Santamarina v. Sears Roebuck & Co. CA2/3 ( 2016 )

Filed 4/26/16 Santamarina v. Sears Roebuck & Co. CA2/3
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION THREE
GUILLERMO GARCIA B246705
SANTAMARINA et al.,
(Los Angeles County
Plaintiffs and Appellants, Super. Ct. No. BC326946)
v.
SEARS ROEBUCK & CO.,
Defendant and Respondent.
APPEAL from an order of the Superior Court of Los Angeles County,
Anthony J. Mohr, Judge. Affirmed.
Motley Rice; Isaacs, Friedberg & Labaton, Mark I. Labaton; Barnow and
Associates, Ben Barnow, Sharon Harris; Law Office of Aron Robinson, Aron Robinson;
Tostrud Law Group, Jon A. Tostrud; Cuneo Gilbert & Laduca, Sandra W. Cuneo; Lowey
Dannenberg Cohen & Hart, Barbara J. Hart, Jeanne D’Esposito and Sung-Min Lee for
Plaintiffs and Appellants.
Greenberg Traurig, Karin L. Bohmholdt, Francis A. Citera and Jane B.
McCullough for Defendant and Respondent.
_________________________
Plaintiffs Guillermo Garcia Santamarina, Brenda Lifsey and Chris Wilson brought
this putative class action against defendant Sears Roebuck & Co. (Sears), alleging Sears
violated, inter alia, the Unfair Competition Law (UCL) and the False Advertising Law
(FAL) by mislabeling, misrepresenting, and falsely advertising that its line of Craftsman
tools and products was made in the United States, whereas in fact, many Craftsman
products are made outside the United States or contain significant foreign-made
components. Plaintiffs appeal the trial court’s denial of their motion for class
certification. For the reasons explained below, the trial court did not abuse its discretion
in concluding that the class was overbroad and plaintiffs failed to establish
ascertainability and/or commonality. We therefore affirm the trial court’s order.
FACTUAL AND PROCEDURAL BACKGROUND
1. Allegations of the complaint
The operative pleading, plaintiffs’ “Corrected Second Amended Complaint,”
1
(complaint), filed in January 2005, alleged the following. Sears sells a propriety line of
Craftsman tools and products, including power, garden, home and auto tools. The
Craftsman brand consists of more than 5,000 products in 80 tool and equipment
1 This matter was originally filed in Los Angeles County Superior Court. In 2005,
Sears removed the action to the United States District Court for the Central District of
California. It was then transferred to the United States District Court for the Northern
District of Illinois and consolidated with several other cases against Sears in a
multidistrict litigation proceeding. The matter was remanded in 2006 to Los Angeles
County Superior Court on appellants’ motion. (See In re Sears, Roebuck & Co. Tools
Marketing (J.P.M.L. 2005) 381 F. Supp. 2d 1383, 1384; Greenfield v. Sears, Roebuck &
Co. (In re Sears, Roebuck & Co. Tools Marketing and Sales Practices Litigation)
(N.D.Ill., Mar. 22, 2012, MDL-1703, Nos. 05 C 4742, 05 C 4744) 2012 U.S.Dist. LEXIS
39561; Chatham v. Sears, Roebuck & Co. (In re Sears, Roebuck & Co. Tools Marketing
and Sales Practices Litigation) (N.D.Ill., Dec. 4, 2007, MDL-1703, Nos. 05 C 4742,
05 C 2623) 2007 U.S.Dist. LEXIS 89349; Santamarina v. Sears, Roebuck & Co. (In re
Sears, Roebuck & Co. Tools Marketing and Sales Practices Litigation) (N.D.Ill., May 24,
2006, MDL-1703, Nos. 05 C 4742, 05 C 4743) 2006 U.S.Dist. LEXIS 36323, affd. by
Santamarina v. Sears, Roebuck & Co. (7th Cir. 2006) 466 F.3d 570.) According to
plaintiffs, the matter was then stayed pending our Supreme Court’s decision in In re
Tobacco II Cases (2009) 46 Cal. 4th 298 (Tobacco II).
2
categories, which are sold and distributed through various outlets, including Sears stores,
Sears Auto Centers, Sears catalogs, the internet, and Orchard Supply Hardware (OSH)
stores. Central to Sears’s advertising is the claim that Craftsman tools and products are
made in the United States. Sears’s California advertising has made or implied this claim
in television and print ads; in catalogs; on the Sears Craftsman website; on store signage;
and through representations made by salespeople. The fact products are made in the
United States is a material factor in many consumers’ purchasing decisions.
This advertising is deceptive because “certain Craftsman tools and products
contain parts that have been entirely or substantially made, manufactured, finished or
produced outside of the United States” and “not all, or virtually all, of the Craftsman
products” are made in the United States. Sears, at some point, decided to manufacture
Craftsman products outside the United States as a means of saving money and increasing
profit margins. In 2000, approximately 20 percent of Craftsman products were foreign-
made; by 2005, the percentage had risen to 70 percent. Attached to the complaint were
copies of print advertisements alleged to be false or misleading.
Sears also deceptively labeled Craftsman products as made in the United States.
As examples of such mislabeling, the complaint described axes, hoes, mauls, sledge
hammers, pitchforks, mattocks, rakes, tree pruning blades, and multi-bit screwdrivers that
were incorrectly marked as “Made in U.S.A.” Attached to the complaint were
photographs of tools and products that were allegedly mislabeled.
Sears executives were aware that their customers believed Craftsman products
were made in the United States. Sears had conducted and was aware of research showing
consumers believed “Made in the U.S.A.” was a significant attribute of Craftsman
products. Sears was able to charge more for Craftsman products based on the claim they
were American-made. Sears-commissioned studies determined that, if consumers
learned Craftsman products were made overseas, some would not buy the products and
others would pay less for them, necessitating a reduction in prices and a drop in profit
margins. Sears “decided not to correct the misconception its customers had about the
origin of its Craftsman products because such a disclosure would cost it money.”
3
In response to litigation here and in other jurisdictions, Sears began obliterating
“Made in the U.S.A.” markings or labels on some Craftsman products and their
packaging, and removed some of the allegedly false and misleading representations that
had previously appeared on its website.
As to the named plaintiffs, the complaint alleged the following. Plaintiff
Santamarina purchased several Craftsman tools, including a pruner, power drills, and a
cap. Plaintiff Wilson purchased dozens of Craftsman products including tool sets,
sanders, a rake and a cap. Plaintiff Lifsey purchased a lawn mower, power tools, and a
wrench set. In each case, the advertising for the products and store signage stated “Made
in U.S.A.,” and the tools and/or packaging were labeled as “Made in U.S.A.” or “Forged
in U.S.A.” When making the purchases, plaintiffs saw and relied on the labeling and/or
advertising for the Craftsman line. Plaintiffs believed the products were made in the
United States, and this belief was the primary factor in their decisions to purchase
Craftsman, rather than a lower priced brand. Plaintiffs were unaware the products they
purchased were not made in the United States. Lifsey additionally relied on the
statements of a salesperson who told her all Craftsman products were made in the
United States.
Based on the foregoing, the complaint alleged nine causes of action: unfair
2
competition in violation of Business and Professions Code section 17200, predicated on
violation of: (1) section 17533.7 [making it unlawful to sell merchandise labeled “Made
in U.S.A.” when the merchandise or any part thereof was entirely or substantially made
outside the United States], (2) title 15 United States Code sections 45 and 45a [regarding
“Made in the U.S.A.” labeling and unfair competition], (3) Civil Code section 1750
et seq., the Consumers Legal Remedies Act (CLRA), and (4) section 17500 [false or
misleading statements]; (5) unfair business acts and practices in violation of
section 17200; (6) commission of fraudulent business acts and practices in violation of
2 All further undesignated statutory references are to the Business and
Professions Code.
4
section 17200; (7) unfair, deceptive, untrue, or misleading advertising in violation of
section 17200; (8) untrue and misleading advertising in violation of section 17500; and
(9) violation of the CLRA. Plaintiffs averred that the action could properly be
maintained as a class action pursuant to Code of Civil Procedure section 382 and Civil
Code sections 1752 and 1781 because they would fairly and adequately protect the
interests of class members and the requisite numerosity, typicality, commonality of issues
existed. Plaintiffs sought both injunctive relief and restitution.
