23.10 Brief In Opposition to Defendant’s Motions In Limine

[Attorneys for Plaintiffs]

) [PLAINTIFF], on behalf of herself and all others ) SUPERIOR COURT OF NEW similarly situated, ) JERSEY ) CAMDEN COUNTY Plaintiff, ) ) NO. v. ) ) REXALL SUNDOWN, INC., ) SUNDOWN, INC. and ) JOHN DOES 1-10, ) BRIEF IN OPPOSITION TO individually and trading as Sundown Inc., ) DEFENDANT’S MOTIONS IN ) LIMINE Defendants. ) )

I. INTRODUCTION

This is a certified class action of New Jersey consumers challenging Defendant’s deceptive marketing and labeling of its 300 mg. and 600 mg. calcium softgel products as Calcium ‘900’ and Calcium 1200. The central issue to be presented for resolution at trial is whether Defendant’s labeling and marketing of these products was unconscionable, deceptive and misleading in violation of the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-2 et seq. (CFA). The focus under the CFA is on the capacity to mislead; thus, liability occurs whether or not any person was in fact misled. See Cox v. Sears Roebuck & Co., 138 N.J 2, 17–18 (1994) (reliance and intent are not relevant to an affirmative violation of the Consumer Fraud Act); Skeer v. EMK Motors, Inc., 187 N.J.Super. 465, 469 (N.J. Super. 1982) (“violation of the Act can be shown even though a consumer has not in fact been misled or deceived.”); State v. Hudson Furniture Co., 165 N.J.Super. 516, 520 (App. Div. 1979). With regard to unconscionability, CFA precedent establishes a broad standard requiring honesty-in-fact and good faith. Gennari v. Weichert Co. Realtors, 148 N.J. 582, 604 (1997); Cox, 138 N.J. at 18; Chattin v. Cape May Greene, Inc., 243 N.J.Super. 590, 599 (App. Div. 1990); D’Ercole Sales v. Fruehauf Corp., 206 N.J.Super. 11, 23 (App. Div. 1985). At trial, therefore, the Class must present evidence that the marketing and labeling characterized in the Defendant’s own customer complaint records, inter alia, as “totally misleading,” “extremely misleading,” “simply not honest,” “deceptive,” “false” and “deceiving,” was unconscionable and/or has the capacity to mislead consumers. The record reflects myriad sources of evidence supporting the Class’ allegations of misrepresentation, deception and unconscionability. These include the Plaintiff’s testimony, Defendant’s records of the calls and letters received from consumers complaining about the labels, Defendant’s statements, documents regarding the support available to retailers to facilitate the misrepresentations, evidence of confusion of employees in Defendant’s customer service and shipping departments, statements of Rexall’s founder and other Rexall executives concerning the design of the product and its labels, expert testimony and the labels themselves. Defendant has not identified a single expert that it expects to call at trial to support its contention that its labels do not have the capacity to mislead consumers. Faced with indisputable proof that consumers, who have spent over $400,000 for these products in New Jersey alone, were, in fact, misled, Defendant responds with Motions in Limine seeking to exclude its own customer complaint records, the statements of its founder Carl DeSantis, evidence of Rexall’s retailer support system and Plaintiff’s experts. As set forth below, these motions are without merit and should be denied.

II. BACKGROUND

The defendant, Rexall Sundown, Inc. (Rexall) is a multinational corporation with its principal place of business in Boca Raton, Florida. Through its Sundown Vitamins Division (SVD), the company markets over 250 dietary supplement products sold in retail outlets across the United States. The SVD product line includes a variety of different calcium supplements including the deceptively marketed products about which the Class complains: Calcium ‘900’ and Calcium 1200. Both of the products at issue are Calcium supplements in softgel form. Calcium ‘900’ was first developed and marketed in 1989 by Rexall founder and CEO, Carl DeSantis. Calcium 1200 was introduced in 1997. (Exhibit A). In the words of Rexall founder, Carl DeSantis, Rexall’s “softgel” product was designed to address the needs of a specific target market of consumers seeking to obtain the calcium they need:

Calcium presents problems for many people. So much Calcium is needed daily (1250 mg. and then some) that the tablets tend to be quite large and very difficult to swallow. Therefore, we have brought into the company liquid form of Calcium in a softgel, making it much easier to swallow while complying with the daily doses necessary to prevent bone loss.

(Exhibit B, Vitamin Enriched by Carl DeSantis, pp. 236–237).

Although the products are named Calcium ‘900’ and Calcium 1200, they do not contain 900 mg. and 1200 mg. of Calcium per pill. Instead, each softgel of Calcium ‘900’ contains only 300 mg. of calcium. Likewise, each softgel of Calcium 1200 contains only 600 mg. of calcium. Defendant claims that the product names indicate the recommended dosage although this was not indicated anywhere on either of the principal display panels of the product labels.1 Instead, the turquoise, black and white principal display labels for Calcium ‘900’ proclaimed the name and number 900 in prominent letters. (Exhibit C). Likewise, Calcium 1200’s label highlighted the product name

1 The principal display panel “is the print of the label that is most likely to be displayed, presented, shown or examined . . . for retail sale.” 21 C.F.R. §101.2 (1999). through the use of color and boldly proclaimed the number 1200 in large block type. (Exhibit C). Significantly, for most of the 1990s, Rexall used what is known as a double-sided label. The double-sided label is a marketing device intended to highlight the special selling features of a product and is unique in that it contains two principal display panels. In her deposition conducted on June 23, 1999, the company’s Vice-President of Product Development, Debbie DeSantis, described the purpose of the label design as follows: … A. So it’s for the purpose of when customers are reading labels, which in ten years of experience in retail pharmacy it was always a constant mess because everyone read everything and then put it back all askew, so this double faced label afforded the retailer a significant advantage in having that because no matter how the customer put the bottle back on the shelf it was always facing forward

Q. And facing forward would mean that the portion that says Calcium ‘900’ would be seen by the customer?

A. Facing forward would mean that the name of the product would be facing forward. In this case Calcium ‘900’ would be facing forward, yes.

(Exhibit D - Deposition of Debbie DeSantis at page 93).

Carl DeSantis, founder of Rexall, echoed the same theme in his book, Vitamin Enriched:

I came up with the idea for a single wrap-around label with two front panels, front and back, so that no matter how the bottle sat on the shelf, the consumer had a better shot to see the label and identify our product. Only a small percentage of our nutritional supplements, the multiples for example, required too much information about their ingredients for a wrap-around double label.

We took out a patent and later prevented one other large competitor from placing a wrap-around on their bottles. Did it work, you ask? It increased our label exposure about 50 percent, and sales of our mass merchandise Sundown line grew by almost 20 percent.

* * *

Our consumer friendly double siding affords assurance that the customers will find the products they are looking for: and the uniform, easy to read styling of our labels adds a professional touch to the retailer’s vitamin shelf. All this leads to increased confidence of the consumer and increased sales for the retailer. (Emphasis added) PA425.

