Morrison v. Trader Joe's Company

Filing 55

ORDER granting in part and denying in part 34 Defendant's Motion to Dismiss Plaintiff's Consolidated Complaint. Signed by District Judge Ruth Bermudez Montenegro on 3/27/2024. (jpp)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 12 IN RE TRADER JOE’S COMPANY DARK CHOCOLATE LITIGATION 13 14 15 Case No.: 3:23-CV-0061-RBM-KSC ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT’S MOTION TO DISMISS PLAINITFFS’ CONSOLIDATED COMPLAINT [Doc. 34] 16 17 18 19 Defendant Trader Joe’s Company (“Defendant” or “Trader Joe’s”) has filed a 20 Motion to Dismiss Plaintiffs’ Consolidated Class Action Complaint (“CAC”) (Doc. 20),1 21 which is now pending before the Court. (Doc. 34.) Plaintiffs filed an Opposition (Doc. 22 35), and Defendant a Reply (Doc. 36). 23 Pursuant to Civil Local Rule 7.1.d.1, the Court finds the instant matter suitable for 24 determination on the papers and without oral argument. For the reasons set forth below, 25 the Motion to Dismiss is GRANTED IN PART and DENIED IN PART, and Plaintiffs 26 are GRANTED leave to file an amended consolidated complaint. 27 28 1 The CAC was filed after the Court approved consolidation of five cases. (Doc. 13.) 1 3:2-cv-00061-RBM-KSC 1 I. BACKGROUND 2 A. 3 The CAC identifies numerous “statements … [that] appear in Defendant’s stores and 4 marketing materials,” including Defendant’s use of “quality ingredients” and “colors 5 derived only from naturally available products” and Defendant not using artificial flavors 6 or preservatives, MSG, genetically modified ingredients, or partially hydrogenated oils. 7 (Id. ¶ 11–12.) 8 section”—is alleged to contain positive statements about the quality of its products and a 9 list of things its product do and do not contain. (Id. ¶¶ 10–11.) The website also includes 10 statements such as: “nothing is more important than the health and safety of [its] 11 customers;” that Defendant would “never sell any product [it] believe[s] to be unsafe;” and 12 that Defendant complies with all applicable laws regarding the production, harvesting, 13 manufacturing, processing, packaging, labeling, transporting of, and delivery of products. 14 (Id. ¶¶ 13–14.) 15 Defendant’s website. Defendant’s Statements Defendant’s website—including its “About Us” page and “‘FAQs’ Plaintiffs do not allege they read or relied on these statements on 16 B. 17 The CAC then identifies the following Trader Joe’s dark chocolate products (“the 18 Products”) that Plaintiffs allege contain undisclosed lead, cadmium, and arsenic (“Heavy 19 Metals”): 20 • • • • • • • • 21 22 23 24 25 The Products Trader Joe’s 72% Cacao Dark Chocolate Bar, Trader Joe’s The Dark Chocolate Lover’s Chocolate Bar (85% Cacao), Trader Joe’s Dark Chocolate Bar with Almonds (73% Cacao), Trader Joe’s Uganda Dark Chocolate Bar (85% Cacao), Trader Joe’s Mini 70% Cacao Dark Chocolate Bars, Trader Joe’s 73% Cacao Super Dark Dark Chocolate Bar, Trader Joe’s Swiss 72% Cacao Dark Chocolate Bar, Trader Joe’s Pound Plus 72% Cacao Dark Chocolate Bar 26 (CAC ¶ 1.) 27 28 /// 2 3:2-cv-00061-RBM-KSC 1 Plaintiffs allege “contrary to Defendant’s assurances that its Products are 2 manufactured under strict quality standards, the Products have been shown to contain 3 detectable levels of Heavy Metals which are known to pose human health risks.” (Id. ¶ 16.) 4 The Products’ packaging does not disclose “that they contain (or have a material risk of 5 containing) Heavy Metals (hereinafter collectively referred to as ‘Omissions’).” (Id. ¶ 17.) 6 “It was only through testing conducted by Consumer Reports that the general public 7 became aware of the Heavy Metal content in [the] Products.” (Id.) Plaintiffs assert that 8 based on this lack of disclosure “no reasonable consumer had any reason to know, suspect, 9 or expect that the Products contained Heavy Metals,” and that “Plaintiffs and other 10 reasonable consumers would not have purchased the Products or would have paid 11 substantially less for them but for the Omissions.” (Id. ¶¶ 18, 22.) 12 Plaintiffs allege Defendant has known about Heavy Metals in it dark chocolate 13 products since 2014 when testing done by a non-profit consumer group “informed 14 Defendant that its dark chocolate products contained levels of cadmium and lead[.]” (Id. 15 ¶¶ 94–95.) The CAC alleges the Products “include undisclosed levels of Heavy Metals 16 due to Defendant’s failure to sufficiently monitor for their presence in the ingredients and 17 finished products.” (Id. ¶ 96.) 