Saying that “labels matter,” the California Supreme Court ruled last month that consumers who bought locksets falsely promoted as “Made in the USA” have a right to sue the manufacturer under the state’s revised consumer protection laws.
Acting on behalf of three unions, Berman DeValerio filed an amicus brief in support of plaintiffs, whose victory marked a milestone in the battle over Proposition 64, a 2004 ballot measure that sought to ensure that only persons who were victimized by a defendant’s conduct can sue to curb corporate abuses.
Plaintiffs in Kwikset Corp. v. Superior Court were consumers who had purchased locksets manufactured by Kwikset Corp. that were labeled as “Made in the USA,” despite containing foreign parts or being partially assembled abroad.
At issue was whether plaintiffs still had standing to sue under California’s consumer protection and false advertising laws. Since Proposition 64 took effect, those laws have required a showing that the plaintiff “lost money or property” as a result of the defendant’s conduct. Plaintiffs argued that they lost the money they spent to purchase the mislabeled locksets. Defendant countered that plaintiffs had lost nothing because they received working locksets in return.
Berman DeValerio’s amicus brief, filed on behalf of the California Teamsters, the California Nurses Association and the Service Employees International Union, informed the Court of the importance that union members and others place on the “Made in the USA” label. It argued that consumers misled into buying products falsely labeled as “Made in the USA” should have standing to bring false advertising claims.
In a 5-to-2 decision issued Jan. 27, the Court ruled decisively in favor of plaintiffs. The Court held that “plaintiffs who can truthfully allege they were deceived by a product’s label into spending money to purchase the product, and would not have purchased it otherwise, have lost money or property’ within the meaning of Proposition 64 and have standing to sue” under California’s consumer protection and false advertising laws. As the Court succinctly put it: “Simply stated: labels matter.” The Court’s opinion provided much-needed clarity in the law and is an excellent result for consumers.
*In August 2017, our firm name changed to Berman Tabacco. Case references and content published before that date may refer to the firm under our prior name, Berman DeValerio.