In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 16‐3656
CHAD CONRAD,
Plaintiff‐Appellant,
v.
BOIRON, INC., and BOIRON USA, INC.,
Defendants‐Appellees.
____________________
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 13 C 7903 — William T. Hart, Judge.
____________________
ARGUED APRIL 4, 2017 — DECIDED AUGUST 24, 2017
____________________
Before WOOD, Chief Judge, and KANNE and ROVNER, Circuit
Judges.
WOOD, Chief Judge. Chad Conrad filed a class action
against Boiron for deceptive marketing, but he was left with
only his individual claim after the district court refused to cer‐
tify his proposed class. About a year later Boiron offered Con‐
rad $5,025, more than he could hope to win at trial. Conrad
does not want to accept the money because it will moot his
claim; Boiron wants to force him to take it for the same reason.
2 No. 16‐3656
The district court refused to certify Conrad’s proposed class
and found his individual claim moot. We conclude, in keep‐
ing with our decision in Fulton Dental, LLC v. Bisco, Inc.,
860 F.3d 541 (7th Cir. 2017), that the latter decision was in er‐
ror, because an unaccepted offer cannot moot a case. There are
other measures available to address the problem (if it exists
here) of “unreasonably and vexatiously” persisting in litiga‐
tion, see, e.g., 28 U.S.C. § 1927, but the district court has yet to
decide whether they should be used. We therefore remand
this case to the district court for further proceedings.
I
Boiron makes homeopathic products, including an over‐
the‐counter remedy called Oscillococcinum (“Oscillo”) that
retails for between $12 and $20, depending on whether one
buys a six, twelve, or thirty‐dose package. Bohn v. Boiron, Inc.,
2013 WL 3975126, at *1 (N.D. Ill. Aug. 1, 2013). Oscillo is made
by mixing one percent Anas Barbariae Hepatis et Cordis
Extractum—that is, duck hearts and livers—with 99 percent
water, repeating the dilution process 200 times, and then
selling the result in pill form. The repeated dilutions render
the finished product nothing more than a placebo. Boiron’s
claim that Oscillo has a therapeutic effect on flu symptoms is
thus highly doubtful. Aggrieved customers caught on at some
point, and in 2011 they filed a class action against the
company in the Southern District of California over its
deceptive marketing. In October 2012, Boiron and the class
agreed to a broad settlement that covered over 200 of the
company’s products (including Oscillo) purchased between
January 1, 2000 and July 27, 2012. Gallucci v. Boiron, Inc.,
2012 WL 5359485 (S.D. Cal. Oct. 31, 2012), aff’d sub nom.
Gallucci v. Gonzales, 603 F. App’x 533 (9th Cir. 2015). In
No. 16‐3656 3
relevant part, the settlement required Boiron to (1) pay
refunds to past buyers, (2) revise its labels to make them
accurate, and (3) let future unhappy customers request
refunds within 14 days of purchase (the company calls this
the “Boiron Promise”). Boiron went one step further; it now
informs customers that they have 30 days from purchase to
request a refund. See Boiron Promise, BOIRON,
http://www.boironusa.com/promise/ (last visited Aug. 22,
2017) (“Boiron Promise Webpage”).
Some of the class members were not satisfied with this
outcome, and so they opted out of the Gallucci settlement.
Attorneys representing the opt‐outs filed new class actions,
raising essentially the same claims against Boiron, in
California and Illinois. When the district courts found the
class representatives inadequate, counsel tried to swap in
replacements. In the Illinois case, the prospective
representative was the current plaintiff, Chad Conrad.
(Boiron eventually prevailed in the California case, and so it
does not concern us further.) Yet before the Illinois
substitution could occur, the then‐lead plaintiff accepted
Boiron’s offer of judgment, prompting the district court to
terminate the case. Boiron also offered Conrad $25 (more than
he had paid for the Oscillo) plus attorney’s fees and costs to
settle his claim, but he rejected the offer and filed the
complaint that kicked off the current suit on November 4,
2013. Eight months of preliminary proceedings followed, at
which point the district court stayed the case pending the
Ninth Circuit’s resolution of the appeal of the October 2012
settlement. That court ultimately upheld the settlement, and
the district court lifted its stay on August 13, 2015.