18 C. Amounts of Heavy Metals in the Products 19 The CAC indicates that “[t]he Products contain (or have a material risk of 20 containing)” three Heavy Metals: arsenic, cadmium, and lead. (Id. ¶¶ 107, 112, 119.) The 21 CAC relies, in part, on a December 2022 report from Consumer Reports (hereinafter, 22 “December 2022 Report”) which found that two of the Products identified above contained 23 undisclosed cadmium and lead. (Id. ¶ 73.) The December 2022 Report found Trader Joe’s 24 72% Cacao Dark Chocolate Bar contains lead and cadmium with cadmium “at 192% above 25 [Maximum Allowable Dose Levels, (“MADL”)]” and “Trader Joe’s The Dark Chocolate 26 Lover’s Chocolate Bar (85% Cacao)” also contained cadmium and lead with cadmium at 27 127% and 229% above the MADL, respectively.” (Id. ¶ 76.) Testing conducted by 28 Plaintiffs and a non-profit consumer group also found Heavy Metals in the Products. (Id. 3 3:2-cv-00061-RBM-KSC 1 ¶¶ 132–33.) Those results show specific levels of arsenic, cadmium, and lead in the 2 Products with some in excess of MADL-levels for at least one of the three Heavy Metals. 3 (Id.; Ex. L (showing which results are above MADL for four of the Products).) Plaintiffs 4 assert that “[e]ven modest amounts of heavy metals can increase the risk of cancer, 5 cognitive and reproductive problems, and other adverse conditions.” (Id. ¶ 89.) 6 D. 7 In addressing the harm from the Heavy Metals, the CAC asserts that “[a]ny cadmium 8 exposure should be avoided” and “[e]xposure to even low levels of cadmium over time 9 may build up cadmium in the kidneys and cause kidney disease and bone loss.” (Id. 10 ¶¶ 113–114.) The CAC contains similar allegations as to lead. (Id. ¶ 122 (“Exposure to 11 lead in foods builds up over time … and has been scientifically demonstrated to lead to the 12 development of chronic poisoning, cancer, developmental, and reproductive disorders, as 13 well as serious injuries to the nervous system, and other organ and body systems.”).) 14 Plaintiffs assert that “[c]admium, like lead, displays a troubling ability to cause harm at 15 low levels of exposure.” (Id. ¶ 117.) Similarly, the CAC alleges “no amount of lead is 16 known to be safe.” (Id. ¶ 119.) Harm from Heavy Metals 17 Plaintiffs allege that “Defendant knew or should have known that it owed a duty to 18 consumers [to] prevent, or at the very least, minimize the presence of Heavy Metals in the 19 Products to the extent reasonably possible.” (Id. ¶ 98.) The CAC also identifies another 20 dark chocolate producer with levels of lead and cadmium below MADL and the December 21 2022 Report’s finding that five of the dark chocolate products tested were relatively low in 22 heavy metals. (¶¶ 81, 124–25.) The CAC also points to specific solutions identified in the 23 December 2022 Report for minimizing or omitting lead and cadmium in cacao. (¶¶ 78– 24 81.) 25 /// 26 /// 27 /// 28 /// 4 3:2-cv-00061-RBM-KSC 1 E. 2 Each Plaintiff alleges they purchased one or more of the Products,2 believed they 3 were purchasing “high quality dark chocolate products from Trader Joe’s[,]” and “relied 4 upon the packaging of the Products.” (Id. ¶¶ 27, 29–30, 32–33, 35–36, 38–39, 41–42, 44– 5 45, 47–48, 50–51, 53–54, 56–57, 59–60, 62–63, 65.) Plaintiffs’ Purchases 6 Each Plaintiff also alleges they were “unaware the Products contained (or had a 7 material risk of containing) any level of Heavy Metals … and would not have purchased 8 the Products if that information had been fully disclosed.” (Id. ¶¶ 29, 32, 35, 38, 41, 44, 9 47, 50, 53, 56, 59, 62, 65.) Most of the Plaintiffs assert they “would be willing to purchase 10 Trader Joe’s dark chocolate products in the future if [they] could be certain that they do 11 not contain (or have a material risk of containing) Heavy Metals.” (Id. ¶¶ 29, 32, 35, 38, 12 41, 44, 47, 50, 53, 59, 62.) However, Plaintiffs Salerno and Ferrante allege that they “will 13 not purchase Trader Joe’s dark chocolate products in the future even if [they] could be 14 certain that they do not contain (or have a material risk of containing) Heavy Metals.” (Id. 15 ¶¶ 56, 65.) 