Sevidal appeals. We affirm. We determine the court properly refused to certify the class based on its finding the proposed class was not ascertainable. Substantial evidence supports the court's conclusion the absent class members could not be reasonably identified by reference to records or by common characteristics that would allow the class members to identify themselves. We also determine the court properly found the class was overbroad because the evidence shows the vast majority of absent class members never saw the Web page containing the alleged misrepresentation and thus were never exposed to the alleged wrongful conduct.
FACTUAL AND PROCEDURAL BACKGROUND
Complaint and Class Allegations
In May and June 2007, Sevidal purchased three clothing items from Target's Web site—two pairs of running shorts and one necktie. Information on the Web site stated the items were made in the United States. However, when the items were delivered, Sevidal discovered the items had labels showing they were made outside the United States.
Sevidal sued Target claiming he had relied on the country-of-origin information in making the decision to purchase the items. Sevidal alleged several causes of action: (1) violation of California's unfair competition law (UCL) (Bus. & Prof. Code,
Sevidal sought to represent the class of persons who purchased imported goods from Target's Web site that were incorrectly identified as "`Made in USA.'"
Target responded by moving for an order denying class certification, based, in part, on its argument that individual questions would predominate because each class member would be required to establish individual reliance under Proposition 64's new UCL standing requirements.
Sevidal's Class Certification Motion
Sevidal then moved for an order certifying a class consisting of "`any California consumer who purchased any product from Target.com on or after November 21, 2003 which was identified on Target.com as "Made in USA," when such product was actually not manufactured or assembled in the United States.'"
In support, Sevidal produced his declaration, stating: "On May 5, 2007 and on June 10, 2007, I purchased merchandise on the Target.com website. I purchased two pairs of ... running shorts and one ... necktie ... all of which were identified on Target.com as `Made in the USA.' [¶] ... I relied on the representation that the merchandise was `Made in the USA,' and purchased these items believing that the merchandise was made by American workers in the United States. Had the merchandise been labeled `Imported' rather than `Made in the USA,' I would have considered purchasing other similar merchandise labeled instead as `Made in the USA.' [¶] ... I am a military services member who has served in Iraq. It is important to me to purchase merchandise made by American workers because I want to repay the support that the American people have given me and my family. [¶] ... I have since discovered that the merchandise that I purchased on Target.com was actually made outside of the United States, in China, Indonesia, and Jordan. [¶] ... I believe that I would be an adequate class representative and would dutifully fulfill this role."
Sevidal also proffered an uncertified "rough" draft of a deposition transcript of Scott Affeldt, who is Target's "resident technical expert in applications and software design for item systems and item data." At his deposition, Affeldt initially testified that Target's error in mislabeling imported goods was "systematic" and agreed with Sevidal's counsel that it "seems reasonable" to conclude that these products were mislabeled from the time they were initially put on Target's Web site. However, three days after the deposition, Affeldt corrected this testimony based on his further investigation and clarified that the computer bug was triggered after an item had been published to the Web site. In the corrected and final version of the deposition, Affeldt testified that "it is not reasonable to assume that all items affected by the computer bug" had the incorrect designation when the items were first posted to the Web site. (Italics added.)
Sevidal also relied on his discovery request asking Target to identify all products advertised by Target as "`MADE IN USA' during the four years preceding the filing of the complaint," and Target's responses in the form of hundreds of pages of spreadsheets, which identified thousands of product items that had been represented as "`Made in USA,'" some of which were imported items.
Based on this and other evidence, Sevidal argued he met the standards for class certification, including that the proposed class was identifiable and ascertainable, common questions of fact and law predominate, Sevidal's claims are typical of the class, and Sevidal and his counsel will adequately represent the interests of the class.
Target's Opposition to Class Certification Motion
Target opposed the motion on three primary grounds: (1) the proposed class is not ascertainable; (2) the proposed class is overbroad; and (3) common issues do not predominate because the claims require individualized factual inquiries.
In support of these arguments, Target presented evidence to explain the manner in which the country-of-origin information manifested on its Web site. This evidence was as follows. Target's Web site offers for sale many categories of consumer products and allows the customer to browse through items by selecting subcategory tabs or to conduct a keyword search for an item. Upon selecting a subcategory or running a keyword search, the customer is directed to a screen displaying small photos and brief descriptions of items. This screen does not state whether each product is "`Made in US'" or imported. Some items can be purchased from this screen by clicking the "Add to Cart" button, which takes a customer to the purchase screen.
