In re Amla Litigation, — F.Supp.3d —-, 2018 WL
3629226, No. 16-cv-6593 (S.D.N.Y. Jul. 31, 2018)
3629226, No. 16-cv-6593 (S.D.N.Y. Jul. 31, 2018)
Plaintiffs brought fifteen claims, including false
advertising, against L’Oreal based on alleged defects in the Amla Legend
Rejuvenating Ritual Relaxer, which is used to chemically straighten naturally
curly hair. The court previously certified a NY class and a Florida class, but
now decertified the unjust enrichment classes and classes seeking injunctive
and declaratory relief, granting summary judgment to L’Oreal on those claims, and
also granted summary judgment on all dangerousness-related claims based on the
relaxer component of the product and on the California plaintiffs’ omission-based
fraud and negligent misrepresentation claims. Summary judgment was denied as to
the NYGBL claims and all remaining claims based on dangerousness or representations
or warranties regarding Amla’s ability to protect scalps or implicit
misrepresentations that the product is safer than relaxers that contain lye.
advertising, against L’Oreal based on alleged defects in the Amla Legend
Rejuvenating Ritual Relaxer, which is used to chemically straighten naturally
curly hair. The court previously certified a NY class and a Florida class, but
now decertified the unjust enrichment classes and classes seeking injunctive
and declaratory relief, granting summary judgment to L’Oreal on those claims, and
also granted summary judgment on all dangerousness-related claims based on the
relaxer component of the product and on the California plaintiffs’ omission-based
fraud and negligent misrepresentation claims. Summary judgment was denied as to
the NYGBL claims and all remaining claims based on dangerousness or representations
or warranties regarding Amla’s ability to protect scalps or implicit
misrepresentations that the product is safer than relaxers that contain lye.
Hair relaxers generally use an alkaline agent “to
penetrate the hair’s outer layer and permanently break the disulfide bonds in
the hair’s keratin proteins, forming new, substantially weaker bonds.” The hair
becomes straighter but more fragile—that is, damaged. This can cause hair
breakage and scalp burning, as relaxer users know. L’Oreal’s expert survey
determined that, after adjusting for the control, 80.2% of respondents believed
that no-lye hair relaxers such as Amla can irritate the scalp and 63.5% knew
that it could cause hair to fall out. “Users’ baseline expectation, then, is
that the product here at issue, like all hair relaxers, poses risks. The
alleged difference must be one of degree.”
penetrate the hair’s outer layer and permanently break the disulfide bonds in
the hair’s keratin proteins, forming new, substantially weaker bonds.” The hair
becomes straighter but more fragile—that is, damaged. This can cause hair
breakage and scalp burning, as relaxer users know. L’Oreal’s expert survey
determined that, after adjusting for the control, 80.2% of respondents believed
that no-lye hair relaxers such as Amla can irritate the scalp and 63.5% knew
that it could cause hair to fall out. “Users’ baseline expectation, then, is
that the product here at issue, like all hair relaxers, poses risks. The
alleged difference must be one of degree.”
Amla’s relaxer component contains proprietary
“pro-solvent ingredients,” allowing the alkaline agent to penetrate the hair
faster than they otherwise would. Plaintiffs alleged that these ingredients,
together with the design of the emulsifier in the relaxer cream, caused the
product to finish relaxing hair in less time than users could reasonably apply
and remove it. But the alkaline agent continues breaking disulfide bonds until
it is removed or neutralized; thus, the relaxer would necessarily break more
bonds than necessary to relax the hair, thus allegedly making the product
unreasonably dangerous. The court found plaintiffs’ expert report on the dangerousness
of the relaxer component unreliable and inadmissible, and their other evidence
of dangerousness insufficient.
“pro-solvent ingredients,” allowing the alkaline agent to penetrate the hair
faster than they otherwise would. Plaintiffs alleged that these ingredients,
together with the design of the emulsifier in the relaxer cream, caused the
product to finish relaxing hair in less time than users could reasonably apply
and remove it. But the alkaline agent continues breaking disulfide bonds until
it is removed or neutralized; thus, the relaxer would necessarily break more
bonds than necessary to relax the hair, thus allegedly making the product
unreasonably dangerous. The court found plaintiffs’ expert report on the dangerousness
of the relaxer component unreliable and inadmissible, and their other evidence
of dangerousness insufficient.
Plaintiffs also argued that Amla was unreasonably
dangerous and representations to the contrary were false and misleading because
the scalp protector in the Amla kit does not “protect[ ] scalp & skin,” as
represented on the product’s packaging. Their expert report tested the scalp
protector versus petroleum jelly five times and each time found that the
relaxer penetrated the scalp protector after a few minutes, while petroleum
jelly lasted 30 minutes. This was admissible evidence, and the court noted that
users might not complain about an unreasonably dangerous flaw in the scalp
protector, given that users already know that the relaxer can burn if it
touches the scalp (and thus presumably might blame themselves for user error in
applying the scalp protector, without understanding that it had failed them).