16 Plaintiffs assert that “[r]easonable consumers expect the dark chocolate products 17 they purchase for their individual and family consumption [are not] contaminated (or [do 18 not] have a material risk of being contaminated) with Heavy Metals, substances that are 19 known to accumulate in the body and pose significant and dangerous health consequences.” 20 (Id. ¶¶ 5, 9, 137 (“No reasonable consumer would expect, suspect, or understand that the 21 Products contain or have a material risk of containing Heavy Metals.”).) Plaintiffs’ counsel 22 conducted a consumer survey that shows the vast majority of consumers did not expect 23 their dark chocolate products would contain arsenic, cadmium, or lead based on the Product 24 25 26 27 28 The CAC also includes the location where each Plaintiff purchased the Products. (CAC ¶¶ 27, 30, 33, 36, 39, 42, 45, 48, 51, 57, 60, 63.) The number of each type purchased ranges from one to four, and the purchases were made at numerous locations throughout California, including San Diego, as well as locations in Illinois, Washington, New York, and Maryland. (Id.) 5 2 3:2-cv-00061-RBM-KSC 1 labels. (Id. ¶ 138.) 2 “Defendant knew that properly and sufficiently monitoring the Products for Heavy 3 Metals in the ingredients and finished products was critical.” (Id. ¶ 142.) “Defendant knew 4 or should have known that a reasonable consumer would consume the Products regularly, 5 leading to exposure to and accumulation of Heavy Metals.” (Id. ¶ 143.) The CAC alleges 6 the Omissions were misleading, deceptive, and material because reasonable consumers 7 “would consider the presence or risk of Heavy Metals in the Products a material fact when 8 considering which dark products to purchase” and “that reasonable consumers paid higher 9 prices for the Products and expected Defendant to sufficiently test and monitor the Products 10 ingredients for the presence of Heavy Metals.” (Id. ¶¶ 146, 148, 151.) Plaintiffs also allege 11 that “without full disclosure, reasonable consumers believe the Products are ‘safe, high- 12 quality products,’ that would not contain or have a material risk of containing Heavy 13 Metals.” (Id. ¶ 152.) 14 F. 15 The CAC asserts claims for: (1) violations of California’s Unfair Competition Law 16 (“UCL”), California Business & Professions Code §§ 17200 et seq.; (2) violations of 17 California’s False Advertising Law (“FAL”), California Business & Professions Code 18 §§ 17500, et seq.; (3) violation of California’s Consumers Legal Remedies Act (“CLRA”), 19 California Civil Code §§ 1750, et seq.; (4) Breach of the Implied Warranty of 20 Merchantability; (5) Unjust Enrichment; (6) violation of Washington’s Unfair Business 21 Practices and Consumer Protection Act, RCW §§ 19.86.010, et seq.; (7) violation of Illinois 22 Consumer Fraud and Deceptive Business Practices Act, 815 Illinois Compiled Statute 23 §§ 505/1, et seq.; (8) violation of Deceptive Practices Act, New York General Business 24 Law § 349; and (9) violation of New York General Business Law § 350. (CAC ¶¶ 180– 25 287.) Claims 26 Plaintiffs’ UCL, FAL, CLRA, Breach of Implied Warranty of Merchantability, and 27 Unjust Enrichment claims are brought “individually and on behalf of the Class members,” 28 although as discussed further below, the Breach of Implied Warranty of Merchantability 6 3:2-cv-00061-RBM-KSC 1 and Unjust Enrichment claims do not indicate which state law they are brought under. 2 (CAC ¶¶ 181, 196, 205, 218, 232. 3) Each of the claims based on Washington (claim six), 3 Illinois (claim seven), and New York (claims eight and nine) consumer protection laws are 4 brought “individually and on behalf of the members of the proposed [specified state] 5 Subclass.” (CAC ¶¶ 240, 253, 267, 278.) 6 II. 7 8 The Court will first address Defendant’s Request for Judicial Notice (Doc. 34-2) of the following fourteen documents pursuant to Federal Rule of Evidence 201 (id. at 24): 9 • Ex. A: Complaint in As You Sow v. Trader Joe’s, Inc., No. CGC-15548791 (San Francisco Cty. Super. Ct. Nov. 3, 2015), … • Ex. B: Consent Judgment in As You Sow v. Trader Joe’s, Inc., No. CGC-15-548791 (San Francisco Cty. Super. Ct. Feb. 15, 2018), … • Ex. C: FDA publication entitled “Guidance for Industry: Lead in Candy Likely To Be Consumed Frequently by Small Children” (Nov. 2006), … • Ex. D: FDA publication entitled “Supporting Document for Recommended Maximum Level for Lead in Candy” (Nov. 2006), … • Ex. E: FDA publication