Case: 19-16696, 04/29/2020, ID: 11675838, DktEntry: 30, Page 1 of 37
`
`No. 19-16696
`
`UNITED STATES COURT OF APPEALS
`FOR THE NINTH CIRCUIT
`
`FRIENDS OF THE EARTH, et al.,
`
`Plaintiffs-Appellants,
`
`v.
`
`SANDERSON FARMS, INC., et al.,
`
`Defendant-Appellee.
`
`
`ON APPEAL FROM THE UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF CALIFORNIA
`Case No. 17-cv-03592-RS
`
`
`
`ELSNER LAW & POLICY, LLC
`Gretchen Elsner
`Gretchen@ElsnerLaw.org
`314 South Guadalupe Street
`Santa Fe, NM 87501
`Telephone: (505) 303-0980
`
`
`PLAINTIFFS-APPELLANTS’ REPLY BRIEF
`
`
`THE LAW OFFICE OF
`PAIGE M. TOMASELLI
`Paige M. Tomaselli (CSB No. 237737)
`paige@tomasellilaw.com
`719 Golden Gate Avenue
`Richmond, CA 94801
`Telephone: (619) 339-3180
`
`Attorneys for Plaintiffs-Appellants
`
`
`
`
`
`
`
`
`
`
`
`

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`Case: 19-16696, 04/29/2020, ID: 11675838, DktEntry: 30, Page 2 of 37
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`
`
`TABLE OF CONTENTS
`
`INTRODUCTION ..................................................................................................... 1
`
`ARGUMENT ............................................................................................................. 2
`
`I.
`
`APPELLANTS HAVE ARTICLE III STANDING. ............................ 2
`
`A. Appellants Diverted Scarce Resources to Counteract the
`Effects of Appellee’s Unfair Practices. ....................................... 3
`
`B.
`
`C.
`
`The Supreme Court Has Set the Injury Bar Low and
`Appellants Easily Meet That Bar. ............................................... 8
`
`This Court Must Consider All Grounds for Appellants’
`Article III Standing. .................................................................. 11
`
`1.
`
`2.
`
`The UCL Has Always Been Appellants First Cause of
`Action. ........................................................................... 11
`
`Appellants Can Fully Analyze Standing on Appeal. ...... 16
`
`II.
`
`THE SWORN DECLARATIONS ADDITIONALLY
`DEMONSTRATE ORGANIZATIONAL STANDING. .................. 22
`
`A.
`
`B.
`
`Sanderson Seeks to Suppress the Declarations Because They
`Demonstrate Appellants’ Standing. .......................................... 22
`
`The Declarations Are Consistent with Deposition Testimony
`and Sanderson Does Not Provide Any Contrary Examples. .... 25
`
`CONCLUSION ........................................................................................................ 30
`
`
`
`
`
`
`
`i
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`

