[00:00:01] Speaker 02:
Good morning, your honors.

[00:00:02] Speaker 02:
Rebecca Peterson on behalf of plaintiffs.

[00:00:04] Speaker 02:
I would like to reserve four minutes for rebuttal, please.

[00:00:09] Speaker 02:
And thank you for the opportunity for the argument.

[00:00:14] Speaker 02:
This case presents a great opportunity and perhaps necessary opportunity for the California Supreme Court of California to clarify what exactly is the proper legal standard to apply to deception by omission claims under the UCL and CLRI.

[00:00:34] Speaker 03:
Can I ask you, they just refused to do it three months ago?

[00:00:37] Speaker 03:
And then they also refused in what, 21 and 22?

[00:00:43] Speaker 03:
If they didn't do it three months ago, right before Christmas, like December 23rd, 2024 is their Capito decision.

[00:00:52] Speaker 03:
What makes you think they'll do it now?

[00:00:54] Speaker 02:
So I think in Capito, it wasn't the same question before the court.

[00:00:59] Speaker 02:
In fact, the California Attorney General's brief there does mention Hodson, but only in the background where he's explaining the various standards that do apply.

[00:01:10] Speaker 02:
So the exact question that we have

[00:01:14] Speaker 02:
asked this court to certify was not the question that was posed in Capito.

[00:01:19] Speaker 02:
And I believe in Capito, pure omissions were not as central.

[00:01:25] Speaker 02:
There was a question as to when there's a statutory duty to disclose, and I think it's maybe the patient's bill of... They didn't even want to decide threshold questions.

[00:01:38] Speaker 03:
They didn't even want to decide whether a failure to disclose can trigger seal or a liability.

[00:01:44] Speaker 03:
Can I ask you on Capito?

[00:01:50] Speaker 03:
Sure.

[00:01:52] Speaker 03:
How should we read this?

[00:01:55] Speaker 03:
Like you said, they don't mention Wilson or Hudson.

[00:01:58] Speaker 03:
They don't mention unreasonable safety hazard or central function test.

[00:02:04] Speaker 03:
Do those no longer apply in omission-based CLRA and UCL claims?

[00:02:10] Speaker 03:
Is it just the lemandry factors?

[00:02:12] Speaker 03:
What's your sense?

[00:02:14] Speaker 02:
Yeah, I would say if, based on Capito, that because they don't even have that initial inquiry as to the Hudson factors of central function and safety risk, that the California court do not consider that.

[00:02:35] Speaker 02:
That was, because out of this circuit, it appears that has been followed as the prerequisite in what the district court did below.

[00:02:43] Speaker 02:
that we had to first satisfy the Hudson factor.

[00:02:46] Speaker 02:
So I do agree, Your Honor, that reading the Capito case, it seems like that is just not applicable for California because the California Supreme Court did not do that inquiry first before even getting into whether the LaMandre factors are likely to deceive apply.

[00:03:05] Speaker 01:
On the, Ms.

[00:03:06] Speaker 01:
Peterson, on the certification factor, plaintiffs brought their case in federal court, right?

[00:03:13] Speaker 01:
They chose a federal forum rather than a state forum, or?

[00:03:16] Speaker 02:
Correct.

[00:03:17] Speaker 02:
This one, we were not removed, and that's because of CAFCA.

[00:03:22] Speaker 02:
And this has, it would have satisfied the CAFCA.

[00:03:25] Speaker 01:
Of course.

[00:03:26] Speaker 02:
And so this did not start in state court.

[00:03:28] Speaker 02:
You are correct.

[00:03:29] Speaker 01:
So to move on to the Lemandre point,

[00:03:35] Speaker 01:
Do you agree then that if none of the LAMANDRI factors are present, at least under the law as it stands, that's the, that's dispositive?

[00:03:51] Speaker 02:
Well, Your Honor, I do believe that the UCL fraud claim, and Hudson even says this, is likely to deceive.

[00:03:57] Speaker 02:
And so I do think LAMANDRI doesn't apply to the UCL claim.

[00:04:05] Speaker 02:
the fraud claim even, not just unlawful or unfair.

[00:04:09] Speaker 02:
And if you do look at Hudson in their holding, it says specifically, and since then, I agree that courts have applied the Hudson factors to the UCL.

[00:04:25] Speaker 02:
But it specifically says on page 865,

[00:04:33] Speaker 02:
under the fraudulent prong.

[00:04:35] Speaker 02:
It says a failure to disclose.

