Defending Defective Product Claims Under the Consumer Legal Remedies Act

For many years, plaintiffs and their attorneys have wielded the California Consumer Legal Remedies Act (“CLRA” or the “Act”) as a powerful weapon against companies for allegedly misleading consumers about goods and services sold in the marketplace. Among other things, the CLRA enables consumers to bring class actions based on broad allegations of product defects framed either as affirmative misrepresentations or fraudulent omissions. The exposure from these cases are magnified not only by the expansive scope of claims permitted under the Act, but also by the availability of statutory attorneys’ fees. Although consumers and their attorneys continue to discover more and more creative ways to allege that consumers have been misled by representations and product advertising, companies have found a variety of ways to successfully defend against CLRA claims.  This article explores some of those legal strategies with particular attention to strategies undertaken by manufacturers of electronic and other devices. Many of these strategies are common to other California consumer claims, such as the Unfair Competition Law (Cal. Bus. & Prof. Code § 17200), and False Advertising Law (Cal. Bus. & Prof. Code § 17500).

A. General Overview of the CLRA

By way of background, the Consumer Legal Remedies Act of 1970, Cal. Civ. Code §§ 1750 et seq., is a California consumer protection statute which allows plaintiffs to bring private civil actions for “unfair methods of competition and unfair or deceptive acts or practices undertaken by any person in a transaction . . . which results in the sale or lease of goods or services to any consumer.” Cal. Civ. Code § 1770(a).  The purposes of the CLRA are “to protect consumers against unfair and deceptive business practices and to provide efficient and economical procedures to secure such protection.”  Cal. Civ. Code § 1760.

As noted, the CLRA only applies to the sale of consumer goods and services.  More specifically, the CLRA enables any “consumer” who suffers any damage to obtain monetary recovery and injunctive relief. Cal. Civ. Code § 1780(a).  The deceptive act or practice must be undertaken by the defendant in a transaction that results “in the sale or lease of goods or services to any consumer[.]” Cal. Civ. Code § 1770(a) (emphasis added).

This is significant because purchases made by a business or other entity are generally not covered by the CLRA.  See, e.g., Ting v. AT&T, 319 F.3d 1126, 1148 (9th Cir. 2003) (“[T]he CLRA does not apply to commercial or government contracts, or to contracts formed by nonprofit organizations and other non-commercial groups.”); Cal. Grocers Ass’n v. Bank of Am., 22 Cal.App.4th 205, 217 (1994) (trade group is not “consumer” of services for personal, family, or household purposes as defined within CLRA).  A “consumer” is by definition “an individual[.]” Cal. Civ. Code § 1761(d). Moreover, only sales concerning goods “for use primarily for personal, family, or household purposes” are covered by the Act. Cal. Civ. Code § 1761(a) (emphasis added); see also Cal. Civ. Code § 1761(b) (defining “[s]ervices” as “work, labor, and services for other than a commercial or business use . . .”) (emphasis added).

The CLRA specifically contemplates the ability to file class actions for violation of the Act’s provisions: “[a]ny consumer entitled to bring an action under Section 1780 may, if the unlawful method, act, or practice has caused damage to other consumers similarly situated, bring an action on behalf of himself and such other consumers to recover damages or obtain other relief as provided for in Section 1780.”  Cal. Civ. Code § 1781(a).

B. What Conduct Is Deemed Unlawful Under the CLRA?

A wide array of unlawful and deceptive practices are deemed violations of the CLRA. Generally speaking, a claim for violation of the CLRA, along with other California consumer claims, is governed by the “reasonable consumer” test.  Williams v. Gerber Prod. Co., 552 F.3d 934, 938 (9th Cir. 2008). Under this standard, the plaintiffs must “show that members of the public are likely to be deceived.” Id. (quoting Freeman v. Time, Inc., 68 F.3d 285, 289 (9th Cir. 1995)).

The Act itself specifies a laundry list of more than 25 “unfair methods of competition and unfair or deceptive acts and practices” in connection with the sale or lease of goods and services to consumers that are “unlawful.” Cal. Civ. Code § 1770(a).  Although this list is extremely broad, covering virtually any conceivable act of deception, examples of such deceptive acts and practices that are more likely to be applicable to manufacturers of allegedly defective and falsely advertised products include the following: 

• Passing off goods or services as those of another. Cal. Civ. Code § 1770(a)(1). 

• Misrepresenting the source, sponsorship, approval, or certification of goods or services. Cal. Civ. Code § 1770(a)(2). 