entitled “Supporting Document for Action Level for Inorganic Arsenic in Rice Cereal for Infants” (Aug. 2020), … • Ex. F: FDA publication entitled “Closer to Zero: Reducing Childhood Exposure to Contaminants from Foods” (Mar. 3, 2023), … • Ex. G: FDA publication entitled “FDA Releases Action Plan for Reducing Exposure to Toxic Elements from Foods for Babies, Young Children” (Apr. 8, 2021), … 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 REQUEST FOR JUDICAL NOTICE As to the UCL, FAL, CLRA claims, the CAC indicates in headings that they are brought “on [b]ehalf of the Class, or [a]lternatively, the California [s]ubclass.” (Doc. 20 at 46, 48– 49.) Headings for the Breach of Implied Warranty of Merchantability and Unjust Enrichment claims indicate they are brought “on [b]ehalf of the Class, or [a]lternatively, the [s]tate [s]ubclasses.” (Id. at 51.) 4 The Court cites the CM/ECF electronic pagination except for citations to the CAC. 7 3 3:2-cv-00061-RBM-KSC 1 • Ex. H: FDA publication entitled “FDA Announces New Actions Aimed at Further Reducing Toxic Elements in Food for Babies, Young Children” (Mar. 5, 2021), … • Ex. I: FDA publication entitled “FDA Announces Action Levels for Lead in Categories of Processed Baby Foods” (Jan. 24, 2023), … • Ex. J: Consumer Reports article by Kevin Loria entitled “Lead and Cadmium Could Be in Your Dark Chocolate” (Dec. 15, 2022), … • Ex. K: Consumer Reports publication entitled “Test Methodology: Heavy Metals in Chocolate Bars” (Jan. 2023), … • Ex. L: Screenshot of As You Sow’s purported 2022 test results, filtered to “Trader Joe’s,” as published on As You Sow’s website … • Ex. M: California Office of Environmental Health Hazard Assessment publication entitled “Proposition 65 in Plain Language” (Aug. 1, 2017), … • Ex. N: Front and back label designs for Trader Joe’s The Dark Chocolate Lover’s Chocolate Bar, Trader Joe’s 73% Cacao Super Dark Dark Chocolate Bar, Trader Joe’s Swiss 72% Cacao Dark Chocolate Bar, and Trader Joe’s Pound Plus 72% Cacao Dark Chocolate Bar— which are partially depicted in paragraph 69 of Plaintiffs’ Complaint. 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 (Doc. 34-2 at 3–4.) 19 A. 20 Here, Defendant primarily requests the Court consider these documents based on 21 judicial notice under Rule 201, but also requests the Court consider some documents under 22 the incorporation-by-reference doctrine. A court generally cannot consider materials 23 outside the pleadings on a motion to dismiss for failure to state a claim. Fed. R. Civ. P. 24 12(d) (“If, on a motion under Rule 12(b)(6) or 12(c), matters outside the pleadings are 25 presented to and not excluded by the court, the motion must be treated as one for summary 26 judgment under Rule 56.”). Judicial notice and incorporation-by-reference are exceptions 27 to this Rule. Khoja v. Orexigen Therapeutics, Inc., 899 F.3d 988, 998 (9th Cir. 2018). 28 Applicable Standards 8 3:2-cv-00061-RBM-KSC 1 Judicial notice under Rule 201 permits a court to notice an adjudicative fact if it is 2 ‘not subject to reasonable dispute.’” Id. at 999 (quoting Fed. R. Evid. 201(b)). “A fact is 3 ‘not subject to reasonable dispute’ if it is ‘generally known,’ or ‘can be accurately and 4 readily determined from sources whose accuracy cannot reasonably be questioned.’” Id. 5 (quoting Rule 201(b)(1)–(2)). This means that “‘a court may take judicial notice of matters 6 of public record without converting a motion to dismiss into a motion for summary 7 judgment,’” but “cannot take judicial notice of disputed facts contained in such public 8 records.” Id. (quoting Lee v. City of Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001)). 9 Under the incorporation by reference doctrine, courts may “take into account 10 documents whose contents are alleged in a complaint and whose authenticity no party 11 questions, but which are not physically attached to the [plaintiff’s] pleading.” Davis v. 12 HSBC Bank Nevada, N.A., 691 F.3d 1152, 1160 (9th Cir. 2012) (internal quotations and 13 citations omitted). “[I]ncorporation-by-reference is a judicially created doctrine that treats 14 certain documents as though they are part of the complaint itself,” Khoja, 899 F.3d at 1002, 15 so long as “the plaintiff refers extensively to the document, or the document forms the basis 16 of the plaintiff’s claim.” United States v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003). 