(Exhibit B - Vitamin Enriched at page 133–134; 272).

The Company’s 1998 Annual Report likewise touts the benefits of the double- sided label: “The Company believes that its double-sided label gives it a shelf-facing advantage appreciated by retailers.” (Exhibit E, p. 6). In the case of Calcium ‘900’ and Calcium 1200, the deception and misrepresentation conveyed by the label regarding the per pill calcium content was reinforced by the marketing support provided to retailers by Defendant. In particular,

[t]o help optimize the performance of the retailers’ departments as well as sales of the company’s products, the company develops computerized planograms designed to efficiently utilize shelf space and direct consumers attention to the company’s products. (emphasis added).

(Exhibit E, p. 6).

A planogram is a document that is used to indicate what products are placed in individual slots on a shelf or on a series of shelves or in a department.

(Exhibit F – Deposition testimony of David Kronrad taken on May 13, 1999 at page 77– Mr. Kronrad is Vice President of National Accounts and Special Markets, Sundown Division for Rexall Sundown, Inc.)

In addition, the deceptive nature of the Calcium ‘900’ and Calcium 1200 labels were facilitated by the fact that the names and labels, appeared to be – but were not – consistent with the labeling convention employed by Rexall for its other calcium products – products which actually contained the milligrams of calcium proclaimed in the name in each tablet. (Exhibit G). In particular, in addition to Calcium ‘900’ and Calcium 1200, Defendant markets other calcium products including Calcium 500, Calcium 600 and Calcium 1000 mg. Like the Calcium ‘900’ and Calcium 1200, the labels for these products display the product name, including a large bold number, on the principal display panel of each bottle. Unlike the Calcium ‘900’ and Calcium 1200, however, and consistent with Rexall’s labeling convention, these products actually contain 500, 600 and 1000 milligrams of calcium per pill so that the name accurately conveys the per pill calcium content. Rexall’s departure from its own labeling convention with regard to Calcium ‘900’ and Calcium 1200 was expressly noted in a number of consumer complaints received by Defendant. For example, in 1997 a consumer wrote:

I feel as though I have been misled and cheated by Sundown. I’ve been taking vitamin and mineral supplements for years – almost solely your brand. I always compare price, quantity and units per pill.

I thought your 900 softgel of Calcium ‘900’ according to the label – only to learn after I got home that in very small print it says you need 3 capsules to make up the 900 and instead of the 900 which you indicate each capsule contains only 300 mg. of calcium. How many woman fighting osteoporoses will buy 900 – not reading the small print and take one a day – getting only 1/3 of the calcium they think they are getting.

I did a quick check of your other supplements – the large number on the front indicates the amount per pill.

Are you trying to cheat and deceive people? If so, it worked with me – I have a poor value and feel I have indeed been deceived by dishonest labeling. (Exhibit H at PA240-PA241).

Defendant has nevertheless explained that the names and labels of Calcium ‘900’ and Calcium 1200 represent the ‘serving size’ or suggested daily dosage for the products at issue. (See eg., Exhibit H at PA180; PA225; PA265; PA267; PA317). Defendant has proferred this explanation despite the fact that the serving size and recommended dosage of some of its other accurately named and labeled Calcium products is greater than one tablet. For example, even though the “serving size” of Calcium 600 mg. is “two tablets” or 1200 milligrams, the product is named Calcium 600. (See Exhibit G at PA432). Rexall’s customer complaint records reflect that it knew that its “serving size” explanation for its deceptive labeling of its Calcium ‘900’ and Calcium 1200 products did not address consumer confusion. For example, one customer, who responded to Rexall’s explanation of its labeling of both Calcium ‘900’ and Calcium 1200 stated:

I am still very befuddled by the use of the 900 (in very large letters) on the front if this product . . . . Why have a 900 out there on front of the bottle, when in fact, each capsule is only 300 mg.

* * * In my opinion, the “serving size” is a poor misnomer for a calcium product. * * *

All this, of course, applies also to your bottles marked “1200.” If one needs 2 capsules (600 each) to reach 1200 – why not simply mark the bottle 600 mg. and let people do their own arithmetic – and then take 2 to make 1200. If everyone marked bottles the way Rexall is doing these two products, then all the vitamin people could put large numbers on the front, with these so-called serving sizes on the back, and appear to be selling vitamins or calcium on these phony per capsule contents. (Exhibit H at PA185).

The names of the subject products do in fact correspond to the “suggested adult usage” contained on an information panel sandwiched in tiny print between the two colorful principal display panels bearing the product name in type nearly ten times larger. However, for most of the class period, nowhere on the information panel of Calcium ‘900’ did the label specifically indicate that each softgel contains only 300 mg. of Calcium. Indeed, the number “300” appeared on the information panel only with reference to IU’s of Vitamin D, not Calcium. Thus, in order for a consumer to understand the amount of Calcium in each softgel of Calcium ‘900’ a calculation using the information provided in the tiny print had to be done. Likewise, until 1998, the labels for Calcium 1200 did not state that each softgel contained 600 mg., thus a mathematical calculation was required in order to discover the true per pill calcium content. (Exhibit I – Affidavit of Deborah Shur Trinker, paragraph 7). Rexall was aware that the adult usage instructions did not correct the misrepresentation conveyed by the name and label from the consumer complaints it received. For example, one consumer wrote:

I am writing about your 900 Liquid Filled Calcium capsules. Reading the label a person would think 1 capsule would be 900 mg. instead of 300 as it reads in small print on the back of the bottle. This is very deceiving to the customer! PA188.

Another consumer told Rexall:

I find it very misleading to the consumer when your liquid-filled Calcium ‘900’ is in Big letters on the front of label – only to get home – put on my glasses to find the small print. I must take 3 softgels daily to get 900 mg. of calcium. You know in all fairness that label should read Calcium “300”. Is this the way your company must push its product – be honest in a round about way? (Exhibit H, PA191). See also PA240; PA248; PA256 (other similar complaints).

It is also clear from the consumer complaint evidence and the testimony of the plaintiffs, that Defendant also knew that many consumers were misled not only at the time of purchase, when the principal display panel is primary, but even after they got home and used the product to obtain what they thought was the proper amount of calcium. These consumers told Rexall:

 I have been using your “The #1 Choice of Sundown Consumers Liquid Filled Calcium ‘900’ enriched with Vitamin D” softgels for one year. Your labeling is “wrong”. In order to get 900 mg. you need to take 3 softgels. Since each softgel is only 300 mg. you are intentionally having the consumer believe that each softgel is 900 mg. Shame on you. Exhibit H at PA 253 (emphasis in the original) (italics added).

 I’ve been taking your Calcium for the past six mo[nths]. The bottle infers that there are 900 mg. of calcium. This is totally misleading to the consumer. Exhibit H at PA238 (emphasis in the original) (italics added).