• Misrepresenting the affiliation, connection, or association with, or certification by, another. Cal. Civ. Code § 1770(a)(3). 

• Representing that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits, or quantities that they do not have or that a person has a sponsorship, approval, status, affiliation, or connection that the person does not have. Cal. Civ. Code § 1770(a)(5). 

• Representing that goods are original or new if they have deteriorated unreasonably or are altered, reconditioned, reclaimed, used, or secondhand. Cal. Civ. Code § 1770(a)(6). 

• Representing that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another. Cal. Civ. Code § 1770(a)(7). 

• Disparaging the goods, services, or business of another by false or misleading representation of fact. Cal. Civ. Code § 1770(a)(8). 

• Advertising goods or services with intent not to sell them as advertised. Cal. Civ. Code § 1770(a)(9).

• Inserting an unconscionable provision in the contract. Cal. Civ. Code § 1770(a)(19). 

• Selling or leasing “grey market” goods. Cal. Civ. Code § 1770(a)(21). 

In addition to affirmative misrepresentations, fraudulent omissions may also violate the CLRA when the omission is “contrary to a representation actually made by the defendant, or an omission of a fact the defendant was obliged to disclose.”  Hodsdon v. Mars, Inc., 891 F.3d 857, 865 (9th Cir. 2018) (quoting Daugherty v. Am. Honda Co., 144 Cal.App.4th 824, 835 (2006)).  An essential element for a fraudulent omission claim under the CLRA and other California consumer statutes is actual reliance.  Daniel v. Ford Motor Co., 806 F.3d 1217, 1225 (9th Cir. 2015). “To prove reliance on an omission, a plaintiff must show that the defendant’s nondisclosure was an immediate cause of the plaintiff’s injury-producing conduct. A plaintiff need not prove that the omission was the only cause or even the predominant cause, only that it was a substantial factor in his decision. A plaintiff may do so by simply proving that, had the omitted information been disclosed, one would have been aware of it and behaved differently.”  Id. (citations and quotation marks omitted).  “That one would have behaved differently may be presumed, or at least inferred, when the omission is material.”  Id.

C. What Remedies Are Available to Plaintiffs Under the CLRA?

Civil Code section 1780(a) covers remedies available to consumers under the CLRA. It states that: Any consumer who suffers any damage as a result of the use or employment by any person of a method, act, or practice declared to be unlawful by Section 1770 may bring an action against that person to recover or obtain any of the following:

(1) Actual damages, but in no case shall the total award of damages in a class action be less than one thousand dollars ($1,000). 

(2) An order enjoining the methods, acts, or practices. 

(3) Restitution of property. 

(4) Punitive damages. 

(5) Any other relief that the court deems proper. 

Cal. Civ. Code § 1780(a).

“Actual damage” under the CLRA is the “difference between the actual value of that with which the defrauded person parted and the actual value of that which he received.”  Krueger v. Wyeth, Inc., 396 F.Supp.3d 931, 948 (S.D. Cal. 2019) (quoting Colgan v. Leatherman Tool Grp., Inc., 135 Cal.App.4th 663, 676 (2006)). This is sometimes referred to as the “out-of-pocket” loss calculation.  See CACI 1923; Cal. Civ. Code § 3343. 

In addition to these remedies, the CLRA provides that “[t]he court shall award court costs and attorney’s fees to a prevailing plaintiff in litigation[.]”  Cal. Civ. Code § 1780(e).  A “prevailing defendant,” on the other hand, may be awarded reasonable attorney’s fees only “upon a finding by the court that the plaintiff’s prosecution of the action was not in good faith.”  Cal. Civ. Code § 1780(e).
Non-restitutionary disgorgement, which focuses on the defendant’s unjust enrichment, is unavailable under the CLRA.  Hadley v. Kellogg Sales Company, 324 F.Supp.3d 1084, 1113 (N.D. Cal. 2018) (quoting In re Tobacco Cases II, 240 Cal.App.4th 779, 800 (2015)).

D. What Are Some Common Defenses to CLRA Claims that Manufacturers of Allegedly Defective Products Frequently Invoke Successfully?

1. Class Action Waivers By Way of Federal Preemption under the FAA

As noted above, the CLRA specifically contemplates that consumers may bring class actions for violations of the substantive provisions of the CLRA.  See Cal. Civ. Code § 1781(a).  Moreover, a defendant’s ability to compel the plaintiff to waive his or her rights to bring a class action is prohibited by the anti-waiver provision of Civil Code section 1751, which states: “[a]ny waiver by a consumer of the provisions of this title is contrary to public policy and shall be unenforceable and void.”  Cal. Civ. Code § 1751; see also Sanchez v. Valencia Holding Co., LLC, 61 Cal.4th 899, 923 (2015) (“[C]lass actions are among the provisions of the CLRA that may not be waived.”).

