court applies issue preclusion to a jury verdict under a different state consumer protection law

Dent v. Premier Nutrition Corp., 2025 WL 1282627, No. 16-cv-06721-RS (N.D. Cal. May 2, 2025)

Here, the court applies issue preclusion against Premier, makers of Joint Juice, which lost a bellwether-type trial under NY law (a ruling affirmed in relevant part by the Ninth Circuit), on claims against it based on Illinois consumer protection laws. The court noted that six other state-wide classes were stayed before it, and a California class was seeking judgment against Premier in state court.

Specifically, Premier was precluded from relitigating materiality, sale in commerce, and the measure of damages.

Premier didn’t dispute that Dent and the Illinois purchasers saw the same labels as Montera and the New York purchasers during the same relevant time period. Under California law, which supplied the rule of decision, “[i]ssue preclusion prohibits the relitigation of issues argued and decided in a previous case, even if the second suit raises different causes of action.” However, courts have discretion to deny issue preclusion if its application does not “comport[ ] with fairness and sound public policy.”

“While Premier may not have expected the Montera trial to have roll-on effects, it does not follow that any effects would be fundamentally unfair.” Montera and Dent both alleged that Premier’s advertisement and marketing of Joint Juice was misleading, harming entire classes of consumers in each state. The advertisement and labeling of Joint Juice was identical in New York and Illinois, and the time period covered in both suits was the same. Whether the advertising is deceptive was evaluated using the same reasonable consumer standard, not individual consumer understandings.

Premier argued that new scientific advances in the study of glucosamine’s potential benefits necessitated a full trial on whether Joint Juice’s label was in fact deceptive. But “new witnesses or cumulative evidence do not negate issue preclusion.”

Once issue preclusion was available, the question was what overlapping issues were decided by Montera. The jury decided that Joint Juice’s label was misleading, and both NY and Illinois use the same materiality standard, so there was issue preclusion.

However, the Montera jury didn’t need to reach a conclusion as to whether Premier intended for the class to rely on the alleged deceptive act or practice, which is required by Illinois law, so that remained for trial. (Imagine going to the jury and arguing, sure, it was materially misleading, but we didn’t intend for consumers to rely on it!)

Dent also conceded that she needed to prove individual causation, but argued that materiality justified an inference of classwide causation. Illinois’s ICFA requires that the defendant’s deceptive practice proximately caused the damages suffered by plaintiff, but not actual reliance. It allows courts to infer proximate causation on a classwide basis when all class members are subject to a material, standardized misrepresentation. While the court found Dent’s argument for preclusion on causation “strong,” it determined that the issue was not “identical.” “While Dent could certainly demonstrate causation by proving the class was exposed to uniform, materially misleading misrepresentations, Montera did not actually do so in her case. Moreover, based on the caselaw presented, such a showing is necessary, but not sufficient for a finding of ICFA causation.” The court cited Illinois cases articulating a standard demanding that “the only logical reason” to buy was as a result of the deception or that “no rational class member would have acted as they did absent the misrepresentation.”

What about the measure of harm? The ICFA defines damage as “the value of what [plaintiff] received less than the value of what was promised”: a benefit-of-the-bargain theory. This means that a full refund is justified if a product “had no value to consumers.” “The jury in Montera, in finding liability and awarding the entire purchase price to consumers, necessarily concluded Joint Juice was valueless for its advertised purpose.” Premier presented extensive evidence arguing purchasers received benefits apart from the potentially deceptive joint health ones advertised on Joint Juice’s label, but the jury declined to reduce its award based on Premier’s suggested alternative benefits, such as Vitamin C, Vitamin D, antioxidants, and hydration. Thus, the damages issues in Dent were narrowed to the calculation of damages due to the Illinois class based on the number of units sold and the purchase price, and punitive damages.

Premier also argued that it was entitled to raise a First Amendment defense, which wasn’t raised in Montera until its renewed judgment as a matter of law after trial. But “issue preclusion requires only the opportunity to litigate ... not whether the litigant availed himself or herself of the opportunity.” Also, “misleading commercial speech is not protected,” meaning that Premier couldn’t raise a First Amendment defense anyway because of the jury findings.

The court also advised the parties that they should settle “this now antique litigation.”