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`TABLE OF AUTHORITIES
`
`Page(s)
`
`Federal Cases
`Adler v. Fed. Republic of Nigeria,
`107 F.3d 720 (9th Cir. 1997) ........................................................................ 26, 27
`Am. Fed. of Gov’t Employees Local 1 v. Stone,
`502 F.3d 1027 (9th Cir. 2007) .............................................................................. 8
`Am. President Lines, Ltd. v. Int’l Longshore & Warehouse Union,
`Alaska Longshore Div., Unit 60,
`721 F.3d 1147 (9th Cir. 2013) ............................................................................ 16
`Am. Diabetes Ass’n v. U.S. Dep’t of the Army,
`938 F.3d 1147 (9th Cir. 2019) .................................................................. 9, 10, 14
`City of L.A. v. County of Kern,
`581 F.3d 841 (9th Cir. 2009) .............................................................................. 16
`City of Littleton v. Z. J. Gifts D-4, L.L.C,
`541 U.S. 774 (2004) ............................................................................................ 21
`City of Oakland v. Lynch,
`798 F.3d 1159 (9th Cir. 2015) ............................................................................ 16
`Constr. Indus. Ass’n of Sonoma Cty. v. City of Petaluma,
`522 F.2d 897 (9th Cir. 1975) ................................................................................ 9
`Czyzewski v. Jevic Holding Corp.,
`137 S. Ct. 973 (2017) ............................................................................................ 8
`East Bay Sanctuary Covenant v. Trump,
`2020 U.S. App. LEXIS 6620 (9th Cir. 2020) ..............................................passim
`Fair Housing Council of San Fernando Valley v. Roommate.com LLC,
`666 F.3d 1216 (9th Cir. 2012) ...................................................................... 4, 5, 6
`FW/PBS, Inc. v. Dallas,
`493 U.S. 215 (1990) ............................................................................................ 21
`
`ii
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`
`
`Page(s)
`
`Federal Cases (Cont’d)
`Gerlinger v. Amazon,
`526 F.3d 1253 (9th Cir. 2008) ............................................................................ 23
`Havens Realty Corp. v. Coleman,
`455 U.S. 363 (1982) .......................................................................................... 1, 8
`Hemmings v. Tidyman’s Inc.,
`285 F.3d 1174 (9th Cir. 2002) ............................................................................ 20
`Hinojos v. Kohl’s Corp.,
`718 F.3d 1098 (9th Cir. 2013) ...................................................................... 14, 15
`Kimes v. Stone,
`84 F.3d 1121 (9th Cir. 1996) .............................................................................. 18
`Lake v. Lake,
`817 F.2d 1416 (9th Cir. 1987) ................................................................ 17, 18, 25
`Mashiri v. Epsten Grinnell & Howell,
`845 F.3d 984 (9th Cir. 2017) .............................................................................. 19
`National Council of La Raza v. Cegavske,
`800 F.3d 1032 (9th Cir. 2015) ................................................................ 4, 5, 6, 25
`Petron v. SFR Invs. Pool 1, LLC,
`754 Fed. App’x 590 (9th Cir. 2019) ................................................................... 19
`Pfingston v. Ronan Eng’g Co.,
`284 F.3d 999 (9th Cir. 2002) .............................................................................. 18
`Rodriguez v. City of San Jose,
`930 F.3d 1123 (9th Cir. 2019) .............................................................................. 9
`Sherman v. SEC (In re Sherman),
`491 F.3d 948 (9th Cir. 2007) .............................................................................. 17
`Singleton v. Wulff,
`428 U.S. 106 (1976) ............................................................................................ 18
`
`iii
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`Page(s)
`
`Federal Cases (Cont’d)
`Smith v. Arthur Andersen LLP,
`421 F.3d 989 (9th Cir. 2005) .............................................................................. 17
`Sweet People Apparel, Inc. v. Phoenix Fibers, Inc.,
`748 Fed. App’x 123 (9th Cir. 2019) ................................................................... 19
`Thompson v. Cty. of Franklin,
`15 F.3d 245 (1994) .............................................................................................. 21
`United States v. Campbell,
`42 F.3d 1199 (9th Cir. 1994) .............................................................................. 21
`United States v. Northrop Corp.,
`59 F. 3d 953 (9th Cir. 1995) ............................................................................... 18
`United States v. Olano,
`507 U.S. 725 (1993) ............................................................................................ 20
`United States v. Sierra Pac. Indus. Inc.,
`862 F.3d 1157 (9th Cir. 2017) ............................................................................ 19
`Utah Animal Rights Coalition v. Salt Lake City Corp.,
`371 F.3d 1248 (10th Cir. 2004) .......................................................................... 22
`Van Asdale v. Int’l Game Tech.,
`577 F.3d. 989 (9th Cir. 2009) ............................................................................. 29
`Warth v. Seldin,
`422 U.S. 490 (1975) .............................................................................................. 8
`Rules
`Fed. R. Civ. P. 9(b) .................................................................................................. 14
`Fed. R. Civ. P. 12(h)(3) ...................................................................................... 23, 25
`Fed. R. Civ. P. 30(b)(6) ...................................................................................... 22, 24
`Constitutional Provisions
`U.S. Const. Article III, § 2 ....................................................................................... 22
`
`
`iv
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`