 In my case, I try to max out on 1500 mgs. a day – which is why I have been so angry with this poor labeling. I took the 300 mg. capsule in your bottle marked 900 – thinking they were 900 each – and for 1 ½ years have thus taken only 600 mg. . . . – which is 900 short of what I felt I needed! Exhibit H at PA185 (italics added).

 I have been a customer of yours for approximately six years, taking your “absorbable Calcium ‘900’ softgel capsules. . . . Unfortunately, until a couple of months ago, I was only taking one capsule a day. I have known for 10 years that I should take 1,000 mg. of calcium daily. I thought I was getting 900 a day with this product according to the front label. When I recently read the whole label, I then realized that each capsule is only 300 mg., not 900 as the front label implies. Osteoporosis runs in my family, so I have to tell you that I was shocked and dismayed to find that I have been taking the correct amount for the past six years that I thought I was. There is no way I can make up for lost time. Exhibit H at PA257 (italics added). 2

Plaintiff’s experts, Dr. Stephen Barrett and William Kitzes, reviewed the labeling and Defendant’s consumer complaint record as well as the evidence reflecting confusion among Defendant’s own employees. In addition, Dr. Barrett, an expert in marketing dietary and nutritional supplements to consumers, referred to Federal Trade Commission Guidelines on advertising and his knowledge of the market garnered from years of monitoring health products marketed to consumers. Mr. Kitzes, drawing on his expertise

2 See also records of calls from consumers who had used the product for a year or more. Exhibit H at PA173 (“started taking the product over a year ago thinking she was getting 900 mg. per softgel. After reviewing the label, she’s getting only 300 mg. per softgel. Think the label is misleading.”); PA284 (“Customer feels labeling is misleading, should be changed. She has been taking only 1 tablet a day for 2 years. She was very upset.”); Exhibit H at PA282 (“Misleading label has been taking 1 capsule for a year, has osteoporosis, should be taking 1200, very upset.”); Exhibit H at PA314 (“Misleading label – thought she was getting 1200 mg. per capsule, then realized it was only 600 mg. per capsule. She has been taking this for a year and now finds out she has not been getting enough to get the benefits she needs.”); Exhibit H at PA329 (“Customer stated that the label on product is misleading. She has been taking it for a year and just discovered she is not getting 1200 mg. per tablet. She feels this is false advertising and is returning all of her Sundown products.”). garnered from his experience at the Consumer Product Safety Commission and as an expert on consumer safety and communication issues, referred to the standards reflected in the applicable regulations in assessing the labels and marketing at issue. Both experts concluded that the labeling at issue had the capacity to mislead consumers. (Defendant’s Kitzes Exhibit G and Barrett Exhibit C). Their conclusions are further confirmed by company price lists and planogram material in which apparently confused Rexall employees mistakenly refer to the products at issue as “900 mg.” and “1200 mg.” products. Exhibit P. It is against this backdrop that Defendant asks this Court to rule that the Defendant’s customer complaint records are inadmissible, that Rexall CEO Carl DeSantis’ statements are likewise inadmissible, and that Plaintiffs’ experts should be barred from testimony. Each of these requests should be denied for the reasons addressed below.

III. THE DEFENDANT’S CUSTOMER COMPLAINT RECORDS ARE ADMISSIBLE

Rexall requests exclusion of the over 120 consumer related complaints received by its customer relations department over the class period. These complaints take several forms:

1. Letters sent by consumers (including retailers or vendors) describing their dissatisfaction with Rexall’s labeling practices or the product that was purchases. 2. Complaint Records completed by Rexall’s customer service representatives in response to a letter or telephone call from a consumer. In many instances the Complaint Record is accompanied by written correspondence from Rexall to the complainant responding to the complaint. Rexall argues that any ‘statements by consumers’ contained in the complaint records should be barred as inadmissible hearsay. Rexall further argues that no exception to the hearsay rule permits the introduction of these statements into evidence. Rexall is clearly wrong and the statements are admissible for numerous reasons. First, the customer complaints are being offered to demonstrate that Rexall had been advised that its labeling for the subject products caused confusion and deception and eventually, Defendant took action acknowledging that the labels had the capacity to mislead. The existence, and Defendant’s knowledge of, the complaints thus serves to support the other evidence of the labels’ capacity to deceive. Put differently, the consumer complaints clearly demonstrate that Rexall had been told that its labels had the capacity to deceive for years and that it finally took action to rectify the deception. The testimony of Rexall’s Senior Vice President for Regulatory Affairs, Deborah Trinker, establishes that this is the case. In response to a question concerning changes in the Calcium ‘900` labels, Ms. Trinker explained that the label “dated 3-98, was changed in response to the company receiving a small number of complaints that raised to the company’s attention the fact that people were not reading the directions for use of the product. Consequently, the label was changed to include in direct proximity to the net content statement of 90 softgels, 300 milligrams calcium.” (Exhibit J, Dep Tr. of Deborah S. Trinker, Esquire at p. 93). It is established that, “Where statements are offered, not for the truthfulness of their contents, but only to show that they were in fact made and that the listener took certain action as a result thereof, the statements are not deemed inadmissible hearsay.” Russell v Rutgers Health Plan, 280 N.J. Super. 445, 456 (App. Div. 1995), certif. den., 142 N.J. 452 (1995). Here, by its own admission, Rexall changed its deceptive and misleading labeling practices in response to the very consumer complaints it attempts to exclude by the within motion. For this reason alone, the statements are admissible. The statements are also admissible pursuant to Rule 703 as information relied upon by plaintiff’s experts in forming their opinions. Both plaintiff experts did an extensive review of the complaint records and Rexall’s response to the same. (See Exhibit C to Defendant’s motion to bar Dr. Barrett and reports of William Kitzes attached thereto as Exhibit G). The complaint records are also admissible to show notice to Rexall of the misleading nature of the labels and Rexall’s indifference to the same confused consumers:

When a statement is offered to prove the probable state of mind it induced in the listener, such as to show information which the listener had which bore on the reasonableness or good faith of the listener’s subsequent conduct, that evidence is not ordinarily excluded as hearsay.

