Amy Joseph v. Trader Joes Company

Filing 68

ORDER GRANTING, IN PART, DEFENDANTS' MOTION TO DISMISS CASE 62 by Judge Otis D. Wright, II. The Court hereby GRANTS, IN PART, AND DENIES, IN PART, Trader Joe's Motion to Dismiss. (ECF No. 62.) Plaintiffs are granted leave to amend, to the extent allowed by this Order. Should Plaintiffs wish to amend their complaint, they must file an amended complaint within 14 days of this Order, and in compliance with Central District Local Rule 15. See document for details. (smo)

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O 1 2 3 4 5 6 7 8 United States District Court Central District of California 9 10 In re Trader Joe’s Tuna Litigation 11 Case No. 2:16-cv-01371-ODW(AJWx) ORDER GRANTING, IN PART, DEFENDANTS’ MOTION TO DISMISS CASE [62] 12 13 14 15 16 I. 17 INTRODUCTION 18 Defendants Trader Joe’s Company and Trader Joe’s East Inc. (collectively, 19 “Trader Joe’s”) move to dismiss Plaintiffs’ Second Amended Complaint (“SAC”) on 20 several bases. (ECF No. 55.) On June 2, 2017, the Court granted Trader Joe’s Motion 21 to Dismiss Plaintiffs’ First Amended Complaint (“FAC”), with leave to amend. (ECF 22 No. 54.) For the reasons discussed below, the Court GRANTS, IN PART, and 23 DENIES, IN PART, Trader Joe’s Motion. 24 II. FACTUAL BACKGROUND 25 Plaintiffs allege a consumer class action relating to Trader Joe’s allegedly illegal 26 and deceptive practices of under filling cans of tuna, despite consumers’ expectations 27 that the cans would contain an “adequate amount.” (SAC ¶¶ 1, 12–13, ECF No. 55.) 28 Plaintiff Sarah Magier is a citizen of New York who purchased Trader Joe’s Albacore 1 Tuna in Water No Salt Added in New York, through the end of 2013, and wishes to 2 represent a subclass of all class members who purchased Trader Joe’s tuna in New 3 York. 4 purchased 5-ounce canned Trader Joe’s Albacore Tuna in Water Salt Added. (Id. 5 ¶ 13.) Reyes wishes to represent a subclass of all Californians who purchased Trader 6 Joe’s tuna. (Id. ¶ 21.) (Id. ¶¶ 12, 20.) Plaintiff Atzimba Reyes is a citizen of California, and 7 As described in detail in the Court’s prior order, (ECF No. 54), Plaintiffs 8 determined that the Trader Joe’s tuna cans were underfilled and underweight by 9 commissioning testing with the U.S. National Oceanic and Atmospheric 10 Administration (“NOAA”) on December 1, 2015. (See SAC ¶¶ 2–7.) NOAA 11 conducted this testing by evaluating the pressed cake weight (“Pressed Weight 12 Standard”). See 21 C.F.R. § 161.190(c). The Pressed Weight Standard is measured by 13 using a complex process requiring specific machinery, and was promulgated by the 14 FDA in 1957. Id.; (Mot. 3.) The NOAA tests based on this method determined that 15 several varieties of Trader Joe’s tuna fell 19.2%, 24.8%, 24.8%, 11.1%, 9.9%, and 16 13.9% below the Pressed Weight Standard. (See SAC ¶¶ 2–7.) 17 Trader Joe’s canned tuna labels do not contain any statements regarding the 18 “pressed weight,” but do contain representations as to the “net weight” (5 oz.), and the 19 “drained weight” (4 oz.).1 (Defendants’ Request for Judicial Notice (“RJN”), Ex. 1, 20 ECF Nos. 62-2, 62-4.) NOAA also tested the “net weight” and the “drained weight” 21 of the tuna. (RJN, Ex. 2, ECF Nos. 62-2, 62-5.) Trader Joe’s contends that, according 22 to the NOAA tests, neither the average “net weight” nor average “drained weight” 23 ever tested below 5 oz. or 4 oz., respectively. (Mot. 3.) Plaintiffs do not dispute this. 24 1 25 26 27 28 Trader Joe’s requests that the Court take judicial notice of various documents, including the labels of its tuna cans, and the results of the NOAA testing, among other things. (RJN, Exs. 1 & 2, ECF Nos. 62-2, 62-4, 62-5.) The Court grants Trader Joe’s request and takes notice of the items identified in Trader Joe’s Request for Judicial Notice (ECF No. 62) because the SAC necessarily relies on these documents, and neither party objects to their authenticity; in fact, the NOAA results are addressed to Plaintiffs’ counsel. See United States v. Corinthian Colleges, 655 F.3d 984, 999 (9th Cir. 2011); Carroll v. Yates, No. 1:10-CV-00623-LJO, 2013 WL 100237, at *6, n.7 (E.D. Cal. Jan. 7, 2013) (taking judicial notice of NOAA study). 2 1 As discussed at length in the Court’s prior Order, (ECF No. 54), Trader Joe’s criticizes 2 the Pressed Weight Standard, which is currently under reconsideration by the FDA, as 3 being outdated and inaccurate. (Mot. 3–4.) Trader Joe’s also claims that its alleged 4 failure to follow the Pressed Weight Standard did not deceive consumers because the 5 temporary marketing permit (“TMP”) the FDA granted to Chicken of the Sea 6 International, Bumble Bee Foods, LLC, and StarKist Co. (collectively, “Major Tuna 7 Producers”) allows them to market tuna without having to comply with the labeling 8 requirements associated with the Pressed Weight Standard. (Mot. 3-4; ECF No. 54.) 9 Federal Regulations require producers of tuna to state, “Below Standard in Fill,” on 10 cans of tuna that do not comply with the Pressed Weight Standard, unless the FDA 11 granted 12 21 C.F.R. § 130.14(b). The FDA extended TMP for the Major Tuna Producers 13 indefinitely on March 7, 2016. 81 Fed. Reg. 11813 (RJN, Ex. 7.) Trader Joe’s does 14 not allege that they are currently included in the TMP, but maintain that they applied 15 in February 2017. (RJN, Ex. 8, ECF No. 62-11.) the manufacturer a TMP. See 21 C.F.R. § 161.190(c)(4); 16 Since the Court’s prior Order dismissing the FAC on preemption grounds, 17 Plaintiffs’ SAC alleges three new categories of fact. First, instead of only violating 18 the “federally mandated minimum standard of fill” set forth in title 21, sections 19 130.14(b) and 161.190 of the Code of Federal Regulations (SAC ¶ 1), Trader Joe’s 20 also violates California’s Sherman Food, Drug and Cosmetic Law (“Sherman Law”), 21 which prescribes labeling requirements for certain foods. (Id. ¶ 9.) Plaintiffs also 22 allege that Trader Joe’s “conduct runs contrary to the standard practices and 23 procedures of other tuna manufacturers.” (Id. ¶ 10.) Finally, Plaintiffs allege they 24 relied on the statements on the label in making their purchases, and would not have 25 purchased the tuna “if the labels had properly contained the statement ‘Below 26 Standard in Fill,’” as required by title 21, section 130.14 of the Code of Federal 27 Regulations. (Id. ¶¶ 12–13.) 