The trial court sustained Sears’s demurrer to the third and ninth causes of action
for, or based on, violation of the CLRA, without leave to amend. It overruled Sears’s
3
demurrers as to the remaining causes of action.
2. The motion for class certification
In January 2010, plaintiffs moved to certify the following class: “All persons who
purchased, in the State of California from January 6, 2001 through the present, any
Craftsman branded tool or product where any unit or part thereof was entirely or
4
substantially made, manufactured, or produced outside of the United States.” Plaintiffs
contended the class was ascertainable and sufficiently numerous, their claims were
typical, common questions predominated over individual issues, they were adequate class
representatives, and a class action was a superior means to adjudicate the claims.
Plaintiffs’ motion was not supported with evidentiary materials.
Sears opposed the motion, arguing plaintiffs had failed to satisfy their burden to
establish any of the requisites for class certification. Sears contended the class was not
ascertainable and was impermissibly overbroad; individual factual issues predominated
on the questions of deceptive practices, materiality, reliance, injury, and monetary relief;
the named plaintiffs were not adequate class representatives and their claims were subject
to unique defenses; and class treatment was not a superior means of resolving the
3 These rulings are not challenged on appeal.
4 Excluded from the proposed class are Sears, related entities, and Sears’s officers
and directors and members of their immediate families.
5
litigation. Sears stressed that the proposed class included millions of consumers and
thousands of products sold through a variety of channels; Sears had clearly identified
many Craftsman products as imported or foreign-made for at least 35 years; not all
Craftsman advertising included the phrase “Made in the U.S.A.” or depicted the
American flag; each putative class member would have been exposed to a unique mix of
advertising through a variety of mediums; there was no national pricing structure; the
“Made in the U.S.A.” attribute never affected pricing of any foreign-made Craftsman
product; and determining whether any particular consumer purchased a foreign-made
Craftsman product would involve unreasonable time and expense and necessitate an
individualized product-by-product, consumer-by-consumer, inquiry. In support of its
opposition and its subsequent replies to plaintiffs’ additional briefing, Sears offered,
inter alia, declarations and excerpts from the depositions of Sears’s personnel regarding
Craftsman products, marketing, pricing, and advertising; pages from Sears catalogs and
accompanying analysis of the frequency with which Craftsman products had been
identified therein as foreign-made; a report prepared by expert witness Dr. Stephen
5 6
Prowse; and plaintiffs’ discovery responses.
In response, plaintiffs filed a reply and two supplemental briefs along with
evidence in support of the motion. They argued that since 1992, Sears had carried on a
ubiquitous, brand-wide advertising campaign aimed at convincing consumers that all
Craftsman products were American-made; Sears charged a premium for Craftsman tools;
damages could be calculated on a classwide basis based on the pricing differential
between Craftsman tools and a lower-priced Sears tool line or competitors’ tool lines; the
class was ascertainable because the class definition was “objective and precise”;
5 The trial court did not consider a declaration and analyses by one of Sears’s
experts, Dr. Yoram Wind, apparently due to the pendency of its ruling on plaintiffs’
objections to this evidence.
6 This evidence, as well as the evidence presented by plaintiffs, is discussed in more
detail where relevant, post.
6
purchasers could be identified by reference to Sears’s databases; putative class members
could “self-identify as having purchased Craftsman tools”; and if they did not know the
origin of purchased products, “Sears [could] provide the answer.” Plaintiffs’ evidence in
support of the motion included, among other things, market analyses and proposals
prepared by or for Sears; Sears’s strategic marketing materials and cost benefit analyses;
pricing information; copies of print ads, scripts for television ads, and video of several
advertisements, including those featuring racecar driver A.J. Foyt and television home
7
improvement show host Bob Vila; photographs of Sears signage; a 1998 floor plan for
Sears’s “Tool Land”; excerpts of the depositions of Sears’s personnel regarding
Craftsman production, marketing, and remediation efforts; plaintiffs’ affidavits and
discovery responses; employee sales tip guides; a 2006 printout of information extracted
from a Sears database and deposition testimony regarding it; and emails between Sears
personnel, vendors, or others.
7 For example, in one of the television advertisements, Foyt states, “People are
selling tools today on the market, that I don’t even think they know where they’re made.
And they’re not a quality tool. One thing about the Craftsman tool, it’s made here, and
you know the quality’s good. If something happens to it you can take it back, and you
know where to take it back, because you know where it come from.” Interspersed with
Foyt’s dialogue is text stating, “Made in America. Guaranteed forever.” A voice-over
states, “1800 Craftsman hand tools. Made in America. Guaranteed forever.” The video
files bear the dates 1999-2000, 2000-2001, and 2002-2003. In another advertisement,
dated 2000-2001, Vila touts the functionality, portability, and pricing of a Craftsman tool
set and case, and states at one point, “This is Craftsman, made in the U.S.A.” One of the
print advertisements pictures a ratchet with the headline, “Made in America. Because
you need something to fix the things that aren’t.” Text in the ad states, “There’s
something about a tool that’s made in America. It just feels better in your hand,” and
“That’s why we insist that our over 1,800 hand tools are ‘Made in America.’ ” Another
included a photograph of wrenches and sockets arranged in a pattern representing the
American flag, with the words “Life, liberty and the pursuit of more tools” and “1,800
Craftsman hand tools. Made in America. Guaranteed forever!”
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3. The trial court’s ruling denying class certification and plaintiffs’ appeal
On November 30, 2012, the trial court denied plaintiffs’ motion for class
certification, explaining its reasoning in a lengthy written ruling. It concluded the
numerosity requirement was met, as there were over 40 million Craftsman customers
during the class period and over six million California transactions involving Craftsman
products in 2004 alone. The court also found plaintiffs had shown representations that a
product was made in the United States were material. (See Kwikset Corp. v. Superior
Court (2011) 51 Cal. 4th 310, 328-329 (Kwikset).) However, the other requisites for class
certification were lacking.
First, the class definition was overbroad and the class was not ascertainable. The
proposed class included persons who could not have suffered injury because they did not
see any false or misleading advertising or labeling. Citing the federal district court’s
decision in the Sears multidistrict court litigation, the court explained the class would
include persons who never saw the allegedly false or misleading representations. (See
Chatham v. Sears, Roebuck & Co. (In re Sears, Roebuck & Co. Tools Marketing and
Sales Practices Litigation), supra, 2007 U.S.Dist. Lexis 89349.) Based on the language
of former section 17533.7 and plaintiffs’ interpretation of the law, the proposed class
included purchasers of Craftsman products where only an insignificant component, such
as a single screw, was foreign-made.
Furthermore, putative class members would be unable to determine whether they
were part of the class because of the difficulties in determining whether any particular
tool was made outside the United States or contained foreign-made components. Class
members whose tools were unmarked would be unable to make that determination. The
court rejected the notion that once a class member identified himself or herself as a
Craftsman purchaser, the burden should shift to Sears to identify the product’s country of
origin. The evidence showed Sears did not have a historical database listing the country
of origin of its thousands of products over a ten-year-plus period, and determining this
information would be “unacceptably time-consuming.” There were also “serious
problems” notifying class members, in that consumers “could have purchased Craftsman
8
tools from any number of sources, including OSH stores” and Sears had no central
customer database.
For some of the same reasons, common questions did not predominate. The “most
glaring problem involves the lack of uniformity in Defendant’s advertising and the sheer
number of products advertised.” The evidence showed Craftsman advertising varied
greatly and only a portion contained the “Made in the U.S.A.” claim; salespeople were
not uniformly trained to make such a representation. Unlike in Tobacco II, plaintiffs
failed to present sufficient evidence of a uniform, long term advertising campaign falsely
touting a “Made in the U.S.A.” claim. Given the absence of uniform misrepresentations,
plaintiffs were not entitled to a presumption of reliance, even though a “Made in the
U.S.A.” claim was material. The class representatives’ claims were not typical; they
were not exposed to the same advertising mix as each other, or as any other class
member.
Further, there was no workable method to determine damages or restitution on a
classwide, as opposed to individual, basis. The court rejected appellants’ contention that
product-by-product inspection to discern the measure of recovery was not required,
finding several proposed methodologies for calculating injury on a classwide basis either
untenable or unsupported by the evidence.
