1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 CLARKSON LAW FIRM, P.C. 9255 Sunset Blvd., Suite 804 Los Angeles, CA 90069 CLASS ACTION COMPLAINT CLARKSON LAW FIRM, P.C. Shireen M. Clarkson (SBN 237882) [email protected]Ryan J. Clarkson (SBN 257074) [email protected]Bahar Sodaify (SBN 289730) [email protected]Zach Chrzan (SBN 329159) [email protected]Nine Two Towers 9255 Sunset Blvd., Suite 804 Los Angeles, California 90069 Tel: (213) 788-4050 Fax: (213) 788-4070 Attorneys for Plaintiff and the Plaintiff Class SUPERIOR COURT FOR THE STATE OF CALIFORNIA COUNTY OF SANTA BARBARA Plaintiff Diane Hightree (“Plaintiff” or “Hightree”), individually and on behalf of all others similarly situated, brings this class action complaint against Amplify, Ltd. (“Defendant” or “Amplify”) and Does 1 through 10, inclusive (collectively referred to herein as “Defendants”) and alleges as follows: DIANE HIGHTREE, individually and on behalf of all others similarly situated, Plaintiff, vs. AMPLIFY, LTD., and DOES 1 through 10, inclusive, Defendants. Case No. CLASS ACTION COMPLAINT 1. BREACH OF EXPRESS WARRANTY 2. BREACH OF IMPLIED WARRANTY 3. UNJUST ENRICHMENT 4. VIOLATION OF CALIFORNIA CONSUMERS LEGAL REMEDIES ACT, CIVIL CODE § 1750, et seq. 5. VIOLATION OF CALIFORNIA FALSE ADVERTISING LAW, BUSINESS & PROFESSIONS CODE § 17500, et seq. 6. VIOLATION OF CALIFORNIA UNFAIR COMPETITION LAW, BUSINESS & PROFESSIONS CODE § 17200, et seq. DEMAND FOR JURY TRIAL ELECTRONICALLY FILED Superior Court of California County of Santa Barbara Darrel E. Parker, Executive Officer 3/20/2020 2:37 PM By: Narzralli Baksh, Deputy 20CV01532
Transcript
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CLASS ACTION COMPLAINT
CLARKSON LAW FIRM, P.C. Shireen M. Clarkson (SBN 237882) [email protected] Ryan J. Clarkson (SBN 257074) [email protected] Bahar Sodaify (SBN 289730) [email protected] Zach Chrzan (SBN 329159) [email protected] Nine Two Towers 9255 Sunset Blvd., Suite 804 Los Angeles, California 90069 Tel: (213) 788-4050 Fax: (213) 788-4070 Attorneys for Plaintiff and the Plaintiff Class
SUPERIOR COURT FOR THE STATE OF CALIFORNIA
COUNTY OF SANTA BARBARA
Plaintiff Diane Hightree (“Plaintiff” or “Hightree”), individually and on behalf of all others
similarly situated, brings this class action complaint against Amplify, Ltd. (“Defendant” or
“Amplify”) and Does 1 through 10, inclusive (collectively referred to herein as “Defendants”) and
alleges as follows:
DIANE HIGHTREE, individually and on behalf of all others similarly situated,
Plaintiff,
vs.
AMPLIFY, LTD., and DOES 1 through 10, inclusive,
Defendants.
Case No. CLASS ACTION COMPLAINT 1. BREACH OF EXPRESS WARRANTY
2. BREACH OF IMPLIED WARRANTY
3. UNJUST ENRICHMENT
4. VIOLATION OF CALIFORNIA
CONSUMERS LEGAL REMEDIES ACT, CIVIL CODE § 1750, et seq.
5. VIOLATION OF CALIFORNIA FALSE ADVERTISING LAW, BUSINESS & PROFESSIONS CODE § 17500, et seq.
6. VIOLATION OF CALIFORNIA UNFAIR
COMPETITION LAW, BUSINESS & PROFESSIONS CODE § 17200, et seq.
DEMAND FOR JURY TRIAL
ELECTRONICALLY FILEDSuperior Court of CaliforniaCounty of Santa BarbaraDarrel E. Parker, Executive Officer3/20/2020 2:37 PMBy: Narzralli Baksh, Deputy
20CV01532
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1 CLASS ACTION COMPLAINT
SUMMARY OF THE ACTION
1. Defendant Amplify, Ltd. markets haircare products and skincare products under the
“Cel MD” brand.