28 Plaintiffs’ SAC alleges claims for: breach of express warranty (Count I), breach 3 1 of implied warranty of merchantability (Count II), unjust enrichment (Count III), 2 negligent misrepresentation (Count VI), and fraud (Count VII). (See generally SAC.) 3 Plaintiff Magier also brings claims on behalf of herself and the New York subclass for 4 violation of New York General Business Law sections 349, 350. (Id. Counts IV & V.) 5 Plaintiff Reyes also brings claims on behalf of herself and the California subclass for 6 violation of California’s Consumer Legal Remedies Act (“CLRA”), Unfair 7 Competition Law (“UCL”), and False Advertising Law (“FAL”). (Id. Counts VIII–X.) 8 Trader Joe’s moves to dismiss Plaintiffs’ SAC on several grounds, including, as 9 10 before, an implied preemption theory. (Mot. 5–8.) III. LEGAL STANDARD 11 A motion to dismiss under either Rule 12(c) or 12(b)(6) is proper where the 12 plaintiff fails to allege a cognizable legal theory or where there is an absence of 13 sufficient facts alleged under a cognizable legal theory. Bell Atl. Corp. v. Twombly, 14 550 U.S. 544, 555 (2007); see also Shroyer v. New Cingular Wireless Serv., Inc., 622 15 F.3d 1035, 1041 (9th Cir. 2010). That is, the complaint must “contain sufficient 16 factual matter, accepted as true, to state a claim to relief that is plausible on its face.” 17 Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks omitted). 18 Accusations of fraud require a heightened particularity in pleading. See Fed. R. 19 Civ. P. 9(b). Federal Rule of Civil Procedure 9(b) establishes that an allegation of 20 “fraud or mistake must state with particularity the circumstances constituting fraud.” 21 The “circumstances” required by Rule 9(b) are the “who, what, when, when, where, 22 and how” of the fraudulent activity. Cafasso, ex rel. U.S. v. Gen. Dynamics C4 Sys., 23 Inc., 637 F.3d 1047, 1055 (9th Cir. 2011). In addition, the allegation “must set forth 24 what is false or misleading about a statement, and why it is false.” 25 heightened pleading standard ensures that “allegations of fraud are specific enough to 26 give defendants notice of the particular misconduct which is alleged to constitute the 27 fraud charged so that they can defend against the charge and not just deny that they 28 have done anything wrong.” Semegen v. Weidner, 780 F.2d 727, 731 (9th Cir. 1985). 4 Id. This 1 Generally, a court should freely give leave to amend a complaint that has been 2 dismissed, even if not requested by the party. See Fed. R. Civ. P. 15(a); Lopez v. 3 Smith, 203 F.3d 1122, 1130 (9th Cir. 2000) (en banc). However, a court may deny 4 leave to amend when it “determines that the allegation of other facts consistent with 5 the challenged pleading could not possibly cure the deficiency.” Schreiber Distrib. 6 Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir. 1986). 7 IV. DISCUSSION 8 Trader Joe’s moves to dismiss Plaintiffs’ SAC on several different grounds: (1) 9 implied preemption; (2) the doctrine of primary jurisdiction; (3) equitable abstention; 10 and (4) a failure to state a viable claim. (See generally Mot.) 11 A. Implied Preemption 12 Preemption may be express or implied. Medtronic, Inc. v. Lohr, 518 U.S. 470, 13 484–85 (1996). Express preemption occurs where Congress explicitly preempts state 14 law. Chae v. SLM Corp., 593 F.3d 936, 941 (9th Cir. 2010). Implied preemption 15 occurs where: 1) “state law actually conflicts with federal law;” or 2) “federal law 16 occupies a legislative field to such an extent that it is reasonable to conclude that 17 Congress left no room for state regulation in that field.” Id. While, at times, the 18 parties’ briefing blurs the lines between these two distinct types of preemption, at 19 issue here, is whether Plaintiffs’ claims are impliedly preempted by the FDCA’s 20 mandate that all actions to enforce the FDCA are brought in the name of the United 21 States, or, in limited circumstances, the states. 21 U.S.C. § 337. In the prior Order, 22 the Court held that Plaintiffs’ claims were impliedly preempted because Plaintiffs’ 23 purported state-law claims did not sufficiently “thread the gap” within the Ninth 24 Circuit’s rule in Perez v. Nidek Co. and were actually an attempt to improperly enforce 25 the FDCA. (June 2, 2017 Order, ECF No. 54.) Now, Plaintiffs assert claims under 26 California’s Sherman Law, which they claim provides an independent basis for relief, 27 and precludes a finding of preemption. (Opp’n Part II.A, ECF No. 63.) Plaintiffs also 28 5 1 maintain that the claims based on New York law also provide a right of action that is 2 not an attempt to enforce the FDCA. (Opp’n 2–6.) 3 There is some tension in the law when it comes to courts’ application of 4 Supreme Court preemption precedent because the opinions, as well as the parties, 5 often rely on express preemption cases, in an implied preemption scenario, and vice 6 versa. The Court is guided by “the assumption that the historic police powers of the 7 States [are] not to be superseded by the Federal Act unless that was the clear and 8 manifest purpose of Congress.” Wyeth v. Levine, 555 U.S. 555, 565 (2009) (citing and 9 quoting Lohr, 518 U.S. at 485). “States have always possessed a legitimate interest in 10 ‘the protection of (their) people against fraud and deception in the sale of food 11 products’ at retail markets within their borders.” Flo. Lime & Avocado Growers, Inc. 12 v. Paul, 373 U.S. 132, 144 (1963) (collecting cases). “Parties seeking to invalidate a 13 state law based on preemption ‘bear the considerable burden of overcoming the 14 starting presumption that Congress does not intend to supplant state law.’” Stengel v. 15 Medtronic, 704 F.3d 1224, 1227–28 (9th Cir. 2013) (en banc) (quoting De Buono v. 16 NYSA-ILA Med. & Clinical Servs. Fund, 520 U.S. 806, 814 (1997)). They also bear 17 the burden of proof. Fifth Third Bank v. CSX Corp., 415 F.3d 741, 745 (7th Cir. 18 2005). 19 The Court starts by addressing Buckman Company v. Plaintiffs’ Legal 20 Committee, which held that a plaintiff’s state-law tort claims, relying on standards set 21 forth in the FDCA, as amended by the Medical Device Amendments of 1976 22 (“MDA”), were preempted. 531 U.S. 341, 343 (2001). Under 21 U.S.C. section 23 337(a) of the FDCA—the same section at issue here—all proceedings to enforce FDA 24 regulations “shall be by and in the name of the United States.” “The FDCA leaves no 25 doubt that it is the Federal Government rather than private litigants who are authorized 26 to file suit for noncompliance” with the provisions of the FDCA. Buckman, 531 U.S. 27 at 349 n.7. 28 6 1 In Buckman, the plaintiffs premised the defendant’s liability on the defendant’s 2 allegedly fraudulent statements to the FDA, which resulted in approval of a medical 3 device that injured plaintiffs. Id. at 343. In finding implied preemption, the Supreme 4 Court explained that the “conflict stem[med] from the fact that the federal statutory 5 scheme amply empowers the FDA to punish and deter fraud against the 6 Administration, and that this authority is used by the Administration to achieve a 7 somewhat delicate balance of statutory objectives.” Id. at 348. Under the FDCA, the 8 FDA may investigate suspected fraud, and may respond by using a variety of legal 9 measures. Id. at 349 (explaining the FDA may respond by seeking injunctive relief, 10 seizing the medical device, or pursuing criminal prosecutions). This flexibility of 11 enforcement mechanisms, the Supreme Court reasoned, allowed the FDA “to make a 12 measured response to suspected fraud upon the Administration[,]” and was a “critical 13 component of the statutory and regulatory framework under which the FDA pursues 14 difficult (and often competing) objectives.” Id. In light of this, the Supreme Court 15 held that the plaintiffs’ claims were impliedly preempted because state-law fraud-on- 16 the-FDA claims would “exert an extraneous pull on the scheme established by 17 Congress.” Id. at 353. Plaintiffs argue here that their claims in the SAC are based on 18 an independent, but parallel state-law duty, and thus do not interfere with Congress’s 19 mandate that the United States is the only party able to enforce the FDCA. (Opp’n 7– 20 9.) 