Finally, the court concluded the plaintiffs had not demonstrated that allowing the
case to proceed as a class action would be superior. It explained: “The resources that
would be needed to manage this case as a class action would be vast, given the number of
products Sears makes and the need to determine which of those were made ‘wholly or
substantially’ outside the United States. Class members would need to be grouped
according to what they purchased, whether part or all of that product was made overseas,
whether they saw any advertising (never mind what kind and where) and whether the ads
were material to their decision to purchase. The cost and time of this process virtually
eliminates any benefit to be achieved by class treatment. To manage this case and its
more than 40 million putative class members would be a nightmare, made more daunting
by the lack of an appropriate measure of damages.”
9
Plaintiffs timely appealed the trial court’s November 30, 2012 order. The appeal
lies. (See Linder v. Thrifty Oil Co. (2000) 23 Cal. 4th 429, 435; Richmond v. Dart
Industries, Inc. (1981) 29 Cal. 3d 462, 470.)
DISCUSSION
1. Standard of review
“On review of a class certification order, an appellate court’s inquiry is narrowly
circumscribed. ‘The decision to certify a class rests squarely within the discretion of the
trial court, and we afford that decision great deference on appeal, reversing only for a
manifest abuse of discretion: “Because trial courts are ideally situated to evaluate the
efficiencies and practicalities of permitting group action, they are afforded great
discretion in granting or denying certification.” [Citation.] A certification order
generally will not be disturbed unless (1) it is unsupported by substantial evidence, (2) it
rests on improper criteria, or (3) it rests on erroneous legal assumptions. [Citations.]’ ”
(Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal. 4th 1004, 1022; Tobacco II,
supra, 46 Cal.4th at p. 311; Fireside Bank v. Superior Court (2007) 40 Cal. 4th 1069,
1089.) If the trial court applies proper criteria and its ruling is founded on a rational
basis, its ruling will be upheld. (Brinker Restaurant Corp., at p. 1022.) We presume in
support of the ruling the existence of every fact the trial court could reasonably deduce
from the record. (Ibid.) Where a ruling on class certification turns on inferences to be
drawn from the facts, a reviewing court has no authority to substitute its decision for the
trial court’s. (Davis-Miller v. Automobile Club of Southern California (2011)
201 Cal. App. 4th 106, 120 (Davis-Miller).)
“ ‘Ordinarily, appellate review is not concerned with the trial court’s reasoning but
only with whether the result was correct or incorrect. [Citation.] But on appeal from the
denial of class certification, we review the reasons given by the trial court for denial of
class certification, and ignore any unexpressed grounds that might support denial.
[Citation.] We may not reverse, however, simply because some of the court’s reasoning
was faulty, so long as any of the stated reasons are sufficient to justify the order.
[Citation.]’ [Citation.] Any valid, pertinent reason will be sufficient to uphold the
10
trial court’s order.” (Thompson v. Automobile Club of Southern California (2013)
217 Cal. App. 4th 719, 726 (Thompson); Sav-On Drug Stores, Inc. v. Superior Court
(2004) 34 Cal. 4th 319, 327; Kaldenbach v. Mutual of Omaha Life Ins. Co. (2009)
178 Cal. App. 4th 830, 843–844 (Kaldenbach).)
2. Class action standards
Code of Civil Procedure section 382 authorizes the maintenance of a class action
“when the question is one of a common or general interest, of many persons, or when the
parties are numerous, and it is impracticable to bring them all before the court.”
(Sevidal v. Target Corp. (2010) 189 Cal. App. 4th 905, 917 (Sevidal); Kaldenbach, supra,
178 Cal.App.4th at p. 843.) To obtain certification, the plaintiffs have the burden of
showing the existence of an ascertainable and sufficiently numerous class, a well-defined
community of interest, and substantial benefits from certification that render proceeding
as a class superior to the alternatives. (Tobacco II, supra, 46 Cal.4th at p. 313; Brinker
Restaurant Corp. v. Superior Court, supra, 53 Cal.4th at p. 1021.) The community of
interest requirement embodies three factors: (1) predominant common questions of law
or fact; (2) class representatives with claims or defenses typical of the class; and (3) class
representatives who can adequately represent the class. (Brinker Restaurant Corp., at
p. 1021; Sevidal, at p. 917.) The “ ‘certification question is “essentially a procedural one
that does not ask whether an action is legally or factually meritorious.” ’ [Citation.]”
(Cohen v. DIRECTV, Inc. (2009) 178 Cal. App. 4th 966, 974 (Cohen); Knapp v. AT&T
Wireless Services, Inc. (2011) 195 Cal. App. 4th 932, 938.)
3. The UCL, the False Advertising Law, and section 17533.7
Section 17533.7 makes it unlawful for “any person, firm, corporation, or
association to sell or offer for sale in this state any merchandise on which merchandise or
on its container there appears the words ‘Made in U.S.A.,’ ‘Made in America,’ ‘U.S.A.,’
or similar words if the merchandise or any article, unit, or part thereof, has been entirely
or substantially made, manufactured, or produced outside of the United States.”
(§ 17533.7, subd. (a).) In 2015, the statute was amended to add subdivision (b), effective
January 1, 2016, which provides: “This section shall not apply to merchandise made,
11
manufactured, or produced in the United States that has one or more articles, units, or
parts from outside of the United States, if all of the articles, units, or parts of the
merchandise obtained from outside the United States constitute not more than 5 percent
of the final wholesale value of the manufactured product.” (§ 17533.7, subd. (b).)
The UCL (§ 17200 et seq.), prohibits and provides civil remedies for unfair
competition, defined as “any unlawful, unfair or fraudulent business act or practice and
unfair, deceptive, untrue or misleading advertising . . . .” (§ 17200; Kwikset, supra,
51 Cal.4th at p. 320; Kaldenbach, supra, 178 Cal.App.4th at p. 847.) Its purpose is to
protect consumers and competitors. (Kwikset, at p. 320.) The UCL’s substantive
provisions are framed in broad language to effectuate this purpose. (Ibid.) “ ‘By
proscribing “any unlawful” business practice, “section 17200 ‘borrows’ violations of
other laws and treats them as unlawful practices” that the [UCL] makes independently
actionable.’ [Citation.]” (In re Tobacco Cases II (2015) 240 Cal. App. 4th 779, 790.)
Under the UCL, there are three varieties of unfair competition: practices that are
unlawful, unfair, or fraudulent. (Tobacco II, supra, 46 Cal.4th at p. 311.) Here, Sears’s
allegedly false advertising falls in the third category; false labeling falls also within the
first. (In re Tobacco Cases II, at p. 790 [false advertising falls within the “fraudulent”
category of prohibited practices under the UCL].)
California’s false advertising law (§ 17500 et seq.) “is equally comprehensive
within the narrower field of false and misleading advertising.” (Kwikset, supra,
51 Cal.4th at p. 320.) Section 17500 provides in pertinent part that it is unlawful for any
corporation, with the intent to dispose of personal property, to knowingly make untrue or
misleading statements in advertising. The statute proscribes not only false advertising,
but also advertising which, although true, is either actually misleading or likely to
deceive or confuse the public. (Colgan v. Leatherman Tool Group, Inc. (2006)
135 Cal. App. 4th 663, 679.) A violation of the UCL’s fraud prong is also a violation of
the false advertising law. (Tobacco II, supra, 46 Cal.4th at p. 312, fn. 8; Pfizer Inc. v.
Superior Court (2010) 182 Cal. App. 4th 622, 630, fn. 4 (Pfizer).) The remedies available
in a UCL or FAL action are generally limited to injunctive relief and restitution.
12
(Tobacco II, at p. 312; Pfizer, at p. 631.) “[R]estitution under the statutes involved here
must be of a measurable amount to restore to the plaintiff what has been acquired by
violations of the statutes, and that measurable amount must be supported by evidence.”
(Colgan, at p. 698.)
“Historically, in order to state a cause of action under either the UCL or the FAL,
case law only required a showing that ‘ “members of the public [were] likely to be
deceived.” [Citations.]’ [Citation.] Allegations of actual deception, reasonable reliance
and damage were unnecessary. [Citation.].” (Pfizer, supra, 182 Cal.App.4th at p. 630.)