2. Within the Cel MD brand, Defendant markets the Microstem Hair Stimulation
Formula, Microstem Shampoo, and Microstem Conditioner, and numerous other products which
claim to grow and repair hair as a purported hair loss solution, as well as a line of skin care products
advertised as anti-aging tools (collectively, the “Products”)1.
3. Defendant makes grand promises to men and women with thinning hair and/or hair
loss by claiming that its haircare Products “encourage new hair growth,” “fight hair loss,
“strengthen hair, “promote new hair growth, “use natural components [to] block the hormone DHT,
known to advance hair loss,” and “encourage high cell turnover to promote new hair growth.”
4. Defendant falsely touts its skincare Products as having the ability to “tighten,”
“rejuvenate,” and smooth lines from aging skin and lips, and the ability to “grow stronger, healthier
nails,” respectively.
5. These claims are false, misleading and deceptive.
6. The American Academy of Dermatology Association has concluded that topical
treatments such as Defendant’s haircare Products “cannot regrow hair or prevent hair from loss
from worsening.” The Products cannot prevent hair loss, nor can they re-grow hair where none
exists. The Products are incapable, when used either individually or collectively as “system,” of
producing the advertised results.
7. Defendant’s promises to change the texture and “age” of the skin and nails through
plant stem cells and collagen, among other things, in their skincare Products is patently falsely and
rejected by the scientific and medical communities.
8. Defendant intentionally misleads and shortchanges consumers by falsely and
deceptively misrepresenting the Products, when in reality, they are incapable of revitalizing or
restoring hair, skin and nails due to the aging process, or for any other chronic or acute reason. 1 The Products include the Microstem Hair Thickening Mask, Advanced Hair Supplement, Brow & Lash Booster, Nail Formula, Protective Skin & Lip Moisturizer, Complete Collagen + MCT, SPF 30 Skin Moisturizer, Stem Cell Face Mask, Neck & Decolletage Cream, and Nail & Cuticle Oil.
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9. This is a class action lawsuit brought on behalf of all purchasers (the “Class”) of the
Products, which are falsely and deceptively marketed and advertised in violation of California’s
consumer protection statutes.
PARTIES
10. Plaintiff Diane Hightree is, and at all times relevant hereto was, a citizen of California
residing in the county of Sacramento. Plaintiff purchased Defendant’s haircare Products in North
Highlands, California within the last two (2) years of the filing of this Complaint through
Defendant’s online website at www.cel.md. In making her purchase, Plaintiff relied upon
Defendant’s advertising claims that the Products “encourage new hair growth,” “fight hair loss,
“strengthen hair, “promote new hair growth, “use natural components [to] block the hormone DHT,
known to advance hair loss,” and “encourage high cell turnover to promote new hair growth,” as
set forth more fully below. These claims were prepared and approved by Defendant and their agents
and disseminated statewide and nationwide, to encourage consumers to purchase the Products. If
Plaintiff had known that the Products were in fact incapable of producing the advertised results, she
would not have purchased the Products.
11. Defendant Amplify, Ltd. is a limited company headquartered in New York, New
York. Amplify, Ltd. maintains its principal business office at 1375 Broadway, 15th Floor, New
York, New York, 10018. Amplify, Ltd. directly and through its agents, has substantial contacts with
and receives substantial benefits and income from and through the State of California. Amplify,
Ltd. is one of the owners, manufacturers, and distributors of the Products, and is one of the
companies that created and/or authorized the false, misleading, and deceptive packaging of the
Products.
12. The true names and capacities, whether individual, corporate, associate, or otherwise
of certain manufacturers, distributors, and/or their alter egos sued herein as DOES 1 through 10
inclusive are presently unknown to Plaintiff, who therefore sues these individuals and/or entities by
fictitious names. Plaintiff will seek leave of this Court to amend the Complaint to show their true
names and capacities when the same have been ascertained. Plaintiff is informed and believes and
based thereon alleges that DOES 1 through 10 were authorized to do and did business in Santa
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Barbara County. Plaintiff is further informed and believes and based thereon alleges that DOES 1
through 10 were and/or are, in some manner or way, responsible for and liable to Plaintiff for the
events, happenings, and unlawful and deceptive conduct hereinafter set forth below.