17 However, “[t]he overuse and improper application of judicial notice and the 18 incorporation-by-reference doctrine … can lead to unintended and harmful results 19 [because] [d]efendants face an alluring temptation to pile on numerous documents to their 20 motions to dismiss to undermine the complaint, and hopefully dismiss the case at an early 21 stage.” Khoja, 899 F.3d at 998. “[U]nscrupulous use of extrinsic documents to resolve 22 competing theories against the complaint risks premature dismissals of plausible claims 23 that may turn out to be valid after discovery.” Id. “If defendants are permitted to present 24 their own version of the facts at the pleading stage—and district courts accept those facts 25 as uncontroverted and true—it becomes near[ly] impossible for even the most aggrieved 26 plaintiff to demonstrate a sufficiently ‘plausible’ claim for relief.” Id. at 999. Significantly 27 here, “if the document merely creates a defense to the well-pled allegations in the 28 complaint, then that document did not necessarily form the basis of the complaint. 9 3:2-cv-00061-RBM-KSC 1 Otherwise, defendants could use the doctrine to insert their own version of events into the 2 complaint to defeat otherwise cognizable claims.” Khoja, 899 F.3d 1002. 3 B. 4 Defendant argues Exhibits C through I and M are subject to judicial notice under 5 Federal Rule of Evidence 201 because they are public records and government documents. 6 (Id. at 4–5.) As to Exhibits A, B, J, K, L, and N, Defendant argues they should be 7 incorporated by reference because they are cited in Plaintiffs’ CAC. (Id. at 5–6.) Analysis 8 Plaintiffs oppose the request for judicial notice as to Exhibits A through I (the two 9 court documents and seven FDA documents) “to the extent they are being introduced to 10 establish the truth of their contents.” (Doc. 35-1 at 2–3.) Plaintiffs explain that Defendant 11 is asking the Court to accept the truth of these documents to establish that: “heavy metals 12 and arsenic in their Products are safe[;] that the Products do not contain heavy metals or 13 arsenic[;] and that the Products do not violate Proposition 65.” (Doc. 35-1 at 3.) As to the 14 court documents (Exhibits A and B), Plaintiffs acknowledge they may be subject to judicial 15 notice as court records, but argue that the disputed facts within them cannot be judicially 16 noticed. (Doc. 35-1 at 4–5 (noting Defendant relies on these documents as proof of safe 17 levels of heavy metals in conflict with the allegations of the CAC).) Similarly, Plaintiffs 18 argue the Court may take judicial notice of the FDA publications (Exhibits C through I), 19 but not the facts within them because those facts, particularly concerning whether and to 20 what extent heavy metals in food are avoidable and the amount of heavy metals that pose 21 a significant risk to human health, are disputed in this case. (Id. at 5.) Plaintiffs do not 22 address whether Exhibits A and B may be considered under the incorporation-by-reference 23 doctrine. 5 24 The Court GRANTS Defendant’s request for judicial notice of Exhibits A and B 25 because they are court documents subject to judicial notice under Federal Rule of Evidence 26 27 28 Plaintiffs do not address the incorporation-by-reference doctrine, but the only exhibits Defendant seeks to incorporate by reference that Plaintiffs oppose are Exhibits A and B. 10 5 3:2-cv-00061-RBM-KSC 1 201 and because they are subject to the doctrine of incorporation by reference. (See CAC 2 ¶¶ 162, 226 (CAC relying on these court documents as informing Defendant that their 3 products contained Heavy Metals).) However, to the extent Defendant relies on them to 4 dispute facts alleged in the CAC, they will not be considered.6 5 The Court also GRANTS Defendant’s request for judicial notice of Exhibits C 6 through I, the FDA documents, because the Court can take judicial notice of government 7 documents from a reliable source; however, they will not be considered for purposes of 8 disputing the allegations of the CAC.7 See In re Bare Escentuals, Inc. Sec. Litig., 745 F. 9 Supp. 2d 1052, 1066–67 (N.D. Cal. 2010) (taking judicial notice of SEC filings but 10 indicating they will not be considered for the truth of the matter asserted if inappropriate); 11 Plaintiffs do not oppose