“However, in November 2004, the voters approved Proposition 64, which provided that
‘ “a private person has standing to sue only if he or she ‘has suffered injury in fact and
has lost money or property as a result of such unfair competition.’ ” ’ ” (Sevidal, supra,
189 Cal.App.4th at pp. 923-924.) “In Tobacco II, the California Supreme Court held that
this new standing requirement applied only to the class representatives, and not to absent
class members.” (Id. at p. 924.) Proposition 64 did not alter the “likely to be deceived”
standard. (Pfizer, at p. 630.)
4. Denial of class certification was not an abuse of discretion
Plaintiffs argue that the superior court improperly applied the standards articulated
in Tobacco II, erroneously relied on the federal district court’s analysis, impermissibly
weighed the lawsuit’s merits, and made unsupported findings. Because at least some of
the trial court’s stated reasons justified its ruling, we discern no abuse of discretion.
a. Because the proposed class definition does not require that putative class
members saw false or misleading Craftsman advertising, the proposed class is overbroad
and lacks commonality
The trial court concluded the proposed class was overbroad, and common issues of
fact did not predominate, because the class definition was not limited to persons who saw
the allegedly false “Made in the U.S.A.” claims. The court reasoned that the putative
class “would include people who (1) bought Craftsman tools but never saw any
Craftsman advertising; (2) bought Craftsman tools but never saw advertising representing
that the tools were made in the United States; and (3) bought Craftsman tools with the
13
knowledge that those tools were not made in the United States.” The court reasoned that
none of these persons could prove deception, and the class was therefore overbroad and
not ascertainable.
The trial court’s reasoning on this point was correct. “[W]hen the class action is
based on alleged misrepresentations, a class certification denial will be upheld when
individual evidence will be required to determine whether the representations at issue
were actually made to each member of the class. [Citations.]” (Fairbanks v. Farmers
New World Life Ins. Co. (2011) 197 Cal. App. 4th 544, 562; Davis-Miller, supra,
201 Cal.App.4th at p. 121; Knapp v. AT&T Wireless Services, Inc., supra,
195 Cal.App.4th at pp. 944–945; Kaldenbach, supra, 178 Cal.App.4th at pp. 849- 850.)
“[W]e do not understand the UCL to authorize an award for injunctive relief and/or
restitution on behalf of a consumer who was never exposed in any way to an allegedly
wrongful business practice.” (Cohen, supra, 178 Cal.App.4th at p. 980.)
In Pfizer, the named plaintiff filed a consumer action against the manufacturer of
Listerine mouthwash, alleging that Pfizer marketed, promoted, and labeled Listerine in a
misleading manner by indicating it was as effective as dental floss in reducing plaque and
gingivitis. (Pfizer, supra, 182 Cal.App.4th at p. 625.) The complaint asserted, inter alia,
UCL and FAL causes of action. (Ibid.) The trial court certified a class of “ ‘all persons
who purchased Listerine, in California, from June 2004 through January 7, 2005.’ ”
(Ibid.) After considering the impact of Proposition 64, the Supreme Court’s Tobacco II
decision, and the precept that relief under the UCL is available without individualized
proof of deception, reliance, and injury, we concluded that the class was grossly
overbroad because many, if not most, class members were never exposed to the alleged
misrepresentations. (Pfizer, at p. 631.) Approximately half of the Listerine bottles sold
during the class period did not include a label stating that Listerine mouthwash was
comparable to floss. Pfizer ran four different television commercials with the “ ‘as
effective as floss’ ” campaign, but they did not run continuously and there was no
evidence a majority of Listerine consumers viewed them. (Id. at pp. 631-632.) “Thus,
perhaps the majority of class members who purchased Listerine during the pertinent
14
six-month period did so not because of any exposure to Pfizer’s allegedly deceptive
conduct, but rather, because they were brand-loyal customers or for other reasons.”
(Id. at p. 632.) We concluded: “Tobacco II does not stand for the proposition that a
consumer who was never exposed to an alleged false or misleading advertising or
promotional campaign is entitled to restitution.” (Ibid.) “[O]ne who was not exposed to
the alleged misrepresentations and therefore could not possibly have lost money or
property as a result of the unfair competition is not entitled to restitution.” (Id. at p. 631;
cf. Perrine v. Sega of America, Inc. (N.D.Cal. May 12, 2015, No. 13-cv-01962-JD)
2015 U.S. Dist. Lexis 62326, at pp.*6-7 [although class members need not demonstrate
individualized reliance under the UCL and FAL, no presumption of reliance applies
unless everyone in the class was “ ‘exposed,’ meaning that ‘it is necessary for everyone
8
in the class to have viewed the allegedly misleading advertising’ ”].)
The same is true here. Insofar as plaintiffs’ claims are based on allegations of
false advertising, the proposed UCL and FAL class is overbroad because it presumes
there was a classwide injury, despite the fact it is not limited to Craftsman customers who
were exposed to deceptive advertising or labeling. (Pfizer, supra, 182 Cal.App.4th at
p. 632; Sevidal, supra, 189 Cal.App.4th at p. 926 [class was overbroad where a majority
of class members were never exposed to the alleged misrepresentation and there was no
likelihood they were deceived by the alleged false advertising]; cf. Brinker Restaurant
Corp. v. Superior Court, supra, 53 Cal.4th at p. 1050 [class definition in wage and hour
action was overinclusive where “[t]he definition on its face embraces individuals who
now have no claim against [defendant]”]; In re Scotts EZ Seed Litigation (S.D.N.Y.
2015) 304 F.R.D. 397, 404, 406 [typicality requirement satisfied where each container
of product bore the allegedly misleading claim]; McAdams v. Monier, Inc. (2010)
182 Cal. App. 4th 174, 192 [reversing order denying class certification but making
8 Unpublished federal opinions are citable as persuasive, but not precedential,
authority notwithstanding California Rules of Court, rule 8.1115. (Haligowski v.
Superior Court (2011) 200 Cal. App. 4th 983, 990, fn. 4.)
15
definition of the class subject to the proviso that class members must have been exposed
to misrepresentation prior to purchasing product].) Not all Craftsman advertisements
made the “Made in the U.S.A.” claim. Not all Craftsman products were foreign-made.
Some advertisements making the American-made claim pertained to tools that were, in
fact, made in the United States. Only where a plaintiff saw a misrepresentation that a
particular Craftsman product, or all Craftsman products, were U.S.A.-made, and then
purchased a foreign-made Craftsman product, could he or she possibly have suffered
injury. (See Pfizer, at p. 631.)
Appellants attempt to overcome this defect in several ways. They aver that the
trial court misapplied Tobacco II when it considered whether consumers were deceived
by Sears’s advertising, in light of Tobacco II’s reasoning that only the class
representatives must prove reliance. We reject this argument in light of Pfizer and the
other authorities discussed ante. Moreover, Tobacco II pertains only to the standing
inquiry, which is not at issue here. As explained in Cohen, supra, 178 Cal. App. 4th 966,
in Tobacco II, “the Supreme Court specifically addressed two questions: ‘First, who in a
UCL class action must comply with Proposition 64’s standing requirements, the class
representatives or all unnamed class members, in order for the class action to proceed . . .