JURISDICTION AND VENUE
13. This Court has jurisdiction over all causes of action asserted herein pursuant to the
California Constitution, Article VI, section 10, because this case is a cause not given by statute to
other trial courts.
14. Plaintiff has standing to bring this action pursuant to the common law, as well as
California Consumers Legal Remedies Act, Civil Code section 1750, et seq.; California False
Advertising Law, Business and Professions Code section 17500, et seq.; and California Unfair
Competition Law, Business and Professions Code section 17200, et seq.
15. The Products are manufactured, labeled, advertised, distributed, and sold by
Defendants.
16. Out-of-state participants can be brought before this Court pursuant to the provisions
of California Code of Civil Procedure section 395.5.
17. Defendants are subject to personal jurisdiction in California based upon sufficient
minimum contacts which exist between them and California.
18. Venue is proper in this Court because Defendants conduct business in Santa Barbara
County, Defendants receive substantial compensation from sales in Santa Barbara County, and
Defendants made numerous misrepresentations that had a substantial effect in Santa Barbara
County, including distribution and sale of the Products throughout Santa Barbara, as well as
distribution of print media and internet advertisements.
FACTUAL ALLEGATIONS
19. Defendant claims that the Products are an efficacious means of delivering the
advertised haircare and skincare benefits.
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HAIRCARE
20. Defendant makes the following misrepresentations about the haircare Products both
on the Product’s packaging as well as on the official website for the Products at www.cel.md 2:
MICROSTEM HAIR STIMULATION FORMULA
“A concentrated oil-based blend of plant extracts, including Asparagus Stem Cells and Biotin, encourages new hair growth and fights hair loss” “Best for: thin, flat hair lacking volume” “Uses natural components [to] block the hormone DHT, known to advance hair loss” “Encourages high cell turnover to promote new hair growth” “Strengthens at the root to prevent breakages”
MICROSTEM SHAMPOO
“A powerful blend of scientifically-optimized plant extracts, including Ginseng and Biotin, cleanses and strengthens whilst promoting new hair growth.” “Best for: thin, flat hair lacking volume” “Strengthens each hair strand to prevent breakages” “Protects hair against day-to-day damage” “Encourages high cell turnover to promote new hair growth”
MICROSTEM CONDITIONER
“A powerful blend of scientifically-optimized plant extracts, including Ginseng and Biotin, strengthens and softens whilst promoting new hair growth.” “Best for: thin, flat hair lacking volume” “Strengthens each hair strand to prevent breakages” “Protects hair against day-to-day damage” “Encourages high cell turnover to promote new hair growth”
21. Defendant markets and sells an array of other substantially similar hair loss and hair
growth products which claim to be efficacious in their ability to deliver the advertised hair loss and
hair growth benefits, including, the Advanced Hair Supplement, Brow and Lash Booster, and
Microstem Hair Thickening Mask, (which are collectively included within the previously defined
“Products”).
22. The net impression of Defendant’s labeling and advertising is that the Products are a
hair loss solution which will stop hair loss and cause hair to grow.
2Statements have been taken from the Products’ packaging and Defendant’s official website: https://www.cel.md/hair-formula.php (last visited Mar. 11, 2020); https://www.cel.md/shampoo-conditioner.php (last visited Mar. 11, 2020).
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23. The Products are not advertised as able to restore and reactivate hair follicles at their
root which have been damaged by the aging process.
24. Defendants state that the Products stop hair loss and cause hair growth based on the
inclusion of several natural ingredients, including, asparagus stem cells, biotin, keratin, glycerin,
ginseng, and saw palmetto.
25. These ingredients cannot prevent hair loss or cause hair growth, either alone nor as
formulated within the Products, much less for all consumers regardless of age, health, skin, diet,
and other individual factors.
26. The Asparagus Stem Cell ingredient in the Products does not affect hair loss or hair
growth. Topical application of Asparagus Stem Cells will not prevent hair loss or cause hair to re-
grow. Leaders in the field of research on stem cells and hair loss agree that neither human stem
cells (derived from embryos or adult tissue) nor plant stem cells, including Asparagus Stem Cells,
can grow new hair follicles or help the quality of hair that is undergoing the influence of genetic
hair loss or any other kind of chronic or acute hair loss.
27. The Biotin ingredient in the Products does not affect hair loss or hair growth.
Consuming Biotin will only affect hair loss and hair re-growth if there is a deficiency, and only
when supplemented orally, in which case supplementing with Biotin may help reverse the hair loss
conditions. Topical application of Biotin, particularly in the absence of a deficiency, will not
prevent hair loss or cause hair to re-grow.