the Court’s consideration of the remaining exhibits, 12 including the Products’ full labels (Exhibit N), the December 2022 Report (Exhibit J), the 13 “Test Methodology: Heavy Metals in Chocolate Bars” publication from Consumer Reports 14 (Exhibit K), As You Sow’s 2022 test results for lead and cadmium (Exhibit L), and a 15 California Office of Environmental Health Hazard Assessment, “Proposition 65 in Plain 16 Language,” (Exhibit M). The Court GRANTS the request to incorporate the full product 17 labels, the December 2022 Report, Consumer Reports’ Test Methodology publication, and 18 As You Sow 2022 test results because they are relied on in the CAC. Corbett v. 19 PharmaCare U.S., Inc., 567 F. Supp. 3d 1172, 1182 (S.D. Cal. 2021) (“[C]ourts addressing 20 motions to dismiss product-labeling claims take judicial notice of images of the product 21 packaging if they are reference or the images are in the complaint.”) (citation omitted); 22 23 24 25 26 27 28 As explained below in considering Defendant’s arguments for dismissal of Plaintiffs’ consumer protection claims, the Court is not going to decide as a matter of law at this stage that Defendant’s preferred threshold for Heavy Metals (the levels in its Consent Judgment for purposes of Proposition 65) disposes of all of Plaintiffs’ claims at this stage. 7 As noted below, the Court does consider Exhibit F, the FDA’s “Closer to Zero, Reducing Childhood Exposure to Contaminants from Foods” (“FDA Initiative”), in considering Defendant’s argument for dismissal or a stay under the primary jurisdiction doctrine because both parties rely on it. 11 6 3:2-cv-00061-RBM-KSC 1 Ritchie, 342 F.3d at 908 (documents “plaintiff refers to extensively … or the document 2 forms the basis of the plaintiff’s claim” may be considered under incorporation by 3 reference.) The Court GRANTS the request for judicial notice of Exhibit M because it is 4 a reliable government record that Plaintiffs do not oppose the Court considering. 5 III. 6 7 MOTION TO DISMISS Defendant only moves to dismiss under Rule 12(b)(6). Defendant does not raise any pleading deficiencies under Federal Rule of Civil Procedure 9(b). 8 8 A. 9 Under Rule 12(b)(6), an action may be dismissed for failure to allege “enough facts 10 to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 11 544, 570 (2007). “A claim has facial plausibility when the plaintiff pleads factual content 12 that allows the court to draw the reasonable inference that the defendant is liable for the 13 misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 14 U.S. at 556). “The plausibility standard is not akin to a ‘probability requirement,’ but it 15 asks for more than a sheer possibility that a defendant acted unlawfully.” Id. (citing 16 Twombly, 550 U.S. at 556–57). For purposes of ruling on a Rule 12(b)(6) motion, the court 17 “accept[s] factual allegations in the complaint as true and construe[s] the pleadings in the 18 light most favorable to the nonmoving party.” Manzarek v. St. Paul Fire & Marine Ins. 19 Co., 519 F.3d 1025, 1031 (9th Cir. 2008). Legal Standards 20 However, the Court is “not bound to accept as true a legal conclusion couched as a 21 factual allegation.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555). Nor is the 22 Court “required to accept as true allegations that contradict exhibits attached to the 23 Complaint or matters properly subject to judicial notice, or allegations that are merely 24 conclusory, unwarranted deductions of fact, or unreasonable inferences.” Daniels-Hall v. 25 Nat’l Educ. Ass’n, 629 F.3d 992, 998 (9th Cir. 2010). “In sum, for a complaint to survive 26 27 28 Defendant references Rule 9(b) in its legal standard section, (Doc. 34-1 at 16), but never raises it in the briefing as a basis for dismissal. 12 8 3:2-cv-00061-RBM-KSC 1 a motion to dismiss, the non-conclusory factual content, and reasonable inferences from 2 that content, must be plausibly suggestive of a claim entitling the plaintiff to relief.” Moss 3 v. U.S. Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009) (internal quotation marks omitted). 4 When a Rule 12(b)(6) motion is granted, “a district court should grant leave to amend 5 even if no request to amend the pleading was made, unless it determines that the pleading 6 could not possibly be cured by the allegation of other facts.” Cook, Perkiss & Liehe v. N. 7 Cal. Collection Serv., 911 F.2d 242, 247 (9th Cir. 1990) (citations omitted). 