Court Opinion

ID: 9953228
Source: CourtListenerOpinion
Date Created: 2024-03-21 17:01:36.662906+00
Date Added: 2024-06-11T14:45:51.935271
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

DZ RESERVE; CAIN MAXWELL,                   No. 22-15916
DBA Max Martialis,
                                               D.C. No.
                Plaintiffs-Appellees,      3:18-cv-04978-JD

 v.
                                              OPINION
META PLATFORMS, INC., FKA
Facebook, Inc.,

                Defendant-Appellant.

         Appeal from the United States District Court
            for the Northern District of California
           James Donato, District Judge, Presiding

          Argued and Submitted September 12, 2023
                  San Francisco, California

                    Filed March 21, 2024

      Before: J. Clifford Wallace, Sidney R. Thomas, and
              Danielle J. Forrest, Circuit Judges.

             Opinion by Judge Sidney R. Thomas;
               Partial Dissent by Judge Forrest
2              DZ RESERVE V. META PLATFORMS, INC.

                          SUMMARY *

                       Class Certification

    The panel affirmed the district court’s order certifying
one class of advertisers who paid Meta Platforms, Inc.
(Meta) to place advertisements on its social media
platforms—the damages class, and vacated the district
court’s order certifying another class of advertisers—the
injunction class.
     The advertisers alleged that Meta fraudulently
misrepresented the “Potential Reach” of advertisements on
its platforms by stating that Potential Reach was an estimate
of people, although it was actually an estimate of accounts.
    The panel affirmed the district court’s certification under
Fed. R. Civ. P. 23(b)(3) of the damages class. The
misrepresentation constituted a “common course of
conduct” under the test for determining whether common
issues predominate among the class. Given that all class
members encountered the same misrepresentation about
Potential Reach—the nucleus of the fraud—the slight
variations in the other information available on the Ads
Manager did not defeat the commonality of the
misrepresentation. The district court properly determined
that the element of justifiable reliance was capable of
classwide resolution. The panel affirmed the district court’s
holding that the requirements of typicality and adequacy
were satisfied. Accordingly, the district court did not abuse

*
 This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
             DZ RESERVE V. META PLATFORMS, INC.              3

its discretion in determining that Fed. R. Civ. P. 23(b)(3) was
satisfied.
    The panel vacated the certification of the Rule 23(b)(2)
injunction class for the district court to reconsider whether
the named Plaintiff Cain Maxwell had Article III standing to
seek an injunction. The district court had no occasion to
consider the record or to analyze Meta’s argument against
Maxwell’s standing to seek injunctive relief.
    Dissenting in part, Judge Forrest agreed that the district
court’s certification of the injunction class must be vacated
and remanded for the district court to reconsider whether
Plaintiff Cain Maxwell had standing to pursue that
claim. She disagreed that the district court properly certified
the damages class because Plaintiffs cannot satisfy the
predominance requirement where there were individual
questions that must be answered related to multiple elements
of Plaintiffs’ fraud-based claims.

                         COUNSEL

Geoffrey Graber (argued), Andrew N. Friedman, Karina G.
Puttieva, and Madelyn Petersen, Cohen Milstein Sellers &
Toll PLLC, Washington, D.C.; Eric Kafka, Cohen Milstein
Sellers & Toll PLLC, New York, New York; Charles
Reichmann, Law Offices of Charles Reichmann,
Kensington, California; for Plaintiffs-Appellees.
Andrew B. Clubok (argued), Susan E. Engel, and Margaret
A. Upshaw, Latham & Watkins LLP, Washington, D.C.;
Elizabeth L. Deeley, Melanie M. Blunschi, Nicholas
Rosellini, and Nicole Valco, Latham & Watkins LLP, San
4            DZ RESERVE V. META PLATFORMS, INC.

Francisco, California; Samir Deger-Sen, Latham & Watkins
LLP, New York, New York; for Defendant-Appellant.
Jennifer B. Dickey and Jordan L. Von Bokern, U.S.
Chamber Litigation Center, Washington, D.C.; Erik R.
Zimmerman, Jazzmin M. Romero, and Jordan T. DeJaco,
Robinson Bradshaw & Hinson PA, Chapel Hill, North
Carolina; for Amicus Curiae Chamber of Commerce of the
United States of America.
David M. Berger, Gibbs Law Group LLP, Oakland,
California, for Amicus Curiae Digital Content Next.

                         OPINION

S.R. THOMAS, Circuit Judge:

    Meta Platforms, Inc. (Meta), formerly known as
Facebook, appeals the district court’s order certifying two
classes of advertisers who paid Meta to place advertisements
on its social media platforms—a damages class and an
injunction class.      The advertisers allege that Meta
fraudulently misrepresented the “Potential Reach” of
advertisements on its platforms by stating that Potential
Reach was an estimate of people, although it was actually an
estimate of accounts. As to the damages class, the primary
issue on appeal is whether that misrepresentation constitutes
a “common course of conduct” under our test for
determining whether common issues predominate among
the class. We conclude that it does. Because the district
court did not abuse its discretion in determining that Federal
Rule of Civil Procedure 23(b)(3) was satisfied, we affirm the
certification of the damages class. However, we vacate the
             DZ RESERVE V. META PLATFORMS, INC.             5

certification of the Rule 23(b)(2) injunction class for the
district court to reconsider whether the named Plaintiffs have
standing to seek an injunction.
                              I
    Meta owns and operates several online social media and
messaging platforms and applications, including Facebook,
Instagram, and WhatsApp. As with many social media
companies, Meta “generates substantially all of its revenue
from advertising.”
    In 2018, a nationwide class of advertisers (“Plaintiffs”)
filed this action against Meta, alleging that Meta had
misrepresented the Potential Reach of advertisements on its
platforms. Meta tells advertisers that “Potential Reach
estimates how many people your ad could potentially reach
depending on the targeting and ad placement options you
select while creating an ad.” Each time that an advertiser
designs a Meta advertising campaign, Meta’s self-service
advertisement creation interface, known as the Ads
Manager, displays the campaign’s Potential Reach.
    Plaintiffs assert that Potential Reach is misleading
because it actually measures social media accounts, not
living humans. Meta has taken steps to increase the accuracy
of Potential Reach by working to remove fake and duplicate
accounts, as well as by updating the calculation of Potential
Reach to include only accounts that were shown an
advertisement in the last thirty days.         Nevertheless,
throughout the class period, the number of accounts was
always larger than the number of people because non-human
entities like businesses and clubs have accounts, some
people have multiple accounts, and some people and bots
create fake accounts.
6            DZ RESERVE V. META PLATFORMS, INC.

    Each advertiser views a different Potential Reach for
each campaign dependent on that campaign’s unique
targeting criteria, so the discrepancy between people and
accounts varies by campaign. The parties disagree as to the
size of this discrepancy. The district court noted this
evidentiary dispute but concluded that Meta’s criticism of
Plaintiffs’ expert evidence “does not foreclose classwide
proof of injury.” Plaintiffs allege that because of the
misrepresentation of Potential Reach, they purchased more
Meta advertisements and paid more for those advertisements
than they would have with accurate information.
    The named Plaintiffs are two former Meta advertisers,
DZ Reserve and Cain Maxwell. DZ Reserve was an e-
commerce business that spent over $1 million on 740 Meta
advertising campaigns. Maxwell operated an online firearm
mount store and spent approximately $379 on 11 Meta
advertising campaigns. DZ Reserve has ceased operations
since the filing of the complaint, and it is unclear from the
record whether Maxwell’s business is still operating.
    Following motion practice and the filing of several
amended complaints, the district court sustained three of
Plaintiffs’ claims under California state law: fraudulent
misrepresentation, fraudulent concealment, and violation of
California’s Unfair Competition Law (“UCL”). Plaintiffs
then moved to certify the following class under Federal Rule
of Civil Procedure 23: United States residents who
purchased at least one advertisement on Meta’s platforms
from August 15, 2014 to the present, excluding advertisers
who used certain specialized purchasing methods or who
were shown a Potential Reach lower than 1,000. The district
court certified the class under Rule 23(b)(3) seeking
damages for fraudulent misrepresentation and concealment,
              DZ RESERVE V. META PLATFORMS, INC.              7

and under Rule 23(b)(2) seeking injunctive relief under the
UCL.
                               II
    We have jurisdiction pursuant to 28 U.S.C. § 1292(e)
and Rule 23(f) of the Federal Rules of Civil Procedure. We
review a district court’s decision to certify a class for abuse
of discretion. Olean Wholesale Grocery Coop., Inc. v.
Bumble Bee Foods LLC, 31 F.4th 651, 663 (9th Cir. 2022)
(en banc). “A class certification order is an abuse of
discretion if the district court applied an incorrect legal rule
or if its application of the correct legal rule was based on a
factual finding that was illogical, implausible, or without
support in inferences that may be drawn from the facts in the
record.” Van v. LLR, Inc., 61 F.4th 1053, 1062 (9th Cir.
2023) (internal quotation marks and citation omitted).
“When reviewing an order granting class certification, we
accord the district court noticeably more deference than
when we review a denial.” Jabbari v. Farmer, 965 F.3d
1001, 1005 (9th Cir. 2020). “We review the district court’s
determination of underlying legal questions de novo, and its
determination of underlying factual questions for clear
error.” Olean, 31 F.4th at 663 (citations omitted).
                              III
                               A
    Before certifying a class, the district court must ensure
that the plaintiffs have made two showings, one under Rule
23(a) and one under Rule 23(b). Olean, 31 F.4th at 663.
8            DZ RESERVE V. META PLATFORMS, INC.

    First, the proposed class action must satisfy four
prerequisites under Rule 23(a):

       (1) the class is so numerous that joinder of all
       members is impracticable;
       (2) there are questions of law or fact common
       to the class;
       (3) the claims or defenses of the
       representative parties are typical of the
       claims or defenses of the class; and
       (4) the representative parties will fairly and
       adequately protect the interests of the class.

