Wilson v. Frito-Lay North America, Inc. et al
Filing
46
ORDER by Judge Samuel Conti granting in part and denying in part 27 Defendants' Motion to Dismiss (sclc2, COURT STAFF) (Filed on 4/1/2013)
1
2
3
4
5
IN THE UNITED STATES DISTRICT COURT
6
FOR THE NORTHERN DISTRICT OF CALIFORNIA
7
8
United States District Court
For the Northern District of California
9
10
MARKUS WILSON and DOUG CAMPEN,
individually and on behalf of
all others similarly situated,
Plaintiffs,
11
v.
12
13
FRITO-LAY NORTH AMERICA, INC.
and PEPSICO, INC.,
14
Defendants.
15
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
Case No. 12-1586 SC
ORDER GRANTING IN PART AND
DENYING IN PART DEFENDANTS'
MOTION TO DISMISS PLAINTIFFS'
FIRST AMENDED COMPLAINT
16
17
18
I.
INTRODUCTION
19
Now before the Court is Defendants Frito-Lay North America,
20
Inc. ("Frito-Lay") and PepsiCo, Inc.'s ("PepsiCo") (collectively
21
"Defendants") motion to dismiss Plaintiffs Markus Wilson and Doug
22
Campen's ("Plaintiffs") first amended complaint.
23
("FAC"), 27 ("MTD").
24
("Opp'n"),1 38 ("Reply"), and suitable for decision without oral
25
argument, Civ. L.R. 7-1(b).
26
Court GRANTS in part and DENIES in part Defendants' motion.
27
1
28
ECF Nos. 18
The motion is fully briefed, ECF Nos. 34
For the reasons explained below, the
Plaintiffs are instructed to review Civil Local Rule 3-4(c)(2),
as the Court will strike portions of future filings that do not
adhere to length limits or type size restrictions.
1 II.
BACKGROUND
2
The following facts are taken from Plaintiffs' FAC.
3
Defendants are producers of retail food products.
4
Plaintiffs are two California consumers who purchased a variety of
5
Defendants' food products between March 29, 2012 and March 29, 2008
6
(the "Class Period").
7
"Lay's Classic Potato Chips" and Plaintiff Campen bought "Lay's
8
Classic Potato Chips, Lay's Honey Barbeque Potato Chips, Lay's
9
Kettle Cooked Mesquite BBQ Potato Chips, Cheetos Puffs, and Fritos
Id. ¶¶ 16-17.
FAC ¶ 19.
Plaintiff Wilson bought
United States District Court
For the Northern District of California
10
Original Corn Chips" (collectively the "Named Products").
Id. ¶
11
17.
12
Defendants during the Class Period, but they do not specify what
13
these other products were.
14
themselves and others similarly situated, filed this putative class
15
action against Defendants, alleging that Defendants' website,
16
advertisements, and products contain deceptive and misleading
17
labeling information, in violation of state and federal law.
18
¶¶ 1-15.
Plaintiffs allege that they bought other food products from
See id.
Plaintiffs, on behalf of
Id.
19
The crucial factual background in this case concerns the
20
specific labeling practices that Plaintiffs claim are misleading.2
21
The only labels actually put before the Court -- described further
22
below -- are two versions of a Lay's Classic Potato Chips bag and
23
labels for the Named Products as they appeared at the time
24
2
25
26
27
28
Defendants filed a Request for Judicial Notice in this matter,
per Federal Rule of Evidence 201. ECF No. 28 ("Def.'s RJN"). The
Court GRANTS Defendants' request as to Exhibits B-F, per the
incorporation by reference doctrine, and DENIES Defendants' request
as to Exhibits A and G, because those exhibits are irrelevant per
Federal Rule of Evidence 402. The Court notes that Defendants' RJN
shows only the labels as they appeared at the time of Defendants'
RJN's filing, not the labels as they appeared to Plaintiffs before
or at the time of their filing the FAC.
2
1
Defendants filed their RJN.
Plaintiffs' allegations that
2
Defendants' labels are misleading and deceptive are based on
3
Defendants' labeling and advertising of their food products (1) as
4
being "All Natural" despite containing artificial or unnatural
5
ingredients, flavoring, coloring, or preservatives; (2) as having
6
"0 Grams Trans Fat" content despite having more than thirteen grams
7
of fat per fifty grams of food product; (3) as having "No MSG"
8
despite containing MSG; (4) as being "low sodium" despite having
9
more than 140 milligrams of sodium per serving size and per fifty
United States District Court
For the Northern District of California
10
grams of food product; (5) as being "healthy despite containing
11
disqualifying nutrient levels"; and (6) as including assertions
12
about other unauthorized health claims.
13
See id. ¶ 2.
Plaintiffs assert that they "care about the nutritional
14
content of food and seek to maintain a healthy diet."
15
They also allege that they bought Defendants' Named Products and
16
other products throughout the Class Period, that they relied on
17
Defendants' labeling and other statements in making their
18
purchases, and that they would not have purchased Defendants'
19
products had they known the truth about them.
20
150-157.
21
Id. ¶ 149.
See, e.g., id. ¶¶
Based on these facts, Plaintiffs assert nine causes of action
22
against Defendants: (1-3) violations of the "unlawful," "unfair,"
23
and "fraudulent" prongs of California's Unfair Competition Law's
24
("UCL"), Cal. Bus. & Prof. Code § 17200, et seq.; (4-5) violations
25
of the "misleading and deceptive" and "untrue" prongs of
26
California's False Advertising Law ("FAL"), Cal. Bus. & Prof. Code
27
§ 17500, et seq.; (6) violations of California's Consumers Legal
28
Remedies Act, Cal. Civ. Code § 1750, et seq.; (7) restitution based
3
1
on unjust enrichment or quasi-contract; (8) breach of warranty
2
under California's Song-Beverly Act, Cal. Civ. Code § 1790, et
3
seq.; and (9) breach of warranty under the federal Magnuson-Moss
4
Act, 15 U.S.C. § 2301, et seq.
5
6 III.
LEGAL STANDARD
7
A.
A motion to dismiss under Federal Rule of Civil Procedure
8
9
Motions to Dismiss
12(b)(6) "tests the legal sufficiency of a claim."
Navarro v.
United States District Court
For the Northern District of California
10
Block, 250 F.3d 729, 732 (9th Cir. 2001).
11
on the lack of a cognizable legal theory or the absence of
12
sufficient facts alleged under a cognizable legal theory."
13
Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir.
14
1988).
15
should assume their veracity and then determine whether they
16
plausibly give rise to an entitlement to relief."
17
Iqbal, 556 U.S. 662, 679 (2009).
18
must accept as true all of the allegations contained in a complaint
19
is inapplicable to legal conclusions.
20
elements of a cause of action, supported by mere conclusory
21
statements, do not suffice."
22
Twombly, 550 U.S. 544, 555 (2007)).
23
generally "limited to the complaint, materials incorporated into
24
the complaint by reference, and matters of which the court may take
25
judicial notice."
26
540 F.3d 1049, 1061 (9th Cir. 2008) (citing Tellabs, Inc. v. Makor
27
Issues & Rights, Ltd., 551 U.S. 308, 322 (2007)).
28
"Dismissal can be based
"When there are well-pleaded factual allegations, a court
Ashcroft v.
However, "the tenet that a court
Threadbare recitals of the
Id. (citing Bell Atl. Corp. v.