8 B. 9 Defendant moves to dismiss Plaintiffs’ California UCL, FAL, and CLRA claims, 10 “as well as … parallel claims under Washington, Illinois, and New York laws.” (Doc. 34- 11 1 at 18.) Defendant asserts four reasons for dismissal of these claims: (1) “no reasonable 12 consumer could have been misled by something [Defendant] did not say and that does not 13 present a safety issue[;]” (2) [Defendant] had no duty to disclose information about the 14 alleged presence of trace heavy metals[;]” (3) “[t]he presence (or mere ‘risk’) of trace heavy 15 metals in dark chocolate does not affect those products’ value[;]” and (4) as to Plaintiffs’ 16 New York and Washington claims, “Plaintiffs knew or could have found out that dark 17 chocolate products may contain trace levels of heavy metals.” (Doc. 34-1 at 18.) Claims 18 Plaintiffs counter that: (1) Defendant’s arguments regarding a reasonable consumer 19 raise questions of fact, are baseless, and conflict with Plaintiffs’ consumer survey results 20 (Doc. 35 at 16–17); (2) Plaintiffs have sufficiently pled the presence of Heavy Metals in 21 the Products made them unsafe and that this is an issue of fact (id. at 17–23); (3) they have 22 pled economic injury under a price premium theory (id. at 24–26); (4) they have alleged 23 they did not know the Products contained Heavy Metals until the December 2022 Report 24 disclosed it and whether a consumer could obtain information about the presence of Heavy 25 Metals in the Products is a question of fact (id. at 26–29). 26 The Court addresses each of Defendant’s arguments below. 27 28 13 3:2-cv-00061-RBM-KSC 1 a) Plaintiffs’ UCL, FAL, and CLRA Claims 2 “The UCL prohibits ‘any unlawful, unfair or fraudulent business act or practice.’” 3 Hodsdon v. Mars, Inc., 891 F.3d 857, 865 (9th Cir. 2018) (quoting Cal. Bus. & Prof. Code 4 § 17200). “The false advertising law prohibits any ‘unfair, deceptive, or misleading 5 advertising.’” Williams v. Gerber Prods. Co., 552 F.3d 934, 938 (9th Cir. 2008) (quoting 6 Cal. Bus. & Prof. Code 17500). The CLRA “prohibits ‘unfair methods of competition and 7 unfair or deceptive acts or practices.’” Id. (quoting Cal. Civ. Code § 1770). “Courts often 8 analyze these statutes together,” as the Court does here, “because they share similar 9 attributes.” In re Sony Gaming Networks & Customer Data Sec. Breach Litig., 996 F. 10 Supp. 2d 942, 985 (S.D. Cal. 2014); see also Hadley v. Kellogg Sales Co., 243 F. Supp. 3d 11 1074, 1089 (N.D. Cal. 2017) (same). 12 Here, Plaintiffs’ claims are based on the alleged Omissions. (Doc. 35 at 15 (“This 13 is an omissions case where non-disclosure is the entire basis for Plaintiffs’ claims.”).) 14 Courts also analyze these three claims together in omissions cases. See Grauz v. Hershey 15 Co., Case No. 23-cv-0028, 2024 WL 312688, at *3 (S.D. Cal. Jan. 25, 2024) (“Because the 16 omissions theories of liability for the CLRA, FAL, and UCL claims overlap, the Court 17 considers them in tandem.”) (citing Gutierrez v. Johnson & Johnson Consumer, Inc., No. 18 19-CV-1345-DMS-AGS, 2020 WL 6106813, at *5 (S.D. Cal. Apr. 27, 2020)). (1) 19 Reasonable Consumer 9 20 “Whether a business practice is deceptive or misleading ‘under these California 21 statutes is governed by the ‘reasonable consumer’ test.” Moore v. Mars Petcare US, Inc., 22 966 F.3d 1007, 1017 (9th Cir. 2020) (citing Williams, 552 F.3d at 938). “The California 23 Supreme Court has recognized that these statutes prohibit explicitly false advertising and 24 25 26 27 28 Although the Court finds below that Plaintiffs’ California UCL, FAL, and CLRA claims cannot proceed as pled for failing to sufficiently plead an unreasonable safety hazard or that the Products are unfit for human consumption, the Court addresses the parties’ arguments concerning the reasonable consumer test because Plaintiffs are being granted leave to amend and because Defendant relied on this test for purposes of other states’ laws. 14 9 3:2-cv-00061-RBM-KSC 1 advertising that is ‘either actually misleading, or which has a capacity, likelihood, or 2 tendency to deceive or confuse the public.’” McGinty v. Procter & Gamble Co., 69 F.4th 3 1093, 1097 (9th Cir. 2023) (quoting Kasky v. Nike, Inc., 27 Cal. 4th 939, 951 (2002)). 