[00:04:38] Speaker 03:
You said that you don't think Lemandre applies to UCL claims, but in Capito, the California Supreme Court relied on the same analysis in the CLRA claim where they did seem to at least discuss two of the Lemandre factors for its ruling on the UCL claim.

[00:05:01] Speaker 03:
So how would

[00:05:02] Speaker 03:
that follow, that lemandry doesn't matter for UCL if the California Supreme Court relied on active concealment and exclusive knowledge, which are lemandry factors for the CLRA claim.

[00:05:16] Speaker 02:
I believe that was because of what was presented as the argument there, but I do believe that in the California Attorney General's amicus brief does go into great detail about how

[00:05:30] Speaker 02:
it's likely to deceive under the UCL.

[00:05:32] Speaker 02:
And so it is our position that even with Capito and looking at its analysis that likely to deceive should be and is the proper standard under the UCL fraud claim.

[00:05:44] Speaker 01:
What difference does that make?

[00:05:48] Speaker 02:
Well, at that point then, the two issues that LaMandrie

[00:05:57] Speaker 02:
addressed in our case, which was exclusive knowledge and active concealment, that consideration would not be the same.

[00:06:09] Speaker 02:
So likely to deceive, you have reasonable consumer.

[00:06:12] Speaker 02:
So we would say the facts that we have here, it should go to the jury.

[00:06:17] Speaker 02:
We have unchallenged experts.

[00:06:20] Speaker 02:
We have including surveys showing that

[00:06:23] Speaker 02:
94% of consumers didn't expect heavy metals in the baby food after looking at the labels.

[00:06:32] Speaker 01:
We have the conjoin, which also shows... But in an admission case, we'd still go to these other likely to deceive cases that seem to be... Those cases, certainly the misrepresentation, the affirmative misrepresentation cases take us, may take us in that direction, but in a

[00:06:52] Speaker 01:
The emission case that you brought why would likely to deceive and how would it look different from?

[00:06:59] Speaker 01:
something that Resembles the lemandry factors is there a duty to disclose is there a half-truth or failure to complete a mission Where would we get that from so I believe that the likely to deceive comes out of?

[00:07:16] Speaker 02:
Doubty and that and excuse me

[00:07:22] Speaker 02:
the cases that are highlighted also in the California Attorney General's amicus brief.

[00:07:27] Speaker 02:
And so the likely to deceive replaces the duty to disclose is how I understand the law.

[00:07:36] Speaker 02:
And so it's not the same inquiry.

[00:07:39] Speaker 02:
But I do want to stress that even if the UCL and how Your Honor has read Capito to say that that seems to say, Lemandre applies,

[00:07:52] Speaker 02:
that our claims survive LaMandry.

[00:07:56] Speaker 02:
First and foremost, defendants didn't move on LaMandry.

[00:08:00] Speaker 02:
So that was a sua sponte decision.

[00:08:02] Speaker 01:
And what we have here... But on summary judgment, we can affirm on any ground supported by the record.

[00:08:10] Speaker 01:
Of course, Your Honor, and that's why we actually briefed it in more detail in our... And I, on Lemandre, can I ask you to provide a little more detail on what knowledge Plum has that the public couldn't know about heavy metals?

[00:08:26] Speaker 01:
What specific knowledge is that issue here in the food?

[00:08:31] Speaker 02:
So, for, we state that Plum actually knew that heavy metals were in the food.

[00:08:39] Speaker 02:
Is that it?

[00:08:41] Speaker 02:
And that the ingredients were high risk.

[00:08:44] Speaker 02:
And so the omission here is that they didn't tell consumers about the presence or high risk of

[00:08:52] Speaker 02:
So that's the knowledge that we would have to show.

[00:08:55] Speaker 01:
So it's at that level of generality that there were heavy metals in the food and heavy metals were high risk and the public couldn't have known either of those things.

[00:09:04] Speaker 01:
I believe your pleadings rely in part on the fact of public disclosures of exactly those facts if that's all we're dealing with.

[00:09:13] Speaker 02:
Well, I would say, Your Honor, that it's not just exclusive knowledge, it's reasonable accessibility.

[00:09:21] Speaker 02:
What's going on here is, yes, there are reports, and they also cite various articles, but Plum never put on its label the inclusion of heavy metals.

[00:09:33] Speaker 02:
Now they do on their website have the testing, but they never... Where is that requirement?

[00:09:39] Speaker 01:
That seems to be a step beyond the cases, that if we're talking about

[00:09:46] Speaker 01:
Basically, that there's an affirmative labeling duty to defeat an exclusive knowledge factor in lumandry.