The court's review is
Metzler Inv. GMBH v. Corinthian Colls., Inc.,
When a motion to dismiss is granted, a district court must
4
1
decide whether to grant leave to amend.
2
Circuit has a liberal policy favoring amendments and, thus, leave
3
to amend should be freely granted.
4
Freight System, Inc., 957 F.2d 655, 658 (9th Cir. 1992).
5
a court does not need to grant leave to amend in cases where the
6
court determines that permitting a plaintiff to amend would be an
7
exercise in futility.
8
Winery, 829 F.2d 729, 738 (9th Cir. 1987) ("Denial of leave to
9
amend is not an abuse of discretion where the pleadings before the
United States District Court
For the Northern District of California
10
Generally, the Ninth
See, e.g., DeSoto v. Yellow
However,
See, e.g., Rutman Wine Co. v. E. & J. Gallo
court demonstrate that further amendment would be futile.").
11
B.
Rule 9(b)
12
Claims sounding in fraud are subject to the heightened
13
pleading requirements of Federal Rule of Civil Procedure 9(b),
14
which requires that a plaintiff alleging fraud "must state with
15
particularity the circumstances constituting fraud."
See Kearns v.
16
Ford Motor Co., 567 F. 3d 1120, 1124 (9th Cir. 2009).
"To satisfy
17
Rule 9(b), a pleading must identify the who, what, when, where, and
18
how of the misconduct charged, as well as what is false or
19
misleading about [the purportedly fraudulent] statement, and why it
20
is false."
21
Inc., 637 F.3d 1047, 1055 (9th Cir. 2011) (internal quotation marks
22
and citations omitted).
United States ex rel Cafasso v. Gen. Dynamics C4 Sys.,
23
24 IV.
DISCUSSION
25
Defendants make six arguments about why Plaintiffs' FAC should
26
be dismissed: (1) Plaintiffs did not sufficiently plead why PepsiCo
27
can be held liable for Frito-Lay's actions; (2) Plaintiffs lack
28
standing as to products they do not claim to have purchased; (3)
5
1
Plaintiffs fail to state claims for all of their causes of action
2
because no reasonable consumer is likely to be harmed or deceived
3
by the labels at issue, and because Plaintiffs' claims fail to meet
4
Rule 9(b)'s heightened pleading standard; (4) Plaintiffs' unjust
5
enrichment and quasi-contract claims fail as a matter of law; (5)
6
Plaintiffs fail to state a claim under the Magnuson-Moss Warranty
7
Act ("MMWA"); and (6) Plaintiffs fail to state a claim under the
8
Song-Beverly Consumer Warranty Act ("Song-Beverly").
9
MTD.
See generally
United States District Court
For the Northern District of California
10
A.
The Statutory Framework
11
The Food, Drug, and Cosmetic Act ("FDCA"), 21 U.S.C. § 301 et
12
seq., as amended by the Nutrition Labeling and Education Act of
13
1990 ("NLEA"), 21 U.S.C. § 343(r), et seq., is the operative
14
statute in this matter.
15
The many subsections of 21 U.S.C. § 343 establish the
16
conditions under which food is considered "misbranded."
Generally,
17
food is misbranded under 21 U.S.C. § 343(a)(1) if "its labeling is
18
false or misleading in any particular."
19
regulate the information that must be included in all packed
20
products' "nutrition box," as well as all other nutrient content
21
claims that appear elsewhere on the label.
Sections 343(q) and (r)
22
Section 343(q) governs information that must be disclosed
23
about certain nutrients in food products -- principally in the
24
nutrition box area.
25
health-related claims" about food products made anywhere on their
26
labels.
27
content or health information that a manufacturer includes on the
28
food label or packaging.
Section 343(r) discusses "nutrition levels and
It governs all voluntary statements about nutrition
The Food and Drug Administration ("FDA")
6
calories"), "implied" (e.g., "high in oat bran"), and "health
3
claims," which "characteriz[e] the relationship of any substance to
4
a disease or health-related condition."
5
101.14; see also Chacanaca v. Quaker Oats Co., 752 F. Supp. 2d
6
1111, 1116-17 (N.D. Cal. 2010) (describing the statutory scheme).
7
Section 343(r) clarifies that it does not govern nutrition content
8
claims made under Section 343(q) (i.e., inside the nutrition box),
9
though an accompanying regulation, 21 C.F.R. § 101.13, clarifies
10
United States District Court
has classified these nutrient claims as "express" (e.g., "100
2
For the Northern District of California
1
that "[i]f such information is declared elsewhere on the label or
11
in labeling, it is a nutrition content claim and is subject to the
12
requirements for nutrient content claims [under Section 343(r)]."
13
See Chacanaca, 752 F. Supp. 2d at 1117.
21 C.F.R. §§ 101.13,
14
B.
Plaintiffs' Claims Against PepsiCo
15
Plaintiffs name PepsiCo as a defendant, but they never explain
16
exactly how PepsiCo, as Frito-Lay's parent company, is liable for
17
Frito-Lay's activity.
18
Court to take judicial notice of a website purported to be
19
published by PepsiCo, on which PepsiCo allegedly directs consumers
20
to Frito-Lay's website.
See ECF No. 35 (Pl.'s Response to Def.'s
21
RJN) at 1-2, Exs. 2-3.
Plaintiffs also claim in their opposition
22
brief that they alleged PepsiCo to have jointly and unlawfully
23
labeled the misbranded products.
24
To cure this problem, Plaintiffs ask the
Opp'n at 4-5 (citing FAC ¶¶ 2-4).
The Court DENIES Plaintiffs' request for judicial notice of
25
these documents, made in response to Defendants' RJN, as an
26
impermissible attempt to amend the pleadings.
27
plead anything about these particular websites in their FAC.
28
Rather, they now attempt to supply new facts in their opposition
7
Plaintiffs did not
1
brief and their response to Defendants' RJN.
The Court declines to
2
allow this practice.
3
Corrections, 151 F.3d 1194, 1197 n.1 (9th Cir. 1998) ("[A] court
4
may not look beyond the complaint to . . . a memorandum in
5
opposition to a defendant's motion to dismiss.").
6
Court takes judicial notice of the exhibits attached to Plaintiff's
7
opposition, which Defendants did not oppose, since those documents
8
-- FDA complaint letters, part of an FDA brochure, and a Lay's
9
Classic Potato Chips label -- are all either part of the public
See, e.g., Schneider v. Cal. Dep't of
United States District Court
For the Northern District of California
10
record or incorporated by reference into the FAC.
11
However, the
1-7.
12
See Opp'n Exs.
Plaintiffs' actual allegations are plainly that "Defendants"
13
made false claims about their products in a SEC filing and on an
14
unidentified website.
15
above "threadbare recitals" of legal conclusions even when the
16
Court construes them most liberally.
17
The Court finds these pleadings insufficient to show that PepsiCo
18
is properly named as a defendant in this case.
19
against PepsiCo are DISMISSED with leave to amend.
20
amend to plead how PepsiCo is responsible for the allegedly
21
actionable conduct at issue here.
FAC ¶¶ 2-4.
These allegations fail to rise
See Iqbal, 556 U.S. at 678.
Plaintiffs' claims
Plaintiffs may
22
C.