Second, what is the causation requirement for purposes of establishing standing under the
UCL . . . ?’ [Citation.] . . . [T]he Supreme Court answered these two questions by ruling
(1) only the class representatives must meet Proposition 64’s standing requirements of
actual injury and causation; (2) only the class representatives must establish reliance in
accordance with fraudulent inducement principles in order for the class action to proceed;
and (3) the class representatives do not have to show reliance on particular
advertisements or marketing materials with ‘unrealistic’ specificity. [Citation.] [¶]
Viewed from the other direction, Tobacco II held that, for purposes of standing in context
of the class certification issue in a ‘false advertising’ case involving the UCL, the class
members need not be assessed for the element of reliance. Or, in other words, class
certification may not be defeated on the ground of lack of standing upon a showing that
class members did not rely on false advertising. In short, Tobacco II essentially ruled
16
that, for purposes of standing, as long as a single plaintiff is able to establish that he or
she relied on a defendant’s false advertising, a multitude of class members will also have
standing, regardless of whether any of those class members have in any way relied upon
the defendant’s allegedly improper conduct. [¶] In the contextual setting presented by
[plaintiff’s] present case, we find Tobacco II to be irrelevant because the issue of
‘standing’ simply is not the same thing as the issue of ‘commonality.’ . . . We see no
language in Tobacco II that suggests to us that the Supreme Court intended our state’s
trial courts to dispatch with an examination of commonality when addressing a motion
for class certification. On the contrary, the Supreme Court reiterated the requirements for
maintenance of a class action, including (1) an ascertainable class and (2) a ‘ “community
of interest” ’ shared by the class members. [Citation.] In short, the trial court’s concerns
that the UCL and the CLRA claims alleged by [plaintiff] and the other class members
would involve factual questions associated with their reliance on DIRECTV’s alleged
false representations was a proper criterion for the court’s consideration when examining
‘commonality’ in the context of the subscribers’ motion for class certification, even after
Tobacco II.” (Cohen, at pp. 980-981.) Other courts, including this one, have followed
Cohen’s reasoning. (See Davis-Miller, supra, 201 Cal.App.4th at p. 124 [“Here, as in
Cohen, Tobacco II is ‘irrelevant because the issue of “standing” simply is not the same
thing as the issue of “commonality” ’ ”]; Knapp v. AT&T Wireless Services, Inc., supra,
195 Cal.App.4th at p. 945.)
Moreover, plaintiffs’ argument ignores the fact that the class in Tobacco II was
defined in part by whether smokers had seen defendants’ false advertising: California
residents who “ ‘smoked in California one or more cigarettes between June 10, 1993 to
April 23, 2001, and who were exposed to Defendants’ marketing and advertising
activities in California.’ ” (Tobacco II, supra, 46 Cal.4th at pp. 306, 309, 324, italics
added.) Plaintiffs’ proposed class contains no such limitation.
Plaintiffs further argue that they established classwide exposure to Sears’s false
advertising by presenting evidence the “Made in the U.S.A.” campaign was substantial
and decades long. Sears spent large sums on advertising during the class period, and
17
Sears’s internal marketing and strategic planning materials show Sears treated the “Made
in the U.S.A.” claim as a valuable brand asset and the cornerstone of its ability to
differentiate the brand in the marketplace. Under such circumstances, they aver,
“exposure language is unnecessary.” They contend it is “hard to imagine any California
consumer could have purchased a Craftsman product without exposure at some point to
the gauntlet” of ads, labels, and other materials featuring a “Made in the U.S.A.”
message.
First, the trial court rejected the notion that the evidence showed a decades-long,
ubiquitous advertising campaign comparable to that in Tobacco II. Substantial evidence
supports this finding. The evidence presented showed “Made in the U.S.A.” claims were
made in Sears’s television and print advertising from 2000 through 2004. Some of these
advertisements, however, pertained only to particular products, and there is no showing
those products were made outside the United States. The evidence does not demonstrate
that the bulk of Sears’s print and television advertisements made a generalized claim that
all Craftsman products were made in the United States. Plaintiffs presented scripts or
videos for approximately 11 television advertisements that either ran, or were prepared,
in 2000 through 2002 and included “Made in the U.S.A.” claims. At least three of those
make an American-made claim only in regard to “hand tools.” Evidence showed that
only a few of approximately 65 different Craftsman television advertisements that ran
between 2002 and 2004 included a “Made in the U.S.A.” claim. Of approximately
45 print ads apparently available for Sears’s use in 2002 through 2004, only seven made a
“Made in the U.S.A.” claim; four of those expressly referred to particular tools or hand
tools, and there is no showing those tools were not made in America.
Tom Arvia, Sears’s Divisional Merchandise Manager of Tools, Paint, and
Hardware, declared that Craftsman advertising varied based upon the particular product
being sold, the time period, the advertising media, and the selling channel. For the period
2001 through 2010, over 800 different advertisements (exclusive of packaging and
labeling) were disseminated for different Craftsman products. Television and magazine
ads comprised only a “small fraction” of Sears’s advertising, and many Craftsman
18
advertisements during this period did not include a “Made in the U.S.A.” claim. The
portion of advertising including such claims was small compared to the portion that did
not include “Made in the U.S.A.” claims. The packaging, labeling, and die sunk
stamping on “thousands of imported Craftsman products” indicated the products were not
American-made. Glori Katz, Sears’s former Director of Broadcast Advertising and
Marketing, declared that Craftsman advertising appeared in a wide variety of mediums;
nationally and within California, some advertising described certain Craftsman products
as foreign-made; and only some Craftsman advertising described certain Craftsman
products as being “Made in the U.S.A” or depicted an American flag. An email indicated
Sears’s website omitted the claim that Craftsman products were made in the United
States in December 2004.
Given that the time period at issue was several years, and only some Sears
advertising and marketing could potentially be found to be false or misleading,
substantial evidence supported the trial court’s finding that the advertising at issue here is
not equivalent to the decades-long campaign in Tobacco II. In contrast to the evidence
here, Tobacco II “involved identical misrepresentations and/or nondisclosures by the
defendants made to the entire class.” (Kaldenbach, supra, 178 Cal.App.4th at p. 849.)
Although plaintiffs complain that the court ignored a “mountain” of evidence and instead
relied on Arvia’s declaration, this argument misconstrues the standard of review. We do
not reweigh the evidence. (See Sav-On Drug Stores, Inc. v. Superior Court, supra,
34 Cal.4th at p. 338; Sevidal, supra, 189 Cal.App.4th at p. 918; Kaldenbach, at p. 844.)
The fact Sears viewed the “Made in the U.S.A.” attribute as a valuable marketing
tool, and attempted to capitalize on it in some of its advertising, simply does not give rise
to the inference that all, or most, members of the proposed class saw such advertising.
Plaintiffs also argue that marketing research materials commissioned by Sears repeatedly
showed consumers associated “Made in the U.S.A.” with Craftsman, a circumstance
plaintiffs contend “empirically prove[s]” classwide exposure. We disagree. Even if
marketing research could substitute for an actual requirement that class members were
exposed to the allegedly false or misleading advertising, it does not suffice here. A Sears
19
internal “2003 Brand Strategic Plan” PowerPoint presentation indicated that 77 percent of
consumers associated Craftsman with the “Made in the U.S.A.” attribute. But the
document included no information regarding the source of this conclusion. Another
PowerPoint presentation entitled “Craftsman – Made in USA,” stated that “[r]epeated
quantitative and qualitative consumer research studies over the last 7 years” established a
“clear, dominant association between the Craftsman brand and made in USA as a tool
attribute.” This document, however, appears to have been generated in 2000, outside the
class period. Moreover, it states that “[c]urrently, 80% of Craftsman products [are]
USA-made.” Given that at the time, a majority of Craftsman products apparently were
made in the United States, the inference that consumers’ perceptions were based on
exposure to false advertising is weak.
Plaintiffs give particular weight to a May 2006 report indicating that in a survey of
a representative sample of 393 homeowners, 90 percent believed that Craftsman hand
and power tools were made in the United States, and perceived Craftsman to be
American-made more than other brands. A “Hardline Tracking Program” prepared by a
marketing research firm for the first quarter of 2006 indicated that 79 percent of survey
participants thought Craftsman hand tools had a reputation of being made in America.
And a 2005 “Brand Essence Exploration,” based on two-hour sessions with 12 focus
groups comprised of eight participants each concluded, among a multitude of other
things, that “ ‘American made’ ” was a positive brand equity. There is little evidence
regarding the methodology for these materials, and, importantly, no showing that
9
consumers’ beliefs were based on Sears advertising. Moreover, there is no survey
9 Other materials cited by plaintiffs are even less useful. A 1998 document
regarding Sears “Tool Land” floor plans; a 2001 email; a 2006 “Brand Plan”; a July 2005
“Brand Review” and an undated PowerPoint document, both stating that Sears “owns
‘lifetime warranty’ & ‘Made in America’ ”; and a document reporting the results of a
“mini brand audit” in which Sears employees and its advertising agencies participated,
simply confirm that Sears personnel viewed the “Made in the U.S.A.” attribute as
important to marketing of the brand. An October 2003 email between Sears employees
and a December 2002 PowerPoint presentation pertained to advertising objectives or
“copy points,” not marketing survey results.