Thus, there was a genuine dispute over scalp protection, including whether
representations and warranties about scalp protection were misleading or were
breached.
dangerous and representations to the contrary were false and misleading because
the scalp protector in the Amla kit does not “protect[ ] scalp & skin,” as
represented on the product’s packaging. Their expert report tested the scalp
protector versus petroleum jelly five times and each time found that the
relaxer penetrated the scalp protector after a few minutes, while petroleum
jelly lasted 30 minutes. This was admissible evidence, and the court noted that
users might not complain about an unreasonably dangerous flaw in the scalp
protector, given that users already know that the relaxer can burn if it
touches the scalp (and thus presumably might blame themselves for user error in
applying the scalp protector, without understanding that it had failed them).
Thus, there was a genuine dispute over scalp protection, including whether
representations and warranties about scalp protection were misleading or were
breached.
Other alleged misrepresentations were based on the
statements/warranties that Amla was a “no-lye,” “anti-breakage” and “intense
conditioning” “rejuvenating ritual” that is “infused with” a “powerful
antioxidant rich in vitamins in minerals” and which “delivers unified results,”
has “superior respect of hair fiber integrity,” “reveal[s] visibly fuller,
silkier hair”, “protects scalp & skin” and “infuses hydration &
conditioning.” The court found that, the scalp protector aside, these were
literally true claims as applied to the individual kit components to which they
were directed.
statements/warranties that Amla was a “no-lye,” “anti-breakage” and “intense
conditioning” “rejuvenating ritual” that is “infused with” a “powerful
antioxidant rich in vitamins in minerals” and which “delivers unified results,”
has “superior respect of hair fiber integrity,” “reveal[s] visibly fuller,
silkier hair”, “protects scalp & skin” and “infuses hydration &
conditioning.” The court found that, the scalp protector aside, these were
literally true claims as applied to the individual kit components to which they
were directed.
However, plaintiffs also argued that these
representations, and other package elements, misleadingly communicated greater
safety than other relaxers, and though the product wasn’t unreasonably more
dangerous than other relaxers, “the evidence strongly suggests that the product
is not safer,” creating a genuine dispute on that issue. But was there a
dispute over whether such a claim was made? The issue is how a normal consumer
understands “no-lye,” a technically accurate description of L’Oreal’s lithium
hydroxide product (lye is sodium hydroxide).
representations, and other package elements, misleadingly communicated greater
safety than other relaxers, and though the product wasn’t unreasonably more
dangerous than other relaxers, “the evidence strongly suggests that the product
is not safer,” creating a genuine dispute on that issue. But was there a
dispute over whether such a claim was made? The issue is how a normal consumer
understands “no-lye,” a technically accurate description of L’Oreal’s lithium
hydroxide product (lye is sodium hydroxide).
Separate from the litigation, L’Oreal conducted a
study among 406 African American women, from 18 to 49 years old, who had used
hair relaxers in the past six months. In that study, 57% of respondents said
that the phrase “no-lye” communicated to them “that the product contained
no/fewer chemicals” than other relaxers, and 39% said it communicated that the
product “will not be harmful to the hair.” 27% of respondents pointed to the lack
of lye as the principal reason they would like to use the relaxer. Another
L’Oreal study found that “women are drawn to trying Amla relaxer anticipating
that an oil-based/no lye relaxer … will be more soothing and protective of a
sensitive scalp than relaxers they’ve used previously.”
study among 406 African American women, from 18 to 49 years old, who had used
hair relaxers in the past six months. In that study, 57% of respondents said
that the phrase “no-lye” communicated to them “that the product contained
no/fewer chemicals” than other relaxers, and 39% said it communicated that the
product “will not be harmful to the hair.” 27% of respondents pointed to the lack
of lye as the principal reason they would like to use the relaxer. Another
L’Oreal study found that “women are drawn to trying Amla relaxer anticipating
that an oil-based/no lye relaxer … will be more soothing and protective of a
sensitive scalp than relaxers they’ve used previously.”
Plaintiffs offered their own survey of a similar
population, which L’Oreal moved to exclude. That survey found that 80% of
respondents answered that they would expect a relaxer whose package makes the
“No-Lye” representation to be “less harsh on your hair,” 77.5% would expect
that it is “more safe to use,” and 77.9% that it is “less likely to be harmful
to your scalp and hair.” L’Oreal argued that the questions were leading in that
they forced respondents to specifically consider safety, which they might not
just seeing the package. There was no control group. “Comparable flaws have
rightfully served as the basis for exclusion of similar surveys in other areas.”