Standing
23
Plaintiffs plead that they bought five different Frito-Lay
24
products, but their claims appear to be based on a much wider
25
variety of products that they do not specify in their complaint,
26
including "other varieties of potato chips, corn-based snacks like
27
Cheetos and Fritos, and other types of salty snacks."
28
see also FAC ¶ 1 (challenging "potato chips and other snack food
8
Opp'n at 4;
1
products . . . sold by [Frito-Lay]").
Defendants argue that
2
"Plaintiffs' standing arguments sweep far too broadly," because
3
Plaintiffs allege that they have standing to bring their case based
4
on an array of products that they do not even name.
5
At this point, however, it is unnecessary for the Court to address
6
the issue of standing for these products: as discussed infra,
7
Plaintiffs' claims as to the unidentified products fail for lack of
8
specificity under Rule 9(b).
9
Inc., -- F. Supp. 2d --, 2012 WL 6569393, at *11 (N.D. Cal. Dec.
Reply at 1-2.
See, e.g., Jones v. Conagra Foods,
United States District Court
For the Northern District of California
10
17, 2012) (dismissing plaintiffs' claims against defendant for
11
failure to meet Rule 9(b)'s specificity standard because plaintiffs
12
did not provide details about "exactly which products they
13
purchased").
14
D.
15
Defendants argue that the entire FAC sounds in fraud and must
Plausibility and Specificity
16
therefore meet the heightened pleading standard of Rule 9(b)
17
because it alleges a continuous course of false, deceptive, and
18
misleading activity.
19
respond that the FAC complies with Rule 9(b) because it is specific
20
enough to give defendants notice of their alleged misconduct, and,
21
separately, that their unlawful business practices claim under the
22
UCL need not comply with Rule 9(b) because it does not sound in
23
fraud.
See Opp'n at 24-25; MTD at 19-20.
Plaintiffs
Opp'n at 24.
24
Regarding Plaintiffs' latter point, the rule is that
25
plaintiffs need not satisfy Rule 9(b) as to the UCL's unlawful
26
prong when the basis of their claim does not sound in fraud.
27
Vess v. Ciba-Geigy Corp., 317 F.3d 1097, 1105-06 (9th Cir. 2003).
28
However, when it does, and especially when a plaintiff alleges a
9
See
1
unified course of fraudulent conduct that forms the basis of their
2
UCL claims, plaintiffs must plead the UCL claims with specificity.
3
Id.
4
claims on Defendants' alleged violations of underlying laws by way
5
of allegedly fraudulent or deceptive labeling and advertising
6
practices.
7
FAC, including its unlawful business practices claim, sounds in
8
fraud and must meet Rule 9(b)'s heightened pleading standards.
9
Kearns, 567 F.3d at 1125; Vess, 317 F.3d at 1103-04.
In this case, Plaintiffs base their unlawful business practice
See FAC ¶¶ 176-79.
Consequently Plaintiffs' entire
See
It is true
United States District Court
For the Northern District of California
10
that, as discussed below, the actual likelihood of deception in
11
UCL, FAL, and CLRA cases is judged by a "reasonable consumer"
12
standard.
13
(9th Cir. 2008); Colucci v. ZonePerfect Nutrition Co., No. 12-2907
14
SC, 2012 WL 6737800, at *7 (N.D. Cal. Dec. 28, 2012).
15
whether a plaintiff even reaches that point at the pleading stage
16
is governed in part by Rules 8 and 9(b).
17
WL 6737800, at *7; Jones, 2012 WL 6569393, at *11.
18
See Williams v. Gerber Prods. Co., 552 F.3d 934, 938-40
However,
See, e.g., Colucci, 2012
Many of Plaintiffs' allegations fail to meet Rule 9(b)'s
19
heightened pleading standard because Plaintiffs simply fail to
20
provide underlying factual details that give Defendant notice and
21
explain to the Court "the who, what, when, where, and how" of the
22
misconduct charged.
23
that Defendants made false and misleading statements about a
24
variety of their products, but at no point in their 53-page, 252-
25
paragraph FAC do Plaintiffs provide details about those products,
26
or about the advertisements and websites they frequently quote to
27
support their claims.
Nor does Plaintiffs' opposition brief
28
clarify these issues.
Plaintiffs simply have not pled which
Vess, 317 F.3d at 1106.
10
Plaintiffs allege
1
products they purchased in a way sufficient for Defendants to be on
2
notice of the products that are actually at issue.
3
WL 6569393, at *11.
4
See Jones, 2012
Further, as to Rule 8, "[t]o survive a motion to dismiss, a
5
complaint must contain sufficient factual matter, accepted as true,
6
to 'state a claim to relief that is plausible on its face,'" Iqbal,
7
556 U.S. at 663 (quoting Twombly, 550 U.S. at 370), and the
8
critical facts must be pled as part of the "short and plain
9
statement of the claim showing that the pleader is entitled to
United States District Court
For the Northern District of California
10
relief," Fed. R. Civ. P. 8.
11
or unnamed products do not rise to this level: given the variation
12
in food labeling even among the Named Products, the Court cannot
13
assume that all of the products at issue are mislabeled even if
14
Plantiffs' pleadings are taken as true.
15
Plaintiffs' claims about unpurchased
Despite Plaintiffs' pleading defects, Defendants gamely
16
address Plaintiffs' claims, supplying the labels toward which
17
Defendants assume Plaintiffs' allegations are addressed.
18
at 7-21; Reply at 5-12; Def.'s RJN Exs. B-F.
19
object to the Court's taking notice of these current labels: they
20
appear to agree that the labels Defendants supply are at least some
21
of the labels at issue in their case.
22
Response to Def.'s RJN) at 1.
23
packaging in Defendants' RJN -- the Named Products' packaging -- is
24
essentially the same packaging that Plaintiffs claim is misleading.
25
As for the one instance in which Plaintiffs argue that there is a
26
material difference in the labels before the Court -- the Lay's
27
Classic Potato Chips labeling and advertisement Plaintiffs include
28
in their FAC at paragraph five, versus different labeling for the
See MTD
Plaintiffs do not
See ECF No. 35 (Pl.'s
The Court therefore assumes that the
11
1
same product included in Defendants' RJN -- the Court's analysis
2
below will address both labels, since Plaintiffs claim that both
3
are misleading.
4
See Opp'n at 7.
Plaintiffs' claims as to the Named Products are undisturbed.
5
Plaintiffs' claims as to all other products, as well as the
6
unidentified advertisements and web pages, are DISMISSED without
7
prejudice for failure to comply with Rules 8 and 9(b).
8
has leave to amend these claims if it can provide details on what
9
the unnamed but allegedly purchased products, advertisements, or
Plaintiff
United States District Court
For the Northern District of California
10
websites were, when they were purchased or viewed, where the
11
allegedly actionable statements appeared, how the statements were
12
misleading, who made the statements, and so forth.
13
E.
Whether Websites Mentioned on Product Labels Constitute
Labeling
14
15
The parties dispute whether statements Defendants make on the
16
www.fritolay.com website can constitute "labeling" of the Named
17
Products under the FDCA.
18
claim that 21 U.S.C. § 321(m) renders the content on the website
19
"labeling," even though none of the website's content actually
20
appears on the labels at issue here, asserting that the FDA has
21
confirmed that "websites are indeed part of a product['s]
22
labeling."
23
point.
24
Opp'n at 19.
See Opp'n at 19; Reply at 11.
Plaintiffs
Plaintiffs cite no authority for this
See id.