Fed. R. Civ. P. 23(a).
    The district court must perform a “rigorous analysis” of
these prerequisites, which frequently “will entail some
overlap with the merits of the plaintiff’s underlying claim.”
Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 351 (2011).
That being said, “[m]erits questions may be considered to
the extent—but only to the extent—that they are relevant to
determining whether the Rule 23 prerequisites for class
certification are satisfied.” Amgen Inc. v. Connecticut Ret.
Plans & Tr. Funds, 568 U.S. 455, 466 (2013).
    Second, the class must fit into at least one of three
categories outlined in Rule 23(b). Olean, 31 F.4th at 663.
Here, the district court certified the class under Rule
23(b)(3), which enables the potential recovery of damages
and requires both that “questions of law or fact common to
class members predominate over any questions affecting
only individual members,” and that a class action be
“superior to other available methods for fairly and efficiently
adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3). The
              DZ RESERVE V. META PLATFORMS, INC.              9

district court also certified the class under Rule 23(b)(2),
which requires “the party opposing the class has acted or
refused to act on grounds that apply generally to the class, so
that final injunctive relief or corresponding declaratory relief
is appropriate respecting the class as a whole.” Fed. R. Civ.
P. 23(b)(2). We address certification of the damages class
under Rule 23(b)(3) and certification of the injunction class
under Rule 23(b)(2) in turn.
                               B
    We need not analyze all of the criteria required for
certification of a damages class, because Meta challenges
only the district court’s findings regarding the predominance
of common factual or legal issues under Rule 23(b)(3) and
typicality and adequacy of representation under Rule
23(a)(3) and (4). The district court did not abuse its
discretion in concluding that Plaintiffs have sufficiently
demonstrated predominance, typicality, and adequacy, and
so we affirm certification of the damages class under Rule
23(b)(3).
                               1
    The requirement under Rule 23(b)(3) that common
questions predominate over individual ones “tests whether
proposed classes are sufficiently cohesive to warrant
adjudication by representation.” Amchem Prods., Inc. v.
Windsor, 521 U.S. 591, 623 (1997).
    The predominance inquiry is “more demanding” than the
commonality inquiry. Id. at 624. Contrary to Meta’s
contentions, predominance is not more demanding because
the common issues must in some way be “more common”
than would be required under Rule 23(a)(2). Rather,
predominance is more demanding because not only must
10            DZ RESERVE V. META PLATFORMS, INC.

there be common issues, but the common issues must
predominate. “The requirements of Rule 23(b)(3) overlap
with the requirements of Rule 23(a): the plaintiffs must
prove that there are questions of law or fact common to class
members that can be determined in one stroke, in order to
prove that such common questions predominate over
individualized ones.” Olean, 31 F.4th at 664 (cleaned up).
    To clarify the inquiry, we proceed with the
predominance analysis in three steps. First, we identify
which questions are central to the plaintiffs’ claim. Second,
we determine which of these questions are common to the
class and which present individualized issues. Third, we
analyze whether the common questions predominate over
the individual questions.
    Under step one, we must identify which questions are
central to the plaintiffs’ claim, which “begins, of course,
with the elements of the underlying cause of action.” Erica
P. John Fund, Inc. v. Halliburton Co., 563 U.S. 804, 809
(2011). The proposed class under Rule 23(b)(3) seeks
damages for fraudulent concealment and fraudulent
misrepresentation under California law, both of which
require a showing of five elements: “(a) misrepresentation
(false representation, concealment, or nondisclosure);
(b) knowledge of falsity (or ‘scienter’); (c) intent to defraud,
i.e. to induce reliance; (d) justifiable reliance; and
(e) resulting damage.” Engalla v. Permanente Med. Grp.,
Inc., 15 Cal. 4th 951, 974 (1997), as modified (July 30, 1997)
(internal quotation marks and citation omitted).
    Under step two, we determine which of those elements
are “common”—which means they are “capable of being
established through a common body of evidence, applicable
to the whole class.” Olean, 31 F.4th at 666. Because this
                DZ RESERVE V. META PLATFORMS, INC.                       11

standard is identical to the analysis under Rule 23(a)(2)’s
commonality requirement, “courts must consider cases
examining both subsections in performing a Rule 23(b)(3)
analysis.” Id. at 664.
    The district court properly determined that each of the
five elements of fraud under California law is capable of
classwide resolution. Meta has only legitimately challenged
the district court’s findings regarding misrepresentation and
justifiable reliance. On appeal, Meta does not dispute the
district court’s conclusion that the knowledge and intent
elements present common issues. Although Meta does
appeal the district court’s damages finding, we decline to
consider Meta’s damages argument because it was not raised
before the district court. 1 Accordingly, we concentrate our
analysis on the elements of misrepresentation and justifiable
reliance.
                                     i
    Where, as in this case, a defendant has uniformly
represented that a certain metric means something that it
does not, the element of misrepresentation presents a
common question. See In re Hyundai & Kia Fuel Econ.
Litig., 926 F.3d 539, 557–65 (9th Cir. 2019) (en banc); In re
First All. Mortg. Co. (First Alliance), 471 F.3d 977, 990–91

1
  “[A]n issue will generally be deemed waived on appeal if the argument
was not raised sufficiently for the trial court to rule on it.” Armstrong v.
Brown, 768 F.3d 975, 981 (9th Cir. 2014) (internal quotation marks and
citation omitted). Before the district court, Meta relied exclusively on
criticisms of Plaintiffs’ experts’ damages modeling techniques and
inputs. Meta’s argument on appeal is altogether different, as Meta now
contends not that the model itself is deficient, but that it is not possible
to use such a model at all. Because Meta did not raise this argument
before the district court, we consider it waived.
12            DZ RESERVE V. META PLATFORMS, INC.

(9th Cir. 2006); Blackie v. Barrack, 524 F.2d 891, 902–05
(9th Cir. 1975).
    Class action fraud claims often involve similar
misrepresentations that cause a large number of victims to
each suffer a small financial loss. Fraud claims are thus
particularly well suited to class treatment under Rule
23(b)(3), which was designed “to overcome the problem that
small recoveries do not provide the incentive for any
individual to bring a solo action prosecuting his or her
rights.” Amchem, 521 U.S. at 617 (quoting Mace v. Van Ru
Credit Corp., 109 F.3d 338, 344 (7th Cir. 1997)). We have
“consistently upheld” the availability of the class action to
address mass frauds perpetrated through similar
misrepresentations in the securities context “in large part
because of the substantial role that the deterrent effect of
class actions plays in accomplishing the objectives of the
securities laws.” Blackie, 524 F.2d at 903. That reasoning
applies equally well to consumer protection laws, and we
have explained that consumer fraud victims often present a
“cohesive group” because “[i]n many consumer fraud cases,
the crux of each consumer’s claim is that a company’s mass
marketing efforts, common to all consumers, misrepresented
the company’s product . . . .” Hyundai, 926 F.3d at 559. In
sum, “[p]redominance is a test readily met in certain cases
alleging consumer or securities fraud . . . .” Amchem, 521
U.S. at 625.
    In determining whether a misrepresentation presents a
common question, we generally categorize the
misrepresentation as falling into one of two groups. On the
one hand, a “fraud perpetrated on numerous persons by the
use of similar misrepresentations may be an appealing
situation for a class action . . . .” First Alliance, 471 F.3d at
990 (quoting Fed. R. Civ. P. 23, Advisory Committee Notes
             DZ RESERVE V. META PLATFORMS, INC.             13

to 1966 Amendments, Subdivision (b)(3)). Accordingly,
“this court has followed an approach that favors class
treatment of fraud claims stemming from a ‘common course
of conduct.’” Id. A “common course of conduct” refers to
a defendant’s “centrally orchestrated strategy” to defraud,
whereby “[e]ach plaintiff is similarly situated with respect
to” that scheme. Id. at 991 (internal quotation marks and
citation omitted). On the other hand, “a case may be
unsuited for class treatment ‘if there was material variation
in the representations made or in the kinds or degrees of
reliance by the persons to whom they were addressed . . . .’”
Id. at 990 (quoting Fed. R. Civ. P. 23, Advisory Committee
Notes to 1966 Amendments, Subdivision (b)(3)).
    In this case, the claimed misrepresentation is the one that
the district court described in its certification order: “[T]he
ability of Potential Reach to reach ‘people,’ namely unique
individuals” when the metric was “actually . . . an estimate
of ‘accounts’ reached.”
    Meta misstates the misrepresentation at issue, insisting
that the misrepresentation is the numerical discrepancy
between people and accounts, rather than the fact that Meta
substituted people for accounts. Under its theory, Meta
contends the misrepresentations materially varied because
the numerical value of the discrepancy differed for each
individual advertiser based on its advertising budget and
targeting, and thus there was no common misrepresentation
among the class. We disagree.
    In Blackie, we rejected a similar strategy to create the
illusion of variation in a claimed misrepresentation by
mischaracterizing the nature of the misrepresentation at
issue. See Blackie, 524 F.2d at n.20. There, a class of
stockholders alleged that the Ampex Corporation uniformly
14           DZ RESERVE V. META PLATFORMS, INC.

misapplied an accounting principle, which resulted in
overstatements of various financial estimates. Id. at 902–05.
Like Meta, Ampex argued that the misrepresentation was the
numerical discrepancy in each financial estimate, such that
there was material variation in the exact numerical
discrepancies. Id. at 904 n.20. We rejected that argument
and affirmed class certification, stating that “plaintiffs are
complaining of abuses of accounting principles, not
estimates.” Id. Likewise, we will not opine on the viability
of Meta’s alternative misrepresentation theory—the
numerical discrepancy between people and accounts—
because it is not the theory presented to us.
    Meta’s insistence that the misrepresentation must be the
numerical discrepancy between people and accounts is based
partly on its suggestion that the substitution of people for
accounts is not itself material. However, we have previously
affirmed both class certification and ultimate liability based
on similar facts. In First Alliance, we affirmed class
certification and a finding of class-wide fraud where a bank
induced borrowers to agree to unconscionable loan terms by
having loan officers “point to the ‘amount financed’ and
represent it as the ‘loan amount.’” See 471 F.3d at 985, 990–
92. We did not focus on the numerical difference between
the amount financed and the loan amount for each individual
borrower, but instead concluded that the overall scheme was
fraudulent. Id.
    More importantly, proof of materiality “is not a
prerequisite to class certification.” Amgen, 568 U.S. at 459.
As the Supreme Court has instructed:

       Rule 23(b)(3) requires a showing that
       questions common to the class predominate,
       not that those questions will be answered, on
             DZ RESERVE V. META PLATFORMS, INC.             15

       the merits, in favor of the class. Because
       materiality is judged according to an
       objective standard, the materiality of
       [defendant’s] alleged misrepresentations and
       omissions is a question common to all
       members of the class [named plaintiffs]
       would represent. . . . As to materiality,
       therefore, the class is entirely cohesive: It
       will prevail or fail in unison.

Id. at 459–60.
    Because materiality is an objective inquiry, differences
in the size and sophistication of the advertisers in the class
are irrelevant. Here, the question is the same for every class
member: Would substituting people for accounts in Potential
Reach be material to the reasonable consumer? At the class
certification stage, identification of a common question is all
that is required. The district court properly concluded that
issue was a matter for trial.
    Given the claimed misrepresentation to be the
substitution of people for accounts, Plaintiffs have clearly
satisfied our “common course of conduct” test. It is
undisputed that Potential Reach was shown to every
advertiser on Meta’s Ads Manager, Potential Reach was
always expressed as a number of people, and Potential Reach
always estimated a number of accounts. Class members
were thus exposed to uniform misrepresentations about the
potential reach of their advertisements.
   Meta raises two additional arguments against a finding
of Potential Reach estimates being a common
misrepresentation.    First, Meta disputes that the
misrepresentation was uniform because Plaintiffs viewed
16           DZ RESERVE V. META PLATFORMS, INC.