However, this does not end the analysis. The Supreme Court held in AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 352 (2011), that the Federal Arbitration Act (FAA) preempted California’s unconscionability rule prohibiting class action waivers in consumer arbitration agreements.  According to the California Supreme Court in Sanchez, under Concepcion, “the CLRA’s anti-waiver provision is preempted insofar as it bars class waivers in arbitration agreements covered by the FAA.”  Sanchez, 61 Cal.4th at 924; see also Ting v. AT&T, 319 F.3d 1126, 1148 (9th Cir. 2003) (holding that FAA preempted the CLRA and thus long distance carrier’s consumer services agreement’s class action ban was not unenforceable).

Because the FAA applies to contracts facilitating, or directly or indirectly affecting, interstate commerce, which is interpreted broadly by the courts, the preemption of the CLRA’s anti-waiver provisions under the Sanchez case has potentially far-reaching consequences.  However, preemption has its limitations. Although defendants have been able to successfully defeat CLRA class actions brought where consumers have entered into formal written contracts with the defendant—as in the case of the purchase of an automobile or wireless telephone service—it is less clear how manufacturers selling goods purchased off the shelf at retail would be able to benefit from preemption. Moreover, Concepcion does not preempt state law rules invalidating mandatory arbitration or other provisions in a consumer contract where a consumer establishes that the contract is substantively and procedurally unconscionable. See, e.g., Sonic-Calabasas A, Inc. v. Moreno, 57 Cal.4th 1109, 1142 (2013) (“[A]fter Concepcion, unconscionability remains a valid defense to a petition to compel arbitration.”).  Therefore,
companies’ ability to do away with consumer class actions altogether under the CLRA through imposing class action waivers is far from complete.

2. Lack of Standing

One of the most common defenses asserted by defendants to a claim brought under the CLRA is that the plaintiffs lack standing. To establish standing under the CLRA, the plaintiff “must meet an economic injury-in-fact requirement, which demands no more than the corresponding requirement under Article III of the U.S. Constitution.”  Reid v. Johnson & Johnson, 780 F.3d 952, 958 (9th Cir. 2015). To establish Article III standing, the plaintiff must satisfy three elements: (1) “injury in fact—an invasion of a legally protected interest which is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical”; (2) causation—“there must be a causal connection between the injury and the conduct complained of—the injury has to be fairly traceable to the challenged action of the defendant, and not the result of the independent action of some third party not before the court”; and (3) redressability—“it must be likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.”  Lujan v. Defenders of Wildlife, 504 U.S. 555, 560–61 (1992) (internal quotation marks, ellipses, and citations omitted).

When the case is a class action, the named plaintiff “must show that she personally has suffered an injury, not just that other members of the proposed class suffered the injury.”  Pirozzi v. Apple, Inc., 966 F. Supp. 2d 909, 917 (N.D. Cal. 2013) (citing Lierboe v. State Farm Mut. Auto Ins. Co., 350 F.3d 1018, 1022 (9th Cir. 2003)). “Economic injury is clearly a sufficient basis for standing.”  San Diego Cty. Gun Rights Comm. v. Reno, 98 F.3d 1121, 1130 (9th Cir. 1996).  More specific to the CLRA, a claim may only be brought by a “consumer,” defined as one who “seeks or acquires, by purchase or lease, any goods or services for personal, family or household purposes.”  Cal. Civ. Code § 1761(d).  Moreover, “in order to bring a CLRA action, not only must a consumer be exposed to an unlawful practice, but some kind of damage must result.”  Meyer v. Sprint Spectrum L.P., 45 Cal.4th at 646, 634 (2009).

In Reid, the Ninth Circuit held that the plaintiff had standing to pursue his CLRA claim by alleging he would not have been willing to pay as much as he did for [the defendants’ food product], if anything, if he had not been misled by [the defendants’] misrepresentations about [the product’s] health effects.”  Reid, 780 F.3d at 958; see also Pirozzi v. Apple, Inc., 966 F.Supp.2d 909, 920 (N.D. Cal. 2013) (consumer’s allegations that she overpaid for her mobile device as a result of device manufacturer’s alleged misrepresentations regarding nature and integrity of its devices asserted economic injury synonymous with “lost money” sufficient to satisfy standing requirements for claim under CLRA).