Section 321(m) defines "labeling" as "all labels and other
25
written, printed, or graphic matter (1) upon any article or any of
26
its containers or wrappers, or (2) accompanying such article."
27
issue here is whether statements made on the www.fritolay.com
28
website "accompany" the Named Products such that they can be
12
The
1
2
classified as "labeling" under the FDCA.
It is true that statements not actually printed on a label
3
itself can constitute "labeling" for FDCA purposes.
What matters
4
is whether the separate material serves the purpose of labeling,
5
which is to supplement or explain the product.
6
States, 335 U.S. 345, 349-350 (1950) ("One article or thing is
7
accompanied by another when it supplements or explains it . . . No
8
physical attachment one to the other is necessary.
9
textual relationship that is significant."); Alberty Food Prods.
Kordel v. United
It is the
United States District Court
For the Northern District of California
10
Co. v. United States, 185 F.3d 321, 324-25 (9th Cir. 1950) (citing
11
Kordel for this proposition); see also United States v. Harkonen,
12
No. C 08-0164 MHP, 2009 WL 1578712, at *9 (N.D. Cal. June 4, 2009)
13
(Kordel " remains the leading Supreme Court authority on the scope
14
of the labeling provision.").
15
their claims on the fact that some of the Named Products include
16
the words "Visit our website @ fritolay.com" in tiny print at the
17
bottom of their back labels.
18
Plaintiffs claim that Defendants' marketing language on the
19
www.fritolay.com website constitute mislabeling under the FDCA.
20
See, e.g., FAC ¶¶ 42, 60, 102, 127, 129, 152-53.
21
In this matter, Plaintiffs base
See Def.'s RJN Exs. B-F.
From this
The Court does not find that the language on the
22
www.fritolay.com website constitutes labeling under the FDCA,
23
because as cited by Plaintiffs, none of the website language
24
explains or supplements the individual Named Products such that the
25
website could generally be found to "accompany" the Named Products.
26
See Kordel, 335 U.S. at 349-50.
27
labels ask consumers to visit the website, they do not state that
28
the website will inform consumers of the details of the Named
Even though the Named Products'
13
1
Products' nutritional facts, and none of the language Plaintiffs
2
cite is drawn closely enough to the Named Products themselves to
3
merit the website's being found to constitute "labeling."
4
extent that any of Plaintiffs' claims are based on language from
5
the www.fritolay.com website, those claims are DISMISSED with leave
6
to amend if Plaintiffs are able to provide or describe labels or
7
website language constituting "labeling," per above.
To the
8
F.
Defendants' Preemption Arguments
9
Defendants maintain that Plaintiffs' state law claims as to
United States District Court
For the Northern District of California
10
Defendants' statements that their products contain "No MSG" and "0
11
Grams Trans Fat" are preempted by federal law.
12
The FDCA, as amended by the NLEA, contains an express
13
preemption provision, making clear that state laws imposing
14
labeling requirements not identical to FDA mandates are preempted.
15
See 21 U.S.C. § 343-1(a).
16
law effectively parallels or mirrors the relevant sections of the
17
NLEA, courts have repeatedly refused to find preemption."
18
Chacanaca, 752 F. Supp. 2d at 1118 (citing N.Y. State Restaurant
19
Ass'n v. N.Y.C. Bd. of Health, 556 F.3d 114, 123 (2d Cir. 2009);
20
Chavez v. Blue Sky Natural Beverage Co., 268 F.R.D. 365, 370 (N.D.
21
Cal. 2010)).
22
stating: "[I]f the State requirement does the same thing that the
23
Federal law does . . . then it is effectively the same requirement
24
as the Federal requirement . . . [T]he only State requirements that
25
are subject to preemption are those that are affirmatively
26
different from the Federal requirements on matters that are covered
27
by Section 403A(a) of the Act."
28
57120 (Nov. 13, 1995).
"Where a requirement imposed by state
The FDA itself appears to endorse this approach,
Final Rule, 60 Fed. Reg. 57076,
14
1
"This means that plaintiffs' claims need not fail on
2
preemption grounds if the requirements they seek to impose are
3
either identical to those imposed by the FDCA and the NLEA
4
amendments or do not involve claims or labeling information of the
5
sort described in [21 U.S.C.] sections 343(r) and 343(q)."
6
Chacanaca, 752 F. Supp. 2d at 1119.
7
issue are nutrient content claims as contemplated by [21 U.S.C. §
8
343(r)], plaintiffs' deception claims may only go forward if they
9
can show that the statements would also be 'misbranded' under the
United States District Court
For the Northern District of California
10
11
12
terms of [the FDCA and NLEA]."
i.
"That is, if the statements at
Id.
"0 Grams Trans Fat" Claims Are Not Preempted
Plaintiffs' claims as to Defendants' "0 Grams Trans Fat"
13
labels are based on a theory that while the claim itself is
14
accurate as to the products' trans fat content, those labels are
15
nevertheless unlawful under 21 C.F.R. § 101.13(h)(1), which states
16
that whenever an express nutrient content claim is made on a food
17
label, that label must bear further disclosures about ingredients
18
that the FDA has found pose diet-related health risks:
19
20
21
22
23
24
25
26
27
28
If a food . . . contains more than 13.0 g of
fat, 4.0 g of saturated fat, 60 milligrams
(mg) of cholesterol, or 480 mg of sodium per
reference amount customarily consumed, per
labeled serving, or, for a food with a
reference amount customarily consumed of 30
g or less . . . per 50 g . . . then that
food must bear a statement disclosing that
the nutrient exceeding the specified level
is present in the food as follows: "See
nutrition information for ___ content" with
the blank filled in with the identity of the
nutrient exceeding
the specified level,
e.g., "See nutrition information for fat
content."
Plaintiffs clarify that Defendants violate this provision by
making "0 Grams Trans Fat" claims even though their products
15
1
contain more than 13 grams of fat.
FAC ¶ 84.
2
allege, Defendants' labeling "bears a statement telling consumers
3
to 'see nutrition facts for saturated fat info,'" even though the
4
total fat level is also high, "thus misdirecting consumers to a
5
nutrient in which the product is low, while failing to draw their
6
attention to the harmful levels of the nutrient (total fat) they
7
are mandated by law to disclose."
8
theory, whenever Defendants label a food product with "0 Grams
9
Trans Fat," the accompanying statement under 21 C.F.R. § 101(h)(1)
Id.
As Plaintiffs
According to Plaintiffs'
United States District Court
For the Northern District of California
10
should say something like "See nutrition facts for saturated fat
11
and total fat info," thereby including all of the nutrients that
12
would be required per 21 C.F.R. § 101(h)(1).
13
at 7-16.
14
See FAC ¶ 84; Opp'n
Defendants argue that all claims based on such "0 Grams Trans
15
Fat" statements are preempted by the FDCA.
16
at 8-9.
17
from this Court: Carrea v. Dreyer's Grand Ice Cream, Inc., No. 10-
18
1044 JSW, 2011 WL 159380 (N.D. Cal. Jan. 10, 2011), aff'd, 475 Fed.
19
App'x 113 (9th Cir. 2012), and Delacruz v. Cytosport, No. 11-3532
20
CW, 2012 WL 2563857 (N.D. Cal. June 28, 2012).
21
distinguishable and inapposite to the preemption discussion.