Potential Reach alongside other metrics, namely “Estimated
Daily Reach.” While Potential Reach represents how many
people meet a campaign’s targeting criteria, Estimated Daily
Reach factors in an advertiser’s budget and past
performance.
      These slight differences do not defeat commonality
under our “common course of conduct” test. As we have
previously explained, “[t]he class action mechanism would
be impotent if a defendant could escape much of his potential
liability for fraud by simply altering the wording or format
of his misrepresentations across the class of victims.” First
Alliance, 471 F.3d at 992. Consequently, “[c]onfronted with
a class of purchasers allegedly defrauded over a period of
time by similar misrepresentations, courts have taken the
common sense approach that the class is united by a common
interest in determining whether a defendant’s course of
conduct is in its broad outlines actionable, which is not
defeated by slight differences in class members’ positions
. . . .” Blackie, 524 F.2d at 902 (collecting cases).
    We have consistently held that similar contextual
differences do not constitute material variations. In Blackie,
we held that there was commonality where defendants
uniformly misapplied an accounting principle in some forty-
five different documents, even though the resulting financial
estimates fluctuated over time. Id. In First Alliance, we
applied Blackie to hold that borrowers exposed to similarly
misleading sales presentations represented a cohesive class,
even though the exact wording of the sales presentations and
individual loan specifics varied. First Alliance, 471 F.3d at
990–91. Most recently, we affirmed a class of car purchasers
exposed to uniform fuel economy misrepresentations, even
though some purchasers viewed the misrepresentations on
stickers placed on the vehicles, while others were only
             DZ RESERVE V. META PLATFORMS, INC.             17

exposed to the misrepresentations through nationwide
marketing. Hyundai, 926 F.3d at 560–61.
    Here, the variations in Estimated Daily Reach and
disclosures accompanying Potential Reach are no more
material than the fluctuating estimates, differently worded
sales pitches, and disparate modes of exposure considered in
our prior cases.
    Second, Meta contends that any misrepresentations
differed among class members because it updated its
disclosures about Potential Reach twice during the class
period. In September 2017, Meta disclosed that Potential
Reach “[e]stimates are based on the placements and
targeting criteria you select,” and are “not designed to match
population or census estimates.” In June 2020, Meta
disclosed that “[t]hese metrics are considered estimated and
sampled, and depend on factors such as how many accounts
are used by each person on Facebook Company Products.”
    We have determined that there were individualized
questions where “explicit signs or explicit verbal advice
would negate the claimed misrepresentation” for some class
members. Berger v. Home Depot USA, Inc., 741 F.3d 1061,
1070 (9th Cir. 2014), abrogated on other grounds by
Microsoft Corp. v. Baker, 582 U.S. 23 (2017). However,
unlike the situation in Berger, none of the disclosures here
negated the misrepresentation, which would have required a
clear statement that Potential Reach measures accounts.
Instead, Meta essentially argues that Plaintiffs should have
known better than to rely on Potential Reach. But as the
district court found, several documents offered by Plaintiffs
show that Meta intended for advertisers to rely on its
Potential Reach numbers. Thus, “[w]e find unpersuasive in
this case the defense that plaintiffs should not have relied on
18           DZ RESERVE V. META PLATFORMS, INC.

statements that were made with the fraudulent intent of
inducing reliance.” First Alliance, 471 F.3d at 992.
    In support of its disclosure argument, Meta also relies on
Mazza v. Am. Honda Motor Co., 666 F.3d 581 (9th Cir.
2012), overruled on other grounds by Olean, 31 F.4th 651.
Disclosures were not at issue in Mazza. Instead, Mazza held
that an inference of reliance was inappropriate because “it is
likely that many class members were never exposed to the
allegedly misleading advertisements.” Id. at 595. Unlike
Mazza, here it is undisputed that all class members were
exposed to Potential Reach.
    Given that all class members encountered the same
misrepresentation about Potential Reach—the nucleus of the
fraud—the slight variations in the other information
available on the Ads Manager do not defeat the commonality
of the misrepresentation.
                              ii
    The district court properly determined that the element
of justifiable reliance is capable of classwide resolution.
Under California law, “when the same material
misrepresentations have actually been communicated to
each member of a class, an inference of reliance arises as to
the entire class.” Mirkin v. Wasserman, 5 Cal. 4th 1082,
1095 (1993). Because Meta communicated the same
misrepresentation to all class members—that Potential
Reach measures people when it really measures accounts—
the class is entitled to an inference of reliance. Meta’s
argument to the contrary rests on its theory that Plaintiffs
were not exposed to a uniform misrepresentation, which we
have rejected.
              DZ RESERVE V. META PLATFORMS, INC.             19

      Despite California’s presumption of reliance, Meta
argues that reliance is always an individualized inquiry
because defendants have a right to rebut the presumption of
reliance. As a practical matter, Meta’s argument that
reliance can never be a common question is incompatible
with the voluminous caselaw from both the United States
and California Supreme Court certifying fraud class actions.
See Basic Inc. v. Levinson, 485 U.S. 224, 242 (1988)
(explaining the utility of the presumption of reliance in the
federal security fraud context and stating that “[r]equiring
proof of individualized reliance . . . effectively would have
prevented respondents from proceeding with a class action
. . . .”); see also Vasquez v. Superior Ct., 4 Cal. 3d 800, 814–
15 (1971) (discussing California’s presumption of reliance
for common law fraud and analogizing to the presumption in
federal securities fraud cases). The purpose of the
presumption of reliance is to avoid precluding all fraud class
actions. See Basic, 485 U.S. at 242. Accordingly, if the
availability of rebuttal defeated commonality, the
presumption would be pointless. While rebuttal “has the
effect of leaving individualized questions of reliance in the
case, there is no reason to think that these questions will
overwhelm common ones and render class certification
inappropriate under Rule 23(b)(3).” Halliburton Co. v.
Erica P. John Fund, Inc., 573 U.S. 258, 276 (2014) (internal
quotation marks and citation omitted).
    Meta finally argues that the Rules Enabling Act prohibits
application of California’s presumption of reliance here.
The Rules Enabling Act instructs that rules of procedure
“shall not abridge, enlarge or modify any substantive right.”
28 U.S.C. § 2072(b). Meta argues that application of the
presumption of reliance amounts to lessening a plaintiff’s
burden of proving reliance in a class action case. However,
20            DZ RESERVE V. META PLATFORMS, INC.

California’s presumption of reliance also applies in
individual fraud actions. Engalla, 15 Cal. 4th at 977. Failing
to apply the presumption of reliance would thus amount to
abridging a substantive right, as the presumption would
apply in individual cases but not in federal class actions.
Contrary to Meta’s contention, the Rules Enabling Act
requires application of California’s presumption of reliance.
    Because the presumption of reliance applies to each
member of the class, reliance presents a common question
provable by common evidence. See Vasquez, 4 Cal. 3d at
814 (“If [Plaintiffs] can establish without individual
testimony that the representations were made to each
plaintiff and that they were false, it should not be unduly
complicated to sustain their burden of proving reliance
thereon as a common element.”).
                              iii
    Having arrived at step three, our analysis in this case is a
simple one. “The predominance inquiry asks whether the
common, aggregation-enabling, issues in the case are more
prevalent or important than the non-common, aggregation-
defeating, individual issues.”       Tyson Foods, Inc. v.
Bouaphakeo, 577 U.S. 442, 453 (2016) (internal quotation
marks and citation omitted). Although predominance does
not require that all questions be common, Hyundai, 926 F.3d
at 557, predominance is necessarily satisfied if all questions
are common. Because the district court properly concluded
that each of the five elements of fraud presents a common
question, the district court did not abuse its discretion in
holding that common issues predominated.
              DZ RESERVE V. META PLATFORMS, INC.               21

                                2
    Meta argues the named Plaintiffs are not typical or
adequate because they suffer from credibility problems that
expose them to individualized defenses related to reliance.
The district court did not clearly err in finding that the named
Plaintiffs’ credibility was not vulnerable to attack.
Accordingly, we affirm the district court’s holding that the
requirements of typicality and adequacy are satisfied.
     Although Meta names both typicality and adequacy in its
argument, its contention that Plaintiffs will be preoccupied
with unique defenses falls within our typicality caselaw.
Under Federal Rule of Civil Procedure Rule 23(a), class
plaintiffs must demonstrate, among other things, that the
named plaintiffs are typical class representatives. See Olean,
31 F.4th at 663 (citing Fed. R. Civ. P. 23(a)). “Under the
rule’s permissive standards, representative claims are
‘typical’ if they are reasonably co-extensive with those of
absent class members; they need not be substantially
identical.” Hanlon v. Chrysler Corp., 150 F.3d 1011, 1020
(9th Cir. 1998), overruled on other grounds by Wal-Mart,
564 U.S. at 338 (quoting Fed. R. Civ. P. 23(a)(3)). A named
plaintiff is not typical if “there is a danger that absent class
members will suffer if their representative is preoccupied
with defenses unique to it.” Hanon v. Dataproducts Corp.,
976 F.2d 497, 508 (9th Cir. 1992) (quoting Gary Plastic
Packaging Corp. v. Merrill Lynch, Pierce, Fenner & Smith,
Inc., 903 F.2d 176, 180 (2d Cir. 1990)). We will affirm a
district court’s typicality determination if “[t]he district court
did not commit a clear error of judgment in concluding that
. . . [the named plaintiff] would not be subject to unique
defenses such that typicality would be defeated . . . .” Just
Film, Inc. v. Buono, 847 F.3d 1108, 1120 (9th Cir. 2017).
22            DZ RESERVE V. META PLATFORMS, INC.