4 No. 16‐3656
Two weeks later, Boiron filed a motion to dismiss, which
for the most part the district court granted. The court found
that Conrad was an inadequate class representative because
his suit would provide little benefit beyond Boiron’s existing
refund guarantee; it also found that Conrad lacked standing
to pursue injunctive relief (a ban on marketing Oscillo as a flu
remedy) under the Illinois Consumer Fraud Act since Conrad
himself would not be duped by Boiron’s misleading claims
again. We denied Conrad’s request to appeal the denial of
class certification in February 2016, leaving him with only his
individual damages claim. After still more proceedings, the
district judge granted Boiron’s motion under Federal Rule of
Civil Procedure 67 to deposit $5,025 with the court—above
the maximum Conrad could recover—in order to moot his
claim. Boiron deposited the funds, and the district court dis‐
missed the case as moot on September 20, 2016. This appeal
followed.
II
Conrad’s main arguments are straightforward: he attacks
both the court’s refusal to certify the class and its rejection of
his individual claim based on Boiron’s use of Rule 67 to try to
moot the case. We review the denial of class certification for
abuse of discretion, and we consider the mootness ruling de
novo. Messner v. Northshore Univ. HealthSystem, 669 F.3d 802,
811 (7th Cir. 2012); Stevens v. Hous. Auth. of S. Bend, Ind.,
663 F.3d 300, 306 (7th Cir. 2011).
A
We begin with Conrad’s effort to represent what remains
of the class of Oscillo purchasers after the Gallucci settlement.
No. 16‐3656 5
Federal Rule of Civil Procedure 23(a) conditions class certifi‐
cation on “four requirements—numerosity, commonality,
typicality, and adequate representation.” Wal‐Mart Stores, Inc.
v. Dukes, 564 U.S. 338, 349 (2011). This case turns on adequacy,
for an aspiring lead plaintiff such as Conrad is entitled to rep‐
resent a class only if he “will fairly and adequately protect the
interests of the class.” FED. R. CIV. P. 23(a)(4). In order to be an
adequate representative, the named plaintiff must “be part of
the class and possess the same interest and suffer the same
injury as the class members.” Amchem Prod., Inc. v. Windsor,
521 U.S. 591, 625–26 (1997) (internal quotation marks and ci‐
tation omitted). In addition, the court must be satisfied that
the plaintiff will keep the interests of the entire class at the
forefront. Conrad’s case brings to mind our comment in In re
Aqua Dots Products Liability Litigation, 654 F.3d 748, 752
(7th Cir. 2011) (“Aqua Dots”), that “[a] representative who
proposes that high transaction costs (notice and attorneys’
fees) be incurred at the class members’ expense to obtain a re‐
fund that already is on offer is not adequately protecting the
class members’ interests.”
In Aqua Dots, the manufacturer of the eponymous toys re‐
called them because they were potentially toxic. The recall no‐
tice told buyers that they could exchange the Aqua Dots for a
non‐defective replacement or a different, comparably priced
toy. Notably, it did not mention any refunds, though they
were provided upon request. A group of buyers challenged
the recall program through a class action, alleging that the re‐
lief the company offered was inadequate. The district court
refused to certify the class, and we affirmed because the pu‐
tative class representative failed to satisfy Rule 23(a)(4)’s ade‐
quacy requirement.
6 No. 16‐3656
Aqua Dots demonstrates that there is more to adequacy
than simple membership in a group. As we said in Eubank v.
Pella Corp., 753 F.3d 718, 719 (7th Cir. 2014), the “named [class]
plaintiffs are the representatives of the class—fiduciaries of its
members … .” It is thus both necessary and proper for the dis‐
trict court to consider whether the potential named repre‐
sentative will act in the best interests of the unnamed mem‐
bers of the class. That was precisely our point in Aqua Dots.
There, the product in question cost from $17 to $30. In re Aqua
Dots Prod. Liab. Litig., 270 F.R.D. 377, 379 (N.D. Ill. 2010). Given
the low price point, we were concerned that transaction costs
might swallow all of any potential recovery. The same point
applies here. Oscillo retails for between $12 and $20. Most Os‐
cillo buyers are protected not only by the Gallucci settlement,
but also by the refund process Boiron now offers on its web‐
site (which is not limited to those who participated in the set‐
tlement).
There is another important similarity between our case
and Aqua Dots—both proposed classes are relatively small.
The class Conrad envisions is limited to relatively recent pur‐
chasers who have not taken advantage of the Boiron Promise.
The combination of low‐value claims and small class size is
likely to make this another case in which “high transaction
costs (notice and attorneys’ fees)” will leave class members
with a negligible award. Aqua Dots, 654 F.3d at 752. Indeed, it
is hard to see how the proposed class action benefits anyone
but the attorneys who filed it, especially since this suit (to say
nothing of its failed predecessor) has been rumbling on for
years. Class actions driven by attorneys’ fees are notoriously
troublesome.