22
See MTD at 11-13; Reply
They base this argument primarily on two recent decisions
Both cases are
In Carrea, the plaintiff's "0 Grams Trans Fat" claim was based
23
on the theory that, since the product in question actually
24
contained more than zero but less than half a gram of trans fat,
25
the defendants could not label the food product as "0g Trans Fat."
26
See Carrea, 2011 WL 159380, at *3.
27
explicitly stated that "If the serving [in question] contains less
28
than 0.5 gram, the content, when declared, shall be expressed as
16
However, FDA regulations
1
zero."
Id. (citing 21 C.F.R. § 101.9(c)(2)(ii)).
Since
2
plaintiff's state law claims in Carrea imposed labeling
3
requirements not identical to the FDA's promulgations, this Court
4
found that they were preempted per the FDCA as amended by the NLEA.
5
See id. at *3-4.
6
tried to impose an obligation that was explicitly disclaimed by FDA
7
regulations, and so its imposition through state law was held to be
8
preempted.
In other words, in Carrea, the plaintiffs had
See id.
In Delacruz, the plaintiff claimed that a nutrition bar's
9
United States District Court
For the Northern District of California
10
statement of "0g Trans Fat" was actionable because the bar
11
contained "more than four grams of saturated fat and its label
12
omits the disclosure statement 'See nutrition information for
13
saturated fat content.'"
14
that the "0g Trans Fat" statement, while an "alleged distraction,"
15
did not "amount to a false statement or misrepresentation and,
16
thus, [was] not an actionable claim."
17
nothing to do with federal preemption: it concerned whether the
18
plaintiff had adequately pled one of her claims.
2012 WL 2563857, at *4.
Id.
This Court found
That holding had
The Court finds that Plaintiffs' claims are in line with
19
20
federal law and regulations.
21
rely on statutes that explicitly incorporate federal law and
22
regulations without modification,3 and since those claims also do
23
not attempt to impose stricter requirements than those laws or
24
regulations, Plaintiffs' state law claims are not preempted.
25
claims are all based on the theory that by not complying with the
26
relevant federal laws and regulations, Defendants' labels mislead
27
3
28
Since Plaintiffs' state law claims
These
Plaintiffs' state law claims are based on California's Sherman
Food, Drug, and Cosmetic Act ("Sherman Act"), Cal. Health & Safety
Code § 109875 et seq., which adopts and incorporates the FDCA.
17
1
and deceive consumers.
2
Rule 12(b)(6) motion below.
3
4
ii.
The Court evaluates whether they survive a
Plaintiffs' "No MSG" Claims Are Not Preempted
Plaintiffs' "No MSG" allegations are based on the fact that
5
some of the Named Products -- apparently just Lay's Honey Barbecue
6
Potato Chips and Lay's Mesquite BBQ Potato Chips -- contain
7
ingredients like torula yeast and yeast extract, which are sources
8
of monosodium glutamate ("MSG") despite not technically being MSG.
9
See FAC ¶¶ 59-72.
United States District Court
For the Northern District of California
10
Defendants argue that the FDA's formal regulation on MSG
11
labeling provides that "[a]ny monosodium glutamate used as an
12
ingredient in food shall be declared by its common or usual name
13
'monosodium glutamate,'" 21 C.F.R. § 101.22(h)(5), while "sources
14
of MSG," like yeast extract, must be labeled according to their
15
common names, like "yeast extract" or "hydrolyzed protein," see,
16
e.g., id. §§ 101.22(h)(7) (protein hydrolysates), 184.1983 (baker's
17
yeast extract).
18
therefore proper: Named Products like Cheetos that contain MSG are
19
not labeled as having "No MSG," Def.'s RJN Ex. E, while Named
20
Products like Lay's Kettle Cooked Mesquite BBQ Potato Chips, Def.'s
21
RJN Ex. D, which contain yeast extract and torula yeast, state
22
those ingredients' common names in the nutrition box and include a
23
"No MSG" statement on the label.
Defendants conclude that their labels are
24
However, Plaintiffs' opposition brief cites a November 19,
25
2012 FDA statement, made on the FDA's website section regarding
26
MSG, that purportedly clarifies the FDA's regulations here:
27
28
FDA requires that foods containing added MSG
list it in the ingredient panel on the
packaging as monosodium glutamate. However,
18
1
2
3
4
5
6
7
MSG occurs naturally in ingredients such as
hydrolyzed
vegetable
protein,
autolyzed
yeast, hydrolyzed yeast, yeast extract, soy
extracts, and protein isolate, as well as in
tomatoes and cheeses.
While FDA requires
that these products be listed on the
ingredient
panel,
the
agency
does
not
require the label to also specify that they
naturally contain MSG.
However, foods with
any ingredient that naturally contains MSG
cannot claim "No MSG" or "No added MSG" on
their packaging.
MSG also cannot be listed
as "spices and flavoring."
8
Opp'n Ex. B.
This statement, made several months after Defendants
9
filed their motion to dismiss, could save Plaintiffs' state law
United States District Court
For the Northern District of California
10
claims from preemption if it is a binding regulation, since in that
11
case Plaintiffs' claims would be in line with federal law.
12
issue here is whether the above statement is binding and entitled
13
to deference by the Court.
The
14
Defendants claim that because the above FDA statement is a
15
"nonbinding, informal guidance that does not alter the FDA's formal
16
regulatory scheme," because it was not preceded by notice,
17
opportunity for public comment, or expert testimony.
18
(citing Christensen v. Harris Cnty., 529 U.S. 576, 587 (2000) for
19
the principal that some agency action that is not the product of
20
formal adjudication or rulemaking lacks the force of law).
21
Defendants argue that the Court owes the FDA's statement no
22
deference under Auer v. Robbins, 519 U.S. 452, 461 (1997), because
23
the language of the regulation was not ambiguous and the FDA's
24
statement on its website "does not purport to interpret any
25
regulation."
26
statement on its website] does not purport to interpret any
27
regulation," but the Court finds that it does: the regulations in
28
question are the FDA's labeling requirements for MSG as a
Reply at 13 n.10.
Reply at 13
Defendants state that "the [FDA's
19
1
particular ingredient and ingredients that are sources of MSG.
2
"[W]here an agency interprets its own regulation, even if
3
through an informal process, its interpretation of an ambiguous
4
regulation is controlling under Auer unless 'plainly erroneous or
5
inconsistent with the regulation.'"
6
F.3d 927, 930 (9th Cir. 2006) (quoting Auer, 519 U.S. at 461).
7
threshold question is whether the FDA's regulation on MSG and
8
sources of MSG was ambiguous.
9
Circuit addressed whether a Department of Labor regulation was
Bassiri v. Xerox Corp., 463
Id. at 931.
The
In Bassiri, the Ninth
United States District Court
For the Northern District of California
10
ambiguous and found that it was, because the term at issue there,
11
"normal rate of compensation," "was left open to . . . various
12
interpretations" by the agency, the district court, and the
13
parties.
14
Id.
In this case, the regulations have at least two possible
15
interpretations.
16
requires each type of ingredient to be listed with its proper name,
17
a "No MSG" statement would not be misleading under the regulations
18
because "MSG" means only "MSG" as an individually named ingredient.
19
Alternatively, the regulations might be interpreted to forbid such
20
a statement because they clearly acknowledge that MSG is just one
21
type of free glutamate, meaning that "No MSG" would be misleading
22
if the product contained another type of free glutamate other than
23
MSG despite properly providing that ingredient's name.
