In the coming year, expect to see the tide begin to turn for the dietary supplement industry in class action cases filed around the country where plaintiffs claim deceptive practices in advertising and labeling.
In June, the US Supreme Court terminated the largest class action ever filed, involving 1.5 million employees of 3,400 Walmart stores who sued over employment discrimination. While the legal principles in the Walmart case are different from those in class action cases against supplement marketers, the decision signals a trend away from approving class action treatment for such claims.
In several cases claims have been dismissed that were too individualized. My firm, Arnstein & Lehr, defeated one such claim on behalf of Celsius, the maker of an energy drink marketed as "Your Ultimate Fitness Partner." In that case we convinced a California court to dismiss a consumer class action lawsuit on summary judgment because the plaintiffs' individual experiences with the product could never form the basis for standing to sue.
I believe that the explosion of class action lawsuits has more to do with leverage gained by plaintiffs' lawyers seeking fees than it does with the merit of the suits themselves. These suits are supposed to compensate victims who suffer small losses from overstated health claims, but often end up compensating the lawyers most of all. But that may be changing, and I expect to see more of it in the year to come.
Joel Rothman is a partner and co-chair of the Arnstein & Lehr Food, Beverage and Nutrition law practice group.