Consumer class actions serve multiple useful purposes. First, they provide an efficient andeffective mechanism for consumers who have been ripped off by deceptive advertising or promotion to recoup some or all of their losses.
They are efficient because they allow hundreds or thousands of consumers who have been deceived by the same company in the same way to be represented by one or more class representatives and class counsel. This avoids the duplicative litigation and wasted resources that would be required if each consumer was required to file his or her own individual case.
They are effective because most consumer protection statutes provide broad protection to consumers from many forms of deceptive advertising, communications and conduct and eliminate some of the legal impediments and other difficulties of bringing a claim for common law fraud. For example, Missouri’s Merchandising Practices Act (Section 407.020 et seq.) eliminates the requirement that each consumer prove he or she relied upon a specific misrepresentation or omission complained of. It also makes clear that any type of deceptive communication or conduct violates the Act. See, e.g., Plubell v. Merck & Co., Inc., 289 S.W.3d 707 (Mo. App. 2009).
Second, consumer class actions provide an effective means to force sellers of goods and services to cease deceptive advertising and communications about their products. Missouri’s Merchandising Practices Act specifically provides for injunctive and other equitable relief in appropriate circumstances. Mo. Rev. Stat. section 407.025.2.
Third, consumer class actions provide a strong deterrent to sellers of goods and services to avoid deceptive advertising, communications or conduct. In addition to potentially large actual damage awards, Missouri’s Merchandising Practices Act specifically provides for punitive damages in appropriate cases. Mo. Rev. Stat. section 407.025.1. Many deceptive sellers have been required to pay millions of dollars in compensatory or punitive damage as a result of their unlawful conduct. Recently, the pharmaceutical giant Merck agreed to a $220 million consumer class action settlement in a Missouri case that alleged deceptive marketing with respect to Merck’s prescription drug Vioxx. See related article in the “In the News” section of this website.