[00:09:56] Speaker 01:
Where does that come from?

[00:09:58] Speaker 02:
Oh, Your Honor, I'm not saying that.

[00:09:59] Speaker 02:
I just, I apologize.

[00:10:02] Speaker 02:
It's just, that's the omission, right?

[00:10:05] Speaker 02:
It's not on the label.

[00:10:06] Speaker 02:
And so once you move outside of the label, so you have Anderson v. Apple, for instance, where they talk about, you look at the nature of the product, the nature of the omission,

[00:10:15] Speaker 02:
and what information is out there.

[00:10:18] Speaker 02:
And so it is our belief that based on the district court's decision on the mandary that she's focused solely on exclusive knowledge and public information is improper.

[00:10:30] Speaker 02:
Because you have to, the other side of that.

[00:10:32] Speaker 03:
Why didn't you make allegations about the specific levels of these heavy metals in the plum products?

[00:10:40] Speaker 03:
Because just saying they exist in the products, there does seem to be ample evidence in the record that that was publicly available.

[00:10:48] Speaker 03:
But if you had information about specific levels of the metals in the products, right, that is something that then there could be more active concealment.

[00:11:03] Speaker 03:
There's more evidence of active concealment of specific levels.

[00:11:05] Speaker 03:
There would also be more evidence of specific safety hazard

[00:11:10] Speaker 03:
and whether that's unreasonable with specific levels.

[00:11:14] Speaker 02:
Well, Your Honor, I guess with food product especially, remember, this is something a baby eats.

[00:11:18] Speaker 02:
And so how does a consumer know what's in that pouch as to a level if plum doesn't disclose it?

[00:11:27] Speaker 02:
And so how to get to levels?

[00:11:29] Speaker 02:
We do have allegations as to levels.

[00:11:31] Speaker 02:
We talk about there's super puffs over 100 parts per billion for organic rice.

[00:11:36] Speaker 02:
So where there was the information available,

[00:11:40] Speaker 02:
From the congressional report, we do talk about levels.

[00:11:43] Speaker 02:
But none of our consumers, none of our plaintiffs can tell you or tell me what exactly was that level in the pouches they got.

[00:11:51] Speaker 03:
Did you get that in discovery?

[00:11:52] Speaker 03:
This was summary judgment.

[00:11:53] Speaker 03:
So I assume this was after some discovery.

[00:11:58] Speaker 02:
So that would just be the general testing.

[00:12:00] Speaker 02:
And Plum themselves never test every, which is one thing we argue is active concealment.

[00:12:05] Speaker 02:
They didn't test every lot until, I think,

[00:12:09] Speaker 02:
Maybe now they, no, I think they never did.

[00:12:11] Speaker 02:
They never even tested every ingredient.

[00:12:13] Speaker 02:
So we got this.

[00:12:15] Speaker 02:
I apologize.

[00:12:16] Speaker 02:
Go ahead.

[00:12:17] Speaker 01:
Thank you.

[00:12:17] Speaker 01:
These are helpful answers.

[00:12:20] Speaker 01:
But to establish anything beyond what was already public knowledge, you had discovery.

[00:12:28] Speaker 01:
Did you test the products to try to specify this?

[00:12:35] Speaker 01:
I guess the problem is if we keep going back to what was already

[00:12:39] Speaker 01:
arguably public knowledge to set the standard for exclusive knowledge, that becomes a little incoherent as a rule.

[00:12:52] Speaker 02:
Yeah, and I see that concern.

[00:12:55] Speaker 02:
We did test.

[00:12:56] Speaker 02:
We had an expert of testing.

[00:12:57] Speaker 02:
We did our own testing.

[00:12:58] Speaker 02:
But again, these aren't the pouches our plaintiffs purchased and fed their babies.

[00:13:02] Speaker 02:
I mean, it doesn't matter the food product.

[00:13:05] Speaker 02:
If you say that the exclusive knowledge has to be

[00:13:07] Speaker 02:
what is the level that they purchased at, then consumers have to go test the food before they eat it.

[00:13:13] Speaker 01:
And that's, so unfortunately just... They can, they may be able to allege that if tested, it would establish this.

[00:13:23] Speaker 01:
But of course, again, on summary judgment, there's the opportunity to

[00:13:27] Speaker 01:
to establish something beyond.

[00:13:29] Speaker 01:
But I didn't take most of your brief.

[00:13:31] Speaker 01:
Again, where we started with our first Q&A here was what knowledge Plum had that the public lacked.