However, there was significant external evidence that relaxer consumers already
associate lye with dangerousness and no-lye relaxers with comparative safety,
as discussed above. “The risk that respondents only considered this possibility
because of the listed responses is therefore relatively low, making the survey
results more reliable.” Thus, the survey was admissible, and there was a
genuine dispute over whether the package “meaningfully communicates to users
that it is safer or gentler than relaxers that do contain lye.”
population, which L’Oreal moved to exclude. That survey found that 80% of
respondents answered that they would expect a relaxer whose package makes the
“No-Lye” representation to be “less harsh on your hair,” 77.5% would expect
that it is “more safe to use,” and 77.9% that it is “less likely to be harmful
to your scalp and hair.” L’Oreal argued that the questions were leading in that
they forced respondents to specifically consider safety, which they might not
just seeing the package. There was no control group. “Comparable flaws have
rightfully served as the basis for exclusion of similar surveys in other areas.”
However, there was significant external evidence that relaxer consumers already
associate lye with dangerousness and no-lye relaxers with comparative safety,
as discussed above. “The risk that respondents only considered this possibility
because of the listed responses is therefore relatively low, making the survey
results more reliable.” Thus, the survey was admissible, and there was a
genuine dispute over whether the package “meaningfully communicates to users
that it is safer or gentler than relaxers that do contain lye.”
Unjust enrichment: plaintiffs’ only damages theory
was that the product was so dangerous as to be worthless, justifying a full
refund. They didn’t have evidence of damages based on the value of the scalp
protector, and that didn’t render the entire kit so dangerous as to be
worthless; the other parts performed their intended functions. [Query whether
any reasonable consumer would buy a kit with a worthless but really important
component.] Thus those claims, and their class, went away.
was that the product was so dangerous as to be worthless, justifying a full
refund. They didn’t have evidence of damages based on the value of the scalp
protector, and that didn’t render the entire kit so dangerous as to be
worthless; the other parts performed their intended functions. [Query whether
any reasonable consumer would buy a kit with a worthless but really important
component.] Thus those claims, and their class, went away.
By contrast, NYGBL § 349 provides for the greater of
actual damages or $50 statutory damages for anyone injured by a violation of
its terms. “Because the statutory damages apply on a classwide basis, there is
no need to determine the exact amount of [any] price premium.” A reasonable
juror could find that adding the scalp protector increased the price of the
product. The package advertised the scalp protector as one of its five steps and
recommended its use in the section of the packaging labeled “READ BEFORE
PURCHASING.” Also, 85.4% of respondents in plaintiffs’ survey, all of whom had
used relaxers, indicated that a scalp protector should always be applied before
using no-lye hair relaxers.
actual damages or $50 statutory damages for anyone injured by a violation of
its terms. “Because the statutory damages apply on a classwide basis, there is
no need to determine the exact amount of [any] price premium.” A reasonable
juror could find that adding the scalp protector increased the price of the
product. The package advertised the scalp protector as one of its five steps and
recommended its use in the section of the packaging labeled “READ BEFORE
PURCHASING.” Also, 85.4% of respondents in plaintiffs’ survey, all of whom had
used relaxers, indicated that a scalp protector should always be applied before
using no-lye hair relaxers.
L’Oreal argued that some class members likely would
have purchased the product even in the absence of those allegedly misleading
representations. “This argument, however, is an attempt to impose a reliance
requirement where none exists. As the New York Court of Appeals has recognized
in this context, ‘[r]eliance and causation are twin concepts, but they are not
identical.’… If there is a price premium, then every purchaser of the kit paid
more than they otherwise would have, so every purchaser was injured. A
purchaser’s individual experience after purchasing the product or idiosyncratic
ex ante valuation does not matter.”
have purchased the product even in the absence of those allegedly misleading
representations. “This argument, however, is an attempt to impose a reliance
requirement where none exists. As the New York Court of Appeals has recognized
in this context, ‘[r]eliance and causation are twin concepts, but they are not
identical.’… If there is a price premium, then every purchaser of the kit paid
more than they otherwise would have, so every purchaser was injured. A
purchaser’s individual experience after purchasing the product or idiosyncratic
ex ante valuation does not matter.”
Since plaintiffs didn’t show a likelihood of
repurchasing the product, their declaratory/injunctive relief claims were
dismissed.
repurchasing the product, their declaratory/injunctive relief claims were
dismissed.
Fraud/negligent misrepresentation by omission: New
York, Florida, Illinois, and Missouri define a manufacturer’s duty in varying
ways, but the upshot is that “a manufacturer that knows its product presents an
unexpected safety risk when put to its normal use has a duty to disclose that
fact to consumers who do not have access to that information.” In California, a
duty to disclose only arises if there is a direct “transaction” between a
manufacturer and end-consumer and negligent omission claims are otherwise
barred, so the California claims were kicked out.
York, Florida, Illinois, and Missouri define a manufacturer’s duty in varying
ways, but the upshot is that “a manufacturer that knows its product presents an
unexpected safety risk when put to its normal use has a duty to disclose that
fact to consumers who do not have access to that information.” In California, a
duty to disclose only arises if there is a direct “transaction” between a
manufacturer and end-consumer and negligent omission claims are otherwise
barred, so the California claims were kicked out.
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