February 01, 2023
5 Trends to Watch: 2023 Class Action Litigation
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- New opportunities for defending class actions with uninjured class members: In November, the U.S. Supreme Court denied certiorari in a case (Olean Wholesale Grocery Coop., Inc. v. Bumble Bee Foods LLC, 31 F.4th 651 (9th Cir. 2022)) that would have potentially resolved a circuit split on the issue of whether the presence of uninjured class members precludes certification of a class. A direct standing challenge is not the only way to challenge class certification in such circumstances, as the presence of uninjured class members can be leveraged under the traditional requirements of Rule 23 (predominance, adequacy, typicality, etc.).
- Omission-based product defect class actions: With the rise of product defect class actions based on an omission theory, defendants should be cognizant of the heightened risks of class certification where the claimed omission is uniform across potential putative class members. Leveraging variations in law concerning the situations in which a duty to disclose arises and the materiality of the alleged statements can provide strong substantive defenses. Businesses can also consider including robust disclosures or warnings to combat claims of reliance and exclusivity.
- Old and new state-specific statutes used to bring privacy class actions: The increase in privacy class actions is expected to continue with plaintiffs' attorneys pursuing new theories of liability under older statutes such as the Video Privacy Protection Act asserting claims based on the use of visitor tracking technology, as well as claims alleging that the use of "chatbot" web services, session replay and voice verification violates decades old wire-tapping statutes. Companies can also expect to see a continued increase in cases brought under new statutes, such as the Illinois Biometric Privacy Act and newly-enacted privacy laws in California and Virginia.
- New areas of exposure for companies face in personal care and cosmetics: Class action lawsuits asserting that personal care products and cosmetics are not "green," "natural," or "sustainable," despite being labeled or marketed as such, are likely to continue to increase in 2023. Plaintiffs may allege that a company's purported "eco-friendly" advertising is false and misleading and caused them to buy a product they would not have otherwise bought at an allegedly "inflated" price that they would not have otherwise paid. Businesses in this space are likely to also see an increase in class actions relating to the alleged presence of purportedly harmful chemicals (g., benzene, per- and polyfluoroalkyl substances (PFAS), etc.) in personal care products and cosmetics, claiming that a product's labeling or marketing suggesting the product is safe for use or "clean" is false and misleading because of the alleged presence of chemicals.
- The changing class action landscape in Europe: The EU's Representative Actions Directive required member states to amend their home laws to allow for consumer representative actions by December 25, 2022. The directive further calls for member states to have the required amendments take effect no later than June 25, 2023. Though (i) the scope of these amendments will vary widely by country and (ii) only "qualified entities:—as opposed to individuals—are authorized to bring representative actions on behalf of consumers, expect a marked increase in cross-border and domestic representative actions in EU countries as 2023 progresses.
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