21 Plaintiffs allege that Trader Joe’s misled its customers regarding the amount of tuna in 22 its product, not the FDA. In this sense, the state-law tort claims are not focused on 23 policing Trader Joe’s representations to the FDA, which Congress and the Supreme 24 Court determined should be left to the FDA. Buckman, 531 U.S. at 353. Rather, 25 Plaintiffs’ claims seek to hold Trader Joe’s accountable for its conduct directed at 26 consumers. Plaintiffs’ allegations here are also distinguishable from Buckman because 27 In prior briefing and now, Plaintiffs cite Hendricks v. StarKist Co., 30 F. Supp. 28 3d 917 (N.D. Cal. 2014), and argue that the Northern District considered the “exact 7 1 same argument for preemption,” and rejected it. (Opp’n 4.) In its prior Order, the 2 Court rejected StarKist because, unlike in StarKist where the plaintiff’s claims were 3 almost identical to the FDCA’s requirements, Plaintiffs’ claims in the FAC did not 4 “mirror the relevant sections of the FDCA.” (June 2, 2017 Order 7, ECF No. 54.) 5 Now, Plaintiffs bring claims pursuant to California’s Sherman Law, which 6 incorporates by reference the requirements of the FDCA, as it must, lest it be 7 expressly preempted by 21 U.S.C. § 343–1(a), the FDCA’s express preemption clause. 8 See Perez v. Nidek Co., 711 F.3d 1109, 1120 (9th Cir. 2013) (addressing express 9 preemption under analogous statute in the MDA, 21 U.S.C. § 360k(a)). 10 In Stengel v. Medtronic, Inc., the Ninth Circuit held that the FDCA “does not 11 preempt a state-law claim for violating a state-law duty that parallels a federal-law 12 duty under the [FDCA].” 704 F.3d at 1228; see also Wyeth, 555 U.S. at 568–69 13 (holding state-law claims sounding in negligence and strict product liability were not 14 preempted because the regulatory scheme did not exhibit Congress’s intent to preempt 15 state remedies). The Court’s analysis then turns on whether California’s Sherman 16 Law, or the New York claims, provide “a state-law duty that parallels a federal-law 17 duty under the [FDCA].” Stengel, 704 F.3d at 1228; (SAC ¶¶ 8–9.) 18 1. California’s Sherman Law Establishes a Parallel State-Law Duty 19 California’s Sherman Law provides that “[a]ll food labeling regulations and any 20 amendments to those regulations adopted pursuant to the federal act…or adopted on 21 or after [January 1, 1993] shall be the food labeling regulations of this state.” Cal. 22 Health & Safety Code § 110100. The Sherman Law also prohibits the misbranding of 23 food, and states that “[a]ny food is misbranded if its labeling is false or misleading in 24 any particular.” Id. § 110660. These regulations are not expressly preempted by 25 Section 343–1(a) of the FDCA because they incorporate the FDCA’s requirements 26 wholesale, and do not impose any additional obligations. Samet v. Procter & Gamble 27 Co., No. 5:12-CV-01891 PSG, 2013 WL 3124647, at *5–6 (N.D. Cal. June 18, 2013). 28 8 1 Here, Plaintiffs allege Trader Joe’s violated the Sherman Law when it under 2 filled cans of tuna because the Sherman Law incorporates by reference the FDCA 3 regulations, which include the Pressed Weight Standard. (SAC ¶ 9; Opp’n 7–8.) 4 Trader Joe’s claims that this is just an end-run around the FDCA’s enforcement clause, 5 which limits enforcement of the FDCA, and thus the Pressed Weight Standard, to 6 actions in the name of the United States. (Reply 2.) Trader Joe’s also aptly points out 7 that many of the cases Plaintiffs cite, address express preemption, not implied 8 preemption. (Reply 2;) see, e.g., Ivie v. Kraft Foods Glob., Inc., No. C-12-02554- 9 RMW, 2013 WL 685372, at *8 (N.D. Cal. Feb. 25, 2013) (“Defendants also argue that 10 the plaintiff’s claims are preempted under [section 343–1], the FDCA’s express 11 preemption provision.”); Khasin v. Hershey Co., No.: 5:12-CV-01862 EJD, 2012 WL 12 5471153, at *4 (N.D. Cal. Nov. 9, 2012) (“Defendant argues that [section 337(a)] 13 explicitly prevents Plaintiff from bringing forth this cause of action.”). Despite the 14 lack of clarity in Plaintiffs’ papers regarding this distinction, the Court still finds that 15 Plaintiffs’ claims are not impliedly preempted because they are predicated on state-law 16 duties that parallel the FDCA requirements. 17 We must ask whether Plaintiffs would have a claim if the Sherman Law 18 specifically set forth the Pressed Weight Standard, instead of incorporating the FDCA 19 requirements by reference. If Plaintiffs would have a claim based on state-law in that 20 scenario, then Plaintiffs’ claims are predicated on an independent state-law violation 21 that parallels a federal duty. In that instance, Plaintiffs would not be relying on the 22 FDCA, but rather the standard set forth in California’s Sherman Law. The fact that the 23 California law does not specifically set forth the Pressed Weight Standard results from 24 consideration of practicalities. If California were required to update its statutes every 25 time the federal government changed a standard, it would constantly have statutes 26 stating standards that did not mirror the federal scheme, which would then be 27 expressly preempted by Section 343–1(a). See Samet, 2013 WL 3124647, at *5–6. 28 The Ninth Circuit has held that states may provide its citizens a private right of action 9 1 even where the federal scheme does not, which is what California has done here. 2 Stengel, 704 F.3d at 1233; In re Farm Raised Salmon Cases, 42 Cal. 4th 1077 (2008) 3 (analyzing the interaction between the FDCA and California’s Sherman Laws and 4 holding Plaintiffs’ claims as actions “based on the violation of state law—albeit state 5 law that is, in compliance with section 343–1, identical to FDCA provisions.”). 