THE "CATCH-22" OF RULE 23(B) (2): PAST PURCHASER'S STANDING TO PURSUE INJUNCTIVE RELIEF.

• Author: Tompkins, Margarete

INTRODUCTION

Frosted Strawberry Pop-Tarts containing as much pear as they do strawberry. (1) Betty Crocker Fudge Brownies not being fudgy enough. (2) A&W Root Beer, advertised as being "MADE WITH AGED VANILLA," containing artificial vanilla. (3)

These are just a few of the variety of class actions that have been brought in recent years, with plaintiffs seeking to enjoin what they claim are deceptive business practices. (4) But are these just frivolous claims brought by "bounty hunter[]" class attorneys seeking to cash in on alleged corporate misdeeds? (5) Or, instead, are these legitimate claims that will protect the public at large from further misrepresentation by corporations?

The answer may depend on one's conception of the broader purpose and function of the class action lawsuit. David Marcus encapsulates the dichotomy of views well: "The conflict involves a basic problem that, to my mind, any history of Rule 23 must address: is the class action a mere procedural device, or is it a regulatory instrument?" (6) Early conceptions of the class action lawsuit in the United States only viewed the class action as a procedural tool, meant to aggregate similar claims. (7) Only later did the regulatory power of the class action become clear, when it was used from the 1940s to the 1960s to advance civil rights causes. (8) When it comes to whether past purchasers of a product have standing to pursue injunctive relief under Rule 23(b) (2), (9) the answer to whether such plaintiffs have standing can be clearly split by one's view of the class action lawsuit.

The quesdon of standing in the Rule 23(b)(2) context poses a unique problem. The basic fact pattern of many of the cases brought is as follows. A plaintiff purchases a product, discovers the alleged false labeling, and then tries to bring a class action to enjoin the false labeling. Many of these plaintiffs bring a suit for money damages and injunctive relief, arguably because Rule 23(b) (2) has a lower bar for class certification than Rule 23(b)(3), which requires both predominance and superiority. (10)

However, now that plaintiffs are aware of the alleged false labeling, many courts have held they no longer have standing to pursue injunctive relief because the plaintiffs now lack one of the three requirements of standing: future harm "likely... redressed by a favorable decision."" The plaintiffs, it is assumed, are unlikely to buy the product again because they know of the alleged false labeling. "A Tool me once' plaintiff does not need an injunction if he or she is not going to buy the product again anyway. There is no risk of 'fool me twice,' so there is no basis for an injunction." (12) A past purchaser either will not buy the product again, or, even if they do repurchase, they now know the labeling is allegedly false and thus are not harmed anew by it. "Thus, any potential 'future injury is merely conjectural or hypothetical' because even if [the] plaintiff[s] purchased the [p]roducts again, [they] would do so 'with exactly the level of information' that [they] possessed from the outset of this suit, and accordingly would not be deceived or harmed." (13)

The situation presents a "Catch-22" of sorts. (14) The moment plaintiffs gain awareness of false labeling, they also lose standing in federal courts to ever enjoin the false labeling. The result is one that many courts are unwilling to accept because "were the Court to accept the suggestion that plaintiffs' mere recognition of the alleged deception operates to defeat standing for an injunction, then injunctive relief would never be available in false advertising cases, a wholly unrealistic result." (15) Especially if one sees the class action as a tool that can serve a quasi-regulatory purpose, allowing plaintiffs to essentially police conduct of businesses, one might be willing to "carve out an exception to the strictures of [the] law on injunctions, so that past purchasers can maintain class actions for such relief." (16)

If one views the class action as a "mere" procedural device, meant simply to aggregate similar claims for efficiency's sake, then one would probably believe that past purchasers do lack Article III standing. This line of argument posits that courts cannot ease standing requirements "no matter how commendable" the policy objective because standing is a constitutional requirement. (17) Thus, while it may be true that past purchasers of a product are then foreclosed from injunctive relief entirely, there is no entitlement to injunctive relief. Even though this result might seem unjust or "unrealistic," there is no requirement that the courts provide injunctive relief. Plaintiffs can seek monetary damages or even pursue injunctive relief in state courts, but they do not have standing for such claims in federal courts. Many courts, in dismissing claims for injunctive relief, propose as much: "[The plaintiffs'] claim for injunctive relief is denied, but [they are] not precluded or constrained from seeking injunctive relief in state court." (18) Such offers by federal courts, while true in theory, lack any real bite.

