In a 5-0 decision, the Illinois Supreme Court ruled both lower courts got it wrong in a Madison County case that allowed a national class action to go forward against Intel over Pentium IV processors.
On Thursday, the high court reversed a Fifth District ruling that gave a green light for the case to proceed as a nationwide class action using the laws of California.
"Illinois law governs the issues of liability and damages in the present case; the action should not proceed as a class action," wrote Justice Thomas R. Fitzgerald.
Barbara's Sales, Inc., Donald Braddy, Michael Bundy, Bundy & Associates, Inc., Rhonda Byington, Rebecca S. Chandler, Vernon Anthony Duenas, Christopher R. Grout, Deanna L. Neubauer, Sandra Pyle, and Richard Rodriguez filed a nationwide, three-count, class action lawsuit against Intel alleging it engaged in unfair business practices through the omission, suppression, and concealment from the public that the Pentium 4 processor does not perform to the expectations of a reasonable consumer.
The appellate decision in July 2006 overturned Madison County Associate Judge Ralph Mendelsohn's decision to certify an Illinois only class using Illinois law.
The Supreme Court ruled that Mendelsohn was correct in applying Illinois law, but it also went a step further and ruled that the lawsuit as presently constituted should not proceed as a class action.
Counts one and two of the complaint were filed under the California Consumers Legal Remedies Act and California's unfair competition law, while count three was pled as an alternative count under the Illinois Consumer Fraud and Deceptive Business Practices Act.
The plaintiffs' were represented by Stephen Tillery of St. Louis and Stephen Swedlow of Chicago.
Intel, represented by Gordon Broom and Troy Bozarth of Edwardsville, argued that California law should not be applied because a state court's application of another state's law to the claims of a nationwide class would be both unconstitutional and a "novel expansion" of choice-of-law jurisprudence.
On July 12, 2004, Mendelsohn concluded that Illinois law could not be applied to a nationwide class, therefore only Illinois consumers or residents would be allowed in the class.
In a 3-0 decision, the appellate court said, "California law, not Illinois law, is applicable" in the case involving people who claim that Intel Pentium 4 processors are no faster than the Pentium III, Celeron, or AMD Athlon processors.
Justice Richard Goldenhersh issued the panel's decision, stating that Mendelsohn, "...did not first consider which state has the most significant relationship to the occurrence."
Goldenhersh wrote, "In deciding which substantive law to apply, we look to our own choice-of-law rules because Illinois is the forum state. Because the trial court's analysis was fatally flawed, its order regarding class certification must be vacated and the cause remanded."
But in reversing both lower courts decision, the Supreme Court concluded that each were wrong.
Fitzgerald also wrote that Intel's claims about its product were non actionable "puffery."
"…Plaintiffs' theory requires vague suggestion upon vague suggestion: that 'best' means 'performance,' that 'performance' means 'speed,' and that 'speed' can be tested for all P4s and P3s according to one benchmark," Fitzgerald wrote.
"Because the term 'better' as a mere suggestion in the name 'Pentium 4' is not capable of precise measuring, it is mere puffery and therefore not actionable…"