Spragg v. Shore Care, 293 N.J. Super. 33, 57 (App. Div. 1996)(citing II John W. Strong, McCormick on Evidence 249 at 103 (4th ed. 1992)). The issue of whether Rexall acted with honesty-in-fact and good faith is not relevant to its liability under the CFA for misrepresentations conveyed by its labels and marketing. Gennari, 148 N.J. at 604 (“… the Act has protected consumers from deception and fraud, even when committed in good faith.”). Whether Rexall acted with honesty-in-fact and good faith, however, is relevant to the Class’ independent allegation that the conduct at issue was unconscionable.3 Unconscionability “is an amorphus concept obviously designed to establish a broad business ethic.” Kugler v. Romain, 58 N.J. 522, 543 (1971). It is intended to promote honesty-in-fact, good faith, and observance of fair dealing. D’Ercole, 206 N.J.Super. at 25 (citing Kugler, 58 N.J. at 544). In this case, Rexall will undoubtedly argue that at all times relevant it acted in good faith with respect to its labeling of Calcium ‘900’ and Calcium 1200. In doing so, Defendant will tender excuses about why retailers were confused, why price reports were confused, why numerous other corporate documents were confused and why Rexall ignored FDA pronouncements since 1993 regarding the proper manner to label these products. Rexall recognizes that its ability to come up with excuses for its conduct becomes even more difficult as a result of its failure to act appropriately in response to consumer complaints about its marketing of these health products. Indeed, it appears the only argument Defendant has put forth to date is that because there were only a limited number of complaints in response to gross sales the complaints could be ignored. Plaintiff will demonstrate that Rexall developed the labels for these products in an effort

3 The CFA declares unlawful “The act, use or employment by any person of any unconscionable commercial practice … [or] misrepresentation.” N.J.S.A. 56:8-2. to maximize the sales and acted with conscious indifference when advised by consumers that the labels were dishonest and misleading. Finally, this Court should be loathe to permit Rexall to succeed on its hearsay argument in light of the fact that Defendant refused to produce, and therefore redacted, the names of the consumers who complained. Moreover, although Plaintiff explicitly requested all information withheld pending merits discovery once the class was certified, the names were never provided. See Exhibit K. As a result, it is Defendant’s conduct that prevented Plaintiff from being able to produce the consumers who complained. Defendant’s attempt to exploit its own recalcitrance in order to preclude evidence that is clearly probative on a number of issues should be rejected out of hand. For this, and all of the foregoing reasons, the consumer complaints are admissible.

IV. THE STATEMENTS OF CARL DeSANTIS ARE ADMISSIBLE

Carl DeSantis is the Founder and former Chief Officer/Chairman of the Board of Rexall. He also developed the product Calcium ‘900’ and 1200 softgels, including naming and initial labeling schemes. At his deposition in this matter he was specifically asked about his book, Vitamin Enriched. Mr. DeSantis testified that the business practices, philosophies and guiding principles expressed in Vitamin Enriched were those employed at Rexall and that they were correct and accurate. (Exhibit L, Carl DeSantis Dep. Tr. 129:16-133:20). Plaintiff will seek to admit select portions of this book as evidence of the marketing practices of the defendant. Blanket preclusion at this time pursuant to N.J.R.E. 403, as defendant requests, would be inappropriate. The excerpts will clearly support plaintiff’s contention that defendant acted with total indifference to the consequences of the manner it marketed its product. The court can consider at the time the evidence is admitted whether it is irrelevant or its probative value outweighs any possible prejudice to defendant. Mr. DeSantis’ statements are also probative on the issue of whether the labels had the capacity to deceive. Indeed. Mr. DeSantis effectively concedes the power of the number on the label in the statement in his book referenced in Rexall’s brief:

“Most people are trusting. They believe that if it says 500 mg. of C on the label, then there is 500 mg. of C in the tablet.”

In this case, Plaintiff will demonstrate through Rexall’s own documents that the number depicted on the principal display panel of a vitamin supplement typically represents the dosage per pill, tablet or softgel. The Class will further provide evidence of the labeling convention used by Defendant that supported the misrepresentation. Further, Dr. Barnett, who has surveyed the marketing of dietary supplements for years has opined that the labels had the capacity to mislead consumers about the Calcium content per pill. In short, it was clearly reasonable for consumers to believe that the names Calcium ‘900’ and 1200 meant there were 900 mg. and 1200 mg. of calcium per softgel. In an effort to rebut the evidence supporting the Class’ assertion about the representation conveyed by the labels, Rexall will argue that the number on the principal display panel does not typically depict dosage per unit. Yet, Carl DeSantis, who developed the products and labeling at issue, concedes in his book that the labels convey the very message that Plaintiff contends they convey; thus, Mr. DeSantis’ testimony establishes that Rexall’s position is wrong. It is beyond belief that Rexall can argue with any degree of good faith that Mr. DeSantis’ statement (like many others in the book) should be deemed inadmissible. Rexall also fails to point out that it is free to call Mr. DeSantis to explain his statements and other actions. Indeed, plaintiff anxiously awaits his appearance and the opportunity to ask him how he possibly believed that the thousands of consumers that purchased these products understood each softgel contained one-third or one-half the amount of calcium depicted in the number on the principal display panel of the package. In sum, the excerpts in Vitamin Enriched are clearly relevant and admissible. And, defendant is free to rebut these statements through Mr. DeSantis testimony but cannot offer additional excerpts of the book except for purposes of completeness.

V. THE PLANOGRAMS ARE ADMISSIBLE Attached hereto as Exhibit P is a typical plan-o-gram provided to retailers by Rexall. As noted earlier, Rexall touts its planograms in its 1998 SEC filing as a device “designed to efficiently utilize shelf space and direct consumers attention to the company’s products.” (Exhibit E, p. 6). It is part of the marketing support Rexall offers to retailers in order to maximize sales. See id. In conjunction with the double-sided label and Defendant’s labeling convention, it is evidence of the marketing strategy that exacerbated the labels’ capacity to deceive. Accordingly, it is admissible with regard to Defendant’s marketwide conduct in connection with the sale of Calcium ‘900’ and Calcium 1200. In addition, the planogram provides evidence of the capacity of the product names and labeling to mislead. More particularly, the planogram is in two parts; the merchandising report and the layout. In all the planograms to be introduced by plaintiffs the jury will see that Rexall refers to the products in question as 900 mg. and 1200 mg. In the layout the product is depicted on the shelf to be sequential after products with a per tablet dose less that 900 and 1200 mg. Clearly, the planograms show an effort to extend the deception to the retailer and reflect the confusion within Rexall’s own marketing department with respect to the milligrams of calcium in each softgel. Consider some of the relevant testimony of Keith Thompson, Vice President of Sales, Rexall Division, regarding the planogram merchandising report:

Q. Do you know why the product is named or described, not named, described Calcium ‘900’ mg. Plus D on the planogram? A. No, I don’t know why.

(Exhibit M – Deposition of Keith Thompson at page 60–61). Rexall further makes the incredible argument that because there is no direct evidence that planograms were involved with the retail site involved in this case that they should be barred. First, this is a statewide class action involving numerous sites where planograms were utilized. Further, the planograms demonstrate that the labels at issue confused Rexall’s own marketing department in this case. This fact will directly refute Rexall’s argument that its labels were not confusing and a reasonable consumer should have not been misled. Rexall also argues that planograms should be barred because retailers have discretion on whether to adopt them or develop their own retail display schemes. Nevertheless, Rexall has never produced a single piece of evidence to support this proposition. The Class is anxious to see how the Defendant intends to do so. Further, even if it were true that not all retailers took advantage of the marketing support offered by Rexall, the planograms would still be admissible. Not only do they demonstrate marketing conduct intended to support the misrepresentation conveyed by the labels, but also, they demonstrate the confusion by Rexall personnel and efforts by Rexall to extend its deception to the retailers. The fact an individual retailer may chose to ignore the planogram does not negate these facts.