[00:13:40] Speaker 01:
And your response was that there is heavy metals in here, and heavy metals can be harmful.

[00:13:47] Speaker 01:
And at that level, it seems like there's plenty of public information.

[00:13:52] Speaker 02:
Okay, so I want to be respectful, but I do want to just say also it's that they knew that there was high risk for heavy metals in their ingredients.

[00:13:59] Speaker 02:
They never told consumers that.

[00:14:00] Speaker 02:
They knew they didn't test by lot.

[00:14:02] Speaker 02:
They knew they didn't test final products.

[00:14:05] Speaker 02:
They knew that consumers were never told that their food has heavy metals.

[00:14:13] Speaker 02:
Even the disclosure they point to, it says may occur in food.

[00:14:17] Speaker 02:
That may occur in our baby food, may occur in baby food, it simply may occur in food.

[00:14:21] Speaker 02:
But I apologize.

[00:14:22] Speaker 03:
Let me just ask one clarification question.

[00:14:25] Speaker 03:
So your position, going back to Capito, is that the likely to deceive standard doesn't apply for seal array claims anymore.

[00:14:32] Speaker 03:
As long as you satisfy one lamandry factor, there's a duty to disclose.

[00:14:37] Speaker 03:
Is that your position?

[00:14:39] Speaker 02:
Yes.

[00:14:39] Speaker 03:
I think that's how I read that.

[00:14:40] Speaker 03:
Thank you.

[00:14:41] Speaker 03:
I'll give you time for rebuttal.

[00:14:43] Speaker 02:
OK, thank you so much.

[00:14:44] Speaker 03:
You only have 35 seconds, but I'll give you more than that.

[00:14:46] Speaker 03:
OK, thank you.

[00:14:47] Speaker ?:
OK.

[00:14:58] Speaker 00:
Good morning, Your Honors.

[00:14:58] Speaker 00:
Charles Sipos on behalf of the Appalachian Plum PBC.

[00:15:01] Speaker 00:
I'm pleased to be here this morning.

[00:15:04] Speaker 00:
Your Honors, the district court issued a thorough and well-reasoned opinion applying this court's precedent in Hodson.

[00:15:11] Speaker 00:
And Hodson unmistakably holds that under the UCL or CLRA, there is no duty to disclose in a pure omission case, which is what this was, unless the plaintiff shows that there is an unreasonable safety hazard

[00:15:24] Speaker 03:
But what should we make of the fact that Capito does not mention unreasonable safety hazard or central function test, doesn't mention Wilson, doesn't mention Hodson, only does two of the Lemandre factors?

[00:15:35] Speaker 03:
So how do we even know that's good law anymore?

[00:15:38] Speaker 00:
I think Capito is, Hodson still is good law post Capito for two reasons.

[00:15:43] Speaker 00:
I think it's distinguishable in two ways.

[00:15:45] Speaker 00:
First of all, Capito was decided and the conduct was not misleading.

[00:15:51] Speaker 00:
because the parties were operating there under the background of an applicable statutory scheme, regulatory scheme for the disclosure of these emergency room fees.

[00:16:00] Speaker 00:
So there was an underlying regulatory requirement that the defendant was complying with that provided the defense.

[00:16:07] Speaker 00:
That's point one.

[00:16:08] Speaker 00:
Point two, I think capital was properly characterized as a partial representation case, which is not this case, because there were some fees disclosed.

[00:16:19] Speaker 00:
So I don't think capital,

[00:16:21] Speaker 00:
unwinds at all the pure omission analysis.

[00:16:35] Speaker 03:
I thought that they say this court has not defined the standard for deception by omission or failure to disclose under the UCL's fraudulent prong, and we express no view here.

[00:16:47] Speaker 03:
So they're saying we understand this is an omission case.

[00:16:50] Speaker 03:
I don't see them as saying, oh, we understand this is a partial, misleading, half-truth case.

[00:16:56] Speaker 03:
They say omission, right?

[00:16:58] Speaker 00:
They do, Your Honor.

[00:16:59] Speaker 00:
But I think the fact that Capito was presented with Hodgson

[00:17:05] Speaker 00:
was advised by way of the AG's brief that this was the way in which pure omission cases were being decided in the federal courts and in California appellate courts in Nalek versus Seagate and left that holding or that body of law, I should say, undisturbed.

[00:17:22] Speaker 00:
I don't think Capito, in light of those distinguishing factors, can be read to overrule Hodson or Nalek subsilentio.

[00:17:32] Speaker 00:
And I want to make sure that this point is emphasized because your honor's question was correct, Judge Coe.

