Panelli v. Target Corporation

── Panelli v. Target Corporation ── Court: Court of Appeals for the Ninth Circuit Date: April 17, 2026 Category: General FOR PUBLICATION UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT ALEXANDER PANELLI, No. 24-6640 D.C. No. Plaintiff - Appellant, 3:24-cv-01218-H- DEB v. TARGET CORPORATION, OPINION Defendant - Appellee. Appeal from the United States District Court for the Southern District of California Marilyn L. Huff, District Judge, Presiding Argued and Submitted March 5, 2026 Pasadena, California Filed April 17, 2026 Before: Kim McLane Wardlaw, Ana de Alba, and Eric C. Tung, Circuit Judges. Opinion by Judge de Alba 2 PANELLI V. TARGET CORPORATION SUMMARY * California Consumer Protection Laws The panel reversed the district court’s dismissal of a diversity putative consumer class action alleging that Target Corporation sold 100% cotton bedsheets with claimed thread counts of 600 or greater, which was impossible to achieve with 100% cotton textile, and remanded for further proceedings. Claims under California’s Unfair Competition Law (UCL) and Consumer Legal Remedies Act (CLRA) are assessed under the “reasonable consumer” test. Under this standard, plaintiffs must show that members of the public are likely to be deceived. The panel held that the district court erred in concluding that plaintiff could not be deceived as a matter of law under California consumer protection laws. The district court understood Moore v. Trader Joe’s Co., 4 F.4th 874 (9th Cir. 2021), as holding that allegations of consumer deception based on factually impossible claims failed as a matter of law because “no consumer of any level of sophistication would reasonably interpret the label in the manner proposed by the plaintiff.” The panel held that the district court incorrectly interpreted Moore. The district court skipped a step by not analyzing whether the labels on Target’s bed sheets were ambiguous. The panel held that the labels were not * This summary constitutes no part of the opinion of the court. It has been prepared by court staff for the convenience of the reader.  PANELLI V. TARGET CORPORATION 3 ambiguous, and therefore, the facts of this case do not trigger the Moore framework. Instead of applying the Moore framework, the panel assessed plaintiff’s claims through relevant caselaw regarding literally false advertising. The panel held that plaintiff’s allegations were actionable under California consumer protection laws because he alleged the challenged claim was literally false. The reasonable consumer standard under the UCL and CLRA raises questions of fact that are appropriate for resolution on a motion to dismiss only in rare situations. This is not one of those situations. Plaintiff’s allegation that it is physically impossible to achieve an 800 thread count on cotton material, alone, does not require the complaint’s dismissal. A reasonable consumer may still be deceived by a physically impossible claim. Thus, the district court erred in dismissing plaintiff’s complaint on this basis. COUNSEL Christen Chapman (argued), Glenn A. Danas, Brent A. Robinson, Ashley M. Boulton, and Lauren Anderson, Clarkson Law Firm PC, Malibu, California; Craig W. Straub, Michael Houchin, and Zachary Crosner, Crosner Legal PC, Beverly Hills, California; Lawrence J. Salisbury, Salisbury Legal Corp, San Diego, California; for Plaintiff- Appellant. Grant Ankrom (argued), Dentons US LLP, Clayton, Missouri; Michael J. Duvall, Dentons US LLP, Los Angeles, California; for Defendant-Appellee. Rebecca A. Morse and Hunter Landerholm, Deputy Attorneys General; Michele Van Gelderen, Supervising 4 PANELLI V