VI. STEPHEN BARRETT, M.D., IS QUALIFIED TO TESTIFY AS AN EXPERT ON COMMUNICATION TO CONSUMERS

Plaintiff will offer Dr. Stephen Barrett as an expert in the marketing of dieting and nutritional supplements to consumers. As reflected in Dr. Barrett’s curriculum vitae, Dr. Barrett has extensive experience researching, reporting, consulting and writing on issues regarding the marketing of products like Calcium `900’ and Calcium 1200 to consumers. (Exhibit N). Defendant challenges Dr. Barrett’s qualifications on the grounds that:

(1) he has no formal training with issues of consumer behavior, marketing or advertising; (2) he has never conducted consumer perception studies or studies concerning the manner in which usage information is perceived; and (3) he has not testified in a case similar to this one. Db, pp. 3-4.

With regard to the first and third challenge, while Dr. Barrett has not had formal training, he has had years of experience. The record reflects that he has served on various boards and committees committed to eliminating health fraud. In addition to receiving awards (including a citation from the FDA) for his work in the fight against nutritional fraud, Dr. Barrett has also written numerous publications relating to frauds in the health care and nutritional supplement industry. As evidenced by his deposition testimony, Dr. Barrett has monitored the consumer health product industry for years. In addition, he has testified before Congress on FDA regulations. (See Defendant’s Barrett Exhibit A, p.189; see also p. 192 discussing Dr. Barrett’s FDA work). Case law in New Jersey is clear that the expertise of a witness may be derived strictly from his occupational experience. Correa v. Maggiore, 196 N.J. Super. 273, 282 (App. Div. 1984) (masonry contractor with 25 years experience qualified to testify about “lifting” a house, although expert had never “lifted” a house). A witness may qualify as an expert by reason of “study without practice or practice without study.” State v. Smith, 21 N.J. 326, 334 (1956). See also Hake v. Manchester Tp., 98 N.J. 302 (1985) (person trained in emergency fist aid, but lacking professional license or degree, may be permitted to give expert opinion as to the potential for success of such emergency first aid). Moreover, a proffered witness is not disqualified merely because he has not previously been qualified as an expert in his chosen field. State v. Moore, 122 N.J. 420 (1991) (State trooper with two years experience as crime scene investigator, but had received only 2 days training in blood spatter analysis and had never testified as an expert in that specialty, was held to have been adequately qualified.). The determination to qualify an expert is a matter left in the discretion of the trial court. Trial courts are instructed, nonetheless, to exercise discretion to reject expert testimony with great caution in light of the strong policy of allowing all relevant evidence. N.J.R.E. 402. “A jury should be trusted to weigh any deficiencies in the qualifications of an expert, as it is the jury’s province ‘to determine the credibility, weight and probative value’ of his testimony.” Comment, N.J.R.E. 702 (quoting Rubanick v. Witco Chemical Corp., 242 N.J.Super. 36, 48 (App. Div. 1990), mod. on other grounds, 125 N.J. 421 (1991)) (additional citations omitted). Here, given Dr. Barrett’s years of exposure and experience in the area, he is clearly qualified to offer an opinion on the marketing of the subject products. Hence, his report and testimony should be admitted and it should be left to the jury to assess the weight to be accorded his opinions. Defendant’s contention that Dr. Barrett’s testimony should be excluded because he is not qualified due to the fact that he never conducted consumer perception studies, should also be rejected. Dr. Barrett’s extensive curriculum vitae demonstrates he possesses the requisite level of experience to opine that Rexall’s labeling for “Calcium 900” and “Calcium 1200” have the capacity to mislead. Exhibit N. Again, any deficiencies in his experience in this regard can be explored on cross-examination and the weight afforded Dr. Barrett’s testimony left to the province of the jury. In addition to challenging Dr. Barrett’s qualifications, Defendant challenges Dr. Barrett’s opinion that the labels have the capacity to mislead, on the ground that it is not based on any formal consumer surveys, focus groups or consumer research. Db. at 10. Defendant further criticizes Dr. Barrett’s opinion because it does not quantify the number of class members misled and because Dr. Barrett acknowledges that the adult usage information has “the capacity to inform.” Db. at 5. It should be recalled in addressing these issues that Plaintiff’s burden in connection with the CFA is to prove that the practices at issue had “the capacity to mislead.” Cox v. Sears Roebuck & Co., 138 N.J. 2, 17 (1994). It is on that issue alone that Dr. Barrett’s testimony will be offered. Moreover, with regard to that issue, it is not relevant that some consumers may not, in fact, have been misled. See Cox, 138 N.J. at 17. Indeed, once the Plaintiff class established the labels had the capacity to mislead, it is entitled to a presumption of reliance Varacallo v. Massachusetts Mutual Life Ins. Co., 332 N.J. Super. 31 (App. Div. 2000), and it is Defendant that must produce dissociative evidence if it wishes to limit application of the presumption. Roberts v. Cowgill, 316 N.J. Super. 33, 44 (App. Div. 1998). Significantly, the fact that Dr. Barrett conceded that the labels have “the capacity to inform” does not negate his opinion regarding the deceptive nature of the label. That opinion was based on his analysis of consumer comments contained in Defendant’s customer complaint records, his knowledge of consumer complaint behavior from years of monitoring the industry, the Federal Trade Commission Guides on Advertising, and his experience monitoring the marketing of consumer health products, as well as Defendant’s documents. When rendered, Dr. Barrett was clearly aware of the existence of the “adult usage information” on Defendant’s labels. Dr, Barrett nevertheless concluded the labels nevertheless have the capacity to mislead. The FTC Guides quoted at length in his report support his conclusion. See Defendant’s Barrett Exhibit C. Those guides instruct that disclosures that appear in fine print or which are obscured by design features may not cure a deception. Id. The consumer complaints examined by Dr. Barrett support this conclusion. Finally, the fact that Dr. Barrett’s opinion is not based upon a formal study or survey does not negate its value to a fact finder attempting to assess the capacity to mislead. Studies are but one form of extrinsic evidence considered in determining whether a practice has the capacity to mislead. Thus, the Federal Trade Commission has identified as evidence relevant to its determination of whether an advertisement has a capacity to mislead, not only survey evidence “of what consumers thought upon reading a challenged ad,” but also, consumer testimony and expert opinion. Kraft, Inc. v. Federal Trade Commission, 970 F.2d 311, 319 (7th Cir. 1992). Dr. Barrett’s opinion, based upon consumer testimony, guidance from appropriate regulatory experts and many years of study is certainly relevant extrinsic expert evidence of the capacity of Defendant’s labels to mislead. In sum, Dr. Barrett’s experience studying the marketing of nutritional supplements, his monitoring of advertising and labeling of such products, and his role as a consultant to the FDA and FTC, qualify him to provide an opinion on the capacity of the labels at issue to mislead. Moreover, as a result of his experience, he is able to provide an opinion informed by knowledge beyond that of a layperson. Accordingly, his testimony should be permitted to assist the jury.

