Beware of the “Influencer”

The proliferation of social media has transformed the world in many ways including how people communicate, becoming a preferred vehicle for political discourse and an important source of information in litigation.  It has also changed the way companies market their products.  Gifting “influencers” with products to promote in their posts has proven to be a successful marketing strategy for increasing brand awareness.  However, companies may be held accountable for claims made by influencers about their products.

The risks associated with using social media as a marketing platform were highlighted in a recent California district court consumer class action concerning the marketing and sales of Younique’s mascara product.  See Schmitt v. Younique LLC, 2019 WL 1431906 (C.D. Cal. Jan. 10, 2019).  The lash enhancer’s label represented that the mascara’s natural fiber component was “natural” and consisted of “100% Natural Green Tea Fibers,” but plaintiffs allege the fiber component was purely ground-up nylon.

What makes Younique’s products unique is that they are not sold in retail stores, but are instead marketed and sold by “Presenters” (more commonly referred to as “Influencers”) through social media platforms and “virtual” parties.  The Presenters—not the company—control how they market the Lash Enhancer.    Although many of the Presenters never mentioned natural green tea fibers or displayed the mascara’s label in their posts, plaintiffs relied on the posts, in part, to satisfy the commonality and typicality requirements to support class certification.

Commonality

Younique argued plaintiffs were not entitled to a presumption of class-wide reliance because they “ha[d] not shown that the ‘natural’ ‘green tea’ language was material” to their purchasing decision.  Younique contended that none of the plaintiffs even saw the label prior to receiving the lash enhancer, and therefore could not satisfy Rule 23(a)(2)’s commonality requirement.

While acknowledging that not all of the plaintiffs had read the label, the Court found plaintiffs had demonstrated that commonality existed because there was at least one “single significant question of law or fact.”  Schmitt, at *4 (citing Mazza v. Am. Honda Motor, Co., 666 F.3d 581, 589 (9th Cir. 2012)).  Plaintiffs demonstrated they were exposed to an alleged misrepresentation either through Defendant’s website, or by reading the product label.  The question as to whether the “natural” and “green tea” representations were false was a significant question of fact that could be determined by this case.  According to the Court, since “materiality, like the reasonable consumer test, concerns objective features of allegedly fraudulent representations and omissions, not subjective questions of how those representations and omissions were perceived by each individual consumer, materiality presents common questions of fact suitable for class litigation.”  Id. (citing Martin v. Monsanto Co., 2017 WL 1115167, at *6 (C.D. Cal. Mar. 24, 2017)).

Typicality

Younique further argued that plaintiffs could not satisfy Rule 23(a)(3)’s typicality requirement, because “not all of the [p]laintiffs had claims that are coextensive with those of the classes that they seek to represent.”  The motion for class certification focused on the language from the label, but not all of the plaintiffs “indicate[d] they were exposed to the label prior to making a purchase.”  One plaintiff alleged she was “exposed to misrepresentations” that the Lash Enhancer was “natural” through a Presenter’s party page—not the label.  Another plaintiff “heard representations that the Lash Enhancer was natural and visited Younique’s website, where she encountered the representation that the fibers were natural.”  The third plaintiff reviewed the label after purchasing the product, and continued to make additional purchases of it.

Nevertheless, the Court found plaintiffs satisfied Rule 23(a)(3)’s typicality requirement, because plaintiffs had “produced evidence that the alleged misrepresentations that the Lash Enhancer’s fibers were natural, which they were exposed to via social media or Younique’s website, were material to their decision to make the purchase.”  (Emphasis added)The two plaintiffs that had not seen the label prior to purchasing the product had allegedly experienced the same injury: “receipt of a product that was not ‘natural.’”  Accordingly, the Court concluded the action was based on conduct that was not unique to these two proposed class members, because the “alleged misrepresentations were distributed widely and other class members ha[d] been injured by the same course of alleged conduct—distributing a Lash Enhancer that does not actually contain natural fibers, as indicated.”  Schmitt, at *5.

Although social media has its perks, companies should be mindful of its pitfalls.   Younique is a reminder that the breadth of social media’s wingspan may make it harder for companies to regulate how and where their products are being marketed.