    The district court did not clearly err in finding no danger
that the named Plaintiffs would be preoccupied with unique
defenses. Meta insists that the named Plaintiffs are not
typical because, unlike other class members, neither named
Plaintiff actually relied on the Potential Reach estimates.
We have “emphasize[d] that the defense of non-reliance is
not a basis for denial of class certification” and reliance is
more appropriately considered at the merits stage. Hanon,
976 F.2d at 509. Even so, the record supports the district
court’s finding at the certification stage that the named
Plaintiffs relied on Meta’s misrepresentations.
    Meta argues that DZ Reserve’s owner dishonestly
testified that the Potential Reach misrepresentation deterred
him from buying Meta advertisements, and that Maxwell
dishonestly claimed to have relied on Potential Reach. The
district court rejected these contentions by pointing to
evidence that DZ Reserve had been deterred from using
Meta advertisements, Maxwell relied on Potential Reach,
and both named Plaintiffs would have spent less money on
Meta advertisements had they known that Potential Reach
was a misrepresentation. The record supports the district
court’s conclusion that the named Plaintiffs have no
credibility issues that would destroy their typicality.
     Even if DZ Reserve and Maxwell faced credibility
questions, those issues would not destroy typicality.
Credibility issues only destroy typicality in “unique
situation[s]” where “it is predictable that a major focus of the
litigation will be on a defense unique” to the named plaintiff.
Id. at 509. We have found such unique situations where a
named plaintiff in a securities action was a serial litigant who
purchased stock solely to facilitate litigation, id. at 508, or
where the named plaintiff insisted that he was not really
deceived by the alleged misrepresentation. Stearns v.
              DZ RESERVE V. META PLATFORMS, INC.               23

Ticketmaster Corp., 655 F.3d 1013, 1019 (9th Cir. 2011),
abrogated on other grounds by Comcast Corp. v. Behrend,
569 U.S. 27 (2013). Neither of those situations apply here,
where the named Plaintiffs are not serial litigants and
presented evidence that they both actually received and
relied upon the alleged misrepresentation.
                                3
    In sum, for the foregoing reasons, we conclude that the
district court did not abuse its discretion in certifying the
damages class under Rule 23(b)(3).
                                C
    Meta appeals the district court’s order certifying an
injunction class under Rule 23(b)(2) on the basis that the
named Plaintiffs lack Article III standing to seek injunctive
relief under California’s UCL. Meta did not present this
theory before the district court. However, an objection that
a federal court lacks subject-matter jurisdiction “may be
raised by a party, or by a court on its own initiative, at any
stage in the litigation, even after trial and the entry of
judgment.” Arbaugh v. Y&H Corp., 546 U.S. 500, 506
(2006). As we explain below, DZ Reserve did not submit
any evidence that would support its standing to seek
injunctive relief. However, Maxwell’s standing is a closer
call and may require additional factual development.
Therefore, we remand the question of Maxwell’s standing to
seek injunctive relief to the district court for its consideration
in the first instance.
   “In a class action, standing is satisfied if at least one
named plaintiff meets the requirements.” Bates v. United
Parcel Serv., Inc., 511 F.3d 974, 985 (9th Cir. 2007). In
order to establish Article III standing, “the plaintiff must
24            DZ RESERVE V. META PLATFORMS, INC.

have suffered an injury in fact—a concrete and imminent
harm to a legally protected interest, like property or
money—that is fairly traceable to the challenged conduct
and likely to be redressed by the lawsuit.” Biden v.
Nebraska, 600 U.S. __, 143 S.Ct. 2355, 2365 (2023) (citing
Lujan v. Defenders of Wildlife, 504 U.S. 555, 560–61
(1992)). “[A] plaintiff must demonstrate standing separately
for each form of relief sought.” Friends of the Earth, Inc. v.
Laidlaw Env’t Servs. (TOC), Inc., 528 U.S. 167, 185 (2000).
Thus, the fact that the named Plaintiffs have standing to seek
damages does not mean that they automatically have
standing to seek injunctive relief. See City of Los Angeles v.
Lyons, 461 U.S. 95, 105–06 (1983); see also TransUnion
LLC v. Ramirez, 594 U.S. 413, 436 (2021) (“[A] plaintiff’s
standing to seek injunctive relief does not necessarily mean
that the plaintiff has standing to seek retrospective
damages.”).
    In order to establish standing for injunctive relief, “a
plaintiff must show that he is under threat of suffering ‘injury
in fact’ that is concrete and particularized; the threat must be
actual and imminent, not conjectural or hypothetical; it must
be fairly traceable to the challenged action of the defendant;
and it must be likely that a favorable judicial decision will
prevent or redress the injury.” Summers v. Earth Island Inst.,
555 U.S. 488, 493 (2009) (citing Friends of Earth, 528 U.S.
at 180–81). “The plaintiff must demonstrate that he has
suffered or is threatened with a concrete and particularized
legal harm, coupled with a sufficient likelihood that he will
again be wronged in a similar way.” Bates, 511 F.3d at 985
(citations and quotation marks omitted). “Past exposure to
harmful or illegal conduct does not necessarily confer
standing to seek injunctive relief if the plaintiff does not
continue to suffer adverse effects.” Mayfield v. United
             DZ RESERVE V. META PLATFORMS, INC.             25

States, 599 F.3d 964, 970 (9th Cir. 2010). “Nor does
speculation or ‘subjective apprehension’ about future harm
support standing.” Id. (quoting Friends of the Earth, 528
U.S. at 184 and citing Lujan, 504 U.S. at 564).
    Consumer fraud plaintiffs can satisfy the imminent
injury requirement by showing they “will be unable to rely
on the product’s advertising or labeling in the future, and so
will not purchase the product although [they] would like to.”
Davidson v. Kimberly-Clark Corp., 889 F.3d 956, 970 (9th
Cir. 2018).
    The plaintiff bears the burden of establishing the
elements of standing. See Lujan, 504 U.S. at 561. A plaintiff
must also demonstrate Article III standing at each stage of
the litigation, including on appeal. Bain v. Cal. Teachers
Ass’n, 891 F.3d 1206, 1211–12 (9th Cir. 2018). Standing
must be proven, “with the manner and degree of evidence
required at the successive stages of the litigation.” Lujan,
504 U.S. at 561. Thus, although standing may be established
at the pleading stage through allegations in the complaint,
the plaintiff must prove the elements of standing at each
successive stage. Id. Because the preponderance of the
evidence standard applies at the class certification stage,
standing at the time of class certification must be established
by a preponderance of the evidence. See Olean, 31 F.4th at
664–65.
    With these general principles in mind, we examine the
standing of the named Plaintiffs to assert claims for
injunctive relief.
                              1
    DZ Reserve does not have standing to seek injunctive
relief. DZ Reserve did not submit any evidence of a threat
26           DZ RESERVE V. META PLATFORMS, INC.

of suffering “actual and imminent” future injury that was
concrete and particularized, and that could be redressed by
injunctive relief. Nor did DZ Reserve demonstrate a
sufficient likelihood that it would again be wronged in a
similar way. Rather, the owner of DZ Reserve simply
testified that he would have spent less on Meta
advertisements in the past had he known the truth about
Potential Reach. He did not testify about his desire to
purchase Meta advertisements in the future. Further, as we
have noted, DZ Reserve is no longer operating as a business.
Thus, DZ Reserve lacks standing to assert a claim of
injunctive relief.
                              2
    We remand the question of whether Maxwell has
adequately pled an injury sufficient to confer standing to
seek injunctive relief. In so doing, we note that there are two
issues for the district court to consider.
    The first question is whether Maxwell’s testimony that
he “think[s] [he] would” purchase Meta advertisements in
the future satisfies Davidson, which relied on a plaintiff’s
more direct assertion that she “desires to purchase” and
“would purchase” a product if she was able to trust the
product’s advertising. 889 F.3d at 970–71.
    The second question is how to square Maxwell’s
testimony with the evidence suggesting that Maxwell no
longer has a business to advertise. A plaintiff typically loses
standing to challenge a policy affecting businesses when the
plaintiff has ceased operating an affected business, unless
the challenged policy caused the business’s closure. See City
News & Novelty, Inc. v. City of Waukesha, 531 U.S. 278, 283
(2001); see also San Lazaro Ass’n, Inc. v. Connell, 286 F.3d
1088, 1096 (9th Cir. 2002); Clark v. City of Lakewood, 259
              DZ RESERVE V. META PLATFORMS, INC.               27

F.3d 996, 1007–08 (9th Cir. 2001). Maxwell’s business
ceased operations sometime in 2019. He testified that he
stopped operations because he “ran out of inventory.” The
record does indicate that Maxwell has not officially
dissolved the business and that his associated tax ID remains
active. The record does not indicate whether Maxwell has
continued to pay taxes associated with the business. It will
be difficult for Maxwell to establish an imminent injury if he
has no business to advertise, or in the alternative, if he does
not offer a compelling explanation for why he would
purchase advertisements without a business.
    The district court has had no occasion to consider the
record or to analyze Meta’s argument against Maxwell’s
standing to seek injunctive relief. Moreover, Maxwell did
not have the opportunity to present arguments concerning his
standing to seek injunctive relief directly to the district court.
Therefore, we remand the question of standing to seek
injunctive relief to the district court for its consideration in
the first instance.
                               D
    In sum, we affirm the district court’s certification of the
damages class. We vacate the district court’s certification of
the injunction class and remand for further proceedings
consistent with this opinion. Each party should bear its own
costs on appeal.
    AFFIRMED in part; VACATED AND REMANDED
in part.
28            DZ RESERVE V. META PLATFORMS, INC.

FORREST, J., dissenting in part:

    I agree that the district court’s certification of Plaintiffs’
Rule 23(b)(2) injunction class must be vacated and
remanded for the district court to reconsider whether
Plaintiff Cain Maxwell has standing to pursue that claim. I
disagree, however, that the district court properly certified
Plaintiffs’ Rule 23(b)(3) damages class because Plaintiffs
cannot satisfy the predominance requirement where there are
individual questions that must be answered related to
multiple elements of Plaintiffs’ fraud-based claims.
Therefore, I respectfully dissent in part.
                    I. BACKGROUND
    Defendant-Appellant Meta Platforms, Inc. (Meta), one
of the world’s largest social media companies, owns and
operates Facebook and Instagram, among other platforms.
Meta claims that more than two billion people use Facebook
every month, with over 200 million monthly active users in
the United States alone. Because of its large user base,
Meta’s platforms are attractive to prospective advertisers,
ranging from Fortune 500 companies and government
agencies to small businesses and individual proprietors. And
Meta “generates substantially all of its revenue from
advertising.”
               A. Meta’s Advertising System
    Most advertisers purchase ads from Meta through its
online self-service ad creation interface, known as “Ads
Manager.” Advertisers “have a wide range of different
advertising objectives, which influences how they set up
their ads and assess ad performance.” When developing an
ad campaign in Ads Manager, advertisers specify their
objective. Advertisers who want to generate awareness of
             DZ RESERVE V. META PLATFORMS, INC.            29

their product or service, and who want Meta to show their ad
“the largest number of times to the largest number of people
in a given audience,” may choose “brand awareness” or
“reach” as their advertising objective. Other advertisers “are
interested in ‘performance advertising,’ or driving specific
actions with their ads, such as clicks and conversions”—i.e.,
prompting users to visit a website or purchase a product.
These advertisers “are typically focused on trying to identify
or have their ads delivered to specific users likely to take a
desired action,” and a large audience size is less important.
    Ads Manager provides several planning tools to help
advertisers design their ad campaigns and target their desired
audience. First (and relevant here) is Potential Reach, which
is defined as “an estimation of how many people are in an ad
set’s target audience” based on statistical sampling and
modeling. A default Potential Reach automatically displays
in Ads Manager, and it updates dynamically in real time as
an advertiser tailors its ad campaign using numerous
targeting and placement criteria, such a demographics (e.g.,
age, gender, location, education), interests (e.g., sports
teams, dogs), and the platform where the ads will be shown
(Facebook, Instagram, etc.). The “default” Potential Reach
displayed to each advertiser during the class period was
between 200 to 250 million, purportedly reflecting the
number of people in the United States between 18 and 65
years old who use Meta’s platforms. As an advertiser selects
targeting criteria, the Potential Reach recalculates, and a
color-coded dial shows whether the target audience is “fairly
broad,” “defined,” or “too specific.” Each advertiser sees a
different Potential Reach estimate for each ad campaign they
run because the non-default—or targeted—Potential Reach
estimate is calculated based on the advertiser’s selected
criteria.
30           DZ RESERVE V. META PLATFORMS, INC.