Alternatively, the customer can choose a particular item by clicking on the "`View Details'" button or on the name of that item, which causes the customer to be directed to an item-specific screen that displays a picture of the item, its price, and a more detailed description. This item-specific screen does not state the product's country of origin, but it provides an option to select size, color, and quantity, and invites the customer to click on "`Add to Cart'" to purchase that item. Toward the bottom of the item-specific screen, there are four tabs labeled: "`Features', `Reviews', `Additional Info', and `Shipping Info.'" To view the information on each of these tabs (except the "`Features'" tab), the customer must physically click on the tab. If the customer clicks the optional "`Additional Info'" tab, the customer will see a separate screen that describes the item as either being "`Made in US'" or "`Imported.'" This is the only screen that shows whether a product is identified as "`Made in US'" or "`Imported.'"
Thus, once the customer reaches the item-specific screen, the customer purchases the item by selecting the "`Add to Cart'" icon after clicking the applicable quantity and size/color tabs. At this point, the customer will not have seen whether an item is identified as "`Made in US'" or "`Imported'" unless the customer chose to click on the optional "`Additional Info'" tab for that item. As a result a customer can log onto Target.com and purchase an item without ever seeing whether it is identified as "`Made in US'" or "`Imported.'"
In 2007, Target discovered that some clothing items were erroneously identified as "`Made in US'" on the "`Additional Info'" pages on its Web
Affeldt also stated that "Target's item database PRISM does not maintain historical information about the country of origin attribute which controls whether an item is listed as `Made in US' or `Imported'.... Instead, PRISM only reflects the current or most recent country of origin designation for each item.... Moreover, [Target has] no other records or databases ... [that] maintain such historical country of origin information. As a result, even if it is known that a particular item had a `US' country of origin designation at one point in time, there is no way for Target to determine the beginning and ending dates that the item had a `US' country of origin in PRISM and therefore on the Target.com website." According to Affeldt, Target was unable to obtain this information from any other source, including Amazon.com Inc. (Amazon), which provides the "web platform" for Target's Web site. Affeldt explained that he was told by Amazon personnel "it would be a significant effort for Amazon to pull such information and that the data provided would be incomplete and unreliable at best."
Target also produced evidence showing that the vast majority of customers do not select the "`Additional Info'" icon before making a purchase and thus are never exposed to the product's country-of-origin designation. Jinzhou Huang, a Target employee whose responsibilities include analyzing Web services for Target, submitted her declaration stating that: "Prior to 2009, Target did not track or collect data regarding whether or how often customers
Huang also stated the data showing 20 percent of consumers select the "`Additional Info'" icon does not necessarily show the customer purchased the item related to this information: "When a customer views more than one product during a session on Target.com, Target has no means to track for which of those products the customer viewed the `Additional Info' tab. Consequently, it is not possible to identify whether the item purchased by the customer is the same item for which the customer viewed the `Additional Info' tab during that session. [¶] ... The data collected ... shows that out of all the items purchased on Target.[c]om during that time period,
Sevidal's Reply and Evidentiary Objections
In reply, Sevidal reiterated his assertion that he has proposed an ascertainable and identifiable class "because the deposition of Scott Affeldt indicates that the products mislabeled `Made in the USA' were so labeled from the moment they were placed onto Target.com's website. Thus, any California-based purchaser of these items is a member of the proposed class." (Italics added.) Sevidal further argued that under Tobacco II, supra, 46 Cal.4th 298, the putative class members need not have reviewed or relied on Target's misrepresentations.
In connection with these arguments, Sevidal filed evidentiary objections to certain statements made in the declarations of Affeldt and Huang. Specifically, Sevidal objected to Affeldt's statements that the PRISM computer bug did not cause a misidentification during the setup process, arguing that these statements contradicted Affeldt's deposition testimony that most items were
After a hearing, the court overruled Sevidal's evidentiary objections and denied Sevidal's class certification motion.