[00:17:37] Speaker 00:
It is not just Capito that we're dealing with.

[00:17:40] Speaker 00:
Nalek versus Seagate presented this issue as well in the petition for review very explicitly as to whether or not Hodgson was the proper standard under California state law to decide an omission claim.

[00:17:54] Speaker 00:
And the petition for review was denied there.

[00:17:55] Speaker 00:
And under this court's certification precedence, that is adequate

[00:17:59] Speaker 00:
to show that the issue is sufficiently resolved as a matter of state law.

[00:18:04] Speaker 00:
And so I think the combined force of Nalek, Capito, and Johnson & Johnson as well make it very clear that the California Supreme Court has no interest or principle disagreement with the Hodson standard.

[00:18:19] Speaker 03:
Right.

[00:18:20] Speaker 03:
But what do you make of the fact that the California Supreme Court just three months ago didn't even mention Hodson or Wilson?

[00:18:26] Speaker 00:
I think that case, Hodgson or Wilson, didn't need to be addressed in capital because of those two distinguishing factors, because it was a case that involved the applicability of a very detailed regulatory scheme.

[00:18:41] Speaker 03:
But where is that in the decision?

[00:18:46] Speaker 03:
These distinctions that you're drawing, I don't agree with the partial representation distinction because they call this an omission case.

[00:18:54] Speaker 03:
But the applicable statutory scheme, where do they say that that is the dispositive factor as to whether we need to go look at unreasonable safety hazard or central function?

[00:19:05] Speaker 00:
I don't think that's, Your Honor, you're correct that that is not addressed explicitly.

[00:19:11] Speaker 00:
But I think that is a fair inference drawn from the disposition of the case when you look at what the Supreme Court was asked to weigh in on.

[00:19:19] Speaker 00:
I mean, it was presented with the question of whether or not Hodgson was the proper way to do this.

[00:19:24] Speaker 00:
And that, Hodgson was not repudiated in any specific or general way.

[00:19:29] Speaker 00:
And I don't think that discussion of omissions really controls in a pure omission case under Hodgson.

[00:19:36] Speaker 00:
I don't think Capito disturbs that part of California law.

[00:19:40] Speaker 01:
Well, it couldn't.

[00:19:42] Speaker 01:
We don't get to do California law.

[00:19:44] Speaker 00:
Correct.

[00:19:44] Speaker 01:
We're just trying to figure out how they do California law.

[00:19:47] Speaker 00:
Correct, correct.

[00:19:48] Speaker 00:
But again, it is not capital standing alone.

[00:19:52] Speaker 00:
It is capital as well as the two prior

[00:19:56] Speaker 00:
petitions for direct review that the California Supreme Court denied.

[00:19:59] Speaker 01:
Just back before the lamandry factors, on the unreasonable safety hazard, why isn't a bioaccumulation theory enough?

[00:20:09] Speaker 01:
What's wrong with that for purposes of this claim?

[00:20:13] Speaker 00:
So the record on unreasonable safety hazard, you have to look at the record in its entirety.

[00:20:19] Speaker 00:
We have admissions throughout the course of discovery

[00:20:23] Speaker 00:
by plaintiffs that these products were in fact safe.

[00:20:28] Speaker 00:
And the bioaccumulation theory, that was premised on the hypothetical possibility that these metals could bioaccumulate in persons with unknown consumption levels at unknown levels of the presence of heavy metals.

[00:20:44] Speaker 00:
But that goes to your question earlier about, or I think your question Judge Coe, about levels in these foods.

[00:20:50] Speaker 00:
There was no proof

[00:20:51] Speaker 00:
whatsoever.

[00:20:52] Speaker 03:
But for lead, zero levels are safe for children.

[00:20:57] Speaker 03:
And that's according to all the federal government agencies, CDC, FDA, EPA, American Academy of Pediatrics, no level is safe.

[00:21:07] Speaker 03:
So you almost don't even need to rely on bioaccumulation for lead.

[00:21:11] Speaker 03:
So what's your response to that?

[00:21:12] Speaker 03:
If no level is safe, then why doesn't that satisfy unreasonable safety hazards?

[00:21:20] Speaker 00:
the language unreasonable safety hazard.

[00:21:23] Speaker 00:
What those agencies have determined is that there is no specific level that they could set which would be deemed a safe amount of lead in foods, so no specific level.

[00:21:35] Speaker 03:
But the implication of your question, Your Honor... That means no level reasonable, unreasonable will be safe.

[00:21:42] Speaker 00:
I don't think so, Your Honor.