    Potential Reach is “not an estimate of how many people
will actually see [an advertiser’s] ad” or how many people
may click on an ad or take any other action with respect to
an ad. That data is provided in separate Estimated Daily
Results metrics, which are displayed adjacent to Potential
Reach in Ads Manager. Estimated Daily Reach is part of the
Estimated Daily Results and is the estimated number of
people that an ad actually will reach per day based on the
advertiser’s selected criteria, budget, and past ad
performance. Advertisers are not charged based on the
Potential Reach calculation.
     Once an ad launches, advertisers can track their results
in real time. Based on detailed performance data, such as the
number of times an ad was shown and clicked on, advertisers
can assess the success of their campaign and return on
investment and adjust their campaign and budget as they see
fit. Advertisers are not shown Potential Reach as part of the
post-ad purchase results.
       B. Changes to Potential Reach Calculation
    Potential Reach has always been displayed to advertisers
as an estimate, but during the class period Meta changed how
it calculates Potential Reach and updated its disclosures in
Ads Manager accordingly. In September 2017, Meta
introduced an “information” icon in Ads Manager
explaining that Potential Reach “[e]stimates are based on the
placements and targeting criteria you select,” and are “not
designed to match population or census estimates.” A year
and a half later in March 2019, Meta changed its calculation
methodology to count only those people who had actually
seen an ad on Meta’s platforms in the last 30 days, rather
than those who were active on a Meta platform and could
have seen an ad. Lastly, in June 2020, Meta “added
             DZ RESERVE V. META PLATFORMS, INC.            31

disclosures to explain that ‘people’ is an ‘estimated and
sampled’ metric, which depends on ‘factors such as how
many accounts are used by each person on [Meta’s
products].” Throughout the class period, Meta also
undertook efforts to remove fake accounts and de-duplicate
accounts across platforms—i.e., counting separate
Instagram and Facebook accounts belonging to the same
person as only one person in Potential Reach estimates.
                  C. Plaintiffs’ Lawsuit
    In 2018, Plaintiffs sued Meta alleging the Potential
Reach calculation is materially misleading because it
exceeds the actual number of people in an ad’s target
audience, causing advertisers to purchase more ads and pay
higher prices for ads than they otherwise would have. Named
Plaintiffs DZ Reserve, an e-commerce business, and Cain
Maxwell are former Meta advertisers. Between December
2017 and December 2018, DZ Reserve spent over $1 million
on 740 ad campaigns comprising approximately 26,000 ads.
Maxwell (d/b/a Max Martialis) operated an online store and
spent approximately $400 on 11 ad campaigns comprising
28 ads between September 2018 and May 2019. Named
Plaintiffs alleged that they viewed and relied on Potential
Reach in purchasing Meta ads.
    Plaintiffs proceeded on three California state-law claims:
(1) fraudulent        misrepresentation,        (2) fraudulent
concealment, and (3) injunctive relief under California’s
Unfair Competition Law (UCL). And they sought to certify
a class related to each claim encompassing the millions of
advertisers (persons or entities) in the United States who
paid to place at least one ad on Meta’s platforms from
August 2014 to the present. Plaintiffs asserted that Potential
Reach is a material misrepresentation because Meta
32             DZ RESERVE V. META PLATFORMS, INC.

characterizes it as a calculation of “people,” which Meta
knows is inaccurate because it is a calculation of accounts,
and because Potential Reach is always significantly more
than the number of people. Plaintiffs further claimed that the
inflation of the Potential Reach calculation is susceptible to
proof through common evidence because their statistics
expert, Dr. Charles Cowan, established that the default
Potential Reach shown to advertisers is always inflated by at
least 33% and the targeted Potential Reach is always inflated
by at least 10%. Through a conjoint survey, Plaintiffs’
expert, Dr. Greg Allenby, further determined that Potential
Reach inflation, as found by Dr. Cowan, has “a statistically
significant impact on consumer demand for [Meta]
advertisements.”
    Meta opposed class certification, arguing, among other
things, that Plaintiffs could not satisfy Rule 23(b)(3)’s
predominance requirement because each class member
received a fundamentally different Potential Reach estimate
and the class members varied in multiple ways that are
material to whether the elements of Plaintiffs’ claims can be
met—including the varying disclosures that advertisers may
have viewed, the advertisers’ objectives for their ad
campaign, and the mix of information each advertiser had
access to or relied on in purchasing ads.
    Over Meta’s objection, the district court certified two
classes: a Rule 23(b)(3) damages class for Plaintiffs’
common law fraud claims and a Rule 23(b)(2) class for
Plaintiffs’ UCL injunction claim. 1 The district court
evaluated Rule 23(a)’s threshold commonality requirement

1
 The class includes only those who purchased ads through Ads Manager
under Meta’s standard contract, and for which Meta provided a Potential
Reach of 1,000 of greater.
              DZ RESERVE V. META PLATFORMS, INC.              33

and Rule 23(b)(3) predominance requirement “in tandem.”
It determined that all class members were exposed to a
similar misrepresentation and that “whether Meta made
misrepresentations to all class members [could] be shown
through common evidence” because Potential Reach was
represented as an estimate of “people” when it really was “an
estimate of ‘accounts,’” and “the number of unique accounts
and unique people were different.” It further reasoned that
materiality and reliance do “not necessarily undermine
predominance” in fraud cases because, under California law,
a “presumption, or at least an inference, of reliance arises
wherever there is a showing that a misrepresentation was
material.” Rather, materiality and reliance could be
established “through common evidence” because “Potential
Reach metrics were shown to all advertisers,” it was “an
important number for advertisers,” and “[a] majority of
advertisers rely on Potential Reach as a metric for their
advertisements.”
    This court granted review of the district court’s class
certification decision under Federal Rule of Civil Procedure
23(f).
                       II. ANALYSIS
    We review the district court’s class certification decision
for abuse of discretion. Olean Wholesale Grocery Coop.,
Inc. v. Bumble Bee Foods LLC (Olean), 31 F.4th 651, 663
(9th Cir. 2022) (en banc). The district court “abuses its
discretion only if it (1) relies on an improper factor, (2) omits
a substantial factor, or (3) commits a clear error of judgment
in weighing the correct mix of factors.” B.K. ex rel. Tinsley
v. Snyder, 922 F.3d 957, 965 (9th Cir. 2019). The district
court’s determination of underlying legal questions is
reviewed de novo, and its determination of underlying
34            DZ RESERVE V. META PLATFORMS, INC.

factual questions is reviewed for clear error. Olean, 31 F.4th
at 663. “An error of law is a per se abuse of discretion.” B.K.,
922 F.3d at 965. A factual finding is clearly erroneous if it is
illogical, implausible, or “without support in inferences that
may be drawn from the record.” Id. at 965–66.
    Federal Rule of Civil Procedure 23 governs class
certification. Plaintiffs, as the party seeking class
certification, bear the burden of demonstrating that the
requirements of Rule 23 are satisfied. Stromberg v.
Qualcomm Inc., 14 F.4th 1059, 1066 (9th Cir. 2021). “As a
threshold matter, a class must first meet the four
requirements            of Rule 23(a):           (1) numerosity,
(2) commonality, (3) typicality, and (4) adequacy of
representation.” Id. Additionally, “the class must meet the
requirements of at least one of the ‘three different types
of classes’ set forth in Rule 23(b).” Id. (citation omitted).
    Relevant here, Plaintiffs must satisfy the requirements of
Rule 23(b)(3) for a damages class. Certification under this
provision is appropriate only where “questions of law or fact
common to class members predominate over any questions
affecting only individual members.” Fed. R. Civ. P. 23(b)(3).
The goal of Rule 23(b)(3) is well-established—by adding the
predominance (and superiority) requirements, the Advisory
Committee intended to “achieve economies of time, effort,
and expense, and promote . . . uniformity of decision as to
persons similarly situated, without sacrificing procedural
fairness.” Amchem Prod., Inc. v. Windsor, 521 U.S. 591, 615
(1997) (emphasis added) (quoting Advisory Committee
Notes). Thus, predominance is established where the
proposed class is “sufficiently cohesive” to justify class-
wide adjudication. Id. at 623. This required cohesion exists
where there are common questions capable of class-wide
resolution. Olean, 31 F.4th at 663. Or, stated another way,
              DZ RESERVE V. META PLATFORMS, INC.             35

where common questions of law or fact “can be determined
in one stroke.” Id. at 664. Conversely, individual questions
dominate where evidence will inevitably vary from class
member to class member. Id.
    Plaintiffs must establish that the preponderance
requirement is met by a preponderance of the evidence. Id.
at 665. Rule 23 “does not set forth a mere pleading standard,”
but instead requires that the district court conduct “a rigorous
analysis” to ensure that the party seeking certification has
satisfied its burden “through evidentiary proof.” Comcast
Corp. v. Behrend, 569 U.S. 27, 33 (2013). “Such an analysis
will frequently entail overlap with the merits of the
plaintiff’s underlying claim . . . because the class
determination generally involves considerations that are
enmeshed in the factual and legal issues comprising the
plaintiff’s cause of action.” Id. at 33–34 (citations and
internal quotation marks omitted). And the Supreme Court
has instructed that “[i]f anything, Rule 23(b)(3)’s
predominance criterion is even more demanding than Rule
23(a).” Comcast, 569 U.S. at 34.
    In considering predominance, the court begins “with the
elements of the underlying cause of action.” Olean, 31 F.4th
at 665. Plaintiffs must show that a common question relating
to an essential element predominates. Id. at 666. A class may
fail to establish predominance where even one essential
element requires individualized determination and this
individualized issue outweighs “common, aggregation-
enabling issues.” See Lara v. First Nat’l Ins. Co. of Am., 25
F.4th 1134, 1138 (9th Cir. 2022). The district court certified
a Rule 23(b)(3) class for Plaintiffs’ fraudulent
misrepresentation and fraudulent concealment claims.
Under California law, the elements of these claims are: “(1) a
misrepresentation (false representation, concealment, or
36              DZ RESERVE V. META PLATFORMS, INC.