In its evidentiary rulings, the court found Huang's descriptions of her job responsibilities show she has personal knowledge of the subject of her declaration, her statements were not inadmissible hearsay, and her statements were relevant to the disputed issues. With respect to Affeldt's declaration, the court found no inconsistency between his declaration and deposition because the rough draft of the deposition produced by Sevidal had been corrected three days after the deposition based on reasonable postdeposition inquiry and research. The court stated it found credible Affeldt's declaration and corrected deposition answer that the computer bug was generally triggered only after the original item was published on the site, and not when the item was first uploaded to the Web site.
On the merits of the class certification motion, the court found Sevidal did not meet his burden to show various required elements of a class action, including an ascertainable class and that common questions of law and fact predominated over individualized issues. On the ascertainability issue, the court stated: "Class members are ascertainable only `where they may be readily identified without unreasonable expense or time by reference to official records' ...," and "Target has no records that maintain the type of historical information as to when items may have been mislabeled," nor was Target able to reasonably obtain this information from other sources, including Amazon.
The court also found that Sevidal did not show common issues predominate over individual issues because it "is likely less than 17% of the proposed class ever viewed the erroneous `Made in the USA' designation at issue but there is no way to identify them without asking each one of them individually." The court distinguished Tobacco II, supra, 46 Cal.4th 298, because that "ruling was made in the context of an `extensive and long-term advertising campaign involving public health,' which is readily distinguishable from the
For similar reasons, the court found that the proposed class was overbroad because it "includes every person who purchased an imported item during the time it was described as `Made in the USA'—even if that person never saw the `Made in the USA' description. While Target has no information about whether any specific customer viewed the `Additional Info' tab that states whether the item is `Made in the USA' or `Imported'..., Target's statistical research shows the vast majority of Target.com customers do not view the `Additional Info' page at all when making a purchase ...."
I. Class Action Standards
In analyzing the trial court's class action ruling, we examine each alleged cause of action to determine whether it is appropriate for class treatment. With respect to the UCL and FAL claims, we are mindful that the California Supreme Court has specifically approved the use of the class action procedure to bring these claims if the statutory class action elements are satisfied. (Tobacco II, supra, 46 Cal.4th at pp. 312-313.) "[T]he UCL class action is a procedural device that enforces substantive law by aggregating many individual claims into a single claim, in compliance with Code of Civil Procedure section 382, to achieve the remedial goals [of the UCL consumer protection statutory scheme]." (Id. at p. 313.)
For the reasons explained below, we conclude the court did not abuse its discretion in concluding that the class was not ascertainable and was overbroad. Therefore, the court properly declined to certify the class.
II. Ascertainability Element
A class representative has the burden to define an ascertainable class. (Tobacco II, supra, 46 Cal.4th at p. 318; Linder v. Thrifty Oil Co., supra, 23 Cal.4th at p. 435; Global Minerals & Metals Corp. v. Superior Court (2003) 113 Cal.App.4th 836, 849 [7 Cal.Rptr.3d 28] (Global Minerals).) Although the representative is not required to identify individual class members (Stephens v. Montgomery Ward (1987) 193 Cal.App.3d 411, 419 [238 Cal.Rptr. 602]), he or she must describe the proposed class by specific and objective criteria. (Global Minerals, supra, 113 Cal.App.4th at p. 858.) Ascertainability is achieved "`by defining the class in terms of objective characteristics and common transactional facts making the ultimate identification of class members possible ....'" (Bomersheim v. Los Angeles Gay &
Target presented evidence that it was unable to determine from its computer records the identity of the individuals who purchased an item when its country of origin was improperly designated. This evidence showed the computer bug causing the improper designation would not consistently misidentify the product origin and the computer bug sometimes affected the same item more than once. As a result, some items could have alternated between being correctly designated as "Imported" and erroneously designated as "Made in US" on the Web site at multiple times on various dates. Thus, without knowing the exact dates and times that a particular item had a United States country-of-origin designation on the "Additional Info" page, Target could not identify those customers who purchased an imported item when it was incorrectly labeled on the Web site.