6 Trader Joe’s anticipated that Plaintiffs would rely on Farm Raised Salmon 7 Cases to establish that the Sherman Law provides an independent state-law duty. 8 (Mot. 7.) Trader Joe’s argues that Farm Raised Salmon Cases is distinguishable 9 because the “claims would have existed in the absence of the FDCA and did not rely 10 on a federal regulation that the FDA was actively reevaluating.” (Id.) The plaintiffs 11 in Farm Raised Salmon Cases relied on standards set forth in the FDCA and the 12 Nutrition Labeling and Education Act of 1990, and brought claims pursuant to 13 California’s Sherman Law, UCL, CLRA, and FAL. Farm Raised Salmon Cases, 42 14 Cal.4th at 1084–86. There are no substantive differences in Plaintiffs’ reliance on the 15 FDCA via California’s Sherman Law here, and the arguments in Farm Raised Salmon 16 Cases, where the California Supreme Court established California’s desire to provide 17 its citizens with an independent right of action. Id. at 1090. In both cases, the 18 plaintiffs allege a violation of a state-law duty that is parallel to, but independent of, 19 the requirements of the FDCA. See Stengel, 704 F.3d at 1228. This combined with 20 the presumption against preemption in areas historically governed by the states, leads 21 the Court to conclude Plaintiffs’ claims in the SAC are not impliedly preempted. 22 Vassigh v. Bai Brands LLC, Case No. 14–cv–05127–HSG, 2015 WL 4238886 (N.D. 23 Cal. July 13, 2015) (collecting cases). 24 25 2. New York Law Does Not Provide an Independent, Parallel State-Law Duty 26 Trader Joe’s argues the New York claims should be preempted because 27 California’s Sherman Law does not apply to sales that occurred outside the state. 28 (Mot. 8–10.) Plaintiffs do not argue that the Sherman Law applies to the New York 10 1 claims. Like California, New York may provide state-law common law and/or 2 statutory duties that establish a private right of action that is parallel to, but 3 independent of, the requirements of the FDCA. Stengel, 704 F.3d at 1228. Whether 4 New York has done so, is subject to debate among the courts. Compare Morelli v. 5 Weider Nutrition Grp., Inc., 275 A.D.2d 607, 607–08 (N.Y. Sup. 2000) (holding 6 claims under New York’s General Business Laws sections 349 and 350 allegedly 7 seeking to enforce FDCA regulations were not preempted by the FDCA’s enforcement 8 clause), with Verzani v. Costco Wholesale Corp., No. 09 CIV 2117 CM, 2010 WL 9 3911499, at *3 (S.D.N.Y. Sept. 28, 2010), aff’d, 432 Fed. App’x 29 (2d Cir. 2011) 10 (“[Plaintiff’s] persistent allegations that Costco’s labeling of the Shrimp Tray violates 11 the FDCA[‘s]…regulations on the labeling of ‘shrimp cocktails’ indicates that his true 12 purpose is to privately enforce alleged violations of the FDCA, rather than to bring a 13 [state-law] claim for unfair and deceptive business practices.”). 14 In Morelli v. Weider Nutrition Group, Inc., the defendants argued that 21 U.S.C. 15 § 337—the same section at issue here—preempted claims under New York’s General 16 Business Law sections 349 and 350. Morelli, 275 A.D.2d at 607–08. The plaintiffs’ 17 claims were based on the allegedly false and deceptive labeling of defendant’s food 18 products, as governed by the Federal Nutritional Labeling and Education Act, 21 19 U.S.C. § 343, et seq. Id. In holding the claims were not preempted, the court 20 reasoned that Congress did not “intend[] to limit a State's otherwise undoubted power 21 to afford consumers within its borders a statutory remedy for injuries caused by 22 knowingly deceptive and misleading business practices where, as here, such remedy 23 in no way interferes with the Federal prerogative to promulgate and enforce uniform 24 food labeling standards.” Id.; see also Goldemberg v. Johnson & Johnson Consumer 25 Cos., 8 F. Supp. 3d 467, 475–76 (S.D.N.Y. 2014) (addressing express preemption 26 provision under FDCA, and holding claims under General Business Law section 349, 27 and parallel common law claims were not preempted). 28 11 1 On the other hand, in New York and many other states, courts have concluded 2 that where a state has not adopted statutes that expressly mirror the FDCA, like 3 California’s Sherman Law, a plaintiff’s claim that relies on the defendant’s failure to 4 comply with federal regulations is impliedly preempted. 5 3911499, at *3; Henry v. Gerber Prods. Co., No.: 3:15-cv-02201-HZ, 2016 WL 6 1589900, at *9 (D. Or. Apr. 18, 2016) (“Oregon, however, has not adopted such a 7 statutory scheme, and thus Henry’s argument that the Puff’s labels do not comply with 8 federal requirements is precluded by the FDCA”); Rikos v. Procter & Gamble Co., 9 782 F. Supp. 2d 522, 538 n. 26 (S.D. Ohio 2011) (“Courts have interpreted section 10 337(a) as prohibiting private rights of action under the FDCA and dismissed state law 11 claims that seek to enforce the FDCA or its regulations”); Parker v. Stryker Corp., 584 12 F. Supp. 2d 1298, 1301 (D. Colo. 2008) (“[T]o the extent that these claims are merely 13 derivative of plaintiff’s state law [sic] claims, they are not saved merely by being 14 recast as violations of the federal adulteration and misbranding statutes.”). See Verzani, 2010 WL 15 The Court finds the reasoning of its sister courts precluding enforcement of the 16 FDCA regulations persuasive. Where, like here, a plaintiff’s true purpose is to enforce 17 federal regulations, masquerading as a state-law claim where the state has not adopted 18 a parallel statutory scheme is not sufficient to escape preemption. Thus, as discussed 19 in the prior Order, because Plaintiffs’ claims here based on New York common and 20 statutory law all depend on the Pressed Weight Standard, they are impliedly 21 preempted. Plaintiffs did not amend their New York claims in the SAC, and the Court 22 finds that providing another opportunity for leave would be futile, and thus GRANTS 23 Trader Joe’s Motion as to Plaintiffs’ claims for violations of New York General 24 Business Law sections 349 (Count IV) and 350 (Count IV), and Magier’s common 25 law claims based on New York law on behalf of herself, and the New York Subclass. 26 B. Primary Jurisdiction Doctrine 27 Trader Joe’s argues the Court should stay this action pending the FDA’s review 28 of the Pressed Weight Standard, and Trader Joe’s application for a TMP. (Mot. 10– 12 1 12.) Plaintiffs principally argue that a stay is not appropriate because: 1) the FDA has 2 been actively evaluating this standard for many years; 2) Plaintiffs’ claims are based 3 on state law, not the FDCA; and 3) Plaintiffs’ claims predate the FDA’s potential 4 issuance of a TMP to Trader Joe’s in the future, and thus a TMP would not absolve 5 Trader Joe’s of liability for its past acts. (Opp’n 10–11.) 6 “The primary jurisdiction doctrine allows courts to stay proceedings or to 7 dismiss a complaint without prejudice pending the resolution of an issue within the 8 special competence of an administrative agency.” Clark v. Time Warner Cable, 523 9 F.3d 1110, 1114 (9th Cir. 2008). The doctrine “is committed to the sound discretion 10 of the court when ‘protection of the integrity of a regulatory scheme dictates 11 preliminary resort to the agency which administers the scheme.’” 12 Semiconductor Co. v. Microchip Tech. Inc., 307 F.3d 775, 781 (9th Cir. 2002) 13 (quoting United States v. Gen. Dynamics Corp., 828 F.2d 1356, 1362 (9th Cir. 1987)). 