This Note argues that past purchasers of a product have standing to pursue injunctive relief under Rule 23(b) (2). Part I discusses class actions and the current state of caselaw on false-labeling cases. I.A discusses the history of class actions generally, as well as the differing views on the purpose of Rule 23 throughout its history. I.B then provides background on standing, both generally and in the class action context. I.C explains the existing caselaw on standing for past purchasers, illustrating the looming circuit split on the issue. Part II then begins the argument portion of this Note. II.A argues that in the typical past purchaser case, all the requirements of Rule 23 are met, both the 23(a) (19) prerequisites and the 23(b)(2) injunctive relief requirements. II.B will then argue that one can embrace both the procedural and regulatory conception of the class action, simultaneously. One can recognize the truth in the largely procedural conception of the rule while also recognizing that the Rule has come to serve a powerful regulatory purpose under certain circumstances where the regulatory role of the legislative and administrative branches is lacking. II.B uses the example of food-mislabeling cases to show where the class action can fill that gap. The Food and Drug Administration (FDA), the regulatory agency meant to police false labeling, is unable to fully police mislabeling due to the sheer volume of cases it faces. II.B explains how, when applied to past purchasers, the need to embrace the regulatory role becomes all the more clear because past purchasers in food-mislabeling cases have no other viable form of relief in federal courts.

1. HISTORICAL BACKGROUND

   A brief overview of the drafting history and revisions to Rule 23 are helpful for conceptualizing the overall purpose the rule was designed to serve. With the drafting history as background, this Note then turns to discussing standing. Standing is first discussed in the context of class actions, and then is explained regarding injunctive relief. Afterwards, a survey of existing caselaw on past purchasers' standing to pursue injunctive relief in federal courts is discussed.

   1. Class Actions Generally

      The role of the class action historically is one distinguishable from the role it plays in society now. Stephen Yeazell cautioned against attempts often made by academics to draw understanding from these early, seventeenth-century lawsuits that on their face bear resemblance to the modern class action (20): "In the earliest reported cases... group litigation functioned as a means of modernizing and adjusting the customary law governing manorial and parochial relationships on the eve of the agricultural revolution." (21) Every case Yeazell looked at from this early period involved members of rural agricultural communities, and unlike the modern class action, these groups existed absent the litigation. (22) Yeazell argues that these cases were less like the litigation of the modern class action and more like legislation; they redefined status groups instead of asserting individual legal rights. (23)

      While the difference in purpose of the historical class action and modern class action are well illustrated here, an overview of the history of the class action is still useful to answer the standing question originally posed. One of the earliest class action lawsuits in the United States was in West v. Randall in 1820. (24) There, Justice Story, sitting in the Circuit Court for the District of Rhode Island, articulated the early conception of the class action:

      It is a general rule in equity, that all persons materially interested, either as plaintiffs or defendants in the subject matter of the bill ought to be made parties to the suit, however numerous they may be. The reason is that the court may be enabled to make a complete decree between the parties, may prevent future litigation by taking away the necessity of a multiplicity of suits, and may make it perfectly certain, that no injustice shall be done, either to the parties before the court, or to others, who are interested by a decree, that may be grounded upon a partial view only of the real merits. (25) The rule, as stated above, is clearly distinguishable from the conception of the early class action in the sixteenth and seventeenth centuries, as it forms classes based on efficiency and fairness, not preexisting social classes. This rule was promulgated in Federal Equity Rules 48 and 38, which governed class actions federally until the enactment of the Federal Rules of Civil Procedure. (26) The main difference between the two Rules was that Rule 48 specifically stated decrees were without prejudice to rights and claims of parties that were absent from the lawsuit, but Rule 38 was silent on this matter. (27) The Court noted the significance of this...