24
The regulations might suggest that since the FDA
Under these circumstances, the FDA's statement on its website
25
appears to be its own interpretation of an ambiguous regulatory
26
scheme, and the Court finds that it owes the FDA's statement
27
deference under Auer, since the FDA's clarifying statements do not
28
appear "plainly erroneous or inconsistent with the regulation," nor
20
1
are they based on impermissible constructions of the governing
2
statute.
3
though MSG and ingredients that are sources of MSG must be labeled
4
by their proper names, a manufacturer cannot say that a product
5
containing an ingredient that is a source of MSG, like torula
6
yeast, therefore contains "No MSG."
therefore not preempted by federal law.4
G.
9
United States District Court
Plaintiffs' Surviving Claims as to Plaintiffs' UCL, FAL,
and CLRA Actions
10
For the Northern District of California
The FDA made clear that even
Plaintiffs' state law claims about "No MSG" statements are
7
8
Auer, 519 U.S. at 457, 461.
Plaintiffs' claims as to their purchases of the Named Products
11
12
remain in the case.
Defendants were cognizant enough of these
13
products and their labels to respond to Plaintiffs' claims about
14
them in detail, and in any event, Plaintiffs meet the "who, what,
15
when, where, and how" standard as to those products per Rule 9(b).
16
The Court first considers Plaintiffs' allegations about each type
17
of allegedly actionable statement and whether Plaintiffs have
18
sufficiently pled their UCL, CLRA, and FAL claims based on these
19
statements.
20
falsity, reliance, or injury: their contentions are essentially
21
that none of the statements in question are misleading as a matter
22
of law.
Defendants do not argue that Plaintiffs fail to plead
The CLRA, FAL, and UCL, which are the basis of Plaintiff's
23
24
first through sixth causes of action, are California consumer
25
protection statutes. The UCL makes actionable any "unlawful, unfair
26
4
27
28
While the Court finds that the regulatory statement addressed in
this Section is binding and entitled to deference, the parties have
yet to address the issue of how, if at all, such a clarification
should apply retroactively to Defendants' statements made during
the Class Period, prior to the FDA's statements.
21
1
or fraudulent business act or practice."
2
17200.
3
statement concerning property or services that is "untrue or
4
misleading."
5
of competition and unfair or deceptive acts or practices."
6
Civ. Code § 1770.
7
Cal. Bus. & Prof. Code §
The FAL makes it unlawful to make or disseminate any
Id. § 17500.
The CLRA also prohibits "unfair methods
Cal.
False advertising and unfair or fraudulent business practices
8
claims under the UCL, FAL or CLRA are governed by the "reasonable
9
consumer" test.
Williams, 552 F.3d at 938 (citing Freeman v. Time,
United States District Court
For the Northern District of California
10
Inc., 68 F.3d 285, 289 (9th Cir. 1995)).
11
consumer standard, a plaintiff must "show that members of the
12
public are likely to be deceived."
13
citations omitted).
14
"that these laws prohibit not only advertising which is false, but
15
also advertising which[,] although true, is either actually
16
misleading or which has a capacity, likelihood, or tendency to
17
deceive or confuse the public."
18
Inc., 45 P.3d 243, 250 (Cal. 2002)) (internal quotations omitted).
19
Under the reasonable
Id. (quotation marks and
The California Supreme Court has recognized
Id. at 938 (quoting Kasky v. Nike,
Generally, the question of whether a business practice is
20
deceptive presents a question of fact not suited for resolution on
21
a motion to dismiss.
22
circumstances consider the viability of the alleged consumer law
23
claims based on its review of the product packaging.
24
Pepsico, Inc., No. C 09–04456 SBA, 2010 WL 2673860, at *3 (N.D.
25
Cal. July 2, 2010).
26
of law that members of the public are not likely to be deceived by
27
the product packaging, dismissal is appropriate."
28
Sugawara v. Pepsico, Inc., No. 2:08-CV-01335–MCE-JFM, 2009 WL
See id.
However, the court may in certain
See Werbel v.
"Thus, where a court can conclude as a matter
22
Id. (citing
1
1439115, at *3–4 (E.D. Cal. May 21, 2009) (finding that the
2
packaging for Cap'n Crunch cereal and its use [of] the term "Crunch
3
Berries" was not misleading); see also, e.g., Videtto v. Kellogg
4
USA, No. 2:08–cv–01324–MCE–DAD, 2009 WL 1439086, at *2 (E.D. Cal.
5
May 21, 2009) (dismissing UCL, FAL and CLRA claims based on
6
allegations that consumers were misled into believing that "Froot
7
Loops" cereal contained "real, nutritious fruit").
8
9
United States District Court
For the Northern District of California
10
11
This Order addresses Plaintiffs' unjust enrichment and
warranty claims separately.
i.
"All Natural" Claims
The following products bear a seal stating "Made with ALL
12
NATURAL Ingredients," according to the labels supplied in
13
Defendants' RJN: Lay's Classic Potato Chips, Lay's Kettle Cooked
14
Mesquite BBQ Potato Chips, and Fritos Original Corn Chips.
15
other Named Products do not include that seal and are therefore
16
excluded from this discussion.
The
17
Plaintiffs explain that they base their "All Natural"
18
allegations largely on the FDA's interpretation of "natural" as
19
being truthful and not misleading when "nothing artificial or
20
synthetic . . . has been included in, or has been added to, a food
21
that would not normally be expected to be in the food."
22
Reg. 2302, 2407 (Jan. 6, 1993).
23
some of Defendants' products contain "artificial and unnatural
24
maltodextrin, ascorbic acid[,] citric acid, and caramel color in
25
the products," Defendants' use of "All Natural" language is
26
unlawful.
27
"All Natural" in a vacuum, since the full phrase is indeed "Made
28
with ALL NATURAL Ingredients."
Opp'n at 23-24.
58 Fed.
Plaintiffs allege that because
Defendants respond that they do not use
Reply at 8-11.
23
Defendants assert
1
that no reasonable consumer would be misled by the phrase because,
2
in context -- including the "made with . . ." language and the
3
nutrition box -- the label only states that the product includes
4
some all-natural ingredients, in this case potatoes and natural
5
oils.
6
matter of law, would read the statement in that context and sate
7
any further curiosity by reading the nutrition box.
8
9
United States District Court
For the Northern District of California
10
11
12
13
14
15
16
17
18
19
See id.
Defendants assert that a reasonable consumer, as a
See id.
The Ninth Circuit provides guidance on how district courts
should approach claims like this one:
We disagree . . . that reasonable consumers
should be expected to look beyond misleading
representations on the front of the box to
discover the truth from the ingredient list
in small print on the side of the box
. . . . We do not think that the FDA
requires
an
ingredient
list
so
that
manufacturers can mislead consumers and then
rely on the ingredient list to correct those
misinterpretations and provide a shield for
liability for the deception.
Instead,
reasonable
consumers
expect
that
the
ingredient
list
contains
more
detailed
information about the product that confirms
other representations on the packaging.
Williams, 552 F.3d at 939.
In light of Williams, Defendants' argument fails.
The label
20
is ambiguous because the phrase "all natural," lacking a hyphen,
21
could suggest either that the labeled product is exclusively
22
natural or that the product simply includes some all-natural
23
ingredients.