14 Courts apply the following factors in determining whether to apply this doctrine: 15 “(1) the need to resolve an issue that (2) has been placed by Congress within the 16 jurisdiction of an administrative body having regulatory authority (3) pursuant to a 17 statute that subjects an industry or activity to a comprehensive regulatory authority 18 that (4) requires expertise or uniformity in administration.” Id. Syntek 19 The Court declines to apply the primary jurisdiction doctrine here. While 20 Congress has placed food regulation in the hands of the FDA, the core issue is 21 “whether a reasonable consumer would be misled by [Trader Joe’s] marketing, which 22 the district courts have reasonably concluded they are competent to address in similar 23 cases.” 24 Chacanaca v. Quaker Oats Co., 752 F. Supp. 2d 1111, 1224 (N.D. Cal. 2010)). 25 Further, the United States Tuna Foundation submitted its first Citizen Petition 26 requesting an evaluation of the Pressed Weight Standard in 1994—more than 20 years 27 ago. (RJN, Ex. 3, ECF No. 62-6.) The Major Tuna Producers filed their Citizen 28 Petition in September 2015 (RJN Ex. 9, ECF No. 62-12), and Trader Joe’s submitted Reid v. Johnson & Johnson, 780 F.3d 952, 967 (9th Cir. 2015) (citing 13 1 its application to participate in the TMP in February 2017. (RJN, Ex. 8, ECF No. 62- 2 11.) At this rate, it is difficult to tell when the FDA will make a determination as to 3 the validity of the Pressed Weight Standard, let alone whether it will change. 4 Accordingly, the Court chooses not to invoke the primary jurisdiction doctrine. 5 C. Equitable Abstention Trader Joe’s also argues that Plaintiffs’ UCL and FAL claims should be 6 7 dismissed under equitable abstention principles. 8 13 whether addressing a plaintiff’s claim: requires ‘determining complex economic policy, which is best handled by the legislature or an administrative agency;’ (2) ‘granting injunctive relief would be unnecessarily burdensome for the trial court to monitor and enforce given the availability of more effective means of redress;’ or (3) ‘federal enforcement of the subject law would be more orderly, more effectual, less burdensome to the affected interests.’ 14 Wehlage v. EmpRes Healthcare, Inc., 791 F. Supp. 2d 774, 784–85 (N.D. Cal. 2011) 15 (quoting Alvarado v. Selma Convalescent Hosp., 153 Cal. App. 4th 1292, 1298 16 (2007)). Here, Plaintiffs’ claims do not involve consideration of complex economic 17 policy. Instead, they depend on whether a reasonable consumer would be misled by 18 Trader Joe’s labeling. 19 discretion under the primary jurisdiction doctrine, the Court declines to exercise its 20 discretion under equitable abstention principles. 21 D. 9 10 11 12 (Mot. 12–14.) Courts consider For the same reasons the Court declines to exercise its Failure to State a Claim: Consumer Protection Statute Claims2 22 Reyes alleges violations of the UCL, the FAL, and the CLRA. (SAC ¶¶ 73– 23 94.) Trader Joe’s argues that these claims should be dismissed because Plaintiffs fail 24 to allege facts showing that a reasonable consumer would be deceived or misled by 25 the labeling on Trader Joe’s canned tuna products. (Mot. 15–19.) 26 27 28 2 Because the Court finds Plaintiffs’ New York claims are impliedly preempted, it does not address Trader Joe’s arguments regarding the substance of the New York claims. 14 1 1. 2 California’s UCL prohibits “any unlawful, unfair or fraudulent business act or 3 practice.” Cal. Bus. & Prof. Code § 17200. “By proscribing ‘any unlawful’ business 4 practice, ‘section 17200 “borrows” violations of other laws and treats them as 5 unlawful practices’ that the unfair competition law makes independently actionable.” 6 Cel-Tech Commc’ns, Inc. v. Los Angeles Cellular Tel. Co., 20 Cal. 4th 163, 180 7 (1999). The “unlawful” prong is separate from the “unfair” and “fraudulent” prongs 8 of the UCL, making unlawful conduct independently actionable even if it is not unfair 9 or fraudulent. Id. Reyes asserts violations under all three prongs of the UCL. (SAC 10 “Unlawful” Prong of UCL ¶¶ 84–86.) 11 Trader Joe’s alleges that Reyes’ claims pursuant to the “unlawful” prong of the 12 UCL should fail because she does not allege facts showing a reasonable consumer 13 would be deceived or misled by Trader Joe’s labeling. (Mot. 15–19.) However, the 14 reasonable consumer test does not apply to claims brought under the unlawful prong 15 of the UCL. See Daro v. Superior Court, 151 Cal. App. 4th 1079, 1099 n.9 (2007); 16 Gitson v. Trader Joe’s Co., No. 13-1333, 2013 WL 5513711, at *6 n.5 (N.D. Cal. Oct. 17 4, 2013). To state a claim under the unlawful prong of the UCL, a plaintiff only needs 18 to sufficiently plead (1) a predicate violation, MacDonald v. Ford Motor Co., 37 F. 19 Supp. 3d 1087, 1097 (N.D. Cal. 2014); see also People ex rel. Bill Lockyer v. Fremont 20 Life Ins. Co., 104 Cal. App. 4th 508, 515 (2002) (“[V]irtually any state, federal or 21 local law can serve as the predicate for an action under section 17200”), and (2) an 22 accompanying economic injury caused by that violation. Kwikset Corp. v. Superior 23 Court, 51 Cal. 4th 310, 329 (2011). 24 Reyes premises all of her “unlawful” prong claims on the contention that Trader 25 Joe’s tuna is mislabeled under California’s Sherman Law, which incorporates the 26 FDCA regulations. (SAC ¶¶ 8–9.) The Sherman Law and CLRA each provide a 27 predicate violation for purposes of the “unlawful” prong of the UCL. See, e.g., 28 Kowalsky v. Hewlett–Packard Co., 771 F.Supp.2d 1156, 1162 (N.D. Cal. 2011) 15 1 (holding UCL unlawful prong dependent upon plaintiff's CLRA claim). Reyes also 2 alleges she lost “money or property as a result of Defendants’ UCL violations.” (SAC 3 ¶ 87.) This is sufficient to state a claim. Accordingly, the Court DENIES Trader 4 Joe’s Motion as to Reyes’s claim pursuant to the “unlawful prong” of the UCL. 5 2. The Reasonable Consumer Standard 6 False advertising claims under California’s FAL, the CLRA, and the fraudulent 7 and unfair prongs of the UCL are governed by the reasonable consumer standard. 8 Williams v. Gerber Prods. Co., 552 F.3d 934, 938 (9th Cir. 2008); Kasky v. Nike, Inc., 9 27 Cal. 4th 939, 951 (2002); Lavie v. Procter & Gamble Co., 105 Cal. App. 4th 496, 10 504 (2003). Under the reasonable consumer standard, a plaintiff must show that 11 members of the public are likely to be deceived by the defendant’s representations. 12 Williams, 552 F.3d at 938 (“The California Supreme Court has recognized that these 13 laws prohibit not only advertising which is false, but also advertising which[,] 14 although true, is either actually misleading or which has a capacity, likelihood or 15 tendency to deceive or confuse the public.” (internal quotation marks omitted)). A 16 likelihood of deception means that “it is probable that a significant portion of the 17 general consuming public or of targeted consumers, acting reasonably in the 18 circumstances, could be misled.” Lavie, 105 Cal. App. 4th at 508. 