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`Case: 19-16696, 04/29/2020, ID: 11675838, DktEntry: 30, Page 6 of 37
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`INTRODUCTION
`
`
`
`Appellant public interest organizations seek to hold Appellee Sanderson
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`Farms, Inc. (Sanderson or Appellee) accountable for its unfair farming practices
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`and its misleading public statements about those practices. Appellants have taken
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`considerable actions to sound the alarm on Sanderson’s threat to public, animal,
`
`and environmental health, and to combat the misinformation Sanderson peddles
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`while promoting these unsafe and unfair practices. Lacking any defense to the
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`merits, Sanderson’s tactic is to try to shut the courthouse door to the public interest
`
`Appellants that Sanderson has harmed with its unfair business practices.
`
`
`
`The issue before the Court is whether Appellants satisfy the standard for
`
`organizational standing. They do. The Court must look at what Appellants pled,
`
`said, and produced in discovery regarding frustration of their mission and diversion
`
`of resources. See Havens Realty Corp. v. Coleman, 455 U.S. 363 (1982); East Bay
`
`Sanctuary Covenant v. Trump, Nos. 18-17274, 18-17436, 2020 U.S. App. LEXIS
`
`6620 (9th Cir. 2020). Sanderson ignored this documentary and testimonial
`
`evidence and now presents only some pieces of the puzzle to distract the Court.
`
`However, a court’s power to hear a case must be based on the full factual picture
`
`and the established precedent. The facts here demonstrate that Appellants have
`
`standing. Thus, Appellants respectfully request that this Court reverse the district
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`court’s order dismissing Appellants’ claims.
`
`1
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`

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`ARGUMENT
`
`I.
`
`
`
`APPELLANTS HAVE ARTICLE III STANDING.
`
`Appellants’ Opening Brief demonstrated that the district court erred in
`
`dismissing the Complaint on the ground that Appellants lack standing. The
`
`evidence before the district court far surpasses this Circuit’s threshold for finding
`
`organizational injury under Article III.
`
`
`
`In its attempt to defend dismissal, Sanderson argues that in order for
`
`Appellants to have Article III standing, their injury must be specific to Sanderson’s
`
`advertising, as opposed to its business practices. This argument is a red herring.
`
`Even Sanderson painfully struggles (and fails) to separate its business practices
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`from the communications about its business practices when discussing what is at
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`stake in this case. See, e.g., Answering Br. 43 (“the issue is that Sanderson’s
`
`farming and slaughtering practices (allegedly) do not comport with its ‘100%
`
`Natural’ marketing and advertising”). This is because you cannot separate the
`
`content of the advertising from the advertising itself. And because you cannot
`
`separate Sanderson’s practices from its advertising, the district court erred by
`
`basing the standing inquiry solely on whether Appellants’ diversion activities were
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`specific to addressing advertising. Notably, neither Sanderson nor the district court
`
`cite a single authority that even suggests, much less holds, that Appellants’
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`2
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`

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`diversion of resources must address advertising per se instead of the practices it
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`advertised. The injury Appellants suffered establishes organizational standing.
`
`A. Appellants Diverted Scarce Resources to Counteract the Effects of
`Appellee’s Unfair Practices.
`
`Appellants diverted resources to counteract the effects of Sanderson’s
`
`deceptive business practices. These diversion activities were substantial for two
`
`nonprofits with limited resources. Opening Br. 15, 24-25. Rather than accepting
`
`that Appellants actually diverted resources—or asking specific questions about
`
`these resource diversions during the 30(b)(6) depositions—Sanderson incorrectly
`
`contends that Appellants did not actually suffer any harm because Appellants’
`
`diversion activities were “part and parcel of that standard-issue advocacy work.”1
`
`
`
`1 Sanderson makes the bald allegation that Appellants did not argue below that
`Sanderson’s discovery was limited. This statement is belied by the record. At the
`hearing, counsel specifically addressed this point: “Defendant [did not] ask
`questions specifically about how plaintiff’s [sic] calculated the figure in
`interrogatory number seven or to describe how the resource diversion went. The
`only questions defendant asked were in support of their specific narrow theory on
`standing, a theory that is not supported by Ninth Circuit case law.” ER045; see
`also ER085 n.3 (“Defense Counsel notably did not ask about this in its deposition
`of the Center for Food Safety 30(b)(6) witness and chose to ask few questions
`about the specific activities detailed in response to Interrogatory number seven by
`both Plaintiffs.”). Not only did Appellee not ask questions specific to Appellants’
`multiple responses to Interrogatory number seven, it failed to ask questions about
`how Appellants’ resources are allocated, and why the specific actions enumerated
`in Interrogatory 7 were indeed diversions. Due specifically to opposing counsel’s
`narrow and argumentative line of questioning, Ms. Keever and Ms. Spector were
`only able to provide cursory testimony regarding diversion of resources during
`
`3
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`