24
could find that a reasonable consumer would ascribe significance to
25
the "made with . . ." qualifier and not be misled by the label, but
26
the Court does not find the choice so obvious as a matter of law,
27
and none of Defendants' cases are precisely on point.
28
Red v. Kraft Foods, Inc., No. CV 10-1028-GW(AGRx), 2012 WL 5504011,
Defendants urge otherwise, stating that the Court
24
See, e.g.,
1
at *4 (C.D. Cal. Oct. 25, 2012) (obvious as a matter of law that no
2
reasonable consumer would think that a box of crackers would not be
3
composed primarily of fresh vegetables); Hairston v. South Beach
4
Beverages Co., Inc., No. CV 12-1429-JFW(DTBx), 2012 WL 1893818, at
5
*5 (C.D. Cal. May 18, 2012) (preempted statements about fruit names
6
and vitamins had been removed from the "All Natural," phrases at
7
issue making it "impossible for Plaintiff to allege how the 'all
8
natural' language is deceptive without relying on the preempted
9
statements regarding fruit names and vitamins").
United States District Court
For the Northern District of California
10
While courts may have found it obvious as a matter of law,
11
under the reasonable consumer standard, that crackers are not
12
primarily made of fresh vegetables, Red, 2012 WL 5504011, at *4, or
13
that "Froot Loops" do not contain "real, nutritious fruit,"
14
Videtto, 2009 WL 1439086, at *3, the Court finds that Plaintiffs
15
have adequately pled that a reasonable consumer could interpret a
16
bag of chips claiming to have been "Made with ALL NATURAL
17
Ingredients" to consist exclusively of natural ingredients,
18
contrary to the reality described in the nutrition box.
19
Williams, 552 F.3d at 939.
20
resolve any ambiguity, the Court cannot conclude as a matter of
21
law, in the context of a Rule 12(b)(6) motion, that no reasonable
22
consumer would be deceived by the "Made with ALL NATURAL
23
Ingredients" labels.
24
See
Even though the nutrition box could
Plaintiffs' "All Natural" claims under the UCL, FAL, and CLRA
25
survive as to the Named Products whose labels bear that statement
26
and include non-natural ingredients.
27
before the Court, this is limited to Lay's Kettle Cooked Mesquite
28
BBQ Potato Chips, since neither Lay's Classic Potato Chips nor
25
According to the labels
1
Fritos Original Corn Chips appear to contain any of the "non-
2
natural" or synthetic ingredients on which Plaintiffs' claims here
3
are premised.
4
leave to amend as to all of the Named Products except Lay's Kettle
5
Cooked Mesquite BBQ Potato Chips.
6
7
ii.
Plaintiffs' "All Natural" claims are DISMISSED with
"No MSG" Claims
This Order explains Plaintiffs' "No MSG" claims in Section
8
IV.F.ii, supra.
FDA regulations support Plaintiffs' theory as to
9
why the Named Products featuring "No MSG" labels are actionably
United States District Court
For the Northern District of California
10
misbranded: manufacturers are forbidden from claiming that a
11
product made with an ingredient that contains MSG therefore "No
12
MSG," rendering it both a violation of the underlying regulation
13
and, as Plaintiffs claim, confusing to consumers for some of the
14
Named Products' packaging to state that the product includes "No
15
MSG" when, in fact, it does.
16
sufficiently stated claims under the UCL, FAL, and CLRA as to the
17
Named Products that are actually labeled with the "No MSG" phrase
18
despite including what the FDA has indicated to be sources of MSG.
19
20
iii.
Therefore Plaintiffs have
"0 Grams Trans Fat" Claims
Plaintiffs' "0 Grams Trans Fat" claims are explained in
21
Section IV.F.i, supra.
Plaintiffs argue that the "0 Grams Trans
22
Fat" labels are misleading when they were not, per FDA regulations,
23
accompanied with a statement directing consumers to the amount of
24
the product's fat content that exceeds the levels described in the
25
pertinent regulation, 21 C.F.R. § 101.13(h)(1).
26
Plaintiffs state that they relied on these claims and were harmed
27
because they would not have purchased the product had they known
28
that the products also included levels of ingredients that should
26
See FAC ¶¶ 84-99.
1
have been noticed on the front of the label, per 21 C.F.R. §
2
101.13(h)(1), but were omitted.
See id.
Defendants' response relies mainly on this Court's decision in
3
dismissed a plaintiff's claims as to a "0 Grams Trans Fat"
6
statement on a nutrition bar, holding that even though that
7
statement was not accompanied by a 21 C.F.R. § 101.13(h)(1)
8
disclosure of any sort, the statement was true, and the distraction
9
the statement posed relative to fat and saturated fat contents
10
United States District Court
Delacruz, 2012 WL 2563857, at *8.
5
For the Northern District of California
4
In Delacruz, this Court
constituted neither a false statement nor a misrepresentation.
11
id. at *8-10.
See
Considering a motion to dismiss in this case, which has a
12
13
similar but ultimately distinct fact pattern from Delacruz, the
14
Court cannot conclude as a matter of law that Plaintiffs' "0 Grams
15
Trans Fat" claims would not be misleading or deceptive to a
16
reasonable consumer.
17
considered the FAC, as well as the properly noticed FDA letters and
18
regulations, the Court finds that Plaintiffs have sufficiently
19
alleged that the "0 Grams Trans Fat" statement was deceptive
20
because, accompanied by a disclosure of at least one of the
21
ingredients that 21 C.F.R. § 101.13(h)(1) requires to be disclosed,
22
they and other reasonable consumers would think that the statements
23
on the labels make accurate claims about the labeled products'
24
nutritional content when, in fact, they do not.
25
Accordingly, all Named Products whose "0 Grams Trans Fat" statement
26
is not accompanied by statements that are fully compliant with 21
27
C.F.R. § 101.13(h)(1) remain in the case.
28
///
See Williams, 552 F.3d at 939.
27
Having
See FAC ¶¶ 82-99.
iv.
1
"Low Sodium," "Healthy," and Other Nutrient Claims
It is undisputed that none of the Named Products include "low
2
3
in sodium," "healthy," or beneficial nutrient labels on their
4
packaging.
5
on uncited websites or advertisements, which the Court has already
6
found are either not specified under Rules 8 or 9(b), not
7
judicially noticeable in this matter, or are not "labeling" for any
8
product as a matter of law.
9
have therefore not pled a cause of action based on any of these
FAC ¶¶ 100-34.
Plaintiffs' allegations are all based
See id.; Opp'n at 19-22.
Plaintiffs
United States District Court
For the Northern District of California
10
claims.
These claims are DISMISSED with leave to amend.
11
H.
12
Plaintiffs asserted breaches of warranty under the federal
Plaintiffs' Warranty Claims
13
Magnuson-Moss Warranty Act ("MMWA") and California's Song-Beverly
14
Consumer Warranty Act ("Song-Beverly").
15
these claims fail as a matter of law.
16
right.
17
"All Natural," "No MSG," and other health and nutrient content
18
claims constitute express written warranties, which MMWA defines
19
as:
20
21
22
23
Defendants argue that
MTD at 22-23.
They are
Under their MMWA claim, Plaintiffs allege that Defendants'
any written affirmation of fact or written
promise made in connection with the sale of
a consumer product by a supplier to a buyer
which relates to the nature of the material
or workmanship and affirms or promises that
such material or workmanship is defect free
or
will
meet
a
specified
level
of
performance over a specified period of time.