19 Plaintiffs advance several theories of how a reasonable consumer would be 20 misled: 1) that consumers thought the amount of tuna in a 5-ounce can would be 21 “adequate;” 2) that consumers would be misled because Trader Joe’s tuna does not 22 say that its product is “Below Standard in Fill,” despite the fact that it does not comply 23 with the Pressed Weight Standard; and 3) that consumers believed they were 24 purchasing a product that was legal in the United States, when, in fact, it was not. 25 (Opp’n 20; SAC ¶¶ 8, 23, 29, 34, 45, 49, 56, 77.) 26 “Defendants’ conduct also runs contrary to the standard practices and procedures of 27 other tuna manufacturers.” (SAC ¶ 10.) 28 16 Plaintiffs also state that 1 With regard to the allegation regarding the “standard practices and procedures 2 of other tuna manufacturers,” the Court finds that this does not sufficiently set forth 3 facts to make their claim plausible under Rule 8. Plaintiffs do not describe any of the 4 alleged practices and procedures of other tuna manufacturers that would render Trader 5 Joe’s practices misleading to a reasonable consumer. Further, a significant portion of 6 the parties’ briefing is dedicated to describing the practices of the Major Tuna 7 Producers, who, because of the TMP, do not have to identify their tuna cans as being 8 “Below Standard in Fill.” Thus, consumers in the market are presented with at least 9 three other tuna manufacturers whose “standard practices and procedures” are to do 10 exactly what Trader Joe’s does. Thus, this allegation does not set forth facts sufficient 11 for the Court to find it plausible that a reasonable consumer would be misled on this 12 basis. Plaintiffs have leave to amend this claim. 13 At the hearing on Trader Joe’s Motion to Dismiss Plaintiffs’ FAC, counsel 14 explained that the potential for confusion, as it relates to the Pressed Weight Standard, 15 occurs because there may be varying amounts of water or oil in the can, in addition to 16 the tuna. The labels of all of the cans at issue here state directly on the front of the 17 label in conspicuous text the various species of tuna, and phrases such as, “in Olive 18 Oil,” or “in Water.” (RJN, Ex. 1, ECF No. 62-11.) Given that a reasonable consumer 19 must consider his or her preference for water or olive oil in choosing a product to 20 purchase, the Court finds it hard to imagine that such a consumer, acting reasonably, 21 would not know that the contents of the can they are purchasing includes fish and 22 water or oil. See Ebner v. Fresh, Inc., 838 F.3d 958, 965 (9th Cir. 2016) (holding that 23 it is not plausible that a reasonable consumer would not understand that lip balm 24 contains additional product in the tube, once the screw mechanism is flush with the 25 tube). 26 Plaintiffs point to StarKist, which reasoned that it is “[t]he appearance of the 27 can itself, not its label, [that] Plaintiff alleges to be misleading.” StarKist, 30 F. Supp. 28 3d at 931–22. A reasonable consumer, while appreciating that the tuna can would 17 1 contain tuna and water or oil, may be misled if the amount of water or oil in the can is 2 excessive. This, Plaintiffs argue, is the reason for the Pressed Weight Standard. 3 Trader Joe’s contends that to adequately allege that the can is misleading Plaintiffs 4 need to set forth in detail the process Plaintiffs used to test the tuna pursuant to the 5 Pressed Weight Standard, which they did not. (Mot. 15.) Plaintiffs allege that, 6 because Trader Joe’s is not a party to the TMP, it is required to display text on its can 7 stating that the cans were “Below Standard in Fill,” which it did not. 21 C.F.R. 8 § 161.190(c)(4); 21 C.F.R. § 130.14(b); (SAC ¶ 8.) Plaintiffs also allege that they 9 thought the tuna they were purchasing was legal for sale in the United States, and that 10 had they known that it was not legal, i.e. below the Pressed Weight Standard, they 11 would not have purchased it. (SAC ¶¶ 8, 23, 29, 34, 45, 49, 52, 56, 77.) It is plausible 12 that a reasonable consumer would expect to purchase a legal product, and could be 13 misled under the facts alleged by Plaintiffs.3 14 Plaintiffs, the Court finds that it is also plausible that a reasonable consumer would 15 expect that the tuna they purchase complies with labeling requirements that are meant 16 to inform consumers of the amount of tuna and water or oil in an otherwise opaque 17 can. Taking all inferences in favor of 18 To the extent Trader Joe’s argues that a reasonable consumer would not have 19 been aware of the food regulations that Trader Joe’s allegedly violated, Courts in this 20 district have rejected similar arguments at the motion to dismiss stage. See, e.g., 21 Khasin, 2012 WL 5471153, at *7 (rejecting defense argument that it is implausible 22 that reasonable consumers would be aware of food labeling regulations); Jones v. 23 ConAgra Foods, Inc., 912 F.Supp.2d 889, 901 (N.D. Cal. 2012) (same). The Court 24 25 26 27 28 3 Citing Brazil v. Dole Packaged Foods, LLC, 660 Fed. App’x 531, 534 (9th Cir. 2016), Trader Joe’s argues, in a foot note, that the Ninth Circuit has already “rejected this exact theory of liability…..” (Mot. 22 n.11.) However, Trader Joe’s conveniently omits the portion of the quote that explains that the plaintiff there suggested that defendant’s “statements about certain fruit products subject[ed] him to risk of fine or prosecution if he [wa]s found in possession of that fruit product.” Id. at 534 (emphasis added). Here, Plaintiffs’ allegations focus on their expectation to purchase a legal product, not a fear that they will be prosecuted criminally. (SAC ¶ 29.) 18 1 must take the allegations of the complaint as true, and based on Plaintiffs’ allegations 2 in the SAC, the Court finds that this is not one of the “rare situation[s] in which 3 granting a motion to dismiss is appropriate.” Williams, 552 F.3d at 939. 