In contrast, the Court found no economic injury sufficient to confer standing in In re Facebook Privacy Litig., 791 F.Supp.2d 705, 717 (N.D. Cal. 2011), aff’d, 572 F. App’x 494 (9th Cir. 2014). There, the plaintiffs alleged Facebook allowed “anyone . . . to register for its services free of charge.”  Id.  The Court found that the plaintiff’s contention that “their personal information constitutes a form of ‘payment’ to Defendant” failed to state a claim under the CLRA.  Id. 

The case of In re Vizio, Inc., Consumer Privacy Litig., 238 F.Supp.3d 1204 (C.D. Cal. 2017), presents the type of case and competing arguments defendants are likely to see more of as data privacy becomes a greater concern to consumers.  There, the plaintiffs filed a putative class action against a smart television manufacturer alleging that the software pre-installed on the defendant’s televisions collected and reported consumers’ content viewing histories and sold them to third parties without adequately disclosing this practice in its marketing and privacy policies. The plaintiffs brought a number of statutory and common law claims, including a claim for violation of the CLRA.  The defendants argued the plaintiffs lacked Article III standing for all of their claims, including the CLRA claim. The Court rejected the defendants’ argument that the plaintiffs lacked standing because they failed to allege Vizio misrepresented its “product’s quality or ability to perform an intrinsic function” such as “television-related functions.” Id. at 1217.  Instead, the Court found the plaintiffs’ allegation that “had they known about Vizio’s data collection and disclosure practices, they would not have purchased their Vizio Smart TVs or would have paid less for them” as sufficient economic injury to confer Article III standing.  Id.

In sum, the hallmark of standing in consumer claims like the CLRA is whether the plaintiff sufficiently establishes he or she has suffered an economic injury as a result of the defendant’s misrepresentations or omissions.  Economic injury is typically established by asserting the plaintiff has lost money or property, or overpaid for a good or service, due to the defendant’s conduct. Claims that fail to make these essential allegations are vulnerable to an argument that they should be dismissed for lack standing.

3. Puffery

Another line of attack often deployed by corporate defendants in response to a claim alleging violation of the CLRA is that the alleged misrepresentations forming the basis of the claim is non-actionable puffery.  In other words, the representation is too vague to constitute a verifiable statement of fact and is instead akin to a company’s expression of an opinion about the product.

A misrepresentation must be a “specific and measurable claim, capable of being proved false or of being reasonably interpreted as a statement of objective fact.”  Rasmussen v. Apple Inc., 27 F.Supp.3d 1027, 1039-40 (N.D. Cal. 2014) (citing Coastal Abstract Serv., Inc. v. First Am. Title Ins. Co., 173 F.3d 725, 731 (9th Cir. 1999)). “Generalized, vague, and unspecified assertions constitute ‘mere puffery’ upon which a reasonable consumer cannot rely, and hence are not actionable.”  Anunziato v. eMachines, Inc., 402 F.Supp.2d 1133, 1139 (C.D. Cal. 2005) (citing Glen Hollywood Entm’t, Inc. v. Tektronix, Inc., 343 F.3d 1000, 1005 (9th Cir. 2003)).  “Ultimately, the difference between a statement of fact and mere puffery rests in the specificity or generality of the claim. . . . Thus, a statement that is quantifiable, that makes a claim as to the specific or absolute characteristics of a product, may be an actionable statement of fact while a general, subjective claim about a product is non-actionable puffery.”  Demetriades v. Yelp, Inc., 228 Cal.App.4th 294, 311 (2014) (quoting Newcal Indus., Inc. v. Ikon Office Solution, 513 F.3d 1038, 1053 (9th Cir. 2008)).

The rulings of courts where these principles are applied are very fact-specific. For example, in Beyer v. Symantec Corp., the district court found that the defendant’s statements in connection with its consumer security software that it “defends you against a broad range of online threats through key technologies, including antivirus, antispyware rootkit detection, and automatic updates” were “general descriptions” that constituted “non-actionable puffery.”  333 F.Supp.3d 966, 977 (N.D. Cal. 2018).  However, its representations that its software provided “enhanced protection” through “industry leading virus, spyware and firewall protection” were “sufficiently specific so as to not constitute mere puffery at the pleading stage.” Id. at 976-77.  The Court explained that the defendant’s “statement that its software is ‘industry leading’ could lead a reasonable consumer to believe that Symantec software would adhere to industry best practices. . . . Best practices may be sufficiently concrete to be provable.”  Id. at 977.