20
evidence for any date after 2006. The evidence did not compel a conclusion that every
purchaser of a Craftsman product was exposed to the allegedly false or misleading “Made
10
in the U.S.A.” claim.
In re Pom Wonderful LLC Marketing and Sales Practices Litigation (C.D.Cal.,
Sept. 28, 2012, No. ML 10-02199) 2012 U.S.Dist. Lexis 141150, is distinguishable; in
that case there was survey evidence consumers purchased defendant’s pomegranate
beverages because of the health benefits, a different question than whether consumers
believed Craftsman tools were American-made. To the extent Pom Wonderful holds
marketing directives and consumer surveys can substitute for an actual classwide
exposure requirement, we disagree, at least on the evidence presented here. (See
People v. Beltran (2013) 56 Cal. 4th 935, 953 [decisions of the lower federal courts are
not binding on questions of state law].)
b. Difficulty of determining whether Craftsman tools sold during the class period
were foreign-made or contained foreign components
The trial court further concluded the class was not ascertainable because class
members whose tools were unmarked would not know whether their products fell within
the class definition, i.e., were made wholly or in part outside the United States. The court
rejected the notion that once a class member identified himself or herself as a Craftsman
purchaser, the burden should then shift to Sears to identify whether the product purchased
had been made in the United States, because Sears did not have a reasonable means of
determining the country of origin of thousands of tools over the lengthy class period.
10 The federal district court in the multidistrict litigation reasoned that plaintiffs there
had alleged Sears’s “Made in the U.S.A.” claim was not always deceptive, but became so
at some point after the year 2000 when Sears began outsourcing production of Craftsman
products. (See Greenfield v. Sears, Roebuck & Co. (In re Sears, Roebuck & Co. Tools
Marketing and Sales Practices Litigation), supra, 2012 U.S.Dist. Lexis at *32, fn. 6.)
The trial court here agreed with the district court’s analysis. Plaintiffs argue that this was
error because Sears admits some of its Craftsman products have been imported for the
past 35 years. The trial court’s error of fact was not significant to its ruling, and does not
require reversal.
21
These findings were not an abuse of discretion, and are supported by substantial
11
evidence.
Plaintiffs had the burden to show the proposed class was ascertainable. (Archer v.
United Rentals, Inc. (2011) 195 Cal. App. 4th 807, 828.) “ ‘Whether a class is
ascertainable is determined by examining (1) the class definition, (2) the size of the class,
and (3) the means available for identifying class members. [Citations.]’ ” (Evans v.
Lasco Bathware, Inc. (2009) 178 Cal. App. 4th 1417, 1422; Cruz v. Sun World Internat.,
LLC (2015) 243 Cal. App. 4th 367, 375.) “The ascertainability requirement is satisfied if
‘the potential class members may be identified without unreasonable expense or time and
given notice of the litigation, and the proposed class definition offers an objective means
of identifying those persons who will be bound by the results of the litigation . . . .’
[Citation.]” (Sevidal, supra, 189 Cal.App.4th at p. 919; Cruz v. Sun World Internat.,
LLC, at p. 375; Archer v. United Rentals, Inc., at p. 828.) Class members are
ascertainable where they may be readily identified by reference to official or business
11 Arguably, analysis of this issue is related to commonality rather than
ascertainability. Cohen explained: “ ‘Although courts sometimes treat [ascertainability
and commonality] as if they were one, they are better examined separately because they
serve separate purposes.’ ” (Cohen, supra, 178 Cal.App.4th at p. 975.) Ascertainability
is required to give notice to putative class members as to whom the judgment will be res
judicata. Common questions of law and fact are required to assure the interest of the
litigants and the court are furthered by permitting the suit to proceed as a class action.
(Ibid.) Therefore issues of proof vis-a-vis liability, causation and damages should be
considered as part of the commonality analysis, not ascertainability. (Id. at p. 978.)
Under this approach, ascertainability is tested by simply determining if class members
may be identified from the most inclusive facial class definition. (Marler v. E.M.
Johansing, LLC (2011) 199 Cal. App. 4th 1450, 1460 (Marler).) Marler, on the other
hand, took “a more nuanced approach. We do not exclude an analysis of community of
interest factors in testing ascertainability. We may consider whether the class ‘definition
is overbroad,’ and if the plaintiffs have shown that ‘class members who have claims can
be identified from those who should not be included in the class.’ ” (Ibid.) Whichever
label is attached, the trial court’s reasoning and conclusions here were not an abuse of
discretion.
22
records. (Hale v. Sharp Healthcare (2014) 232 Cal. App. 4th 50, 58; Thompson, supra,
217 Cal.App.4th at p. 728; Sevidal, at p. 919; Archer v. United Rentals, Inc., at p. 828.)
The evidence supported the trial court’s ruling. Tom Arvia and Greg Inwood,
Sears’s former Vice President and General Merchandise Manager of Tools, Paint, and
Hardware, declared that the Craftsman line includes over 900 different product classes
and over 10,000 discrete products. More than 40 million California customers purchased
Craftsman items in California during the relevant period. In 2004 alone, more than
7.5 million Craftsman products were sold in California. Sears does not manufacture
Craftsman products; instead it contracts annually with over 100 vendors to procure the
Craftsman line. Those vendors and products change each year. Sears relies upon its
vendors to accurately label the country of origin of Craftsman products. A substantial
portion of Craftsman items are U.S.A.-made, while others are not. For example,
marketing materials and item counts variously showed that of 5,120 hand tools, power
tools, storage, and other items, 4,157 were made in the United States. Another document
indicates that 4,021 of 4,834 items, including patio, electric, security, storage, vacuums,
compressors, tractors, mowers, hand tools, blowers, and other items, were American-
made. An excerpt from Sears’s “CORE” database lists the origin of Craftsman products,
with some being made in the United States and some elsewhere. The percentage of
products made in the United States changed over time. Because of sourcing changes and
inventory turnover, the same Craftsman product could be on store shelves in both “Made
in the U.S.A.” and foreign-made versions simultaneously.
Arvia and Inwood both confirmed that Sears does not maintain a database of
historical data containing country of origin information by product for each year, nor
does it maintain purchase information for all consumers of Craftsman products. Sears
does maintain a “complex database system” known or formerly known as CORE, which
contained hundreds of data fields for any particular product, including country of origin
information for all Craftsman products as well as all other Sears products. However, the
database “change[d] daily” as it was updated with new information. A Sears Systems
Manager declared that the raw data for a product listed in CORE cannot be extracted and
23
produced in the form in which it is maintained in CORE, but must be converted into a
readable format using another program. This process can be time consuming,
burdensome, and expensive. Sears was therefore unable to determine the manufacture
date of all Craftsman products purchased in a particular year.
The evidence also showed that in order to determine the country of origin for a
particular product, Sears would need to conduct a tool-by-tool analysis, starting with
examination of the product’s “stock keeping unit” (SKU). Some SKU’s are die sunk, but
can fade over time; other SKUs are on labels affixed to products. In the absence of a
SKU, Sears would be unable to determine the country of origin without extensive
research and inspection of the product. Even if Sears could identify the product via its
SKU or inspection, it could not determine whether the item or a part of the item was
foreign-made; only the vendor for that particular product at that particular point in time
could verify that information. Vendor stipulations would have been stored in a file, but
Inwood believed that they would not have been retained indefinitely.
Based on the foregoing, the trial court found country of origin information for
particular tools could not be retrieved without unreasonable time and expense: “It
appears that [Sears] truly ‘does not maintain a database of historical information that
contains country of origin information by product for each year’ ” and “Sears could
verify country of origin by examining each tool and contacting the tool’s manufacturer to
obtain country of origin information [citation], but, in light of millions of customers with
millions of tools, this process would be unacceptably time-consuming.” The fact Sears
was able to identify foreign-made products during its remediation efforts was insufficient
to create an inference that Sears “now possesses information to cover the [entire] class
period.” The court rejected the notion that vendor stipulations would still be accessible
based on Inwood’s deposition testimony that he doubted the documents were still
available.