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`Answering Br. 52. First, Sanderson is a multi-billion-dollar for-profit corporation
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`that does not engage in “issue advocacy.” It is hard to imagine how Sanderson can
`
`have the slightest clue how resources are allocated at nonprofits and whether an
`
`organization has diverted those resources, especially when it fails to ask about it in
`
`discovery. Second, organizational plaintiffs commonly engage in “issue advocacy”
`
`in support of their missions. This Court has consistently held that when an
`
`organization’s mission is frustrated, causing it to allocate resources in response, it
`
`has standing. See, e.g., East Bay Sanctuary, 2020 U.S. App. LEXIS at *29 (Trump
`
`administration rule frustrated organizations’ missions and caused them to divert
`
`limited resources in response to the collateral obstacles the rule introduced);
`
`National Council of La Raza v. Cegavske, 800 F.3d 1032, 1040-41 (9th Cir. 2015)
`
`(voting rights groups’ missions frustrated because state not complying with the
`
`National Voter Registration Act (NVRA) and organizations utilized resources
`
`registering voters that could have used on other aspects of their missions); see also
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`Fair Housing Council of San Fernando Valley v. Roommate.com LLC, 666 F.3d
`
`1216, 1219 (9th Cir. 2012) (Fair Housing Council). For example, the majority
`
`opinion in Fair Housing Council held that plaintiffs’ expenditures to investigate
`
`defendant’s discriminatory practices and to start an educational campaign—a
`
`
`
`their depositions and therefore submitted declarations to make a more complete
`record. See infra, Section II.
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`4
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`

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`campaign that was not specific to the defendant, Roommate.com—targeting
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`discriminatory roommate advertising and thereby furthering the organizations’
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`mission sufficed to confer organizational standing. See Fair Housing Council, 666
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`F.3d at 1219. There, the plaintiffs engaged in educational programs and assisted
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`discrimination victims independent of Roommate.com. Roommate.com made the
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`exact argument Sanderson makes here, to no avail: the “alleged injuries are routine
`
`efforts at community outreach and professional conferences plaintiffs regularly
`
`attended long before the creation of roommates.com [sic].” See Appellant
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`Roommate.com, LLC’s Opening Brief, Fair Housing Council, Case Nos. 09-
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`55272, 09-55875, 09-55969 (9th Cir. filed Jan. 11, 2010). The Ninth Circuit did
`
`not agree and concluded that the Fair Housing Council appellees’ activities
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`favored standing. 666 F.3d at 1219. Similarly, in National Council of La Raza,
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`plaintiffs alleged that, but for state government’s violations of their voter
`
`registration obligations, plaintiffs would have allocated their resources differently.
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`800 F.3d 1032, 1040-41. The district court in National Council of La Raza stated,
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`much like the district court and Sanderson here, that because the organizations
`
`were already doing voter registration drives, their continued efforts were business
`
`as usual. 800 F.3d at 1040. The Ninth Circuit reversed, holding that even though
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`these organizations were already conducting these activities, they used “resources
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`they would have spent on some other aspect of their organizational purpose—such
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`5
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`

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`as registering voters the NVRA’s provisions do not reach, increasing their voter
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`education efforts, or any other activity that advances their goals.” Id.
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`Like Appellants, plaintiffs in Fair Housing Council and National Council of
`
`La Raza were advocacy organizations, and the diversion activities were either
`
`activities the organization was already doing—as was the case in National Council
`
`of La Raza, id. at 1039-40—or “issue advocacy work” that was not specific to, and
`
`did not mention, the defendant’s advertising—as was the case in Fair Housing
`
`Council. The district court and Sanderson try to distinguish these Ninth Circuit
`
`precedents by asserting that Appellants here did not expend additional resources to
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`counteract Sanderson’s UCL and FAL violations. However, all resources that
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`Appellants expended to counteract the effects of Appellee’s unfair business
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`practices and false advertising were additional because Appellants lost the
`
`opportunity to do other work to advance their missions. See East Bay Sanctuary
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`Covenant, 2020 U.S. App. LEXIS at *32 (“The Organizations are not required to
`
`demonstrate some threshold magnitude of their injuries; one less client that they
`
`may have had but-for the Rule’s issuance is enough.”). In East Bay Sanctuary, this
`
`Court held that the organizational plaintiffs had standing in part because they
`
`would have lost clients if they had not diverted resources counteracting the effect
`
`of a Trump Administration asylum rule. Id. Similarly, here, Appellants diverted
`
`6
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`