Elias v. Hewlett-Packard Co., 903 F.Supp.2d 843 (N.D. Cal. 2012), is another example of the fact-specific nature of the puffery defense. There, a consumer brought a putative class action against Hewlett-Packard arising out of the purchase of a laptop. He asserted that his purchase of an upgraded graphics card with the laptop, which required a higher power supply than the laptops came with, created a risk of overheating and catching fire In purchasing the laptop, the plaintiff had relied on statements on the manufacturer’s website advertising that the computers at issue had “ultra-reliable performance,” “full power and performance,” “versatile, reliable system[s],” and were “packed with power” and “delivers the power you need.”  Id. at 854.  The Court held that these were “[g]eneralized advertisements” that “say nothing about the specific characteristics or components of the computer.”  Id. at 855; see also Frenzel v. AliphCom, 76 F.Supp.3d 999, 1011- 12 (N.D. Cal. 2014) (alleged statements on box of seller’s fitness-tracking wristband, including “understand your sleep and wake up refreshed” and “measure daily activity and calories burned,” were not affirmative representations regarding wristband’s reliability, but rather they were vague statements about general functionality that were not actionable); Anunziato v. eMachines, Inc., 402 F.Supp.2d 1133, 1140 (C.D. Cal. 2005) (statements that a line of laptops has the “latest technology” and “outstanding quality, reliability, and performance” are non-actionable puffery, where the plaintiff alleged the laptops contained a defect that caused them to overheat); Consumer Advocates v. Echostar Satellite Corp., 113 Cal.App.4th 1351, 1353 (2003) (statements that satellite television company would provide “crystal clear digital video” and “CD-quality audio” were “mere puffing,” but statements that service included on-screen guide showing schedule “up to 7 days in advance” and 50 channels of content” were actionable).

4. Absence of Reliance

“[A] CLRA claim based in fraud requires reliance.”  Richter v. CC-Palo Alto, Inc., 176 F. Supp. 3d 877, 899 (N.D. Cal. 2016); Daniel v. Ford Motor Co., 806 F.3d 1217, 1225 (9th Cir. 2015) (“An essential element for a fraudulent omission claim [under the CLRA] is actual reliance.”) (citing Cohen v. DIRECTV, Inc., 178 Cal.App.4th 966, 980 (2009)).  “In order to show actual reliance, whether based on an affirmative misrepresentation or a material omission, Plaintiffs must demonstrate that the misrepresentation or omission was an ‘immediate cause of the injury-causing conduct.’”  Sud v. Costco Wholesale Corp., 229 F. Supp. 3d 1075, 1083 (N.D. Cal. 2017), aff’d, 731 F. App’x 719 (9th Cir. 2018) (quoting In re Tobacco II Cases, 46 Cal.4th 298, 328 (2009)); Daniel, 806 F.3d at 1225. “A plaintiff need not prove that the omission was the only cause or even the predominant cause, only that it was a substantial factor in his decision.”  Id.  “A plaintiff may do so by simply proving ‘that, had the omitted information been disclosed, one would have been aware of it and behaved differently.’”  Id. (quoting Mirkin v. Wasserman, 5 Cal.4th 1082, 1093 (1993)).

Although reliance is generally assumed to be one of the easier elements for a plaintiff to satisfy, corporate defendants have found some success in obtaining dismissal of consumer claims by demonstrating that the plaintiff was not actually exposed to the representation he or she alleges was misleading prior to purchasing the offending product.

For example, in Sud, the plaintiff filed a class action against Costco for selling prawns farmed in Thailand where the supply chain was tainted by slavery, human trafficking, and other illegal labor practices.  The plaintiff alleged Costco failed to disclose these labor abuses on the packaging and, further, that the abuses contradicted representations Costco made on a “Disclosure Regarding Human Trafficking and Anti-Slavery” on its website, along with a supplier “Code of Conduct.”  The Court dismissed the plaintiffs’ claim because “neither Plaintiff alleges that she read or relied on the Disclosure before she purchased prawns from Costco.”  Id. at 1084. “Therefore, to the extent their claims are based allegations that the Disclosure is misleading, either because it contains affirmative misrepresentations or because it omits information, Plaintiffs fail to allege facts to show reliance.”  Id.; see also Stanwood v. Mary Kay, Inc., 941 F.Supp.2d 1212, 1218 (S.D. Cal. 2012) (dismissing claims relating to website and other documents where the plaintiff did not allege “that she viewed any of those sources, and therefore cannot link her injuries to those misrepresentations”).