4 3. The FDA’s Actions Are Not Dispositive 5 Trader Joe’s urges the Court to consider the FDA’s findings regarding the 6 Pressed Weight Standard in evaluating Plaintiffs’ claims against the reasonable 7 consumer standard. Rojas v. General Mills, Inc., No. 12-cv-05099-WHO, 2013 WL 8 5568389, at *4–5 (N.D. Cal. Oct. 9, 2013) (noting the FDA’s views are relevant to the 9 issue of whether a label misleading, but also noting that they are not the sole or 10 dispositive factor). Trader Joe’s argues that the FDA determined their label cannot be 11 misleading because the Major Tuna Producers, pursuant to the TMP, are not required 12 to state “Below Standard in Fill” on their labels, even though they are not operating 13 under the Pressed Weight Standard. (Id.; RJN, Ex. 7, ECF No. 62-10.) Plaintiffs 14 argue that the FDA’s acceptance of the Major Tuna Producer’s labels has no bearing 15 on Trader Joe’s because the TMP does not apply to Trader Joe’s. In any event, the 16 TMP is not dispositive because it merely allows the tuna producers to conduct 17 “market testing.” (Opp’n 18); 79 Fed. Reg. 35362. Further, Plaintiffs argue that, to 18 the extent that Trader Joe’s is eventually included in the TMP, it still would not 19 remedy the violations that occurred during the periods alleged in the SAC, and before 20 Trader Joe’s was included in the TMP. The Court finds Plaintiffs’ reasoning as to the 21 FDA’s actions persuasive. While the Court considers the FDA action in its evaluation 22 of the reasonable consumer standard, the TMP does not apply to Trader Joe’s, and 23 even if it were eventually to apply to Trader Joe’s, it would not have been in effect 24 during the time periods alleged in the SAC. On its face, the TMP also only authorizes 25 “market testing” of the current label. 79 Fed. Reg. 35362. There is no evidence of the 26 results of the testing other than the fact that the FDA extended the TMP indefinitely. 27 81 Fed. Reg. 11813 (“We find that it is in the interest of consumers to extend the 28 19 1 permit for the market testing of canned tuna to gain additional information on 2 consumer expectations and acceptance.”). This is not enough to tip the scales. 3 4. 4 Because Plaintiffs’ claims sound in fraud, they must also meet the particularity 5 requirements under Federal Rule of Civil Procedure 9(b). The Ninth Circuit has 6 specifically held that Rule 9(b)’s heightened pleading standard applies to claims for 7 violation of the UCL, FAL, or CLRA that are grounded in fraud. Vess, 317 F.3d at 8 1103–06; Kearns v. Ford Motor Co., 567 F.3d 1120, 1125 (9th Cir. 2009). To satisfy 9 Rule 9(b), “[a]verments of fraud must be accompanied by ‘the who, what, when, 10 Plaintiffs Sufficiently Allege a Misrepresentation where, and how’ of the misconduct charged.” Vess, 317 F.3d at 1106. 11 Trader Joe’s argues that Plaintiffs fail to sufficiently allege a misrepresentation 12 because the statements regarding drained and net weight on Trader Joe’s cans of tuna 13 are accurate. (Mot. 14–15.) Plaintiffs respond that the misrepresentation stems from 14 the can itself, not the drained and net weight, and that Trader Joe’s failed to include 15 “Below Standard in Fill” on the can, as it was required to do pursuant to the FDCA 16 regulations. (Opp’n 13–17; SAC ¶¶ 1–14, 30, 31, 52, 59, 78, 87.) In the SAC, 17 Plaintiffs allege when and where they purchased the tuna, and that they relied on 18 Trader Joe’s express and implied warranties that the cans of tuna “contained an 19 adequate amount of tuna for a 5-ounce can and that Trader Joe’s Tuna is legal for sale 20 in the United States.” 21 substantially more based on these representations. (Id.) Plaintiffs sufficiently set 22 forth the who, what, when, where, and how of Trader Joe’s allegedly fraudulent 23 conduct. Vess, 317 F.3d at 1106; StarKist, 30 F. Supp. 3d at 934 (holding similar 24 allegations met the pleading standard for fraud). Accordingly, the Court DENIES 25 Trader Joe’s Motion with respect to Plaintiffs’ California claims for fraud (Count VII) 26 and violation of the CLRA (Count VIII), UCL (Count IX), and FAL (Count X). 27 // 28 // (SAC ¶¶ 45, 63, 77, 91.) 20 They also claim they paid 1 E. Negligent Misrepresentation 2 In California, to plead negligent misrepresentation, Plaintiffs must allege: “(1) a 3 misrepresentation of a past or existing material fact, (2) made without reasonable 4 ground for believing it to be true, (3) made with the intent to induce another's reliance 5 on the fact misrepresented, (4) justifiable reliance on the misrepresentation, and (5) 6 resulting damage.” Ragland v. U.S. Bank Nat. Ass’n, 209 Cal. App. 4th 182, 196–97 7 (2012). 8 Trader Joe’s argues that the economic loss doctrine precludes Plaintiffs’ claim 9 for negligent misrepresentation under California. (Mot. 19–20.) Plaintiffs argue that 10 California classifies negligent misrepresentation as a type of fraud, and thus economic 11 loss is recoverable. 12 plaintiff's tort recovery of economic damages is barred unless such damages are 13 accompanied by some form of harm to person or property, or the action falls under an 14 exception.” Strumlauf v. Starbucks Corp., 192 F. Supp. 3d 1025, 1035 (N.D. Cal. 15 2016) (citing N. Am. Chem. Co. v. Super. Ct., 59 Cal. App. 4th 764, 777 (1997). (Opp’n 21.) “The economic loss doctrine provides that a 16 Plaintiffs cite Robinson Helicopter Co. v. Dana Corp., 34 Cal. 4th 979 (2004) 17 for the proposition that California law permits negligent misrepresentation claims, 18 despite only alleging economic loss. (Opp’n 21.) As described in Strumlauf, “[i]n 19 Robinson, the California Supreme Court distinguished between two acts by the 20 defendant, finding that one act was a breach of contract, and the other was fraudulent 21 conduct—independent of the breach—that put the plaintiff's physical safety at risk.” 22 Strumlauf, 192 F. Supp. 3d at 1035 (citing Robinson, 34 Cal. 4th at 991)). In holding 23 that the economic loss doctrine did not bar plaintiff’s claims, the Robinson court 24 emphasized that its holding was “narrow in scope and limited to a defendant’s 25 affirmative misrepresentations on which a plaintiff relies and which expose a plaintiff 26 to liability for personal damages independent of plaintiff’s economic loss.” Robinson, 27 34 Cal. 4th at 993. Plaintiffs make no such allegations here, and the Court finds 28 Plaintiffs’ claim for negligent misrepresentation barred by the economic loss rule. 21 1 Because the Court does not see how this claim could be remedied if Plaintiffs had 2 leave to amend, the Court GRANTS Trader Joe’s Motion as to this claim without 3 leave to amend. 4 F. 5 Breach of Express & Implied Warranties 1. Pre-Suit Notice 6 “The buyer must, within a reasonable time after he or she discovers or should 7 have discovered any breach, notify the seller of breach or be barred from any 8 remedy.” Cal. Com. Code §2607(3)(A). Trader Joe’s argues that Plaintiffs failed to 9 provide reasonable pre-suit notice of their breach of express warranty claims, as 10 required under California law. (Mot. 21.) 11 First, Plaintiffs claim that they were not required to provide pre-suit notice 12 because they are alleging claims against Trader Joe’s as a manufacturer. (Opp’n 22.) 