TRENDS IN US CONSUMER CLASS ACTIONS
Any company that sells a product or service to US consumers should be aware that there has been a sharp spike in class actions brought under state consumer protection laws. There were over 500 such cases filed in 2021 and over 600 in 2022. Behind the scenes, many, many more class actions are threatened and resolved. Companies on the receiving end of these class actions should, unfortunately, continue to expect them – and in even greater numbers.
The good news for industry is that there are pre-emptive steps companies can take to protect against class actions and position themselves for a successful defence if one is filed. Monitoring and tracking class actions filed throughout the country allows us to foresee class action trends and best position clients even before cases are threatened or filed. Below, we discuss some of the hottest areas we observed in 2022.
Safety claims and failure to disclose product contamination
In addition to challenging marketing claims that a product is ‘safe’, ‘non-toxic’ or lacking ‘harsh chemicals’, there were dozens of class actions last year – many of which are still ongoing – that allege a product contains a dangerous ingredient or contaminant. Many of these cases are spurred by third-party investigations whose reliability has been questioned by the Food and Drug Administration (FDA) and courts. Nonetheless, these cases continue to be filed in large numbers. Companies should make sure to have proper substantiation for any safety-related claims and should monitor for trends, including particular contaminants the plaintiffs’ bar is targeting.
Apr-Jun 2023 issue
Proskauer Rose LLP