VII. WILLIAM KITZES IS QUALIFIED TO TESTIFY AS AN EXPERT ON CONSUMER SAFETY AND LABELING ISSUES

As with Dr. Barrett, Defendant contends that William Kitzes does not have the requisite qualifications to testify as an expert on consumer labeling issues and further that his opinion is not based upon any scientific methodology or studies. In addition, Defendant contends that Mr. Kitzes is offered to provide a legal conclusion and therefore that his opinion as to Defendant’s compliance with the FDA regulations is an inadmissable legal conclusion. None of these positions has any merit. As to Mr. Kitzes’ qualifications, it is readily apparent from his curriculum vitae (which, like Dr. Barrett’s, was conspicuously omitted from Defendant’s Exhibits and which is attached in Plaintiff’s Appendix as Exhibit O), and his deposition testimony, that he has vast amounts of experience in both the regulatory and private sector, with issues involving consumer safety and labeling. In addition to serving as a Legal Advisor at the U.S. Consumer Product Safety Commission for seven years, he has consulted in connection with the development of effective product warnings and spoken on consumer issues including notice to consumers. In addition to his regulatory work at the CPSC, Mr. Kitzes also served as an expert on a number of FDA issues and evaluated labeling compliance involving Norplant contraceptive implant. Defendant Kitzes’ Exhibit G, Paragraph 2. Testimony elicited at Mr. Kitzes’ deposition provides further insight into his vast experience and qualifications. The value of Mr. Kitzes’ expert insight into consumer safety issues has been repeatedly acknowledged by the courts. Mr. Kitzes has testified in court, and been qualified as an expert, eighty (80) times. (Defendant Kitzes Exhibit F, Dep. Tr. 41:25 to 42:5). He has extensive experience with both over-the-counter and prescription drugs, which include: Zomax, Lovenox, Norplant, Imitrex, intravenous saline solutions, hypo/hyperthermia blankets, autologous blood equipment, patient lifts and oxygen bottles. (Id., Dep. Tr. 19:14 – 20:10). In fact, in connection with the Zomax litigation, Mr. Kitzes involvement was as a safety communications expert. (, Id., Dep. Tr. 20:11 – 23:11). In addition to his litigation experience, Mr. Kitzes is also involved with the Florida legislature. He is chairman of the Florida Consumer Council, where his responsibilities (which are performed on a voluntary, unpaid basis) include his review of all consumer legislation prior to submission to the legislature, most of which have to do with deceptive practices. (Kitzes Dep. Tr. 54:1-14). In sum, Mr. Kitzes has a wide range of experience with issues involving effective communications to consumers and analysis of communications in light of the relevant standards, including any applicable government regulations. As such, he has special knowledge developed through study and practice that qualifies him to opine on the communications at issue here in light of the applicable standards. More particularly, as an expert with experience in the application of regulatory standard to communications to consumers Mr. Kitzes is qualified to assist the jury in its efforts to assess whether the Class’ assertion that Defendant committed a per se violation of the CFA by violating a FDA regulation intended to protect to consumer is meritorious. See Green v. Continental Rentals, 292 N.J. Super. 241 (Law Div. 1994) and Swiss v. Williams, 184 N.J.Super. 243 (Law Div. 1982) (holding violations of federal statutes and regulations are evidence of a per se violation of the CFA). As is evident from the extended discussion in Defendant’s brief attempting to debunk Mr. Kitzes’ opinion that the labels did not satisfy the regulatory standards established by the FDA, (see Db 10-18), the regulatory landscape is not readily traversed by a layperson. Mr. Kitzes can clearly assist the jury on both direct and cross-examination in understanding what the regulations required so that the jury can then determine whether the labels met the applicable standard and whether there is a violation of the CFA. See Payne v. A.O. Smith Corp., 627 F.Supp. 226 (S.D. Ohio 1985) (Court permitted expert testimony as to accepted principles of safety analysis as useful to jury’s consideration). Moreover, Mr. Kitzes also offers an opinion based upon experience and an assessment of particular features of the labels which effect what is communicated to consumers. Again, as recognized by the Federal Trade Commission, the types of extrinsic evidence that are useful to a fact finder assessing the representations conveyed to consumers are not limited to copy tests and “scientific studies”. Thus, for example, the Commission has observed that expert opinion, consumer testimony and evidence of what consumers thought when they read something is probative extrinsic evidence. See Kraft, supra. Moreover, as recognized by the Seventh Circuit in Kraft in rejecting the defendant’s arguments that the FTC must rely on extrinsic evidence in interpreting advertising, the Commission’s experience with the regulation of communications directed to consumers provides an expertise in the analysis of messages conveyed by advertising. Likewise, Mr. Kitzes extensive experience with developing and consulting on safety communications to consumers enables him to opine on the communications conveyed by the labels at issue. In short, Mr. Kitzes has experience, knowledge and expertise that will be useful to the jury in its attempt to assess whether the labels at issue had the capacity to mislead the average consumer. His opinion addresses the factors relevant to such determinations when made by other fact finders, such as the Federal Trade Commission. Indeed, just as the Federal Trade Commission looks to extrinsic evidence such as expert opinion, Kraft, supra, so too should the jury here have the benefit of such additional evidence. Accordingly, Mr. Kitzes’ testimony should be permitted.

VIII. CONCLUSION

For all of the foregoing reasons, Defendant’s Motions in Limine should be denied.

Respectfully submitted,

[Attorneys for Plaintiff]

23.11 Plaintiff’s Supplemental Submission In Opposition to Defendants’ Motion to Bar the Testimony of Plaintiff’s Expert

) [PLAINTIFF], on behalf of herself and all others ) SUPERIOR COURT OF NEW similarly situated, ) JERSEY ) CAMDEN COUNTY Plaintiff, ) ) NO. v. ) ) PLAINTIFF’S REXALL SUNDOWN, INC., ) SUPPLEMENTAL SUNDOWN, INC. and ) SUBMISSION IN JOHN DOES 1-10, ) OPPOSITION TO individually and trading as Sundown Inc., ) DEFENDANTS’ MOTION TO ) BAR THE TESTIMONY OF Defendants. ) WILLIAM KITZES )

In the hearing on February 26, 2002, this Court directed that the parties file an additional submission in connection with Defendant’s Motion to Bar the Testimony of William Kitzes. The Plaintiff Class has offered Mr. Kitzes as an expert in product labeling and consumer safety communication. Mr. Kitzes rendered an initial report on January 20, 1999, and a supplemental report, by way of affidavit on June 15, 1999, after being supplied additional information. The initial report and supplemental report of Mi. Kitzes are attached as Exhibits 1 and 2. As this Court now well knows, the Plaintiff Class intends to prove that the labels for Defendant’s Calcium ‘900’ and Calcium 1200 products had the capacity to mislead consumers as to the per pill calcium content and, in addition, that Defendant acted unconscionably without regard for appropriate standards, good faith or honesty-in-fact, all in violation of the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-2 et seq. In connection with establishing that Defendant acted unconscionably, the Plaintiff Class intends to offer evidence that at all relevant times Defendant, Rexall, violated labeling standards of the FDA. The evidence will be offered in several manners:

1. Through judicial notice of various rules and regulations published by the FDA in the Federal Register. 2.Through cross-examination of defendants’ witnesses. 3.Through the expert testimony of William Kitzes.