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`resources to address Sanderson’s unfair, unlawful, and fraudulent practices that
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`could have been spent in advance of other organizational priorities.
`
`
`
`As the Opening Brief details, Opening Br. 4-7, Appellants did expend
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`additional resources investigating Sanderson’s public statements, drafting social
`
`media posts and outreach to members, meeting with allied organizations about
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`Sanderson, and altering resource allocation to spend more time educating
`
`consumers about the challenged practices. See, e.g., ER154-155 (educating
`
`consumers about Sanderson’s practices); ER160 (strategy call with Sanderson on
`
`agenda); ER162-67 (correspondence regarding response to Sanderson’ deceptive
`
`statements); ER168-169 (strategy call regarding changing advocacy action);
`
`ER201-04 ¶¶ 13-19 (explaining how Friends of the Earth diverted resources in
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`August 2016 to counteract Sanderson’s deceptive advertising); ER229 ¶ 29
`
`(explaining how Center for Food Safety diverted resources after August 2016 to
`
`counteract Sanderson’s deceptive advertising). But for Sanderson’s misleading and
`
`contradictory messaging about its practices—for example, defending its use of
`
`antibiotics to the New York Times, ER164, 231, while at the same time, telling
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`consumers “no antibiotics to worry about here,” ER417 ¶ 59—Appellants would
`
`have allocated these resources to other organizational priorities. ER201 ¶ 13; (“If
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`Defendant had not advertised 100% Natural chicken and ‘no antibiotics to worry
`
`about here’ to the public despite Defendant’s routine antibiotic use, Friends of the
`
`7
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`

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`Earth would not have had to use its resources to educate the public on the truth of
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`Defendant’s chicken raising process and product on the grocery store shelves.”);
`
`ER230 ¶ 34 (“Defendant’s actions caused Center for Food Safety to expend more
`
`time, money, and other resources, and ‘but for’ those actions, it would have spent
`
`those resources to accomplish other aspects of its organizational mission.”). The
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`district court erroneously ignored this evidence.
`
`B.
`
`The Supreme Court Has Set the Injury Bar Low and Appellants
`Easily Meet That Bar.
`
`An organization is entitled to sue on its own behalf for injuries it has
`
`
`
`sustained. Warth v. Seldin, 422 U.S. 490, 511 (1975). “The question is simply
`
`whether the organization satisfies the usual requirements for standing.” Am. Fed. of
`
`Gov’t Employees Local 1 v. Stone, 502 F.3d 1027, 1032 (9th Cir. 2007) (quoting
`
`Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., Inc., 528 U.S. 167, 180-81
`
`(2000)). An organization sustains a concrete injury in fact where it has diverted
`
`resources to counteract the illegal acts of the defendant, impairing the
`
`organization’s ability to engage in other activities. Havens Realty, 455 U.S. at 379.
`
`The injury bar is not high. This Court stated as recently as February 2020, in
`
`a case conspicuously absent from Appellee’s March 2020 brief, “plaintiffs who
`
`suffer concrete, redressable harms that amount to pennies are still entitled to
`
`relief.” East Bay Sanctuary 2020 U.S. App. LEXIS at *32 (emphasis added); see
`
`also Czyzewski v. Jevic Holding Corp., 137 S. Ct. 973, 983 (2017) (“For standing
`8
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`

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`purposes, a loss of even a small amount of money is ordinarily an injury”); Constr.
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`Indus. Ass’n of Sonoma Cty. v. City of Petaluma, 522 F.2d 897, 903 (9th Cir. 1975)
`
`(holding that an organization that suffers a decreased “amount of business” and
`
`“lost revenues” “easily satisf[ies] the ‘injury in fact’ standing requirement”)).
`
`Instead of addressing East Bay Sanctuary or this Circuit’s other precedent
`
`regarding the quantum of lost money necessary to show injury, Sanderson relies on
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`two cases, neither of which support its argument that Appellants lack standing.
`
`First, in Rodriguez v. City of San Jose, 930 F.3d 1123 (9th Cir. 2019), the
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`organizational plaintiffs failed to explain how the challenged action either impeded
`
`each organizations’ ability to carry out its mission or required it to divert resources
`
`away from the organizations’ preferred uses—let alone both. Id. at 1135. The
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`organizations simply failed to allege either element of organizational standing. Id.
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`Instead, the Complaint advanced a representational standing injury. Id. Second, in
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`Am. Diabetes Ass’n v. U.S. Dep’t of the Army, 938 F.3d 1147 (9th Cir. 2019), the
`
`appellant alleged that answering a phone call is a diversion of resources. 938 F.3d
`
`1155 (“the only resource the Association claims it diverted as a result of the New
`
`Policy is the time one of its two staff attorneys took to handle a single intake call
`
`from an Army parent”). This Court explained:
`
`The Association has not shown that, at the time the operative
`complaint was filed and as a result of the New Policy, the Association
`had altered or intended to alter its resource allocation to allow its
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`9
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`