[00:21:44] Speaker 00:
I think

[00:21:45] Speaker 00:
The unreasonableness of the unreasonable safety hazard standard imposes a heightened and a greater degree of safety consideration beyond just conjectural or hypothetical risk, which is, I think, all that's presented here with bioaccumulation.

[00:22:02] Speaker 00:
I mean, there was, Dr. Gardner never examined either the plaintiffs or plum products at all.

[00:22:08] Speaker 00:
And bear in mind, the entry point for these heavy metals are the crops themselves.

[00:22:15] Speaker 00:
So the court's questions, I think, I just want to be very clear about this.

[00:22:21] Speaker 00:
The necessary implication of that holding would be that spinach is unreasonably unsafe.

[00:22:26] Speaker 00:
Carrots are unreasonably unsafe.

[00:22:28] Speaker 00:
Kale is unreasonably unsafe because of the presence of lead.

[00:22:32] Speaker 00:
And so bioaccumulation is a theory of potential future harm.

[00:22:38] Speaker 00:
If these metals accumulate over time, it increases perhaps the risk

[00:22:44] Speaker 00:
of some adverse health consequences.

[00:22:46] Speaker 00:
But there are a series of inferences in that causal chain, and none of those inferences were even looked at here.

[00:22:53] Speaker 00:
And in fact, those inferences were disclaimed because the plaintiffs all admitted that they were unharmed.

[00:22:59] Speaker 01:
On the exclusive knowledge moving on to the Landry factors, who are we supposed to look to for who has reasonable access?

[00:23:12] Speaker 01:
I mean, I suppose that if you're a judge or a law clerk or an associate at a law firm or otherwise very online, you would be aware of all of this.

[00:23:24] Speaker 01:
But why should that be enough when we're talking about consumers and these products?

[00:23:30] Speaker 00:
So, sir, your honor, I want to address your question directly, but I wanted to offer a point, make sure this point wasn't passed over in doing so.

[00:23:38] Speaker 00:
Under Hodgson, the lamandry factors are not considered unless and until there is a showing on either unreasonable safety hazard or central function.

[00:23:50] Speaker 00:
That's clear in Hodgson itself, where the court assumed

[00:23:53] Speaker 00:
that there was superior knowledge on behalf of the defendant.

[00:23:56] Speaker 00:
And that's reflected in Intel, in Browning, and in ARIS, these court's decisions, where once that threshold was failed, once the plaintiff failed to demonstrate unreasonable safety hazard or central function, you don't even look to LeMandre.

[00:24:11] Speaker 01:
Sure.

[00:24:12] Speaker 01:
But assume that we want to play it safe with respect to the state of California consumer protection law.

[00:24:17] Speaker 00:
Understood.

[00:24:17] Speaker 00:
So under active concealment, what you look at is,

[00:24:21] Speaker 00:
What are the matters complained of?

[00:24:24] Speaker 00:
And here the matter complained of was the presence of heavy metals.

[00:24:29] Speaker 00:
Well, I'm sorry.

[00:24:30] Speaker 01:
I thought I was exclusive knowledge rather.

[00:24:33] Speaker 01:
Those are two different factors.

[00:24:34] Speaker 01:
Sure, sure.

[00:24:36] Speaker 00:
OK.

[00:24:36] Speaker 00:
So for exclusive knowledge, Your Honor, I think it just merely has to be the case that the evidence is present or the information is present in some public fashion.

[00:24:50] Speaker 00:
I mean, if you look at the record here, it was not only on Plum's own website, but it was in a series of public reports dating back to 2017.

[00:25:00] Speaker 00:
And so I think you're not considering, it's not an analysis of what's the level of penetration of this information among consumers.

[00:25:09] Speaker 00:
You're looking at, is this information publicly available to someone if they want to look for it?

[00:25:16] Speaker 00:
And here, that was easy.

[00:25:17] Speaker 01:
Query notice somewhere out there in the great big world.

[00:25:21] Speaker 00:
Your honor, I think that's right.

[00:25:22] Speaker 00:
As long as the information is reasonably accessible and publicly available information is reasonably accessible.

[00:25:31] Speaker 00:
I think those two concepts are coextensive.

[00:25:35] Speaker 00:
And to hold it, to change it to a heightened standard, I think, would push the standard to actual knowledge on behalf of the plaintiff, which is clearly not the case.

[00:25:46] Speaker 00:
I mean, if there has to be some showing that the plaintiff knew

[00:25:50] Speaker 00:
then that test collapses on itself.