Challenging this conclusion, Sevidal contends his proposed class is ascertainable because "Target has already identified specific products which fall within this definition.... [Thus], ascertaining the members that fit within the
This evidence does not support Sevidal's argument. As the trial court found, Target's spreadsheets did not reflect only the items which were misidentified or the dates on which a misidentification occurred: "Contrary to [Sevidal's] statement, 35,000 items were not misidentified. That number refers to all items that Target has been able to determine were ever described as `Made in the USA' on its website." Moreover, the fact that certain products were misidentified does not provide a basis to determine who purchased those products. The court made a factual finding that Target could not make these identifications, and this finding was supported by the record.
Sevidal argues that "Target's own records will likely reveal the identity of class members" because "Target must have collected electronic billing information (such as credit card information) and shipping information (including names and addresses) from [its online] customers." However, the fact that Target may be able to identify consumers who purchased goods online would not provide the necessary information to determine the identity of the putative class members, i.e., those California consumers who purchased goods online that were misidentified at the time of the purchase.
However, there are no facts in the record showing Sevidal could meet this standard with respect to his proposed class. In the proceedings below, Sevidal made clear that only those who purchased an item when the country of origin
In Lee, the reviewing court found "the basic parameters" of the proposed class "can be readily ascertained through company records," and that subclasses could be used to identify factual differences among the members of the class or certain class members could be eliminated at a later time. (Lee, supra, 166 Cal.App.4th at p. 1334.) In Aguiar, the court found that the problem of identifying all class members could be resolved through payroll records and emphasized that because the defendant had a legal obligation to maintain proper records, the failure to do so would not preclude certification, particularly where it was possible for each class member to identify himself or herself as a member of the class. (Aguiar, supra, 144 Cal.App.4th at pp. 134-136.) The Aguiar court also stated that the few employees who were not part of the class definition could be eliminated from the class later in the litigation. (Id. at p. 136.)
This case is different. Unlike the defendant in Aguiar, Target had no contractual or statutory duty to maintain records pertaining to a consumer's selection of the "`Additional Info'" icon. And unlike Aguiar and Lee, the problem of identifying the class members was not merely a matter of creating subclasses or later eliminating a small portion of the class members.
The court did not abuse its discretion in concluding that Sevidal did not meet his burden to show the proposed class was ascertainable.
III. The Proposed Class Was Overbroad
Although the court's ruling may be upheld based solely on the court's finding that Sevidal failed to propose an ascertainable class, we additionally conclude the court's order can be affirmed based on the evidence showing the proposed class was overbroad because a substantial portion of the class would have no right to recover on the asserted legal claims.
A. UCL and FAL Claims
A Court of Appeal recently interpreted Tobacco II in this precise manner. (Pfizer, supra, 182 Cal.App.4th 622.) In that case, the plaintiff alleged Pfizer advertised and promoted its mouthwash product, Listerine, in a misleading manner by indicating that Listerine can replace dental floss in reducing plaque and gingivitis. (Id. at p. 625.) The plaintiff brought a class action and asserted numerous claims, including violations of the UCL and FAL. (182 Cal.App.4th at p. 625.) The trial court certified a class of "`all persons who purchased Listerine, in California, from June 2004 through January 7,
The Pfizer court thus held that the certified class, consisting of all purchasers of Listerine in California over a six-month period, was overbroad because the trial court improperly presumed the existence of a classwide injury. (Pfizer, supra, 182 Cal.App.4th at pp. 632-633.) The court reasoned that as to the "large numbers of class members [who] were never exposed to the `as effective as floss' labels or television commercials[,] ... there is absolutely no likelihood they were deceived by the alleged false or misleading advertising or promotional campaign. Such persons cannot meet the standard of section 17203 of having money restored to them because it `may have been acquired by means of the unfair practice. In the language of section 17203, with respect to perhaps a majority of class members, there is no doubt Pfizer did not obtain any money by means of the alleged UCL violation." (Ibid.) The California Supreme Court later denied the plaintiff's petition for review.
In this regard, this case is materially different from the facts in Tobacco II and the two subsequent Court of Appeal decisions upon which Sevidal relies. (See Tobacco II, supra, 46 Cal.4th 298; Weinstat v. Dentsply Internat., Inc. (2010) 180 Cal.App.4th 1213 [103 Cal.Rptr.3d 614] (Weinstat); Steroid Hormone Product Cases (2010) 181 Cal.App.4th 145 [104 Cal.Rptr.3d 329] (Steroid Hormone).)