24
We discern no abuse of discretion in the trial court’s ruling. Ascertainability
requires that class members be readily identifiable without unreasonable time and
expense. (See Sevidal, supra, 189 Cal.App.4th at pp. 919, 921; Hale v. Sharp
Healthcare, supra, 232 Cal.App.4th at pp. 58-59.) Purchasers of Craftsman tools that
were made outside the United States, or that contain components made outside the
United States, over a ten-year-plus period, are not a readily identifiable group. The
evidence suggests many Craftsman purchasers would be unable to determine whether
their product was made in or outside the United States, or contained a component made,
manufactured, or produced outside the United States if that product was either
mislabeled, unlabeled, or the foreign-made internal component was hidden from sight. If
the country of origin information had been placed on the product’s packaging, the
putative class member would generally have no way of readily determining whether he or
she fell within the class. It seems unlikely at best that most consumers will have retained
packaging materials, especially for smaller items like hand tools, for years after purchase.
If, as plaintiffs allege, some tools were mislabeled as “Made in the U.S.A.,” even a
“Made in America” label or stamp would not necessarily answer the question for a
putative class member. If the problem with a particular product is that various steps in
the manufacturing process were completed outside the United States, identification might
12
be even more difficult. (See generally Colgan v. Leatherman Tool Group, Inc., supra,
12 Plaintiffs take issue with the trial court’s statement that the “meaning of
‘substantially’ ” in section 17533.7 was “problematic, despite the fact that is it taken
from” the statutory language. The court opined that if a single foreign-made screw
in a lawn mower rendered the mower foreign-made, then for practical purposes,
“Plaintiffs . . . ask to certify a class of all persons who purchased a product with any
component made outside the US.” Plaintiffs contend the court’s holding “usurped the
power of the [L]egislature,” effectively “repealed [section 17533.7],” and is therefore
reversible error. Plaintiffs overstate the significance of the court’s statement. The trial
court did not state that the law was unenforceable, nor did it hold that a class could never
be certified due to a strict “single screw” standard. It appears it was concerned about the
manageability of the class, or felt ascertainability was lacking if class membership
depended on the genesis of miniscule components of Craftsman products, the origin of
which might not be obvious. In any event, as noted, the Legislature has amended
25
135 Cal.App.4th at pp. 673, 681-682 [Made in the U.S.A. representations were deceptive
where parts of the tools were investment cast, fineblanked, formed, hardened, cut, forged,
polished or machined in foreign countries].) Even where it can be confirmed that a
particular product was foreign-made during a particular time period, this would not
entirely solve the problem: at least for small purchases made early in the class period, it
is unlikely most purchasers would recall, or have records indicating, the year in which the
item was purchased.
Certainly, some consumers could self-identify. Class representative Wilson, for
example, allegedly purchased a rake with a metal head stating it was made in Austria, but
the label on the wooden handle reads USA. The same would be true if a consumer’s
product clearly states it was made outside the United States, and the consumer saw
advertising stating the opposite. However, the fact some consumers can be identified
does not mean the class as a whole is ascertainable. (Sevidal, supra, 189 Cal.App.4th at
p. 921.) The proposed class involved thousands of products, only some of which were
foreign-made during the entire class period. As the court stated at the hearing, the
determination of whether a consumer was a class member would be “tool by tool, year by
year all the way down the line.” On this record, we cannot say the trial court abused its
discretion. Given that there are thousands of Craftsman tools, millions of purchasers, a
time period of over ten years, and no ready means of determining whether each hammer,
lawn mower, or screwdriver was American-made, determining whether many Craftsman
purchasers fell within the proposed class would necessitate a time consuming,
individualized inquiry.
section 17533.7 to provide that it does not apply to merchandise made, manufactured, or
produced in the United States “if all of the articles, units, or parts of the merchandise
obtained from outside the United States constitute not more than 5 percent of the final
wholesale value of the manufactured product.” (§ 17533.7, subd. (b).)
26
Plaintiffs argue that the trial court’s finding was erroneous because it ignored the
fact that Sears managed to produce a printout of some CORE database information,
which plaintiffs aver covered the years 2001 through 2005. But assuming the cited
evidence supports a conclusion the CORE database information was more readily
available than Sears admits, this does not warrant reversal. “[T]he proper standard of
review is not whether substantial evidence might have supported an order granting the
motion for class certification, but whether substantial evidence supported the trial court’s
conclusion . . . .” (Knapp v. AT&T Wireless Services, Inc., supra, 195 Cal.App.4th at
pp. 940-941; Sevidal, supra, 189 Cal.App.4th at p. 918 [we do not reweigh the evidence
and must draw all reasonable inferences supporting the court’s order]; Kaldenbach,
supra, 178 Cal.App.4th at p. 844 [“we are concerned with whether substantial evidence
supports the court’s reasoning, not with whether there was evidence that might have
supported a different conclusion”].)
Plaintiffs also argue that any inability to determine the country of origin is
attributable to Sears. They aver that federal law and regulations required Sears to
maintain import records for five years (19 C.F.R. §§ 163.2, 163.4 (2012); 19 U.S.C.
13
§ 1508(a)), and label imported products (19 C.F.R. § 134.11 (2012)). But title 19 Code
of Federal Regulations part 134.11 provides that every article of foreign origin or its
container shall be marked as “permanently as the nature of the article (or container) will
permit.” It is fanciful to think most purchasers of Craftsman products retained the
container or packaging of small items for years after purchase; therefore Sears’s
13 Title 19 Code of Federal Regulations part 134.11 (2012), provides: “Unless
excepted by law, section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), requires
that every article of foreign origin (or its container) imported into the United States shall
be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of
the article (or container) will permit, in such manner as to indicate to an ultimate
purchaser in the United States the English name of the country of origin of the article, at
the time of importation into the Customs territory of the United States. Containers of
articles excepted from marking shall be marked with the name of the country of origin of
the article unless the container is also excepted from marking.”
27
compliance with the regulation would not necessarily assist consumers in identifying the
country of origin. As to record keeping, Sharon Bringelson, Sears’s Divisional Vice
President of Transportation and International Operations, declared she is familiar with
Sears’s “record-keeping obligations” under federal law. She explained that Sears
maintains customs records only for products that Sears imports and for which Sears
serves as the importer of record; Sears was not the importer of record for all imported
Craftsman products sold between 2000 and 2011; and therefore “Sears does not and
never has possessed customs records for all Craftsman products imported into the United
States during this time period.” Plaintiffs’ bare citation to federal law governing record
keeping obligations, without any explanation of whether or how they apply to Sears, is
14
insufficient to preserve this argument. (See In re Marriage of Falcone & Fyke (2008)
164 Cal. App. 4th 814, 830; Tilbury Constructors, Inc. v. State Comp. Ins. Fund (2006)
137 Cal. App. 4th 466, 482.)
Next, plaintiffs argue that Sears persuaded the trial court the class was not
ascertainable “in part by defying its discovery obligations.” They point to a portion of
the trial court’s class certification ruling in which it discounted plaintiffs’ evidence of
store signage because there was no showing the tools displayed beneath were foreign-
made. Plaintiffs aver that the trial court “did not have that particular information because
Sears refused to comply with the court’s explicit discovery orders.” They also complain
that Sears has “been under litigation hold obligations to maintain all relevant documents
and information,” and should therefore have ceased overwriting the CORE database.
Plaintiffs moved for discovery sanctions in regard to their seventh set of interrogatories
15
while the class certification motion was pending; the trial court ruled on the sanctions
14 We express no opinion on the application of these statutes and regulations to
Sears.
15 Plaintiffs’ seventh set of interrogatories contained two interrogatories: the first
asked Sears to state what percentage of all Craftsman products were made in the United
States for each year from 1999 through 2011, and the second asked the same question in
regard to Craftsman hand tools.