No. 16‐3656 7
Conrad responds that the Aqua Dots recall was more gen‐
erous than the “Boiron Promise,” and so there is more poten‐
tial in the class‐wide treatment he proposes. We agree with
him that the Boiron Promise is poorly publicized and hard to
use when compared to the Aqua Dots recall. Boiron does not
mention the refund on Oscillo’s packaging nor does it display
information about the refund prominently on its website. To
the contrary, finding any information at all takes some dig‐
ging. See Boiron Promise Webpage. And, astonishingly,
Boiron requires that refunds be sent by “snail mail” rather
than digitally. Color us unimpressed with this transparent at‐
tempt to put off dissatisfied customers. Boiron is happy to
take Oscillo buyers’ money online, and so we see no reason
why it cannot handle refunds the same way. See Oscillo,
BOIRON, https://shop.boironusa.com/medicine/oscillococ‐
cinum/ (last visited Aug. 22, 2017) (allowing online purchase
of Oscillo). More broadly, as digital commerce becomes ever‐
more embedded into American society, Boiron’s pretense that
recalls and refunds (but not purchases) require resort to phys‐
ical mail is hard to take seriously.
Nonetheless, taken as a whole, the Boiron Promise is com‐
parable to the process we accepted in Aqua Dots. Boiron’s re‐
fund publicity, lackluster though it is, looks better when we
consider that the Aqua Dots recall did not even mention a re‐
fund. There, customers had to decide on their own to ask for
one. The contrast between the two default positions is im‐
portant—the typical Boiron Promise user receives a refund;
the typical Aqua Dots buyer got a replacement product or a
comparable toy. Compare Aqua Dots, 654 F.3d at 750 with
Boiron Promise Webpage. All of this is to say that the reme‐
8 No. 16‐3656
dies already in place for disappointed Boiron customers un‐
dermine Conrad’s ability to show that he can bring any signif‐
icant extra value to the absentee class members.
Conrad argues that, as a factual matter, discovery would
reveal that the Boiron Promise is empty, and that aggrieved
purchasers are not obtaining any relief. But there was enough
information in the record to permit the district court to spot
the similarities with Aqua Dots and to conclude that this case
is not suitable for class treatment. It is hard to see how more
discovery would change things. In one incarnation or another,
this case has dragged on since 2013; it is a de facto continuation
of the preceding 2011 suit, which was itself an outgrowth of
the underlying California class action. The evidence is out
there for all to see, and Conrad has given us no reason to think
that there are any smoking guns left to uncover. His own ac‐
tions reinforce this conclusion: he took no steps to pursue dis‐
covery between his 2013 motion for class certification and his
last‐ditch effort to avoid dismissal in 2016. We conclude,
therefore, that the district court was well within its rights to
refuse to certify Conrad’s proposed class. In so ruling, we
stress that we place no significance on Boiron’s later effort to
render Conrad’s individual case moot by buying him off with
a Rule 67 deposit into the court’s registry. The denial of class
certification stands on its own.
B
That leaves Conrad’s individual case, which does turn on
the effect of Boiron’s payment of $5,025 into the court’s
registry, pursuant to Federal Rule of Civil Procedure 67. In
Fulton Dental, we addressed the question whether a
defendant’s act of depositing with the court an amount that (if
accepted) would fully satisfy a plaintiff’s claim, rendered the
No. 16‐3656 9
plaintiff’s case moot. After a review of the Supreme Court’s
decision in Campbell‐Ewald Co. v. Gomez, 136 S. Ct. 663 (2016),
as well as a careful look at the mechanics of Rule 67, we
concluded that the answer was no. 860 F.3d at 545–46. See also
Chapman v. First Index, Inc., 796 F.3d 783, 786–87 (7th Cir. 2015).
Our reasoning in Fulton Dental, following that of the Supreme
Court in Campbell‐Ewald, was based on the law of contract. As
the Court put it, “an unaccepted settlement offer or offer of
judgment does not moot a plaintiff’s case.” 136 S. Ct. at 672.
We explained in Fulton Dental why a Rule 67 offer for this
purpose is equivalent to the Rule 68 offer that was involved in
Campbell‐Ewald. The court cannot accept an instrument made
payable to a third party into its registry; checks are normally
drawn to the clerk of the court and release is by order of the
court. This fact prompted our statement in Fulton Dental that
the process of depositing funds with the court and later
withdrawing them in favor of a party is not a mechanical one.
