2021 Trends in Bet-the-Company Class Actions
2022 looks to be a year where courts around the country will provide needed clarification on the impact of recent Supreme Court decisions concerning consumer class action litigation.
January 05, 2022 at 12:36 PM
5 minute read
From the ExpertsEach year brings change and 2021 is no different. From the Supreme Court issuing long-awaited clarity on what constitutes an automatic telephone dialing system under the TCPA to whether all members of a class must have standing and the eye-popping spike in lawsuits brought under the ADA and California's Unruh Civil Rights Act, the year was filled with major developments for the most frequently filed consumer class actions: ADA, false advertising, TCPA and privacy based actions.
ADA and Unruh: WCAG 2.0, 2.1, 2.2 or None of the Above?
In 2021, the increase of cases in both state and federal courts against small and medium-sized businesses whose websites are allegedly not compliant with the ADA or the Unruh Act continued. Ever since 2017, when the Department of Justice withdrew its endorsement of Web Content Accessibility Guidelines (WCAG) 2.0, it has been unclear whether or not businesses are required to make their websites ADA complaint, and whether or not conformity with WCAG is a necessary component of compliance. This lack of guidance has led some courts to hold that a business's website qualifies as a "place of public accommodation" under the ADA, even when a business does not have a physical location that provides a "nexus" to the website. In response to the flood of lawsuits, some courts are finally starting to push back. For example, in April 2021, in Winn-Dixie, the Eleventh Circuit found that websites are not "places of public accommodation" under the ADA. At the state court level, in September 2021 in Omni Hotels Management, the California Court of Appeals affirmed a jury verdict in favor of the defendant hotel management corporation after the jury determined that the plaintiff did not possess a "bona fide intent" to use the defendant's services, a pre-requisite to establish standing to sue under the Unruh Act. Without meaningful input from federal and state legislators and regulatory agencies, it is nearly certain that the trend of appellate courts making consequential decisions regarding application of the ADA and the Unruh Act will continue in 2022.
False Advertising: More Than Just Vanilla
Challenges to flavored foods, including class actions alleging that various vanilla-labeled products are not actually flavored with vanilla beans or extract but are instead flavored with other ingredients, continue to grow. In July 2021, the Ninth Circuit affirmed dismissal of a putative consumer class action alleging Trader Joe's misleadingly labeled its store brand honey as "100% New Zealand Manuka Honey," where testing showed only 60% of the honey derived from Manuka flower nectar. Moore v. Trader Joe's Co., No. 19-16618 (9th Cir. July 15, 2021). In reaching its decision, the court reinforced the importance of the "reasonable consumer" standard and the context in which information is provided to consumers in assessing whether advertising is likely to mislead.
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