28
motion after it ruled on class certification. Plaintiffs argue that the “trial court agreed
with Plaintiffs that Sears failed to comply with its discovery obligations” when it ruled on
the sanctions motion. Therefore, they argue that the court’s finding that Sears “truly
‘does not maintain a database of historical information’ ” should not bar a finding of
ascertainability. Instead, Sears should be subject to a “negative inference that any
Craftsman product whose country of origin records were not maintained be deemed” not
to have been made in the United States. (See Reeves v. MV Transportation, Inc. (2010)
186 Cal. App. 4th 666, 681-682 [“ ‘Spoliation’ is ‘ “the destruction or significant alteration
of evidence, or the failure to preserve property for another’s use as evidence in pending
or reasonably foreseeable litigation” ’ ” and the destruction of evidence relevant to proof
of an issue at trial “ ‘can support an inference that the evidence would have been
unfavorable to the party responsible for its destruction’ ”].)
These contentions lack merit. First, after plaintiffs moved to compel further
responses on plaintiffs’ fifth set of interrogatories, Sears agreed to supplement its
responses regarding its remediation efforts. On September 23, 2011, Sears notified
plaintiffs in a letter that it had no additional information to disclose. The sanctions
motion pertained not to the fifth set of interrogatories, but to plaintiffs’ seventh set of
interrogatories, which did not involve Sears’s signage or information regarding tool
display. Therefore, there is no showing the trial court found Sears’s September 23, 2011
letter was somehow a breach of its discovery obligations.
Second, in its ruling denying class certification, the trial court expressly found
there was no evidence of spoliation and the negative inference suggested by plaintiffs
was unwarranted. Plaintiffs provide no evidence proving otherwise. The trial court
ultimately denied the sanctions motion. It ordered Sears to obtain more information from
its vendors – a process it acknowledged would be “massively time consuming” -- but did
not make a finding that the CORE database should have been frozen, or that Sears had
committed any discovery violation or wrongdoing in continuing to allow daily
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16
updating. Indeed, there is no evidence that the CORE database could have been
programmed not to overwrite data while still remaining functional. The declaration of
Sears Systems Manager Arthur McKeague explained that “CORE is a complex database
system at Sears which contains, among other things, summary level data on products,
vendors, and logistical information for distribution and supply purposes. Hundreds of
fields of data may exist within CORE for any particular product . . . includ[ing]
information regarding carton sizes for shipping product, carton weight, billing type, and
other information. CORE runs on a daily basis; thus CORE data as it appears on a given
date for a particular product does not necessarily reflect information relating to that
product over time.” Even if an order requiring Sears to cease use of what appears to be
an important system in its daily operations would have been proper – a proposition that
seems doubtful – no such order was issued here.
16 The court’s written ruling was as follows: “Plaintiffs request issue or evidentiary
sanctions to the effect that Defendant’s ‘Made in USA’ claims are false and misleading.
Defendant responds that its only obligation was to give ‘its best shot’ in a further
response, which it alleges it has done. As noted in earlier hearings, Sears apparently has
the ability to obtain more information from its vendors, although the process will be
massively time consuming. Still, the information goes to the heart of the case and
plaintiff deserves to have it, if it is possible to obtain. While the court has ordered that
Sears take steps to calculate the percentage of tools made in this country during any given
year, including obtaining vendor certifications for every Craftsman product for every year
of the class period, the court is not prepared to conclude that Sears’ failure to complete
this effort by now warrants evidence or issue sanctions.”
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Third, plaintiffs’ argument is something of a red herring. At a September 2, 2011
hearing, the trial court queried whether plaintiffs were ready to proceed with the
certification motion in light of the fact discovery issues were still outstanding. Class
counsel replied: “Yes, your honor. We’re ready to have the motion heard” and plaintiffs
“would stand on the record as it exists and schedule arguments.” Later, when hearing
argument on the class certification motion, the trial court took note of the fact that the
sanctions motion was still pending, and expressed concern about putting the “cart before
the horse.” Class counsel did not object or request that the certification motion be
deferred.
c. Trial court’s failure to sua sponte modify the proposed class definition
Citing Marler, supra, 199 Cal. App. 4th 1450, plaintiffs argue that the trial court
“ignored its obligation to consider certification of a redefined and/or narrower class,
including a class for injunctive relief.” (See Marler, at p. 1462 [if necessary to preserve
the case as a class action, “ ‘ “the court itself can and should redefine the class where the
evidence before it shows such a redefined class would be ascertainable” ’ ”; because “ ‘it
is the court’s duty to certify an identifiable and ascertainable class, the court is not
limited . . . to the class description contained in plaintiff’s complaint’ ”]; see also
Safaie v. Jacuzzi Whirlpool Bath, Inc. (2011) 192 Cal. App. 4th 1160, 1174 [“trial courts
have broad discretion to determine the propriety of class actions, including being
procedurally innovative in certifying an appropriate class”].)
In Marler, however, the appellate court held the trial court should have allowed
plaintiffs leave to amend their class descriptions to more concisely identify class and
subclass members. (Marler, supra, 199 Cal.App.4th at pp. 1455, 1459.) The trial court
here did not preclude plaintiffs from amending or narrowing the class description.
Plaintiffs stated in their response to Sears’s sur-reply that if the trial court concluded the
class definition was overbroad, “the appropriate remedy is to allow Plaintiffs to amend
the definition.” The trial court heard oral argument on the class certification motion on
September 14, 2012. At that hearing, it indicated that a class based on, for example,
purchasers of an individual tool might be ascertainable. It orally issued its ruling on
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November 6, 2012, and stated, “The plaintiffs are free to try again, but they have got to
take a smaller bite.” Plaintiffs’ counsel indicated plaintiffs would “re-urge class cert for a
narrower class.” The trial court did not issue its written ruling for approximately three
weeks thereafter. At no time did plaintiffs move to amend the class definition. It was
plaintiffs’ burden to define an ascertainable class. (Sevidal, supra, 189 Cal.App.4th at
p. 918.) Under these circumstances, the trial court can hardly be faulted for failing to
sua sponte redefine the class. (See Chatham v. Sears, Roebuck & Co. (In re Sears,
Roebuck & Co. Tools Marketing and Sales Practices Litigation), supra, 2007 U.S.Dist.
Lexis 89349, at pp.*16-17 [“it is not the court’s role to fashion plaintiffs’ class definitions
for them where the original proposed class is so problematic”; “[e]ssentially, plaintiffs’
counsel has attempted to shift the task of class definition to the court”].)
Plaintiffs also argue that the trial court could have designated a subclass of persons
who purchased Craftsman products that were falsely labeled as made in the United States
even absent a requirement in the class definition that such persons saw false advertising.
Their first cause of action for violation of the UCL is premised on Sears’s alleged
mislabeling of products, and thus is not dependent upon class members’ exposure to false
advertising. (See Steroid Hormone Product Cases (2010) 181 Cal. App. 4th 145, 159
[class members’ reliance is irrelevant to commonality where the UCL claim is based
upon the “unlawful prong” of the UCL and thus presents no issue regarding reliance].)
Plaintiffs aver Sears has identified 53 products that were foreign-made and mislabeled as
American-made, and the trial court could have certified a subclass of purchasers of these
products. But, again, plaintiffs did not ask the trial court to certify a class of purchasers
of only those products, or of only plaintiffs who purchased mislabeled goods, and
therefore its ruling cannot be faulted on this ground. Further, the trial court’s concerns
about ascertainability and commonality still exist in regard to such a subclass; as we have
explained, identification of which of the thousands of Craftsman products were foreign-
made during particular years cannot be accomplished, on the facts of this case, without
unreasonable time and expense. The identification of 53 of 10,000 products is not an
impressive indicator that identification is readily possible. We do not hold that
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certification of a subclass or narrower class could never be possible. But the trial court
did not abuse its discretion when it found the class as proposed is overbroad, not readily
ascertainable, and commonality is lacking given the particular facts of this case and the
17
evidence before the trial court.
17 Because the trial court properly denied the motion for the reasons addressed
herein, we need not consider the other bases for the trial court’s ruling and the parties’
arguments related thereto. (See Cohen, supra, 178 Cal.App.4th at p. 981.)
We decline plaintiffs’ request to take judicial notice of various tobacco
advertisements available online, because even if these materials may be judicially
noticed, consideration of them is unnecessary to our resolution of this matter.
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DISPOSITION
The trial court’s order is affirmed. Respondent is to recover its costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
ALDRICH, Acting P. J.
We concur:
LAVIN, J.
JONES, J.
 Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant to
article VI, section 6 of the California Constitution.
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