Mueller v. Puritan's Pride, Inc.

Background

Puritan's Pride markets and sells vitamins and supplements through catalogs, email, mail, and a website. It sells most of its products through buy-one-get-one, or “BOGO,” promotions. The plaintiffs alleged that these promotions were deceptive because the prices of products described as “free” were included in the prices of the products customers had to purchase.

The order addressed Puritan's Pride’s motion for summary judgment on the plaintiffs’ remaining claims in the class action. Earlier orders had dismissed the New York-law claims, granted Puritan's Pride summary judgment barring damages and restitution under the California False Advertising Law, and denied summary judgment on actual damages under the California Consumer Legal Remedies Act. The court had also certified a class for injunctive relief on the plaintiffs’ Consumer Legal Remedies Act and California Unfair Competition Law claims, while denying certification for monetary relief.

Summary-Judgment Standard

Summary judgment is appropriate when the moving party shows that no genuine dispute exists about any material fact and that it is entitled to judgment as a matter of law. A genuine dispute exists when the evidence could allow a reasonable jury to decide for the opposing party. The court must view the evidence in the light most favorable to the party opposing summary judgment.

Consumer Deception

Puritan's Pride argued that summary judgment was warranted because the plaintiffs had not produced evidence showing that reasonable consumers would be deceived by the BOGO promotions, as required by the Unfair Competition Law and Consumer Legal Remedies Act. The court explained that both claims use the “reasonable consumer” test and require evidence that members of the public are likely to be deceived.

The court found enough disputed evidence for a trial. The evidence included declarations and depositions from the named plaintiffs stating that the BOGO promotions misled them; Puritan's Pride’s internal marketing research showing favorable consumer responses and repeat visits to its website because of the promotions; and an analysis by plaintiffs’ expert Brian Bergmark stating that almost all of Puritan's Pride’s sales were BOGO purchases.

The court also relied on unchallenged portions of Dr. Larry Compeau’s expert report. Those portions included opinions that the advertised BOGO prices were deceptive, were likely to increase consumers’ perceptions of value and their likelihood of making purchases, and made consumers less likely to search for lower prices. Dr. Compeau also opined that Puritan's Pride’s reference prices lacked veracity because the company did not make a substantial number of sales at those prices.

Unlawful-Prong Claim

Puritan's Pride separately sought summary judgment on the “unlawful” prong of the Unfair Competition Law. That prong treats violations of other laws as independently actionable unfair-competition practices. Puritan's Pride argued that, because the court had concluded that the False Advertising Law did not apply, the only remaining basis for the Unfair Competition Law claim was a Federal Trade Commission guide, which Puritan's Pride said was not a law under the statute.

The court did not decide whether that guide could serve as a predicate law. It held that the plaintiffs had ample grounds to maintain the Unfair Competition Law claim based on alleged violations of the Consumer Legal Remedies Act. Puritan's Pride’s argument that it should prevail on the Consumer Legal Remedies Act claim presented disputed factual issues that had to be tried.

Disposition

The court denied summary judgment across the board. It also declined to consider, at that stage, Puritan's Pride’s request to strike portions of Dr. Compeau’s report, relying only on the unchallenged portions. The court scheduled a status conference and directed the parties to address dates for the pretrial conference and trial.