Mr. Kitzes is an expert in product labeling and consumer safety communications. Since his days with the Consumer Product Safety Commission he has spent his career making recommendations on consumer related communication issues. As part of his professional practice, including work on behalf of various Florida State agencies, he has advised on safety issues based on pronouncements by the FDA and other government agencies.

I. THE STANDARD ESTABLISHED BY THE FDA REGULATIONS

Mr. Kitzes will outline the history of FDA regulations applicable to Vitamin Supplements during the relevant class period. Without calling an expert or other qualified evidence the defendant will attempt to argue it complied with all FDA standards and regulations during the time it marketed the products, Calcium ‘900’ and Calcium 1200 softgels. This position is simply wrong and refuted by the clear language of the regulations. The relevant history of the FDA regulations is set forth below.

A. The History of the FDA Regulations

1. In November 1991, the FDA proposed detailed rules for labeling of Vitamins and Minerals. These rules had a format for listing ingredients on products such as defendants Calcium ‘900’ and CALCIUM 1200 (Exhibit A). 2. On October 6, 1992, Congress passed the Dietary Supplement Act of 1992. Section 202 (a) requires the Secretary, and by delegation the FDA, to issue new proposed regulations that are applicable to dietary supplements no later than June 15, 1993, and final regulations by December 31, 1993. (Exhibit B). 3 On June 18, 1993, the FDA issued proposed rules for labeling dietary supplements. (Exhibit C). 4. On January 4, 1994, the FDA passed final rules for labeling of Dietary Supplements. In the rules ‘Establishing Date of Application’ the effective date was set as July 1, 1995. (Exhibit D). 5. On January 4, 1994, the FDA Final Rules for Labeling Dietary Supplements (Exhibit B) set forth a detailed framework for labeling dietary supplements such as Calcium ‘900’ and 1200 softgels. William Kitzes explains these rules. Suffice it to say these rules with respect to the labeling issues raised in this trial demonstrate defendants’ lack of compliance with FDA standards. 6. On February 9,1995 (Exhibit F), the FDA issued a notice of intent not to enforce the labeling rules to take effect on July 1, 1995. In doing so the FDA specifically noted that Congress enactment of DSHEA in October 1994 “amended both the nutrition labeling and nutrient content claim provisions of the act…it made limited changes to how nutrition information is to be presented in the labeling of dietary supplements… (emphasis added) Exhibit F at page 87. In issuing the notice of intent, the FDA was very specific about the status of the dietary supplement labeling regulations:

Having considered these factors, FDA advises that while the nutrition labeling and nutrient content claim regulations implementing the 1990 amendments for dietary supplements will go into effect on July 1. 1995, it does not intend to enforce those regulations until it has modified them to reflect the 1994 DSHEA, and until after dietary supplement manufacturers are required to label their products in accordance with the 1994 DSHBA; that is, not until after December 31, 1996” (emphasis added). Exhibit F at page 88.

As noted, the FDA made clear that the dietary labeling rules passed on January 4, 1994, (as detailed in Mr. Kitzes report) would go into effect on July 1, 1995. They simply would not be enforced until a later date. The FDA also noted that many firms had already complied with the new rules:

“Having completed these rulemakings, FDA anticipated that dietary supplement firms would begin taking steps to come into compliance with the new ru1es, and dietary supplement manufacturers have apparently done so.” Exhibit F at page 87

7. On December 28, 1995, the FDA issued new proposed rules for labeling Dietary Supplements. Even a cursory review of these proposed rules reflects the FDA’s intention that the previously passed rules went into effect on July 1, 1995:

“The agency points out that, under current 101.36(b) (3), the heading ‘Amount Per Serving’ must be separated from the other information on the nutrition label by a bar above and beneath it.” Exhibit U at page 67198.

“FDA is proposing in 101.36 (e) (3) to maintain the graphic requirements in current 101.36 (b) and (c)(1) through (c)(5). These sections require the use of the largest type size within the nutrition label for the title; holding of the title and column headings; a hairline box around the nutrition label; a single easy-to-read type style; all black or one color type... Exhibit 0 at page 67205.

“FDA is proposing no change from the bars as currently required above and beneath the ‘Amount Per Serving’ heading in current 101.36 (b) (3) and at the bottom of the nutrition label in current 101.36 (b) (3) (iii)!’ Exhibit G at page 67205

“However manufacturers of these products have been aware of the potential for regulated labeling changes due to recent regulatory and legal activities. FDA assumes that the majority of these manufacturers have been taking the necessary steps to reduce their label inventories since January of 1994 the date of publication of FDA’s previous regulations regarding the labeling of dietary supplements. (emphasis added). Exhibit G at page 67211

8. On September 23, 1997, the FDA passed final rules for labeling dietary supplements. The final rules reiterated most of the labeling requirements that took effect in July 1995. And, although the new rules were to take effect in March 1999, the FDA specifically stated:

FDA will not alter its previous estimates based on the comment because dietary supplement firms have known about these label changes since at least January 1994. and the majority of firms have been taking the necessary steps to reduce their label inventories.” (Emphasis added) Exhibit H at page 49844.

The FDA stated that ‘although the effective date is 18 months hence, FDA encourages manufacturers to have new labels that are in compliance with these final rules printed as soon as current inventories are exhausted to assure a smooth and timely changeover.” Exhibit H at page 49843.

