Tuesday, December 7, 2010

8th Circuit’s Disapproval of Tobacco II Deemed “Unpersuasive” by Northern District Court: Greenwood v. Compucredit Corp.

On November 19, 2010, Northern District Judge Claudia Wilken declined to follow the 8th Circuit’s recent decision in Avritt v. Reliastar Life Ins. Co., 615 F.3d 1023 (8th Cir. 2010) as a basis for decertification of a UCL deceptive advertising class.  See Greenwood v. Compucredit Corp., 2010 U.S. Dist. LEXIS 127719 (N.D. Cal. Nov. 19, 2010).  As explained by the Court, Avrit “disapproved of Tobacco II’s holding that absent class members were excused from establishing individual reliance on misrepresentations alleged in UCL claims.”  See id., at 7.  In no uncertain terms, the Court concluded that “[t]he decision in Avritt does not bind this Court, and it is unpersuasive.”  See id. As reasoned by the Court, Arvitt’s conclusion regarding absent class member standing was contrary to Ninth Circuit authority [see id.], and ultimately, the issue of absent class member reliance “is a question of the meaning of a California state law, on which the California Supreme Court's decision in Tobacco II is determinative.”  See id., at 15.

Discussion of the Court's certification order in Greenwood is contained in a previous post contained here.

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