A cut up Ninth Circuit panel lately overturned a $24 million judgment in a category motion lawsuit towards Kimberly-Clark and its spinoff, Halyard Well being. Bahamas Surgical procedure Heart v. Kimberly-Clark et al., No. 18-55478 (ninth Cir. July 23, 2020).
Plaintiff class consultant Bahamas Surgical procedure Heart accused the defendants of misrepresenting the effectiveness of their surgical robes at stopping the unfold of illness. In accordance with plaintiff, defendants falsely represented that their surgical robes had been compliant with the Affiliation for the Development of Medical Instrumentation (AAMI) business normal, however didn’t disclose testing failures that actually rendered them noncompliant. Primarily based on these allegations, the district courtroom allowed Plaintiffs to pursue class claims for fraudulent concealment and violation of California’s Unfair Competitors Legislation. At trial, the jury discovered defendants violated these legal guidelines and awarded the category $450 million in compensatory and punitive damages. The district courtroom subsequently diminished this award, getting into judgment within the quantity of $24 million.
On attraction, defendant Halyard argued that the district courtroom erred find the category consultant had standing to deliver claims towards Halyard. Halyard was spun off from Kimberly-Clark shortly after the lawsuit was initiated, so it didn’t exist on the time of plaintiffs’ alleged accidents. The district courtroom discovered standing based mostly on a juridical hyperlink between defendants, however the Ninth Circuit panel reversed. Though Halyard additionally bought robes following the spin-off, the category consultant didn’t buy any robes from Halyard and none of its accidents had been traceable to Halyard’s conduct. With out its personal declare towards Halyard, the panel held the category consultant couldn’t search reduction on behalf of different class members — even these with probably legitimate claims towards Halyard. The Ninth Circuit subsequently put aside the judgment towards Halyard and remanded with directions to dismiss the claims towards it.
Kimberly-Clark argued that the district courtroom abused its discretion by refusing to decertify the category for lack of predominance. The panel agreed, discovering that particular person points predominated relating to the materiality of the purported non-disclosure of AAMI take a look at failures, and that the shortage of predominance was deadly to certification as to each the fraudulent concealment and UCL claims. The proof the district courtroom relied on to seek out materiality solely utilized to transactions involving robes labeled with an AAMI ranking. Nevertheless, for a majority of the category members, the robes they bought didn’t show an AAMI ranking on the packaging. Discovering no proof an affordable individual would think about omissions referring to AAMI take a look at failures materials the place the robe had not been labeled with an AAMI ranking, the Ninth Circuit vacated the judgment towards Kimberly-Clark and remanded for additional proceedings.
The dissent partly opined that the decrease courtroom was right to not decertify the fraudulent concealment class for lack of predominance. The dissenting decide famous that based mostly on his studying of California regulation, a plaintiff needn’t present that particular person class members had been uncovered to particular misrepresentations to succeed on such a declare.
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