B. The Evidence Shows Rexall Acted in Contravention of the Applicable Standard

The foregoing regulatory history clearly demonstrates that the FDA established a standard for labeling dietary supplements as early as 1993. William Kitzes details in his report the nature of that standard. The regulations and FDA statements on their face show a clear guide to industry to label in accordance with the enunciated standard. Indeed, as noted above and in the attached portions of the FDA regulations, Rexall would have to have been totally indifferent to government labeling standards to fail to have known that their Calcium ‘900’ and Calcium 1200 labels should have included Supplementary Facts information panels since at least 1995. The evidence is that Rexall did not change its labels to comply with the FDA labeling guidelines until January 1999. Rexall’s excuse is that the FDA Notice of Intent issued in February 1995 indicated that although the regulations took effect they were not being enforced. Thus, Rexall contends that it was free to ignore the FDA standard as long as it would not get penalized. In his testimony of February 28, 2002, Rexall’s former sales director, Nicholas Palm, admitted that the Calcium ‘900’ and Calcium 1200 labels were not in accordance with current FDA standards until January, 1999. Indeed, the evidence in this case will also demonstrate that between 1993 and the January, 1999 Rexall changed the label on Calcium ‘900’ on over six occasions. At no time did Rexall attempt to implement any of the suggested FDA labeling standards prior to January 1999. Rexall’s complete disregard of the FDA standard, particularly in the face of consumer complaints and employee confusion about product content, flies in the face of the purpose and intent of FDA pronouncements:

To reduce consumer confusion and to ensure that it is readily observable and comprehensible to consumers, the agency is proposing that nutrition labeling on vitamin or mineral supplements be presented in a manner that is as similar as possible to the nutrition labeling of other foods... (Exhibit C, June 18, 1993 FDA proposed rules at page 33716).

The agency fully expects that some dietary supplement firms will be able to comply before this date once the pressure on printing dietary labels for foods in conventional food form is eased after May 8, 1994. Therefore, consumers can expect to begin enjoying the health benefits of the label changes prior to July 1, 1995. (Exhibit D, June 1994 FDA final rule at page 351).

Of equal importance, in February 1997, Rexall brought to market Calcium 1200 softgels. Here, the company designed a completely new label and had a full opportunity to do so in compliance with the FDA standard. Again, Rexall completely ignored the FDA and designed a label with no Supplemental Facts section with respect to content. If Rexall wishes to argue it was justified to ignore the FDA standard until it would be penalized in March 1999, it is free to do so. However, it would be inappropriate to bar the FDA evidence from the jury. Indeed, Rexall’s argument is as silly as the argument from a person who has an accident while speeding 5-mph over the speed limit. The speeder does not get to argue that he was free to speed and the speed limit rules are not applicable to the violation since everyone knows police will not enforce speeding laws at 5 mph over the legal limit. Of further importance is the expertise of William Kitzes in explaining the FDA regulations to the jury. Mr. Kitzes has over 20 years experience in interpreting government standards and applying them to consumer safety issues. A lay jury needs someone of his experience to unravel the FDA history of dietary supplement labeling so that the applicable standard can be explained to them. In this regard, the testimony to be offered by Mr. Kitzes is markedly different than that which was excluded in Payne v. A.O. Smith Corp.. 627 F. Supp. 226 (W.D. Ohio 1985). In that case, the regulations at issue created an independent basis for a cause of action and liability. In contrast, here Mr. Kitzes’ testimony concerns the standard established by the relevant regulations which the jury may then consider in determining whether the Defendant acted unconscionably in violation of the New Jersey Consumer Fraud Act. Instead of going to an ultimate issue, Mr. Kitzes’ testimony will provide information that will assist the jury in making its factual findings. To exclude such testimony is to give credence to Rexall’s specious argument that because it could not be penalized, it was free to ignore FDA standards until January 1999. II. MR. KLTZES’ REPORTS ARE NOT NET OPINIONS BUT RATHER ARE BASED UPON AN ANALYSES OF STANDARDS AND AN ANALYSIS OF FACTS RELIED UPON BY EXPERTS IN THE FIELD

In Vitrano v. Schiffman, 305 N.J. Super. 572, 577 (App. Div. 1997), the Appellate Division, quoting Jiminez v. GNOC Corp., 286 N.J. Super. 533, 540 (App. Div. 1996), stated:

When an expert’s opinion is merely a bare conclusion unsupported by factual evidence, i.e., a ‘net opinion’, it is inadmissible. Buckelew v. Grossbard, 87 N.J. 512, 524, 435 A.2d 1150 (1981); In re Yaccarino. 117 N.J. 175, 564 A.2d 1184 (1989). In essence, the net opinion rule requires an expert witness to give the why and wherefore of his expert opinion, not just a mere conclusion. As the Supreme Court stated, [***7] this rule ‘frequently focuses. . . on the failure of the expert to explain a causal connection between the act or incident complained of and the injury or damage allegedly resulting therefrom.” Bucke1ew, supra, 87 N.J. at 523. Where. . . an expert offers an opinion without providing specific underlying reasons for the alleged malfunction, he ceases to assist the trier of fact and becomes nothing more than an additional juror.

Even a brief review of Mr. Kitzes’ reports reveals that he identifies both the facts and standards that provided the basis for his opinion that the Defendant’s labels had the capacity to mislead. In particular, Mr. Kitzes provided an indepth analysis of the standard established by the FDA regulations in his January 20, 1999 report. (Exhibit 1). As a consumer safety expert, who has been qualified as an expert 80 times (see Plaintiffs previous submission), his reference to and reliance upon the standards reflected in the regulations applicable to the industry for labeling purposes provides a sound basis for his opinion. In addition, Mr. Kitzes identified specific features of the labels, including, in particular, the size, position, color and juxtaposition of the label features that supports his opinion. The Federal Trade Commission, the federal consumer protection agency charged with preventing deceptive advertising, typically looks to such features in assessing whether an advertisement has the capacity to mislead consumers. See In Re: Thompson Medical Company, Inc., 104 F.T.C. 648 (1984). As recognized in Kraft, Inc. v. Federal Trade Commission, 970 F.2d 311 (7th Cit 1992), the Federal Trade Commission is accepted as an expert in advertising interpretation. FTC precedent establishes that the standard used in assessing whether a practice “is likely to mislead consumers, acting reasonably under the circumstances, in a material respect,” requires an examination of “the overall net impression of an ad” and “a three part inquiry: (1) what claims were conveyed by the ad; (2) are those claims false or misleading; and (3) are those claims material to prospective consumers.” Id. Moreover, the FTC has stated that while disclosures can prevent a misrepresentation, cases also recognize that such disclosures need to be made clearly and prominently to be effective. Whether or not a particular disclosure was clear and prominent is a question for whose answer we often would seek information in addition to that from the ad itself” In Re Thomnson Medical Company. Inc., 104 FTC 648, n.9 1984 FTC LEXUS 6 at *314, n.9 (November 1984). FTC case law thus establishes that whether a particular challenged claim is made is an inquiry requiring an examination of the extrinsic evidence supporting the assertion that the ad or label has the capacity to mislead. Such evidence may include survey evidence of “what a consumer thought upon reading the advertisement in question,” consumer testimony, expert opinions and copy tests of the ad. See Kraft, 970 F.2d at 3ll. See also In Re Thompson, 104 FTC 648. Mr. Kitzes’ reports identify, quite specifically, these types of factors (including consumer testimony from the complaints), which experts in the field of communication to consumers consider in determining what is information conveyed to consumers. As such, it is not a net opinion and he should be permitted to testify in this case, just as he has in so many others, concerning the labeling communications to consumers.

Respectfully submitted,

[Attorneys for Plaintiff]