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Courthouse 2020

Quincy Bioscience gains ‘decertification’ victory in class action suit

A judge granted Quincy Bioscience’s motion to decertify a class of California consumers in a 2015 lawsuit following a mistrial.

A judge on Monday decertified a class of consumers in a lawsuit in California against Quincy Bioscience LLC, the marketer of Prevagen—a dietary supplement advertised to improve memory and the target of a separate government lawsuit pending in New York.

U.S. District Judge Haywood S. Gilliam Jr. granted Quincy Bioscience’s motion to decertify the class in a 2015 lawsuit, which alleged violations of California’s Unfair Competition Law (UCL) and the Consumers Legal Remedies Act (CLRA). He denied competing motions for judgment as a matter of law after a jury in January 2020 was unable to come to a verdict, resulting in a mistrial.

In 2017, Gilliam certified a class of California consumers for plaintiff’s UCL and CLRA claims. His decision was based on a finding that the named plaintiff, Phillip Racies, presented evidence suggesting he was motivated to purchase Prevagen based on representations that the supplement improves memory, supports healthy brain function, a sharper mind and clearer thinking.

During the trial, the court admitted into evidence plaintiff’s receipt for an item listed as “Prevagen Brn Cell Protect Cap 30S” from a Walgreens in San Rafael, California. The label represented that as people age, they “lose calcium-binding proteins that protect our brain cells,” and “Prevagen (Apoaequorin) replaces those proteins in the body and helps protect our cells during this natural process of aging.”

But even though Racies testified at trial that he purchased Prevagen because he was facing “some memory recall issues” and wanted to purchase the supplement to “help me with those issues, focus, memory, recall,” he didn’t present evidence of a product label touting Prevagen to improve memory, Gilliam found.

Plaintiff neglected “to present any of the critical label evidence submitted in support of his class certification motion at trial,” Gilliam, of the U.S. District Court for the Northern District of California, wrote in his May 4 order. “Critically,” the judge added later in his opinion, “the ‘Brain Cell Protection’ label does not contain any of the representations plaintiff claimed other class members saw.”

Gilliam set a telephone case management conference on May 12 to discuss a plan for resolving the lawsuit.

“We are pleased with the outcome in this case and appreciate the work put in by the jurors and the court,” a spokesperson for Quincy Bioscience said in an email. “We look forward to turning our full attention to continuing to serve our millions of loyal customers around the country.”

Class counsel for plaintiffs, Elaine Ryan, and Stewart Weltman, did not immediately respond to requests for comment.

Madison, Wisconsin-based Quincy Bioscience and its president, Mark Underwood, still face a separate lawsuit brought by the FTC and Attorney General of New York related to Prevagen. According to court records, the dietary supplement yielded U.S. sales of $165 million between 2007 and mid-2015.

In 2019, the U.S. Court of Appeals for the Second Circuit revived the lawsuit, which alleged violations of state and federal deceptive advertising laws, following dismissal of the action in 2017 by U.S. District Judge Louis L. Stanton.

The controversy boils down to an interpretation of a randomized, double-blind, placebo-controlled study on Prevagen, what the company’s lawyers described in court documents as the “gold standard" to corroborate the advertising statements. Although the study failed to show any statistically significant results for the study population as a whole, statistically significant results were identified among certain subgroups.

In July 2019, after the Second Circuit remanded the case back to his court, Stanton largely denied a motion to dismiss the lawsuit. However, he threw out claims against one of the defendants, Quincy Bioscience co-founder Michael Beaman.

The case remains in the discovery phase, and a trial has not yet been set in the U.S. District Court for the Southern District of New York.

TAGS: Litigation
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