860 F.3d at 545.
Boiron would like us to hold that at some point, a plain‐
tiff’s stubborn refusal to accept a generous settlement offer
should be taken as the legal equivalent of acceptance. But we
are aware of no such doctrine, and we are loathe to adopt such
an ill‐defined rule. The Supreme Court has never endorsed
anything like this. To the contrary, it has recognized “the
deep‐rooted historic tradition that everyone should have his
own day in court.” Taylor v. Sturgell, 553 U.S. 880, 892–93
(2008) (internal quotation marks omitted). That does not
mean that every person will use that day in court in a way that
is economically rational, and some will invoke the aid of the
courts for impermissible purposes. But so‐called negative‐
value cases are sometimes rational, if the party hopes to es‐
tablish an important principle through the case. That said,
10 No. 16‐3656
there is no guarantee that litigation will not be abused. Cf.
Prof’l Real Estate Investors, Inc. v. Columbia Pictures Indus., Inc.,
508 U.S. 49 (1993) (setting out the contours of the “sham” liti‐
gation doctrine for antitrust purposes).
The law has developed doctrines, such as the common‐
law tort of wrongful civil proceedings (related to the mali‐
cious prosecution tort that arises from criminal proceedings),
to address abusive litigation. And free‐standing claims are not
the only option. Federal courts have an array of tools to ad‐
dress these problems. Prominent among them is 28 U.S.C.
§ 1927, which authorizes the court to sanction against “[a]ny
attorney … who so multiplies the proceedings in any case un‐
reasonably and vexatiously … .” Rule 11 of the Federal Rules
of Civil Procedure also serves as a constraint on a lawyer’s
ability to file a case that is not appropriately founded. If a case
is based on diversity of citizenship, whether under the con‐
ventional rules of 28 U.S.C. § 1332(a) or (as here) the Class Ac‐
tion Fairness Act, 28 U.S.C. § 1332(d), if the plaintiff prevails
but is awarded less than $75,000, “the district court may deny
costs to the plaintiff and, in addition, may impose costs on the
plaintiff.” 28 U.S.C. § 1332(b). If the defendant, rather than us‐
ing the Rule 67 process that Boiron tried, uses the rule best
suited for pre‐trial offers of settlement—Rule 68—and that of‐
fer is not accepted, then “[i]f the judgment that the offeree fi‐
nally obtains is not more favorable than the unaccepted offer,
the offeree must pay the costs incurred after the offer was
made.” FED. R. CIV. P. 68(d). Finally, the courts have inherent
power to punish abuses of process. Chambers v. NASCO, Inc.,
501 U.S. 32 (1991). We are not saying, at this juncture, that any
of these measures is appropriate for Conrad’s case. The point
is only that tools exist for the person who abuses the litigation
No. 16‐3656 11
process, but the tools do not include deemed acceptance of a
proposed offer of settlement.
Before concluding, we should say a word about the district
court’s conclusion that Conrad does not have standing to re‐
quest injunctive relief under the Illinois Consumer Fraud Act
(ICFA). See Summers v. Earth Island Inst., 555 U.S. 488, 493
(2009) (plaintiff “bears the burden of showing that he has
standing for each type of relief sought”). The court reasoned
that Conrad, as an individual, knows about Boiron’s refund
program and that he is fully aware of the fact that Oscillo is
nothing but sugar water. No injunction could therefore re‐
dress any potential injury for him, and that lack of redressa‐
bility defeats standing. See Spokeo, Inc. v. Robins, 136 S. Ct.
1540, 1547 (2016). We agree with that ruling. This is not a case
like Laurens v. Volvo Cars of N. Am., LLC, No. 16‐3829 (7th Cir.
Aug. 22, 2017), where class treatment was still a possibility
and the record did not unequivocally foreclose the possibility
of injunctive relief for the putative named plaintiff. In the pre‐
sent case, there will be no class, given our affirmance of the
district court’s decision denying certification. If Conrad has a
claim at all, it is an individual one for money only.
III
The district court did not abuse its discretion in denying
class certification, and it correctly rejected Conrad’s individ‐
ual claim for injunctive relief. It erred, however, insofar as it
concluded that the passage of time meant that Conrad no
longer had the legal right to reject Boiron’s offer of settlement.
We therefore AFFIRM in part and REMAND for further proceed‐
ings consistent with this opinion. Each party will bear its own
costs on appeal.