Duane Morris Consumer Fraud Class Action Review – 2024

dismiss. In Goodman, et al. v. Intervet, Inc. , 2023 U.S. Dist. LEXIS 36634 (D.N.J. March 6, 2023), the plaintiffs sued Intervet, Inc. relative to its “home again” services to help people find their lost pets. The defendants provide services through a microchip program, which requires participants to register the microchip in defendant ’ s database that is a permanent registration. Id. at *1-2. Typically, the fees associated with the program are often included in the microchip ’ s cost, and if a pet does get lost, a veterinarian or pet shelter can scan the microchip to identify the pet and the owner. The plaintiffs brought a class action against the defendants alleging that their marketing materials contain both express misrepresentation and material omissions that dupe consumers into believing that they are required to enroll in an annual paid membership to maintain access and updated contact information in the defendants’ database. Specifically, Home Again provides its customers with enrollment papers that advertises “[H]ome Again membership services are $19.99 per year,’ has a space for credit card information, and warns ‘ Please return this form to the Home Again Pet Recovery Service or we will not be able to identify your pet if lost . ’ ” Id. at *3. It also stated that “on Home Again ’ s website, customers may ‘ Check Your Status’ to confirm pet registration, but if membership has lapsed, the webpage does not confirm whether the pet is in the database; instead, a message pops up to call Customer Service as ‘ [t]his pet ’ s full service annual membership has expired. ’ ” Id. The plaintiffs filed a class action naming five class representatives from California, Ohio, New York, Maryland, and Florida, respectively. The crux of the allegations was that the plaintiffs, relying on the defendants’ advertising and marketing statements, paid the $19.99 yearly membership even though they did not have to do so. Upon agreement of the parties, the plaintiffs filed an amended complaint with causes of action were based on the false advertising and unfair competition laws of the various states where the named plaintiffs resided. The defendants moved to dismiss the amended complaint arguing that the plaintiffs did not identify any express misrepresentations and that the defendants’ communications did not indicate that database access is contingent upon payment of the $19.99 yearly membership. The defendants also argued that the plaintiffs’ state law statutory claims fail to meet the heightened pleading standard of Rule 9(b). First, the court noted that the heightened pleading standard of Rule 9(b) does not apply to New York ’ s advertising laws or unjust enrichment claims. However, it opined that all remaining claims must satisfy the heightened pleading standard, and the amended complaint did not adequately describe or specify the “what, when, or where” of how any of the plaintiffs were exposed to misleading statements, and the court dismissed the consumer protection claims under New Jersey, California, Maryland, and Florida laws. In addition, the court analyzed which of the statutes require actual reliance. Generally, the court observed that the Maryland and California statutes which the plaintiffs claimed the defendants violated require actual and detrimental reliance, and the court dismissed those claims with leave to amend. The court likewise reasoned that one of the California consumer protection states, the California Legal Remedies Act (CLRA), requires notice and an opportunity to correct within thirty days of filing suit. The defendants argued that the plaintiffs did not comply with those requirements, but the court disagreed and denied this claim. The court also quickly disposed of the defendant ’ s arguments that the plaintiffs failed to plead a viable cause of action under the CLRA. The defendants argued that the allegations failed to state a CLRA claim because the Home Again premium membership includes the advertised benefit of premium database access. However, the court denied the motion on the basis that the allegations centered on the marketing practices that purportedly tricked consumers into paying for the membership predicated upon the belief that payment is necessary to maintain the membership. Turning to the New Jersey claims, the defendants argued that the statutory consumer protection claims must be dismissed because there is no relationship to New Jersey other than one of the defendants being headquartered there. The plaintiffs countered by asserting that the defendants’ enrollment form included a New Jersey choice-of-law provision. The court concluded that a choice-of-law analysis had been raised. The court performed a choice-of-law analysis, and noted the New Jersey statutes at issue conflicted with the other statutes. Noting that case law precedents had previously dismissed claims based upon state statutes where a product was not purchased, the court dismissed the claims where the plaintiffs brought suit under the laws of states where the product was not purchased.

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