28. Keratin and Glycerin do not affect hair loss or hair growth. Keratin works by
smoothing down the cells that overlap to form individual hair strands, which may result in hair that
looks shiny and glossy. Glycerin is a humectant that helps hair retain moisture.
29. Ginseng cannot grow new hair follicles or help the quality of hair that is undergoing
the influence of genetic hair loss or any other kind of chronic or acute hair loss.
30. The Saw Palmetto ingredient in the Products does not affect hair loss or hair growth,
as advertised. To the extent it is “believed” that an extract of saw palmetto berries may block 5-
alpha-reductase, an enzyme that converts testosterone to DHT, which is the molecule responsible
for male pattern hair loss, such a benefit is not available through topical application, but rather only
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through oral supplementation. Nor would this have any effect females suffering from any type of
thinning or hair loss, which is generally not a result of DHY over-production.
31. According to the American Academy of Dermatology Association, topical treatments
such as the Products “cannot regrow hair or prevent hair from loss from worsening.”3
32. Experts within the field of dermatology and trichology confirm that topical treatments,
including the Products, which claim to prevent hair loss and regrow hair, do not work as advertised.
33. The Products cannot prevent hair loss and regrow hair that is thinning due to aging,
or other chronic or acute causes of hair loss.
34. The underlying causes of hair loss include a variety of factors, including but not
limited to, age, genetics, hormonal imbalance, malnutrition, disease, medications, infection, and
stress. None of these conditions can be “corrected” through topical application of the Products.
35. Defendant omitted material facts that the Products’ efficacy, to the extent there could
be any, would also depend upon individual factors, including, inter alia, age, genetics, hormone
balance, vitamin and nutrient levels, gender, diet, and prior existing health conditions.
36. The Food and Drug Administration (“FDA”) has found that products, like the
Products at issue, can be classified as a drug if they are intended to prevent hair loss and stimulate
hair growth.4 For example, the FDA sent a Warning Letter to the manufacturer of Soleo, stating
that products that are “labeled, represented, or promoted for external use as a hair grower or for hair
loss prevention are regarded as new drugs” and require FDA approval before they can be marketed.5
The Products are marketed as hair growers that combat hair loss and thus must satisfy FDA
guidelines before Defendant can make such claims.
37. The Products constitute a “drug” under the FDA guidelines, as Defendant explicitly
claims that they “encourage high cell turnover to promote new hair growth, and “use natural
components [to] block the hormone DHT, known to advance hair loss.” Products that are intended
3Thinning Hair and Hair Loss: Could it be Female Pattern Hair Loss?, AMERICAN ACADEMY OF DERMATOLOGY ASSOCIATION, https://www.aad.org/female (last visited Mar. 11, 2020). 4See, Is It a Cosmetic, a Drug, or Both? (Or is it Soap?) https://www.fda.gov/cosmetics/cosmetics-laws-regulations/it-cosmetic-drug-or-both-or-it-soap (last visited Mar. 11, 2020). 5Warning Letter Soleo, FDA (Dec. 13, 2018) https://www.fda.gov/inspections-compliance-enforcement-and-criminal-investigations/warning-letters/soleo-567046-12132018 (last visited Mar. 11, 2020).
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“for use in the cure, mitigation, treatment or prevention of disease and/or are intended to affect the
structure or any function of the human body” are rendered “drugs” under Section 201(g)(1)(cc) of
the Federal Food Drug and Cosmetic Act (“FDCA”).
SKINCARE
38. Defendant makes the following misrepresentations about the skincare Products both
on the Product’s packaging as well as on the official website for the Products at www.cel.md:
DECOLLETAGE & NECK CREAM
“Accelerated cell regeneration diminishes fine lines and wrinkles”
“Boosts cell activity to brighten, tighten and help skin appear more youthful” “Aging-prone skin, looking for a firming boost” “A rich and powerful moisturizer formulated specifically for the neck, jawline and decolletage area”
NAIL & CUTICLE OIL
“A powerful, nourishing oil formulated specifically to promote healthy nail growth and nourish cuticles” “Nourishes the cuticle to aid stronger nail growth” “Specific ingredients to rejuvenate dry, damaged nail beds” “Repairs and protects from fungus and other infections”
39. Defendant markets and sells an array of other substantially similar skincare and nail
products which claim to be efficacious in their ability to deliver the advertised anti-aging and
growth benefits, including, the Nail Formula, Protective Skin & Lip Moisturizer, Complete
Collagen + MCT, SPF 30 Skin Moisturizer, and Stem Cell Face Mask (which are collectively
included within the previously defined “Products”)
40. Plaintiff and the Class purchased the Products with the hope of tightening,
rejuvenating and smoothing their skin of wrinkles, as well as re-growing dry or damaged nails, due
to the aging process, based on the claims and promises Defendant makes with respect to the
Products.