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`attorneys to take a higher volume of calls or separately address the
`New Policy.
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`Id. The Court continued, if the Association had shown that it altered or intended to
`
`alter its resource allocation by doing something as simple as allowing their staff
`
`attorneys to take a higher volume of calls, then this action could satisfy the injury
`
`bar. See id.
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`Here, Appellants spent substantially more than pennies and did substantially
`
`more than answer a phone call. Appellants altered their resource allocation to
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`address Sanderson’s unfair business practices and its advertising. ER108-123
`
`(supplemental interrogatory responses identifying lost money or property in
`
`response to Sanderson’s unfair business practices totaling thousands of dollars);
`
`ER201-04 ¶¶ 13-19 (declaration describing resource diversion); ER207 ¶ 29
`
`(same); ER229 ¶ 29 (same). These resource diversions—which included
`
`significant staff time researching Sanderson’s practices and advertisements for the
`
`purpose of publishing new blog posts and additional social media posts, and
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`reframing and restructuring current campaigns to address Sanderson’s unfair
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`business practices—were undertaken to counteract the negative effects of
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`Appellee’s misinformation about its business practices.
`
`10
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`C. This Court Must Consider All Grounds for Appellants’ Article III
`Standing.
`
`Appellants have consistently asserted a UCL claim in this case. Appellants
`
`
`
`explained in the Opening Brief how this lawsuit was designed to challenge
`
`Sanderson’s unfair business practices, including but not limited to its false
`
`advertising. Opening Br. 24-33. Appellants also discussed issues relevant to the
`
`UCL claim in opposition to Sanderson’s 12(h)(3) motion and at the hearing on the
`
`motion. FER041; FER076; SER001-36; ER046 (32:15-22); ER081; ER085;
`
`ER088-90; ER099-100; ER433 ¶ 84. Moreover, standing is a jurisdictional inquiry,
`
`and whether the district court erred by not addressing Appellants’ standing under
`
`the UCL is a purely legal question. In a case such as this one, where Appellants
`
`argued in support of their standing at the district court, this Circuit permits
`
`Appellants to bolster such arguments on appeal.
`
`1.
`
`The UCL Has Always Been Appellants First Cause of
`Action.
`
`Appellants challenge Sanderson’s conduct under both the UCL and the FAL.
`
`The UCL is not merely a conduit for the FAL claim, it is an independent action
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`that has appeared in every Complaint and that is the basis for Appellants’ challenge
`
`to Sanderson’s business practices. For example, in the original Complaint filed
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`June 22, 2017, Appellants allege that Sanderson’s advertising “misleadingly
`
`suggests that . . . the chickens who wind up in the Chicken Products are raised in
`
`11
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`

