Newspaper: Metropolitan News-Enterprise

Publication Date: Wednesday, September 6, 2006

Page No.: 1

Headline: Individual, Not Common Issues Dominate in Tobacco Lawsuit—C.A.

Byline: By a MetNews Staff Writer

Body: Individual issues predominate in claims of false advertising against tobacco companies under the state’s unfair competition law, making such a suit inappropriate for a class action, the Fourth District Court of Appeal ruled yesterday.

Div. One affirmed San Diego Superior Court Judge Ronald S. Praeger’s order decertifying a class action against tobacco companies Phillip Morris USA Inc., R.J. Reynolds Tobacco Company, Lorillard Tobacco Company, Brown & Williamson Tobacco Corporation and others under the UCL..

In a complaint filed in 1997 plaintiffs alleged that the cigarette makers made false and misleading statements in their advertising denying or disputing the health hazards and addictiveness of cigarette smoking, and targeted minors, in violation of the UCL and other laws. Plaintiffs’ alleged that class members became smokers and purchased defendants’ cigarettes as a result of these misrepresentations.

Praeger originally granted a motion to certify the suit as a class action with respect to the UCL claim because at the time the law did not require individualized determinations as to reliance. The class was composed of smokers who were residents of California between June 10, 1993, and April 23, 2001 who were exposed to defendants’ marketing and advertising in California.

But Praeger decertified the class after California voters in 2004 approved Proposition 64, which requires private plaintiffs in a UCL suit to have “suffered injury in fact and . . . lost money or property as a result of such unfair competition.”

Injury In Fact

Praeger ruled that to establish standing the individual plaintiffs and all class members were required to show injury in fact consisting of lost money or property caused by the unfair competition. He further found that the requirement of individual reliance meant the individual issues were predominate over the common ones, making the case unsuitable for a class action.

Plaintiffs appealed arguing that Prop 64 didn’t apply because their action was filed before the measure was approved. But, while plaintiffs’ appeal was pending, the Supreme Court decided in Californians for Disability Rights v. Mervyns, LLC (2006) 39 Cal.4th 223 that Prop 64 applies to cases that were pending when it passed.

Plaintiffs also claimed that Praeger erred in finding that the individual issues were predominate. They argued:

“[T]he question for class certification . . . is not whether each class member saw or relied on a specific advertisement, but whether a reasonable person would, in light of defendants’ campaign of misrepresentations, buy — and continue to buy — cigarettes.”

Numerous Misrepresentations

But Presiding Justice Judith McConnell, writing for the court of appeal, said:

“There were numerous misrepresentations occurring over more than a half a century. The representations changed over time as did the general dissemination of information about the health risks and addictiveness of cigarette smoking. . . . Therefore, all class members were not exposed to the same representations or information about the health risks and addictiveness of cigarettes.”

McConnell concluded:

“Individual determinations would have to be made as to when the class members began smoking, what representations they were exposed to, what other information they were exposed to, and whether their decision to smoke was a result of defendants’ misrepresentations (and thus they suffered an injury due to defendants’ conduct) or was for other reasons. The numerous individual determinations render this case unsuitable for a class action.”

Justices Judith L. Haller and Alex C. McDonald concurred in the opinion.

The case is In re Tobacco II Cases, 06 S.O.S. 4795