[00:25:52] Speaker 00:
I think so long as the information is publicly available and reasonably accessible online or through other forms of public reports, then the exclusive knowledge standard isn't met.

[00:26:04] Speaker 00:
But bear in mind that exclusive knowledge, and this is, I think in the Uber case makes this clear, it's a two-pronged standard.

[00:26:11] Speaker 00:
You have to show, the plaintiffs have to show that that defendant was in sole possession of the information

[00:26:19] Speaker 00:
and that the information wasn't reasonably accessible.

[00:26:22] Speaker 00:
And here, under exclusive knowledge, you fail at both steps because the record was likewise very clear that the presence or risk of presence

[00:26:31] Speaker 00:
of heavy metals was not something exclusively in Plum's knowledge.

[00:26:36] Speaker 00:
Not at all.

[00:26:36] Speaker 03:
Let me ask you a question.

[00:26:39] Speaker 03:
For the central function test, you say, well, it has to be completely unusable as food.

[00:26:45] Speaker 03:
And if you have that test, then it completely renders superfluous the next test, which is, is the defect material.

[00:26:54] Speaker 03:
So you're basically eliminating the second part of the Hudson test.

[00:27:01] Speaker 03:
Your honor, I because then what's the materiality if you've already said it has to be completely rendered unusable as food to satisfy the central function test Well your honor I I I think in a case where the central function I think those two those two inquiries do I think collapse on each other but they're not supposed to write under Hudson they are separate tests if you

[00:27:28] Speaker 03:
affect the central function, then is that defect material?

[00:27:32] Speaker 03:
That's supposed to be a second step, but you're collapsing those two, right?

[00:27:36] Speaker 00:
Okay, I'm following, I think, now, Your Honor.

[00:27:39] Speaker 00:
I think there could be a case in which the matter complained of might be immaterial and the analysis might stop there.

[00:27:49] Speaker 00:
So, for example, a food case in which there was

[00:27:51] Speaker 03:
But what authority says these two steps don't always have to be applied, it just depends on the context and you can figure it out when it applies and when it doesn't.

[00:28:01] Speaker 03:
I don't think that's consistent with how Hudson

[00:28:05] Speaker 00:
Well, here, Your Honor, we- Worth the test, right?

[00:28:07] Speaker 00:
Yeah, to be clear, here, we're not challenging materiality.

[00:28:10] Speaker 03:
I mean, I think materiality can be shown by- Right, but what I'm saying is you're saying at the central function test, it has to be incapable of being used as food.

[00:28:19] Speaker 03:
And if that's the test for central function, then what is the defect material test?

[00:28:26] Speaker 03:
What work is that doing at all?

[00:28:29] Speaker 00:
Your Honor, I think materiality still is a gatekeeping function.

[00:28:32] Speaker 00:
I mean, plaintiffs, if plaintiffs had no evidence,

[00:28:35] Speaker 00:
that anyone was interested in the issue of heavy metals, they would fail on materiality as well.

[00:28:39] Speaker 00:
And here we're not, for purposes of the appeal, we're not contesting materiality.

[00:28:42] Speaker 00:
I mean, there was some evidence in the record that this information was material to some consumers.

[00:28:49] Speaker 00:
But the point is that's not enough under Hodgston.

[00:28:53] Speaker 00:
And you have to show both materiality and that the central function was impaired.

[00:28:59] Speaker 00:
So I don't think there's, on this record, I don't think materiality

[00:29:04] Speaker 00:
makes a difference.

[00:29:05] Speaker 00:
They had evidence of materiality, but where the analysis failed was on central function.

[00:29:10] Speaker 00:
So this is a case where there was a distinction in the proof between materiality and central function.

[00:29:15] Speaker 00:
And there might be a case where the theory is so attenuated that you wouldn't even be able to establish bare materiality.

[00:29:22] Speaker 03:
I want to ask you a question on active concealment.

[00:29:23] Speaker 03:
You just said earlier that Johnson & Johnson is still good law, in your view.

[00:29:28] Speaker 03:
And in Johnson & Johnson, playing down health risk of these pelvic mesh products,

[00:29:33] Speaker 03:
was deemed active concealment.

[00:29:37] Speaker 03:
And if we look at the House report, which repeatedly says plumb concealed this, plumb concealed that, and then you downplay the information on your website, how is that not comparable to active concealment found in Johnson & Johnson?

[00:29:55] Speaker 03:
And even if it doesn't constitute active concealment, how does that not establish a genuine issue of material fact?

[00:30:02] Speaker 03:
such that plaintiffs should have survived summary judgment.