nondisclosure); (2) knowledge of falsity (or scienter);
(3) intent to defraud, i.e., to induce reliance; (4) justifiable
reliance; and (5) resulting damage.” Robinson Helicopter
Co. v. Dana Corp., 34 Cal. 4th 979, 990 (2004). A plaintiff
may rely on a presumption of reliance, but “only [by
making] a showing that the misrepresentations were
material.” Engalla v. Permanente Med. Group, Inc., 15 Cal
4th 951, 977 (1997), as modified (July 30, 1997).
    The plaintiffs’ ability to prove each element of their
claim must be considered in light of the class-action
mechanism, which often is ill-suited to fraud claims. As the
1966 Advisory Committee on Rule 23 notes, even where a
“common core” exists in a fraud case, it nonetheless “may
be unsuited for treatment as a class action if there was
material variation in the representation made or in the kinds
or degrees of reliance by the persons to whom they were
addressed.” 2 Fed. R. Civ. P. 23, Advisory Committee Notes
to 1966 Amendments, Subdivision (b)(3). Here, Plaintiffs
failed to establish predominance because there are three

2
  The majority asserts that fraud claims are “particularly well suited to
class treatment under Rule 23(b)(3).” Maj. Op. 12. The majority
references a passing statement from Amchem, which states that
predominance may be “readily met in certain cases” of consumer fraud.
See 521 U.S. at 625 (emphasis added). The majority ignores, however,
the rest of the paragraph from which it quotes, which specifically
cautioned courts to heed the “[Rule 23 Advisory] Committee’s warning,
[which] continues to call for caution when individual stakes are high and
disparities among class members great.” Id. The majority’s statement
that fraud claims are “particularly well suited” for class treatment runs
in the face of the Committee’s cautionary understanding that our sister
circuits have consistently recognized. See, e.g., In re St. Jude Med., Inc.,
522 F.3d 836, 838 (8th Cir. 2008) (noting the “difficulty with class
treatment of cases alleging fraud or misrepresentation”); Moore v.
PaineWebber, Inc., 306 F.3d 1247, 1253 (2d Cir. 2002) (same).
                DZ RESERVE V. META PLATFORMS, INC.                      37

issues that involve individualized questions: (1) whether
each advertiser in the class was subject to a
misrepresentation, (2) whether any misrepresentation was
material, and (3) whether each advertiser relied on a material
misrepresentation. I address each in turn.
                      A. Misrepresentation
    To assess whether predominance is satisfied regarding
the misrepresentation element, we must first be specific in
identifying Plaintiffs’ claimed misrepresentation. On appeal,
Plaintiffs argue that Meta categorically misrepresented its
Potential Reach metric presented to advertisers by
characterizing it as a metric of “people” rather than
“accounts.” The majority accepts this characterization of
Plaintiffs’ claims. But Plaintiffs’ complaint alleged that
Meta failed to provide “accurate Potential Reach” because
this calculation “is inflated.” Core to Plaintiffs’ claims is the
degree of discrepancy between the number of people and the
number of accounts (not just the characterization of Potential
Reach as a calculation of people), which the Plaintiffs
explicitly attempt to prove. 3
   Meta does not dispute that Potential Reach calculated
accounts as a proxy for people. But contrary to the majority’s
suggestion, this proxy is not inherently misleading like the

3
  If Plaintiffs’ claimed misrepresentation rested solely on the description
of Potential Reach as a calculation of people, there would have been no
need for Plaintiffs to submit statistical evidence regarding the degree of
inflation of the Potential Reach calculation. The analysis could have been
merely definitional—especially given that Meta does not dispute it used
accounts as a proxy for people. And the district court recognized that
Plaintiffs’ theory was more than merely definitional, stating: “Potential
Reach was always expressed as a number of ‘people,’ and the
discrepancy between people and accounts made the number inaccurate.”.
38             DZ RESERVE V. META PLATFORMS, INC.

accounting practices challenged in Blackie v. Barrack, 524
F.2d 891 (9th Cir. 1975), discussed more below. Potential
Reach as described is misleading only if there is a significant
deviation between the number of accounts and the number
of people that may see ads. 4 If these two populations neatly
correlate, characterizing Potential Reach as a calculation of
people is accurate. Moreover, whether a deviation between
the number of accounts and the number of people is a
misrepresentation must consider Meta’s express disclosure
that Potential Reach is an estimate. Cf. Estimate, Merriam-
Webster (defining “estimate” as “a rough or approximate
calculation”),                          https://www.merriam-
webster.com/dictionary/estimate?utm_campaign=sd&utm_
medium=serp&utm_source=jsonld;            Estimate,    Oxford
English Dictionary (defining “estimate” as “an approximate
notion of (the amount, number, magnitude, or position of
anything) without actual enumeration or measurement”),
https://www.oed.com/dictionary/estimate_v?tab=meaning_
and_use#5272337. On this point, the district court erred by
reasoning that any variation between accounts and people
was a misrepresentation.
    Properly framed, Plaintiffs’ assertion that there is a
cohesive class for which common questions predominate
begins to unravel. Consistent with the Rule 23 Advisory
Committee’s admonishment that fraud claims are not well
suited for class treatment, we have upheld class certification
of these kinds of claims in limited circumstances where the

4
  The relevant metric to whether a misrepresentation occurred is the
Potential Reach after targeting. Only 1.2% of U.S. ads were purchased
with numbers near the default Potential Reach of 200-250 million.
Additionally, while the district court mentioned default Potential Reach
in analyzing typicality, it did not rely on default Potential Reach in
analyzing predominance for the misrepresentation element.
              DZ RESERVE V. META PLATFORMS, INC.               39

misrepresentations stemmed from a “common course of
conduct” or “centrally-orchestrated scheme.” In re First All.
Mortg. Co., 471 F.3d 977, 990–91 (9th Cir. 2006). The
substance of the misrepresentation must be sufficiently
uniform to prove fraud on a class-wide basis. See In re
Hyundai & Kia Fuel Econ. Litig., 926 F.3d 539, 560 (9th
Cir. 2019) (approving a class certification where class
members were uniformly exposed to a nationwide
advertising campaign that gave “uniform fuel-economy
misrepresentations”); see also In re First All., 471 F.3d at
990 (“The required degree of uniformity among
misrepresentations in a class action for fraud is a question of
law . . . .”). If the challenged communication is not
sufficiently uniform, then whether a material
misrepresentation occurred depends on individual questions
specific to each class member. See Berger v. Home Depot
USA, Inc., 741 F.3d 1061, 1069 (9th Cir. 2014), abrogated
on other grounds by Microsoft Corp. v. Baker, 582 U.S. 23
(2017).
    Plaintiffs assert that Meta made a common
misrepresentation that fits “comfortably” within the
“common course of conduct” principle, first established in
Blackie, and applied again in First Alliance, because Meta
uniformly represented that Potential Reach was a
measurement of people. This argument is unavailing. At
issue in First Alliance was a challenge to certification based
on Rule 23(a)(2)’s commonality requirement, not Rule
23(b)(3)’s predominance requirement. For commonality, we
declined to adopt a “talismanic rule” that requires
“representations [to be] all but identical.” In re First All., 471
F.3d at 991 (quoting In re Am. Cont’l Corp./Lincoln Sav. &
Loan Sec. Litig., 140 F.R.D. 425, 430 (D. Ariz. 1992)).
Rather, we held that in a common-course-of-conduct
40              DZ RESERVE V. META PLATFORMS, INC.

analysis, courts must determine whether the “center of
gravity” of the fraud overshadows any variations in
individual misrepresentations across the class. Id. at 991.
Where there are immaterial variations, a common course of
conduct can compensate for reduced uniformity. See id. at
990. The center of gravity in First Alliance was a
standardized protocol to induce fraud: sales agents were
“carefully trained” in a “standardized training program”
requiring memorization of a specific sales pitch and “strict
adherence to a specific method of hiding information.” Id.
    In Blackie, we analyzed whether financial reports that
“uniformly misrepresent a particular item” presented a
common question, again for purposes of the commonality
requirement. 524 F.2d at 903. Plaintiffs cite Blackie’s
commonality analysis to support their predominance
argument. 5 But the difference between the commonality and
predominance analyses and the factual differences between
Blackie and this case are key. The Blackie plaintiffs argued
that 45 financial documents fraudulently inflated a stock
price. Id. at 902. The court found a common
misrepresentation based on the “unique situation of the
accounting and legal principles” at play and that “financial
reports throughout the period uniformly and fraudulently”
failed to adhere to “accepted accounting principles” in a
manner that “injur[ed] all purchasers.” 6 Id. at 904. The court

5
  The Blackie court did not analyze predominance for the
misrepresentation element, only for reliance, causation, and damages.
524 F.2d at 905–08.
6
 The commonality and predominance analyses in Blackie were informed
by the “flexibl[e]” context of securities fraud laws. 524 F.2d at 907; see
also id. at 903 n.19; cf. Sullivan v. Chase Inv. Servs. of Bos., Inc., 79
F.R.D. 246, 259 (N.D. Cal. 1978) (citing Blackie to support the
proposition that “common questions generally predominate in securities
               DZ RESERVE V. META PLATFORMS, INC.                    41

further noted that “plaintiffs are complaining of abuses of
accounting principles, not estimates.” Id. at 904 n.20.
     But this case is about estimates. Meta represented to the
advertiser class that Potential Reach is an estimate of people
who could potentially view a given ad based on the
advertiser’s targeting criteria. That Meta provided a common
description of Potential Reach does not automatically
establish that this description was a misrepresentation as to
all class members. Cf. Blackie, 524 F.2d at 903 n.19 (noting
that even where a common course of conduct exists in a
fraud class that satisfies Rule 23(a)(2) commonality, the
predominance requirement may not be satisfied).
Predominance requires more than a common but superficial
thread connecting class members—this may be shown where
class claims “prevail or fail in unison.” Amgen Inc. v. Conn.
Ret. Plans & Tr. Funds, 568 U.S. 455, 460 (2013). And
given the context here, whether Meta’s characterization of
Potential Reach was misleading turns on how much
deviation there was between the Potential Reach estimate
and the number of people that fell within the advertiser’s
target criteria.
    As discussed, targeted Potential Reach estimates are
tailored to each advertiser’s choices. Advertisers can narrow
their estimates with standard demographics (age, education,
gender, etc.) and by location and interests. Altogether, the
available targeting criteria provide thousands of options.
How this targeting criteria impacts the accuracy of each
estimate is apparent considering, for example, duplicate
counts. One Facebook user may have two or more
accounts—take, for example, one professional and one

fraud cases involving standardized written representations to a class of
investors”).
42              DZ RESERVE V. META PLATFORMS, INC.