41. Plaintiff and the Class made their purchasing decisions in reliance upon Defendant’s
advertised claims, including, but not limited to, that the Products will “tighten skin,” “brighten
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skin,” “rejuvenate skin,” “diminish dark circles,” “fight aging,” “diminish fine lines and wrinkles,”
and “help skin appear more youthful.”
42. Plaintiff reasonably and detrimentally relied upon the Products’ label indicating that
the Products were a solution to her aging skin and hair.
43. Plaintiff would not have purchased the Products had she known the Products were not
capable of producing the advertised benefits.
44. Defendants’ conduct threatens California consumers by using deceptive and
misleading labels. Defendants’ conduct also threatens other companies, large and small, who “play
by the rules.” Defendants’ conduct stifles competition, has a negative impact on the marketplace,
and reduces consumer choice.
45. There is no practical reason for the false or misleading labeling and advertising of the
Products, other than to mislead consumers as to the actual ingredients of the Products being
purchased by consumers.
46. Plaintiff makes the allegations herein upon personal knowledge as to herself and her
own acts and experiences, and as to all other matters, upon information and belief, including
investigation conducted by her attorneys.
CLASS ALLEGATIONS
47. Plaintiff brings this action on her own behalf and on behalf of all other persons
similarly situated. The Class which Plaintiff seeks to represent comprises: All persons who purchased the Products in the United States or, alternatively, the State of California, for personal use and not for resale during the time period of four years (4) prior to the filing of the complaint through the present.
Said definition may be further defined or amended by additional pleadings, evidentiary hearings, a
class certification hearing, and orders of this Court.
48. There is a well-defined community of interest in the questions of law and fact involved
affecting the parties to be represented. The questions of law and fact common to the Class
predominate over questions which may affect individual Class members. Common questions of law
and fact include, but are not limited to, the following:
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a. Whether Defendants’ conduct constitutes an unfair method of competition, or
unfair or deceptive act or practice, in violation of Civil Code section 1750, et seq.;
b. Whether Defendants used deceptive representations in connection with the
sale of the Products in violation of Civil Code section 1750, et seq.;
c. Whether Defendants represented the Products have characteristics or
quantities it does not have in violation of Civil Code section 1750, et seq.;
d. Whether Defendants advertised the Products with intent not to sell it as
advertised in violation of Civil Code section 1750, et seq.;
e. Whether Defendants’ labeling and advertising of the Products is untrue or
misleading in violation of Business and Professions Code section 17500, et seq.;
f. Whether Defendants knew or by the exercise of reasonable care should have
known their labeling and advertising was and is untrue or misleading in violation of Business and
Professions Code section 17500, et seq.;
g. Whether Defendants’ conduct is an unfair business practice within the
meaning of Business and Professions Code section 17200, et seq.;
h. Whether Defendants’ conduct is a fraudulent business practice within the
meaning of Business and Professions Code section 17200, et seq.;
i. Whether Defendants’ conduct is an unlawful business practice within the
meaning of Business and Professions Code section 17200, et seq.;
j. Whether Plaintiff and the Class paid more money for the Products than they
actually received; and
k. How much more money Plaintiff and the Class paid for the Products than they
actually received.
49. Plaintiff’s claims are typical of the claims of the Class, and Plaintiff will fairly and
adequately represent and protect the interests of the Class. Plaintiff has retained competent and
experienced counsel in class action and other complex litigation.
50. Plaintiff and the Class have suffered injury in fact and have lost money as a result of
Defendants’ false representations and material omissions. Plaintiff and the Class purchased the
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haircare Products under the false belief that they “encourage new hair growth,” “use natural
components [to] block the hormone DHT, known to advance hair loss,” and “encourage high cell
turnover to promote new hair growth.”
51. Plaintiff and the Class purchased the skincare Products under the false belief that they