24
15 U.S.C. § 2301(6)(A) (emphasis added).
The MMWA's disjunctive
25
language ("or") identifies two kinds of written warranties, the
26
first warranting a "defect free" product and the second warranting
27
a product that will "meet a specified level of performance over a
28
specified period of time."
Plaintiffs also allege that Defendants
28
1
breached their implied warranties under the MMWA.
While Defendants
2
argue that Plaintiffs simply have not pled claims under the MMWA,
3
Plaintiffs make no more than a conclusory defense of these claims
4
in their opposition brief.
See Opp'n at 25 n.13.
The Court finds that Plaintiffs' claim fails as a matter of
5
6
law.
Plaintiffs allege that Defendants' package labels are
7
warranties that Defendants breached by selling, at premium prices,
8
food products whose labels do not comply with federal or California
9
labeling requirements.
FAC ¶¶ 247-49.
This Court has held
United States District Court
For the Northern District of California
10
repeatedly that such arguments are meritless, since product
11
descriptions like "All Natural" labels "do not constitute
12
warranties against a product defect."
13
Ice Cream, Inc., No. C 11-2910 EMC, 2012 WL 2990766, at *3 (N.D.
14
Cal. July 20, 2012), mot. to certify appeal denied, No. C 11-2910
15
EMC, 2012 WL 3892391 (Oct. 12, 2012); see also, e.g., Colucci, 2012
16
WL 6737800, at *5-6; Jones, 2012 WL 6569393, at *12-13 (citing
17
cases).
18
meet a specified level of performance over a specified period of
19
time."
20
Plaintiffs' MMWA claims are DISMISSED WITH PREJUDICE.
21
could not save these claims and would be prejudicial to Defendants.
22
Astiana v. Dreyer's Grand
Further, none of the labels promise that the product "will
The labels were, at most, product descriptions.
Plaintiffs' Song-Beverly claims also fail.
Amendment
Plaintiffs allege
23
that Defendants' products contain express and implied warranties
24
under Song-Beverly, which Defendants breached by selling misbranded
25
products at premium prices.
26
an "express warranty" as "[a] written statement arising out of a
27
sale to consumer of a consumer good pursuant to which the
28
manufacturer, distributor, or retailer undertakes to preserve or
FAC ¶¶ 237-40.
29
Song-Beverly defines
1
maintain the utility or performance of the consumer good or provide
2
compensation if there is a failure in utility or performance."
3
Cal. Civ. Code § 1791.2 (emphasis added).
4
Song-Beverly likewise attach to "consumer goods."
5
"consumer good" is "any new product or part thereof that is used,
6
bought, or leased primarily for personal, family, or household
7
purposes, except for . . . consumables."
Implied warranties under
Id. § 1791.1.
A
Id. § 1791(a).
matter of law: Song-Beverly does not provide for express or implied
10
United States District Court
Plaintiffs' claims under Song-Beverly are deficient as a
9
For the Northern District of California
8
warranties as to consumables, and so by definition Plaintiff cannot
11
plead breaches of those warranties under Song-Beverly as to any of
12
Defendants' food products.
13
DISMISSED WITH PREJUDICE for the same reason Plaintiffs' MMWA
14
claims were.
15
I.
16
Defendants argue that Plaintiffs' cause of action for
17
restitution based on unjust enrichment fails as a matter of law
18
because (1) "there is no cause of action in California for unjust
19
enrichment," (2) Plaintiffs have not identified an unjustly
20
conferred benefit warranting redress, (3) Plaintiffs cannot allege
21
a quasi-contractual remedy because they alleged that their
22
relationship with Defendants was governed by binding express
23
warranties, and (4) Plaintiffs' request for equitable relief is
24
improper because there is an adequate remedy at law under the
25
statutes Plaintiffs cite.
26
they have properly pled an unjust enrichment claim because they
27
alleged that Defendants were enriched by means of "unlawful,
28
fraudulent, and misleading labeling."
Plaintiffs' Song-Beverly claims are
Plaintiffs' Restitution Based on Unjust Enrichment Claim
MTD at 21-22.
30
Plaintiffs respond that
Opp'n at 25 (citing FAC ¶¶
1
239, 246-49).
In support of this response Plaintiffs cite Colucci,
2
in which this Court held that unjust enrichment had been properly
3
pled because those plaintiffs pled it in the alternative.
4
6737800, at *10.
2012 WL
Plaintiffs did not plead that their unjust enrichment claim is
5
6
based on quasi-contract or pled in the alternative.
7
228-31.
8
correctly, they are entitled to the claim.
9
wrong.
See FAC ¶¶
They simply assert that because they pled the elements
Opp'n at 25.
This is
Cf. Colucci, 2012 WL 6737800, at *10 ("[C]laims for
United States District Court
For the Northern District of California
10
restitution or unjust enrichment may survive the pleading stage
11
when pled as an alternative avenue of relief, though the claims, as
12
alternatives, may not afford relief if other claims do.").
13
claim is DISMISSED with leave to amend if Plaintiffs wish to plead
14
it in the alternative.
This
15
16
17
V.
CONCLUSION
For the reasons explained above, Defendants Frito-Lay North
18
America, Inc. and PepsiCo, Inc.'s motion to dismiss Plaintiffs
19
Markus Wilson and Doug Campen's first amended complaint is GRANTED
20
in part and DENIED in part.
The Court orders as follows:
21
Plaintiffs' claims as to PepsiCo are DISMISSED with leave
22
to amend.
23
Plaintiffs' claims as to all products except the products
24
named and described in the complaint, Lay's Classic
25
Potato Chips, Lay's Honey Barbeque Potato Chips, Lay's
26
Kettle Cooked Mesquite BBQ Potato Chips, Cheetos Puffs,
27
and Fritos Original Corn Chips (collectively the "Named
28
Products"), are DISMISSED with leave to amend.
31
1
As to the Named Products and Defendant Frito-Lay,
2
Plaintiffs' UCL, CLRA, and FAL claims based on all
3
statements except the "All Natural," "No MSG," and "0
4
Grams Trans Fat" statements are DISMISSED with leave to
5
amend.
6
are undisturbed.
7
based on content appearing on websites or advertisements,
8
including the "low sodium," health claims, and "other"
9
claims, are DISMISSED with leave to amend.
Plaintiffs' claims as to those three statements
Claims as to these statutes that are
United States District Court
For the Northern District of California
10
Plaintiffs' claim for breaches of warranties under the
11
Magnuson-Moss Warranty Act and the Song-Beverly Consumer
12
Warranty Act are DISMISSED WITH PREJUDICE.
13
Plaintiffs' claim for restitution based on unjust
14
enrichment is DISMISSED with leave to amend.
15
Plaintiffs may amend these claims if they can specify exactly which
16
products, regulations or laws, and other relevant elements are at
17
issue, and otherwise correct the deficiencies described above.
18
Plaintiffs are instructed to keep their pleadings short, plain, and
19
plausible.
Boilerplate pleadings are strongly discouraged.
20
Plaintiffs have thirty (30) days from this Order's signature
21
date to file an amended complaint, or the deficient claims may be
22
dismissed with prejudice.
23
24
IT IS SO ORDERED.
25
26
Dated: April 1, 2013
27
UNITED STATES DISTRICT JUDGE
28
32
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?