Skinnygirl Margaritas Avoid Class Certification

In Stewart v. Beam Global Spirits & Wine, decided on June 27, 2014 in the District of New Jersey, a motion for class certification was denied because the plaintiffs failed to propose a class whose members could be ascertained in an administratively feasible manner. The ruling indicates that the federal courts in the Third Circuit (New Jersey, Pennsylvania, Delaware and the Virgin Islands) are becoming stricter when considering whether to certify a class of purchasers of a retail product.

The lawsuit was filed by purchasers of Skinnygirl Margarita, an alcoholic beverage marketed by reality television star Bethenny Frankel. The plaintiffs challenged claims that the margarita drinks were all natural and a “healthy alternative to other commercial margarita products.”

In their motion for class certification, the plaintiffs sought to represent both New Jersey and multi-state purchasers of the Skinnygirl product. However, the defendants opposed the motion because, in their view, there was no reliable way to determine who had purchased the product.

The defendants stated that none of them sold the product directly to the public because they used distributors. The named plaintiffs did not have any proof of purchase, and the court found that other class members would also be unlikely to have any proof that they actually purchased Skinnygirl.  

The plaintiffs countered that class members could submit affidavits swearing that they purchased the product.  District Judge Noel L. Hillman disagreed, saying unsubstantiated affidavits fall short of the ascertainability requirement: “While the proposed class definitions appear to be based on objective criteria, i.e., who made purchases of Skinnygirl Margarita during a specified time frame, Plaintiffs' only proposed method for identifying potential class members relies on the completely subjective information provided by individuals claiming entitlement to class relief]. […] Such affidavits essentially amount to nothing more than reliance on the subjective ‘say so’ of the putative members that they meet the class definition and are entitled to relief, and practically ignores the need for a class definition based on objective criteria. This process leaves Defendants without a suitable and fair method for challenging these individuals' purported membership in the class-a right the Third Circuit has clearly stated Defendants are absolutely entitled to.”

Although ascertainability is not identified in the Federal Rules of Civil Procedure as a requirement for class certification, the Skinnygirl decision indicates that federal courts, particularly those in the Third Circuit, are paying increased attention to it.

The denial of class certification was without prejudice, meaning the plaintiffs can try again for class certification at a later date if they believe they can sustain their burden of satisfying all of the requirements for class certification (including an ascertainable, administratively feasible class).

Please also see Scott's article in Law360, which provides a more in-depth analysis of the matter.

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