[00:30:06] Speaker 00:
Because, Your Honor, the matters complained of were the presence, was the presence of heavy metals at any level or the risk of heavy metals.

[00:30:15] Speaker 00:
Their theory was not that when heavy metals are present at some threshold, then the deception accrues or then liability accrues.

[00:30:22] Speaker 00:
It was simply that is there heavy metals present or the risk of that presence.

[00:30:27] Speaker 00:
And if you look at the website statement, there is no denial.

[00:30:31] Speaker 00:
There is repeated affirmance of the fact that heavy metals are present in these foods, that they're present at levels typical for comparable foods, and that if you buy any food with one of these underlying crops, heavy metals are going to be present there.

[00:30:45] Speaker 00:
So I don't think there is a downplaying of the issue actually challenge, which is, is there some risk that heavy metals will be in these foods?

[00:30:55] Speaker 00:
That was openly

[00:30:58] Speaker 00:
Admitted to you because it is an omnipresent issue in the food supply when you're talking about these crops All right, you've gone a minute over your time, so we don't have any more questions for you.

[00:31:09] Speaker 03:
Thank you.

[00:31:10] Speaker 02:
Thank you I'll give you two minutes for rebuttal Just to go back to the exclusive knowledge as we address in a briefing and believe it's superior knowledge and reasonable accessibility and I believe

[00:31:26] Speaker 02:
The question that was asked of my colleague on the other side of the V as to who is the audience that the court considers as to reasonable accessibility.

[00:31:36] Speaker 02:
And that's the reasonable consumer.

[00:31:37] Speaker 02:
And that's usually a question of fact.

[00:31:39] Speaker 02:
And with the record here, we have disputed facts as to whether it was reasonably accessible based on plaintiff's testimony.

[00:31:48] Speaker 02:
Our survey, which they did not challenge, 95% of consumers did not know.

[00:31:53] Speaker 02:
The congressional report itself said that they were selling baby food with heavy metals to unsuspecting consumers.

[00:32:00] Speaker 02:
And in Anderson v. Apple, it highlights how you have to look at what is the product.

[00:32:09] Speaker 02:
This is a baby food product they buy at a grocery store.

[00:32:12] Speaker 02:
It's not something you would spend months and months investigating online.

[00:32:19] Speaker 03:
I thought 35%.

[00:32:21] Speaker 03:
of the survey respondents in your survey were aware of the congressional report?

[00:32:26] Speaker 02:
That was just a question we asked after the congressional report came out, but the congressional report is what... Well, they couldn't have known it before the congressional report came out, right?

[00:32:37] Speaker 03:
Yeah.

[00:32:37] Speaker 02:
I apologize.

[00:32:38] Speaker 02:
But that cannot be shown for knowledge in this case, because that is what actually informed all of our plaintiffs, and this was at summary judgment.

[00:32:48] Speaker 02:
So this is their individual claims.

[00:32:49] Speaker 02:
And none of them bought after the congressional report.

[00:32:52] Speaker 02:
So to use a post-dated report to show knowledge goes against what the record shows.

[00:33:00] Speaker 02:
And then as to unreasonableness of the safety risk, we believe, you know, Hudson, clear as safety risk, you don't even get into unreasonable.

[00:33:10] Speaker 03:
But here we had... Why would you not get into unreasonable?

[00:33:13] Speaker 03:
That is Hudson's test, right?

[00:33:14] Speaker 02:
I think Hudson quoted Mars as too unreasonable.

[00:33:18] Speaker 02:
When they finally do the holding, they just say safety risk.

[00:33:22] Speaker 02:
But either way, based on the facts here, that should have gone to the jury, the disputed facts.

[00:33:27] Speaker 02:
Because unreasonableness is a question of would a reasonable consumer think accumulation of heavy metals in baby food that could have been prevented or mitigated by plum an unreasonable risk?

[00:33:38] Speaker 02:
We have facts here that show that

[00:33:41] Speaker 02:
They would, and that should have been a question for the jury.

[00:33:43] Speaker 02:
And the same with central function.

[00:33:45] Speaker 02:
We had enough evidence to go to the jury.

[00:33:50] Speaker 02:
I see I'm over time, so I would like to thank the court for the opportunity to argue today.

[00:33:57] Speaker 02:
And thank you.

[00:33:59] Speaker 03:
All right.

[00:33:59] Speaker 03:
Thank you to both counsel.

[00:34:01] Speaker 03:
These were very helpful arguments.

[00:34:03] Speaker 03:
And we're adjourned.