personal. So, if an advertiser selects only geographic criteria,
both accounts may be counted. But if the advertiser selects
both geography and interests criteria, the work account may
be excluded and only the personal account counted or vice
versa. Given the variability at play in targeted Potential
Reach calculations, their degree of accuracy relative to the
number of people is not uniform—one Potential Reach
calculation may be an accurate “estimate” of the people who
may see an advertisement based on the selected criteria
while another is not.
     To make up for the lack of uniformity in the millions of
Potential Reach calculations that Meta provided, Plaintiffs
first assert that the district court found that Potential Reach
estimates were always “significantly inflated.” This
misconstrues the record. The district court acknowledged
that Plaintiffs’ expert opined the Potential Reach calculation
was always significantly inflated and that Meta’s expert did
not eliminate the possibility that some inflation occurred. 7
What underpins the district court’s decision is the latter

7
  The majority seems to agree that the district court’s acknowledgement
that Meta failed to show that no inflation occurred is not the same as
crediting Plaintiffs’ expert that significant inflation always occurred, but
it ignores the significance of this point in the class context. Resolving
conflicts in the evidence is within the district court’s purview. See Ellis
v. Costco Wholesale Corp., 657 F.3d 970, 983 (9th Cir. 2011) (“[T]he
district court was required to resolve any factual disputes necessary to
determine whether there was a common pattern and practice that could
affect the class as a whole.”); Olean, 31 F.4th at 666 (“The determination
whether expert evidence is capable of resolving a class-wide question in
one stroke may include weighing conflicting expert testimony and
resolving expert disputes, where necessary to ensure that Rule 23(b)(3)’s
requirements are met . . . .” (cleaned up)). And without a finding
regarding the rate of inflation, the common pattern begins to unravel
because there is no set inflation range binding class members together.
             DZ RESERVE V. META PLATFORMS, INC.            43

point—that because Meta’s expert failed to establish that no
inflation occurred, characterizing Potential Reach as a
calculation of people was inaccurate, regardless of the
degree of inaccuracy. This means the class includes
advertisers who received targeted Potential Reach estimates
with a discrepancy between people and accounts that could
range from 1% to 50%. Cf. Thrifty Payless, Inc. v. The
Americana at Brand, LLC, 218 Cal. App. 4th 1230, 1242 &
n.7 (2013) (holding fraud action may be based on an estimate
after considering the disparity and finding “the huge
disparity between the estimates and the ultimate costs
supports an inference of misrepresentation” (emphasis
added)).
    Plaintiffs’ reliance on In re U.S. Foodservice Inc.
Pricing Litig., 729 F.3d 108 (2d Cir. 2013), in arguing that a
uniform misrepresentation was made regardless of any
variation in Potential Reach inflation, is unavailing. In that
case, the degree of difference between what the plaintiffs
were charged and the “cost-plus” pricing they were entitled
to pay was irrelevant to liability because any difference—
one cent or a thousand dollars—was proof that plaintiffs
were harmed. 729 F.3d at 118, 123. The same is not true
here. Meta did not charge advertisers based on its Potential
Reach estimates. And the degree of inflation in the Potential
Reach calculation is the crux of whether Meta
misrepresented the estimated number of people who could
potentially see a given ad.
    Determining whether the Potential Reach calculations
were misrepresentations is further challenged by Meta’s
evolving disclosures over the class period. Early on, Meta’s
disclosures stated that Potential Reach was “not designed to
match population or census estimates.” Then in 2019, Meta
changed its disclosure to state that Potential Reach depends
44           DZ RESERVE V. META PLATFORMS, INC.

on “[h]ow many accounts are used per person.” Meta
changed the disclosure again in 2021 to state that “the
presence of fake accounts” could impact the Potential Reach
calculation. I disagree that the impact of these changes goes
only to class-wide merits issues. The court must determine
whether individual or common questions will predominate
in assessing whether Meta’s Potential Reach calculations
were fraudulent misrepresentations. The disclosures that
Meta provided regarding the nature of its calculated estimate
are important to this analysis. The reasoning in Berger v.
Home Depot USA, Inc. is particularly persuasive. 741 F.3d
at 1067–69. There, the district court denied certification of a
fraud claim brought against Home Depot related to its tool-
rental contracts over a multi-year period. Id. at 1066. We
affirmed on predominance grounds because the class period
covered five different versions of the contract, each with
different language requiring an “independent legal analysis.”
Id. at 1069. The varying disclosures that Meta provided
about the limitations of Potential Reach estimates likewise
present individualized issues in determining whether Meta
made fraudulent misrepresentations. Cf. Mazza v. Am.
Honda Motor Co., 666 F.3d 581, 596 (9th Cir.
2012) (holding a class definition as fatally overbroad where
many class members learned that the advertising was
misleading before purchase).
    In the cases where we have upheld certification of a fraud
class based on misrepresentation of an estimate, the class
members were given the same estimate. See In re Hyundai,
926 F.3d at 553, 559 (upholding certification based on
“inflated fuel economy standards” that were uniformly
disseminated). That is not what happened here, and the
evidence does not establish that the millions of unique
Potential Reach calculations that Meta provided to the class
                DZ RESERVE V. META PLATFORMS, INC.                    45

had the same degree of inflation. Is a Potential Reach
calculation with a 2% deviation a misrepresentation where
the targeted population includes millions of people? What
about a Potential Reach calculation with an 8% deviation
where the targeted population includes only 1,000 people?
Where a class claim “prevail[s] or fail[s] in unison,” it
satisfies predominance. Amgen, 568 U.S. at 460. That
standard is not met here because the factfinder could
conclude that some, but not all, Potential Reach calculations
presented to the class members were fraudulently
misleading. See Lara, 25 F.4th at 1139 (affirming denial of
class certification because “figuring out whether each
individual putative class member was harmed would involve
an inquiry specific to that person”). 8
                          B. Materiality
    Because this case does not involve a uniform
misrepresentation, many of the problems discussed in
relation to the misrepresentation element of Plaintiffs’ claim
also apply to the materiality-of-the-misrepresentation
element. Under California law, a misrepresentation is
material if “a reasonable man would attach importance to its
existence or nonexistence in determining his choice of action

8
  The reasoning in Reitman v. Champion Petfoods USA, Inc., 830 F.
App’x 880 (9th Cir. 2020), though unpublished, is similarly persuasive.
There, this court affirmed denial of certification on predominance
grounds because whether a representation was false depended on
comparing each individual product. Id. at 881. The products, dog food,
had packaging that contained different information, and the court would
need to conduct a bag-to-bag comparison for each representation. This
led to individual questions predominating. Id. Here, each Potential Reach
estimate is akin to an individual product that would require an
individualized assessment to determine if each “product” was indeed
false.
46            DZ RESERVE V. META PLATFORMS, INC.

in the transaction in question.” Engalla, 15 Cal. 4th at 977
(quoting Restatement (Second) of Torts § 538 (1977)).
Materiality is generally a fact question unless the “fact
misrepresented is so obviously unimportant that the jury
could not reasonably find that a reasonable man would have
been influenced by it.” Id. Our focus here is whether
common or individual issues will predominate in
determining whether a misrepresentation is material, not
whether Plaintiffs can prove materiality. See Amgen, 568
U.S. at 469; Olean, 31 F.4th at 667.
    In the majority’s view, Amgen established that
materiality always satisfies predominance because it is
governed by an objective standard. I disagree. In Amgen, the
Court concluded that the class had a “fatal similarity.” 568
U.S. at 470. If materiality failed for one, it failed for all. Id.
at 468 (“A failure of proof on the common question of
materiality ends the litigation and thus will never cause
individual questions of reliance or anything else to
overwhelm questions common to the class.”). The Court
reached this conclusion because “[i]n no event will the
individual circumstances of particular class members bear
on the inquiry” of the materiality of the allegedly fraudulent
statements Amgen made about its products that inflated its
stock price. 568 U.S. at 460. This makes sense in securities-
fraud cases that address fraudulent statements that are
released to and impact the market. See id. at 466
(“[I]mmaterial information, by definition, does not affect
market price . . . .”). But nothing in Amgen commands that
materiality, no matter the context, necessarily is provable
with class-wide evidence and, therefore, satisfies the
predominance requirement.
   Additionally, while Amgen addressed a claim arising
under federal law, the Plaintiffs’ claims here are governed
               DZ RESERVE V. META PLATFORMS, INC.                   47

by California law. California courts applying that state’s law
have recognized that materiality cannot be resolved on a
class-wide basis where this issue inevitably depended on
individualized questions. See, e.g., In re Vioxx Class Cases,
180 Cal. App. 4th 116, 129 (2009) (stating that “if the issue
of materiality . . . is a matter that would vary from consumer
to consumer, the issue is not subject to common proof, and
the action is properly not certified as a class action”). 9 And
federal courts applying California law likewise have found
Rule 23 predominance lacking when plaintiffs fail to proffer
class-wide evidence of how a reasonable consumer would
interpret the allegedly misrepresented fact or when
consumers are interested in a product for a variety of
reasons. See, e.g., Townsend v. Monster Beverage Corp., 303
F. Supp. 3d 1010, 1045, 1047–48 (C.D. Cal. 2018)
(collecting cases).
    Here, plaintiffs primarily rely on two pieces of evidence
in arguing that materiality is susceptible to class-wide proof:

9
  In an unpublished decision, the California Court of Appeal upheld
denial of class certification in part because individualized questions
predominated regarding the materiality of “online fuel calculator”
estimates provided to encourage consumers to buy the Toyota Prius.
Reynante v. Toyota Motor Sales USA, Inc., No. B275937, 2018 WL
329569 (Cal. Ct. App. Jan. 9, 2018). The online calculations were
accompanied by a message stating that “results are based on estimates.”
Id. at *4. The court reasoned that “[w]hether a consumer was actually
misled by the fuel calculator prior to purchasing a [car] necessarily
would vary by customer” because “[s]ome customers, for example,
could have viewed the fuel calculator and have been adequately
informed—whether by their experience with vehicle EPA estimates or
by the disclaimer—that their actual fuel efficiency would vary based on
driving conditions.” Id. Similarly here, many advertisers are repeat
players and Meta provides historical data from previous ad campaigns
that can further alter their understanding of Potential Reach.
48              DZ RESERVE V. META PLATFORMS, INC.