In Tobacco II, the plaintiffs alleged the defendants violated the UCL and FAL by conducting a decades-long campaign of deceptive advertising and misleading statements about the addictive nature of nicotine, and the proposed class "consist[ed] of members of the public who were exposed to" these advertisements and statements and were consumers of defendants' products. (Tobacco II, supra, 46 Cal.4th at p. 324, italics added.) Thus, unlike here, the proposed class included only those who were allegedly exposed to the alleged fraud.
In Weinstat, the plaintiffs alleged each product sold by the defendant contained written directions misrepresenting the safe use of the product. (Weinstat, supra, 180 Cal.App.4th at pp. 1219-1220.) Thus, each consumer of the product was exposed to the misrepresentation. Moreover, in reversing the denial of class certification on the UCL and breach of warranty claims, the Weinstat court focused primarily on the reliance issue, and did not specifically consider section 17203's "may have been acquired" statutory language. (See Weinstat, supra, at pp. 1222-1235.) A case is not authority for a proposition not considered. (Johnson v. Bradley (1992) 4 Cal.4th 389, 415 [14 Cal.Rptr.2d 470, 841 P.2d 990].)
In Steroid Hormone, supra, 181 Cal.App.4th 145, the proposed UCL class consisted of individuals who allegedly purchased a nutritional supplement containing a controlled substance and none of these class members had been informed the product contained this substance. (181 Cal.App.4th at p. 150.) Ruling before Tobacco II was filed, the trial court refused to certify the class because, even though the defendant may have been legally required to
In this case, there was no similar allegation that Target was legally required to inform consumers of the product origin information. Although Sevidal alleged a false "`Made in U.S.A.'" representation violates a statute (§ 17533.7; see fn. 6, ante), he has not cited to any legal requirement that a retailer must inform consumers of the country-of-origin information before they purchase an item. Thus, unlike Steroid Hormone, the fact that the consumers did not learn of this information was not a basis to conclude Target was required to disgorge profits from the sales to every consumer, regardless whether the consumer was ever exposed to the alleged misrepresentation.
Sevidal's reliance on the Tobacco II court's discussion of Collins v. Safeway Stores, Inc. (1986) 187 Cal.App.3d 62 [231 Cal.Rptr. 638] is also misplaced. In Collins, the class representatives bought eggs produced by the defendant egg producer and sold by the defendant supermarket chain. Some of the eggs had been contaminated by a pesticide. (Id. at pp. 65-66.) The contaminated eggs were mixed in with uncontaminated eggs and once the contamination was known, all cartons from the producer were pulled from the supermarket chain's shelves and destroyed. (Ibid.) The trial court declined to certify a class of individuals who purchased eggs from the supermarket during a five-month period and were not injured, finding the class was not ascertainable because there was no way of knowing which eggs were defective and thus whether these consumers purchased a defective product. (Id. at p. 67.) The appellate court agreed with this reasoning and affirmed. (Id. at pp. 69-70.)
The Tobacco II court found the Court of Appeal's holding in Collins to be "questionable" on the issue of the class members' right to recover on the UCL claim. (Tobacco II, supra, 46 Cal.4th at p. 322.) The Tobacco II court stated that "[i]t is clear in Collins that some of the purchasers in question may have purchased contaminated eggs — therefore, the `money or property' of the entire class of purchasers `may have been acquired by means' of an unfair practice (§ 17203), thus entitling them to restitution for their loss." (Id. at pp. 322-323.)
B. CLRA and Fraud Claims
On appeal Sevidal also contends the court erred in denying class certification on his fraudulent concealment and CLRA claims, but he does not state the factual basis for this assertion or develop any legal argument on these points. Thus, he has waived any challenge with respect to these claims. (See Associated Builders & Contractors, Inc. v. San Francisco Airports Com. (1999) 21 Cal.4th 352, 366, fn. 2 [87 Cal.Rptr.2d 654, 981 P.2d 499].)
Even if we were to reach the issues on the merits, we would find no error.
Judgment affirmed. Appellant to pay respondent's costs on appeal.
Huffman, Acting P. J., and Nares, J., concurred.