Kosher hot dog case presents a real constitutional pickle
Who would have guessed that a consumer class action accusing ConAgra of deceiving consumers in the labeling of its Hebrew National hot dogs and salami would implicate two meaty constitutional issues? (Sorry, couldn’t resist.)
As the 8th U.S. Circuit Court of Appeals explained in an opinion Friday, the class action, which contends that ConAgra falsely labels Hebrew National products as 100 percent kosher, presents a question that the 8th Circuit has never before answered: whether the Establishment Clause of the First Amendment precludes federal courts from hearing claims against a secular company just because its labels invoke religious rules. That’s a toughie, according to the 8th Circuit panel — Chief Judge William Riley and Judges Roger Wollman and James Loken, who clearly had no appetite to bite off more than they could chew. (Yes, that was intentional. Sorry again.) The judges opened their discussion of the case by quoting from a 1905 case, Burton v. United States, in which the U.S. Supreme Court said, “It is not the habit of the court to decide questions of a constitutional nature unless absolutely necessary.”
That cardinal rule from 1905 has a corollary, though, according to the 8th Circuit: “If a case may be resolved on easy and settled constitutional grounds, the court should do so instead of deciding the case on difficult and novel constitutional grounds.” In the Hebrew National case, the 8th Circuit hit upon what it considered to be a relatively easy constitutional question, at least compared to the First Amendment issue. The panel found that the consumers suing Hebrew National didn’t have standing in federal court under Article III of the U.S. Constitution because they could not show they’d actually been injured.
To get to that result, the 8th Circuit had to decide whether Congress intended to change the constitutional requirements for standing when it passed the Class Action Fairness Act in 2005. The Hebrew National case only landed in federal court because of CAFA. It was originally filed in state court in Minnesota on behalf of buyers who claimed that the processing plants that supplied ConAgra with kosher meat operated under a quota system that compromised kosher standards. Plaintiffs lawyers at Zimmerman Reed, Kuhlman Law and Ridout & Lyon claimed that class members suffered economic injury under the consumer protection laws of several different states because they paid an unwarranted premium for purportedly kosher food that might not have been kosher.
ConAgra, represented by Blackwell Burke, removed the class action to federal court under CAFA and insisted, among other defenses, that class members didn’t have standing because they couldn’t show any particular Hebrew National buyer purchased hot dogs that weren’t kosher. (ConAgra also submitted copious evidence to the aptly named U.S. District Judge Donovan Frank that all of its Hebrew National meat is, in fact, kosher under religious rules.) Judge Frank didn’t reach the standing issue because his decision to dismiss the class action adopted ConAgra’s primary defense that kosher standards are a matter of Jewish religious rules and therefore, under the First Amendment, not subject to the jurisdiction of federal courts.
When lawyers for the class addressed Article III standing at the 8th Circuit, they said that class members only had to show that they’d been harmed under state laws to establish their right to sue in a case removed to federal court under CAFA, even if the relevant state laws don’t require the same showing of specific injuries as the Constitution. (I’m relying here on the 8th Circuit opinion’s description of the class arguments; the class appellate brief doesn’t address Article III standing and audio of the oral argument isn’t available at the 8th Circuit’s website.) The 8th Circuit panel regarded the plaintiffs’ theory as “a serious constitutional problem.”
“To interpret CAFA as a congressional attempt to extend federal jurisdiction to cases involving no injury in fact would force us to presume — without any basis in the statutory text and in contradiction to long-settled constitutional precedent — that Congress intended to stretch, if not breach, the constitutional limits on federal jurisdiction,” wrote Chief Judge Riley. “We never assume the people’s elected representatives would so casually disregard the Constitution they have sworn to uphold.” And even if Congress intended to do just that, the 8th Circuit said, it can’t. “We therefore hold CAFA does not purport to extend federal jurisdiction to state claims — if any exist — permitting recovery for bare statutory violations without any evidence the plaintiffs personally suffered a real, non-speculative injury in fact,” the opinion said.
For the Hebrew National consumers and ConAgra, the 8th Circuit’s opinion means the class action goes back to state court, where it started. A ConAgra spokeswoman told Jon Stempel at Reuters that the company is “satisfied with the outcome” even though the appeals court revived a case that had been dismissed by the trial judge. Class lawyer Anne Regan of Zimmerman didn’t return Stempel’s call for comment.
To me, it’s interesting that the 8th Circuit found it so easy to decide the case based on the standing of class members who claimed an injury in law but not fact. You probably recall that defendants in consumer and privacy breach class actions have been agitating for the U.S. Supreme Court to take up the parallel question of whether otherwise uninjured plaintiffs can sue as a class for violations of a federal statute. The Supreme Court punted on the issue in 2012, when it dismissed its cert grant in First American Financial v. Edwards, and ducked it again last month, when the justices declined to review the certification of a class of ATM users with claims for statutory damages under the Electronic Funds Transfer Act. As it happens, the appellate court that upheld class certification for the ATM users in the cases the Supreme Court declined to hear was the 8th Circuit. So according to that court, plaintiffs can proceed with class actions in federal court when their claims are based on “information injuries” under federal statutes but not on economic injuries under state consumer laws.
I’d warrant that a lot of consumer lawyers on both sides of the v. don’t think the question of Article III standing for plaintiffs with only non-specific economic damages claims under state law is as straightforward as the 8th Circuit’s Hebrew National opinion makes it out to be.
Who knows? Maybe one of these days the Supreme Court will confront that issue. I’ll leave it to you to come up with the requisite Justice Frankfurter joke.
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