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`Case: 19-16696, 04/29/2020, ID: 11675838, DktEntry: 30, Page 17 of 37
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`natural conditions.” SER002 ¶ 7. The First Cause of Action in this Complaint—the
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`UCL cause of action—states that “Sanderson engaged in unlawful, unfair, and/or
`
`fraudulent conduct under [the UCL] by representing that its chickens are raised
`
`with ‘100% Natural’ farming procedures.” SER033 ¶ 103. It states that
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`“Sanderson’s conduct is unfair in that it offends established public policy and/or is
`
`immoral, unethical, oppressive, unscrupulous, and/or substantially injures Plaintiffs
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`and California consumers.” SER034 ¶ 105. Appellants complained that
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`“Sanderson’s actions and practices constitute ‘fraudulent’ business practices in
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`violation of the UCL because, among other things, they are likely to deceive
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`reasonable consumers.” Id. ¶ 106 (emphasis added). Each version of the Complaint
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`contains similar or identical statements. FER041; FER076.
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`Appellants maintained this UCL nexus even when opposing Sanderson’s
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`fifth motion to dismiss (the April 1, 2019 12(h)(3) motion, ER050-70). Appellants
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`argued that business practices are just as much a part of this case as
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`advertisements, and that they cannot be separated from the advertising when
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`considering standing:
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`• “[I]t cannot be denied that the advertisements contain animal-raising
`claims and thus any efforts by Plaintiffs to inform its members or the
`public about the misrepresentations in these claims are efforts to
`combat the effects of Sanderson’s advertising.” ER100.
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`• “Defendant cannot distance Plaintiffs’ work from Defendant’s
`confusing advertising in this area by distinguishing its advertising from
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`its animal-raising practices because Defendant’s advertising is about its
`animal-raising practices.” ER099 (emphasis in original).
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`• “Plaintiffs filed this case to enjoin Sanderson’s false and misleading
`representations about its chicken. Sanderson claims via video
`commercial, on its website, and in print that its chickens are 100%
`Natural, notwithstanding that these animals are subject to a host of
`practices that reasonable consumers find very unnatural.” ER081.
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`• “Defendant continues to advertise as 100% Natural on its website, and
`its practices do not match how reasonable consumers understand that
`term.” ER085.
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`Appellants similarly cited pages of UCL caselaw in their opposition to
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`Sanderson’s 12(h)(3) motion. See ER088-90. For example:
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`The statute requires only (1) a loss or deprivation of money or property
`and (2) that such economic injury be caused by the unfair business
`practice. The California Supreme Court declined to “supply an
`exhaustive list of the ways in which unfair competition may cause
`economic harm,” but noted that plaintiffs “required to enter into a
`transaction, costing money or property, that would otherwise have been
`unnecessary” have standing under the UCL.
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`ER089 (citations omitted). Appellants carried this theme over to oral argument:
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`And we respectfully disagree with defendant about how [] the ads are
`different from the practices. As this Court just said, the ads are about
`the practices. You cannot sever the two. When a consumer is trying to
`decide whether or not to purchase something that says it’s a hundred
`percent natural that they saw on the website or on the television that
`said it was 100 percent natural, they need to know about the practice in
`order to make that decision.
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`ER046 (32: 15-22).
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`The UCL’s standing requirements are incredibly broad, Opening Br. 18-20,
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`and require only that Appellants “lost money or property as a result of unfair
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`competition.” Hinojos v. Kohl’s Corp., 718 F.3d 1098, 1104 (9th Cir. 2013)
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`(quoting Kwikset Corporation v. Superior Court, 246 P.3d 877, 887 (Cal. 2011)).
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`Appellee does not address this UCL caselaw in its Answering Brief and it did not
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`grapple with it in the district court. Instead, it reiterates its theory that Appellants
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`must have diverted resources solely in response to Sanderson’s advertising—and
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`with more specificity than a Rule 9(b) pleading requires—in order to have
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`standing. Both the district court, ER009, and Appellee, see, e.g., Answering Br. 22,
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`incorrectly assert that Appellants’ diversion of resources must specifically call out
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`Appellee’s advertising as deceptive. This would create a paradox. For example, by
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`requiring that public interest organizations re-publicize a false ad campaign in an
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`action alert to its members or in a social media post, then address why it is false.
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`The Appellants’ resources are better spent educating the public directly about the
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`truth (counteracting the effect of the misinformation) rather than giving more air
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`time to industry falsehoods.
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`Moreover, instead of correctly interpreting the standing requirement to be
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`broadly about lost money or property to combat the effects of a defendant’s
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`unlawful conduct, Am. Diabetes Ass’n, 938 F.3d at 1154-55, Sanderson’s
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`argument suggests that a plaintiff must catalog in discovery how each action alert
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`or social media post standing alone was because of a specific false advertisement
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`by a defendant, Answering Br. 31. Even the case law Sanderson cites looks at a
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`defendant’s illegal conduct as a whole, and how advocacy organizations worked to
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`counteract the effects holistically, not piecemeal. The UCL, and the binding
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`precedent interpreting it, requires only that:
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`[A] plaintiff [] demonstrate “some form of economic injury” as a result
`of his transactions with the defendant, Kwikset, 246 a