The defendant exploited this same problem in the plaintiffs’ complaint in In re Apple Inc. Device Performance Litigation, 347 F.Supp.3d 434 (N.D. Cal. 2018). There, the plaintiffs alleged that Apple affirmatively misrepresented the characteristics of various iPhones, such as various representations concerning faster performance and better battery life.  Among other reasons for dismissal, the Court found “Plaintiffs do not plead exposure to Apple’s allegedly misleading advertising statements” and thus failed to specify which statements the plaintiffs actually saw and relied upon as required by Rule 9(b).  Id. at 458.

5. Failure to Raise an Unreasonable Safety Hazard in the Product or a Defect Central to the Product’s Function

In CLRA cases alleging pure omissions—i.e., the failure to disclose material facts concerning the product at issue—defendants have also attempted to argue that the plaintiffs’ case must be premised on the failure to disclose a “design defect [which] caused an unreasonable safety hazard.”  Wilson v. Hewlett-Packard Co., 668 F.3d 1136, 1143 (9th Cir. 2012).  The Court in Wilson argued that California federal courts interpreted California law as holding that a “manufacturer’s duty to consumers is limited to its warranty obligations absent either an affirmative misrepresentation or a safety issue.”  Id. at 1141 (quoting Oestreicher v. Alienware Corp., 322 Fed.Appx. 489, 493 (9th Cir. 2009)).

Although this is a popular defense invoked by corporate defendants, the viability of Wilson is doubtful.  Subsequent California decisions found that manufacturers had a duty to disclose defects even if unrelated to safety concerns.  See, e.g., Rutledge v. Hewlett-Packard, 238 Cal.App.4th 1164, 1176 (2015) (allowing consumer protection claims relating to notebook computers to proceed even without “defects relating to safety concerns”).  Acknowledging this point, the Ninth Circuit stated in 2018 that “recent California cases do cast doubt on whether Wilson’s safety-hazard requirement applies in all circumstances . . .”  Hodsdon v. Mars, Inc., 891 F.3d 857, 861-62 (9th Cir. 2018); Beyer v. Symantec Corp., 333 F.Supp.3d 966, 978 (N.D. Cal. 2018) (“The requirement . . . that there be a safety hazard has been cast into doubt by recent California Court of Appeal opinions.”). Moreover, Wilson itself acknowledged that those cases where the alleged defect existed upon purchase or within the express warranty period could be actionable even in the absence of a safety issue. See Wilson, 668 F.3d at 1142 n.1.  Accordingly, Defendants may find judges to be sympathetic to a requirement of a duty to disclose safety defects only in those cases where the latent defect manifests after the warranty period.

A more credible attack on a consumer claim alleging omissions of material facts concerning a product is to argue that the alleged product defect “was central to the product’s function[.]”  Hodsdon v. Mars, Inc., 891 F.3d 857, 863 (9th Cir. 2018). In Hodsdon, the Ninth Circuit concluded that there was no duty to disclose the existence of child labor in the supply chain of chocolate being sold by the defendants because the “challenged omission does not concern a central functional defect” of chocolate.  Id. at 864.  Such a defense is particularly relevant for device manufacturers where practical functionality of a given product, as opposed to cosmetic or other ancillary benefits, is integral to the value proposition of a product. See In re Apple Inc. Device Performance Litig., 386 F.Supp.3d 1155, 1177–78 (N.D. Cal. 2019) (finding consumers failed to allege material omission of fact regarding alleged defect in central function of smartphones and tablet computers where only alleged defect was short battery life in older devices resulting from normal battery aging process and use of updated “power-hungry” software).

E. Conclusion

As shown above, there are a variety of legal arguments available to corporate defendants defending against CLRA claims.  This is plainly a summary of such defenses—not an exhaustive list. Indeed, this article does not discuss class certification, which introduces additional avenues for defendants to defeat or weaken consumer claims brought under the CLRA and other California consumer statutes.  Ultimately, however, the success of a defendant often depends in large part on the strength of plaintiffs’ counsel’s ability to frame its case to avoid these pitfalls.

* Ahmed Ibrahim is the founding partner of AI Law, PLC, a litigation boutique practice based in Newport Beach specializing in business litigation and class actions. He may be reached at

By Ahmed Ibrahim, AI Law, PLC *
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