Dr. Cowan’s statistical analysis and Dr. Allenby’s conjoint
survey. Plaintiffs assert that Dr. Cowan can establish that all
Potential Reach estimates were inflated by at least 10%. The
Supreme Court has held that “proving classwide liability”
through statistical sampling is appropriate if “each class
member could have relied on that sample to establish
liability” in an individual action. Tyson Foods, Inc. v.
Bouaphakeo, 577 U.S. 442, 455 (2016). But here, it is
unclear that materiality can be established based on just the
percentage of deviation. As discussed above, the degree of
inflation in the Potential Reach estimate informs whether a
misrepresentation has occurred, let alone a material
misrepresentation. The degree of inflation relative to the
total number of people within the targeted audience may also
be relevant. A 10% deviation may have different import as
relates to a reach of millions than to a reach of thousands or
hundreds. But even assuming plaintiffs could establish that
a 10% inflation rate, or some other threshold, is always
material, that does not resolve the claims of class members
who received Potential Reach estimates with less than the
threshold. Thus, again, while Plaintiffs’ statistical evidence
may prove or disprove some claims, they have not shown it
can resolve all claims within the far-reaching class. 10

10
   This is true even if the misrepresentation at issue is merely Meta’s
statement that Potential Reach is an estimate of people instead of
accounts. Plaintiffs point to no evidence that could establish on a class-
wide basis that reasonable advertisers view the account-as-proxy-for-
people itself as a material misrepresentation regardless of the degree of
deviation between those two metrics. Cf. In re NJOY, Inc. Consumer
Class Action Litig., 120 F. Supp. 3d 1050, 1117 (C.D. Cal. 2015)
(rejecting a survey as dispositive of materiality, in a predominance
analysis, where it “did not ask respondents questions relevant in
assessing the materiality of information omitted from the packaging”).
                DZ RESERVE V. META PLATFORMS, INC.                    49

    Turning to Dr. Allenby’s conjoint survey, the district
court assessed this evidence in analyzing damages, not
materiality. This survey included only small-to-medium
businesses, not the full breadth of entities that compose the
class. It also did not mirror Meta’s varying disclosures
during the class period. And lastly, this survey is
representative of only 7% of the class. 11 While the survey
shows that some respondents would increase their spending
if an audience size was increased 10% in the abstract,
Plaintiffs have not pointed to any evidence that the
reasonable ad purchaser in this class would understand the
estimated Potential Reach to not have any inflation or
deviation. Nor is there any evidence addressing how
reasonable advertisers would understand Potential Reach in
light of Meta’s evolving disclosures.
    In sum, there are two primary reasons why
predominance is not satisfied as to materiality. First,
determining the objective perspective of a reasonable
advertiser is made difficult by the breadth of Plaintiffs’
proposed class, which includes millions of advertisers of all
types conducting advertising campaigns ranging from
millions of dollars to tens of dollars. Cf. Webb v. Carter’s
Inc., 272 F.R.D. 489, 502 (C.D. Cal. 2011) (declining to
apply the objective “reasonable consumer standard” where
materiality would “vary from consumer to consumer”).
    Second, Meta told advertisers that Potential Reach is an
estimate, and Meta provided evolving disclosures about the
limitations of this estimate. A false estimate undoubtedly can

11
  The study only included respondents that spent $1,000 to $25,000 per
year on advertising through their employment. The majority of Meta’s
advertisers spend less than $50 per year. And one of the Named Plaintiffs
spent upwards of $1 million on Meta advertising.
50           DZ RESERVE V. META PLATFORMS, INC.

be the basis for a fraud claim, see Aloe Vera of Am., Inc. v.
United States, 699 F.3d 1153, 1164 (9th Cir. 2012), but what
a reasonable purchaser believes about the precision of
information necessarily is impacted by what they are told
about precision. This case is a far cry from the objective
class-wide materiality analysis that was appropriate in
Amgen. Because securities fraud impacts the market,
“fantastic scenarios in which an individual investor might
rely on immaterial information (think of the superstitious
investor who sells her securities based on a CEO’s statement
that a black cat crossed the CEO’s path that morning)” do
not establish that materiality is an individualized issue.
Amgen, 568 U.S. at 469. But here, the ability to establish
materiality based on class-wide proof is not undermined by
“fantastic scenarios.” Id.
    The Named Plaintiffs’ own actions help demonstrate the
point. Taking a “peek at the merits,” Dancel v. Groupon,
Inc., 949 F.3d 999, 1005 (7th Cir. 2019) (citation omitted),
the owner of DZ Reserve made statements online that
inflation in the Potential Reach calculation “should . . . not
deter anyone from doing [Facebook] ads for [e-commerce].”
Cf. Johnson v. Harley-Davidson Motor Co. Grp., LLC, 285
F.R.D. 573, 581 (E.D. Cal. 2012) (finding materiality
lacking, in part, because the former named plaintiffs, even
with full knowledge of a product’s defect, “would still buy
and recommend the [product]”). And Maxwell set an
advertising budget of $20 regardless of whether the Potential
Reach estimate was one million or 50 million. Contrary to
the district court’s assertion otherwise, this evidence
suggests that ad buyers as a group may not have “attach[ed]
importance” to Potential Reach in choosing to buy Facebook
ads. Engalla, 15 Cal. 4th at 977.
             DZ RESERVE V. META PLATFORMS, INC.             51

    The district court’s assertion that materiality is provable
on a class-wide basis because “Potential Reach is an
important number for advertisers,” improperly conflates the
importance of the subject matter with the importance of the
claimed misrepresentation and also fails to meet the rigors
of Rule 23(b)(3). Cf. In re ConAgra Foods, Inc., 90 F. Supp.
3d 919, 1019 (C.D. Cal. 2015), aff’d sub nom. Briseno v.
ConAgra Foods, Inc., 674 F. App’x 654 (9th Cir. 2017), and
aff’d sub nom. Briseno v. ConAgra Foods, Inc., 844 F.3d
1121 (9th Cir. 2017) (analyzing the materiality of food labels
not for their importance generally but for how consumers
understand them). ConAgra concerned whether a “100%
Natural” food label on cooking oil was a misrepresentation.
Id. at 1018. Food labels are shown to all consumers, but the
district court did not consider the importance of food labels
in the abstract, it considered the content of the challenged
label and how reasonable consumers would understand that
content. Id. at 1019.
    Here, the district court’s and the majority’s framing of
Plaintiffs’ case derails their analyses. Cf. Gonzalez v.
Corning, 885 F.3d 186, 201 (3d Cir. 2018), as amended
(Apr. 4, 2018) (“[T]he ‘question of defect’ they propose is
only superficially a ‘common question,’ just as any question
becomes universal when it includes the word ‘all.’”); In re
Vioxx, 180 Cal. App. 4th at 133–34 (rejecting an argument,
as an “oversimplification,” where plaintiffs argued there was
nothing more material than “risk of death” because some
patients and doctors would still use the medicine regardless
of the risk). The proper focus is on how advertisers in the
class would view the Potential Reach estimates they received
in specific transactions, based on the total mix of information
available at the time of purchase. See Engalla, 15 Cal. 4th at
977–78 (assessing materiality based on the explicit and
52            DZ RESERVE V. META PLATFORMS, INC.

implicit representations made in the context of the
transaction). Facebook provided advertisers with
individualized information beyond Potential Reach. For
example, the “Estimated Daily Reach” calculation—viewed
alongside Potential Reach—estimated how many people
might see an ad each day based on the buyer’s advertising
budget. The Estimated Daily Reach was part of the calculus
informing the buyers’ reasonable expectations in purchasing
ads. Cf. Algarin v. Maybelline, LLC, 300 F.R.D. 444, 457
(S.D. Cal. 2014) (looking at consumer expectations for a
product in determining that materiality was not susceptible
to common proof).
    For all these reasons, the materiality analysis required in
this case centers on individualized questions of what
advertisers understood about the information they were
given at the time they purchased Facebook ads, and,
therefore, Plaintiffs have not satisfied the predominance
requirement.
                         C. Reliance
    Finally, actual reliance is an essential element of fraud
under California law. Conroy v. Regents of Univ. of Cal., 45
Cal. 4th 1244, 1256 (2009). Actual reliance does not require
proving the alleged misrepresentation was the “sole” or
“decisive” cause of the plaintiff entering into the transaction.
Id. A plaintiff need only prove the misrepresentation was an
“immediate cause” or “played a substantial part” in entering
the transaction. Id. A plaintiff meets this burden by showing
that, absent the misrepresentation, the plaintiff “would not,
in all reasonable probability, have entered into the . . .
transaction.” Id. (internal quotation marks and citation
omitted). California law recognizes that “when the same
material     misrepresentations      have     actually     been
                DZ RESERVE V. META PLATFORMS, INC.                     53

communicated to each member of a class, an inference of
reliance arises as to the entire class.” Kaldenbach v. Mutual
of Omaha Life Insurance Co., 178 Cal. App. 4th 830, 851
(2009), as modified (Oct. 26, 2009) (citation and emphasis
omitted). But the presumption of reliance does not apply
where uniformity of representation is lacking, or at least does
not predominate. Id.
    The seminal California case applying this presumption
involved salesmen that “memorized a standard statement”
that was “recited by rote to every member of the class.”
Vasquez v. Superior Ct., 4 Cal. 3d 800, 812 (1971); see also
Occidental Land, Inc. v. Superior Ct., 18 Cal. 3d 355, 358–
59, 363 (1976) (applying presumption where the class read
the same document containing the misrepresentation and
was required to state in writing that they had read it). On the
other hand, the Kaldenbach court did not apply the
presumption of reliance where the case involved
individualized sales presentations because the plaintiff had
not overcome the “significant individual issues” of whether
misrepresentations were made to each class member. 178
Cal. App. 4th at 851.
    Here, the district court erred by applying the
presumption of reliance as a basis for granting class
certification of Plaintiffs’ Rule 23(b)(3) damages class
because Plaintiffs did not establish that Meta made a uniform
misrepresentation. 12

12
  Plaintiffs rely on Tobacco II to discount alternative information Meta
provided to advertisers. Tobacco II stated that “an allegation of reliance
is not defeated merely because there was alternative information
available to the consumer-plaintiff, even regarding an issue as prominent
as whether cigarette smoking causes cancer.” 46 Cal. 4th 298, 328
(2009). This language, however, concerns alternative information
54              DZ RESERVE V. META PLATFORMS, INC.

    For these reasons, I would reverse the district court’s
certification of Plaintiffs’ Rule 23(b)(3) damages class. I do
not reach Meta’s additional challenges regarding the district
court’s typicality and adequacy analyses.

external to a defendant’s representation, such as medical studies by third
parties. See id. (citing to a case discussing “common knowledge”). It
does not concern information provided by the defendant that is directly
relevant in determining whether a misrepresentation occurred at all.