13 In California, where a plaintiff brings claims against a defendant for breach of express 14 warranty in its capacity as a manufacturer, not as a seller, the plaintiff is not required 15 to give pre-suit notice. Rosales v. FitFlop USA, LLC, 882 F. Supp. 2d 1168, 1178 16 (S.D. Cal. 2012) (citing Aaronson v. Vital Pharm., Inc., No. 09–CV–1333 W (CAB), 17 2010 WL 625337, at *6 (S.D. Cal. Feb. 17, 2010)). Plaintiffs allege claims against 18 Trader Joe’s in their capacity “as the designers, manufacturers, marketers, distributors, 19 and/or sellers” of the tuna. (SAC ¶ 29.) California courts have reasoned that notice is 20 not required to the manufacturer of a product because “it will not occur to [a buyer] to 21 give notice to one with whom he has had no dealings.” Greenman v. Yuba Power 22 Prods., Inc., 59 Cal. 2d 57, 61 (1963) (citations and quotations omitted). Here, there 23 is no reasonable interpretation of the SAC that would allow the Court to find it should 24 not have occurred to Plaintiffs to give notice to Trader Joe’s. Id. Plaintiffs were 25 required to give notice to Trader Joe’s because they allege they had direct dealings 26 with Trader Joe’s, as evidenced by the allegations that Plaintiffs purchased the tuna at 27 “a Trader Joe’s retail store.” (SAC ¶¶ 12–13;) see also Minkler v. Apple, Inc., 65 F. 28 Supp. 3d 810, 817 (N.D. Cal. 2014). 22 1 Plaintiffs claim that they provided adequate notice because they informed 2 Trader Joe’s “within days after learning of the breach.” (Opp’n 22.) Plaintiffs do not 3 allege this in the portion of the SAC setting forth their express warranty claim, nor do 4 they explain this argument in their Opposition. (SAC ¶¶ 27–31.) The Court interprets 5 this to mean that Plaintiffs notified Trader Joe’s within days after receiving the results 6 of NOAA’s testing pursuant to the Pressed Weight Standard. Plaintiffs allege that 7 they provided notice pursuant to the CLRA on December 21, 2015. (Id. ¶ 79, Ex A.4) 8 Plaintiffs’ demand letter provides that the “letter also serves as notice pursuant to 9 U.C.C. § 2-607(3)(a) concerning the breaches of express and implied warranties….” 10 (SAC, Ex. A.) 11 Trader Joe’s urges the Court to find that the notice was not reasonable as a matter 12 of law because Plaintiffs stopped purchasing Trader Joe’s tuna in 2013, and 2014—a 13 year and two years prior to giving notice, respectively. (Mot. 21.) The Court agrees 14 that Plaintiffs failed to give notice within a reasonable period as a matter of law. Ice 15 Bowl v. Spalding Sales Corp., 56 Cal. App. 2d 918, 921–22 (1943) (holding notice 16 untimely as a matter of law where given four months after the purchase of defective 17 skates). 18 To the extent Plaintiffs claim they needed the results from NOAA prior to 19 providing notice, at the very least, Plaintiffs’ claims based on the “standard practices 20 and procedures” of other tuna manufacturers should have been apparent to them when 21 they opened the cans of tuna. Yet, Plaintiffs waited more than a year before notifying 22 Trader Joe’s of the alleged breach of warranty. Accordingly, the Court GRANTS 23 Trader Joe’s Motion as to Plaintiffs’ breach of express warranty claims against Trader 24 25 26 27 28 4 The Court notes a discrepancy in the SAC that it treats as a typographical error. The demand letter is dated December 21, 2015, whereas Paragraph 79, describing the demand letter, states Plaintiffs gave notice on December 29, 2015. 23 1 Joe’s as a seller.5 The Court denies leave to amend because Plaintiffs could not 2 remedy this defect under any plausible set of facts. 3 2. Breach of Implied Warranty of Merchantability 4 Trader Joe’s argues that Plaintiffs’ implied warranty claims should be dismissed 5 because the tuna was fit for consumption, and thus satisfied the implied warranty of 6 this food product. (Mot. 23.) Plaintiffs contend that they allege a claim because in 7 addition to a product being suitable for its intended use—to eat—the implied warranty 8 provides that the product is “adequately contained, packaged, and labeled as the 9 agreement may require” and “[c]onform[s] to the promises or affirmations of fact 10 made on the container or label if any.” Cal. Com. Code § 2314(2). Here, Plaintiffs 11 allege the packaging of Trader Joe’s tuna was inadequate because it was not 12 “consistent with an implied promise that they were adequately filled with tuna.” 13 StarKist, 30 F. Supp. 3d at 933; (SAC ¶ 35). In opposition, Trader Joe’s cites 14 Strumlauf v. Starbucks Corporation, 192 F. Supp. 3d 1025, 1032 (N.D. Cal. 2016) and 15 Red v. General Mills, Inc., Case No. 2:15-cv-02232-ODW(JPR), 2015 WL 9484398, 16 at *6 (C.D. Cal. Dec. 29, 2015), which are distinguishable because the allegations 17 there did not focus on the adequacy of the packaging of the product, but only on 18 whether a consumer could eat the product. Accordingly, the Court finds Plaintiffs 19 alleged sufficient facts to state a claim for breach of the implied warranty of 20 merchantability, and DENIES Trader Joe’s Motion as to this claim. 21 H. UNJUST ENRICHMENT 22 “[I]n California, there is not a standalone cause of action for ‘unjust 23 enrichment,’ which is synonymous with ‘restitution.’” Astiana v. Hain Celestial Grp., 24 Inc., 783 F.3d 753, 762 (9th Cir. 2015) (citing Durell v. Sharp Healthcare, 183 Cal. 25 App. 4th 1350, 1370 (2010) and Jogani v. Super. Ct., 165 Cal. App. 4th 901, 912 26 (2008)). However, courts construe such claims as an action in quasi-contract seeking 27 5 28 Trader Joe’s also argues that Plaintiffs fail to allege an express warranty. (Mot. 22.) However, because Plaintiffs’ breach of express warranty claim fails for lack of notice, the Court does not address this argument. 24 1 restitution. Id. (citing and quoting Rutherford Holdings, LLC v. Plaza Del Rey, 223 2 Cal. App. 4th 221, 230 (2014)). 3 Trader Joe’s asserts that Plaintiffs’ claim for unjust enrichment should be 4 dismissed because it is duplicative of the relief Plaintiffs seek in their other claims and 5 because Plaintiffs failed to plead unjust or inequitable conduct. (Mot. 23–24.) Trader 6 Joe’s cites Trainum v. Rockwell Collins, Inc., a New York case, for the proposition 7 that courts may dismiss unjust enrichment claims as duplicative. (Id.;) 16-cv-7005 8 (JSR), 2017 WL 2377988, at *20 (S.D.N.Y. May 31, 2017). However, this court is 9 bound by Ninth Circuit precedent, and the Ninth Circuit specifically held that a 10 duplicative cause of action is not grounds for dismissal. Astiana, 783 F.3d at 762–63 11 (citing Federal Rule of Civil Procedure 8(d)(2), which allows parties to plead in the 12 alternative). 13 consumers as to the adequacy of the amount of tuna in its cans. (SAC ¶¶ 45–46.) 14 Accordingly, the Court DENIES Trader Joe’s Motion on this ground. Plaintiffs allege that Trader Joe’s acted unjustly when it misled V. 15 CONCLUSION 16 For the reasons discussed above, the Court hereby GRANTS, IN PART, AND 17 DENIES, IN PART, Trader Joe’s Motion to Dismiss. (ECF No. 62.) Plaintiffs are 18 granted leave to amend, to the extent allowed by this Order. Should Plaintiffs wish to 19 amend their complaint, they must file an amended complaint within 14 days of this 20 Order, and in compliance with Central District Local Rule 15. 21 22 23 October 3, 2017 24 25 26 ____________________________________ OTIS D. WRIGHT, II UNITED STATES DISTRICT JUDGE 27 28 25

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