4 “‘Whether a practice is deceptive will usually be a question of fact not appropriate 5 for decision on demurrer’ or motions to dismiss.” Moore v. Mars Petcare US, Inc., 966 6 F.3d 1007, 1017 (9th Cir. 2020) (quoting Williams, 552 F.3d at 938); see also Davis v. 7 HSBC Bank Nev., N.A., 691 F.3d 1152, 1162 (9th Cir. 2012) (same). Rather, it is a “rare 8 situation” when dismissal is appropriate at the pleading stage. Williams, 552 F.3d at 939 9 (“The facts of this case, on the other hand, do not amount to the rare situation in which 10 granting a motion to dismiss is appropriate.”); see also Reid v. Johnson & Johnson, 780 11 F.3d 952, 958 (9th Cir. 2015) (reversing district court dismissal because plaintiff’s claim 12 was plausible and “questions of fact that are appropriate for resolution on a motion to 13 dismiss only in rare situations.”)(quotations and citation omitted) “However, in rare 14 situations a court may determine, as a matter of law, that the alleged violations of the UCL, 15 FAL, and CLRA are simply not plausible.” Cheslow v. Ghirardelli Chocolate Co., 445 F. 16 Supp. 3d 8, 16 (N.D. Cal. 2020) (quoting Ham v. Hain Celestial Grp., Inc., 70 F. Supp. 3d 17 1188, 1193 (N.D. Cal. 2014)). 18 The reasonable consumer test “requires more than a mere possibility that [a] label 19 ‘might conceivably be misunderstood by some few consumers viewing it in an 20 unreasonable manner.’” Ebner v. Fresh, Inc., 838 F.3d 958, 965 (9th Cir. 2019) (quoting 21 Lavie v. Proter & Gamble Co., 105 Cal. App. 4th 496, 508 (2003)). “Rather, the reasonable 22 consumer standard requires a probability ‘that a significant portion of the general 23 consuming public or of targeted consumers, acting reasonably in the circumstances, could 24 be misled.’” McGinty, 69 F.4th at 1097; see also Davis, 691 F.3d at 1162 (“A reasonable 25 consumer is the ordinary consumer acting reasonably under the circumstances.”) 26 (quotation omitted); see also Souter v. Edgewell Personal Care Co., No. 22-55898, 2023 27 WL 5011747, at *1 (9th Cir. Aug. 7, 2023) (“This standard is evaluated from the 28 perspective of the ‘ordinary consumer within the larger population,’ who is not typically 15 3:2-cv-00061-RBM-KSC 1 ‘exceptionally acute or sophisticated’ or ‘wary and suspicious of advertising claims.’”) 2 (quoting Hill v. Roll Int’l Corp., 195 Cal. App. 4th 1295, 1305 (2011)). “The touchstone 3 under the ‘reasonable consumer’ test is whether the product labeling and ads promoting the 4 products have a meaningful capacity to deceive consumers.” McGinty, 69 F.4th at 1097. 5 Here, the Court finds Plaintiffs have plausibly alleged a reasonable consumer could 6 be misled by the lack of any disclosure on the Products indicating that they contain Heavy 7 Metals when they contain the levels of Heavy Metals listed in the CAC. However, the 8 Court notes that this conclusion is based in part on Plaintiffs’ allegations, that this Court 9 must accept as true, that the Products all actually contain undisclosed Heavy Metals, 10 including some exceeding MADL levels on one or two of the Heavy Metals. (See Exhibit 11 L (As You Sow Testing); CAC ¶¶ 76, 132–33.) 12 Defendant argues “trace quantities of heavy metals, like all common elements and 13 minerals, are ubiquitous in the food supply” and “even if they were not, it would still be 14 unreasonable for Plaintiffs to subjectively interpret the lack of any references to heavy 15 metals on the [P]roducts labels as a promise that they contain no trace of those elements.” 16 (Doc. 34-1 at 20 (emphasis added).) Defendant also asserts that a reasonable consumer 17 would not expect the “trace amounts of heavy metals, … far below the amount deemed 18 tolerable by the FDA,” to be disclosed. (Id. (emphasis added)). Defendant also challenges 19 Plaintiffs’ consumer survey results and asserts a reasonable consumer would know 20 Defendant’s dark chocolate bars contain Heavy Metals based on Defendant entering into a 21 Consent Judgment in 2018 with thresholds for Heavy Metals in its chocolate. (Doc. 34-1 22 at 20–21.) 23 As to this last argument, the Court is not persuaded that an “ordinary consumer … 24 who is not typically exceptionally acute or sophisticated or wary and suspicious of 25 advertising claims” would be aware of Defendant’s litigation history or its Consent 26 Judgment and the levels that were set as to Defendant’s chocolate products. Souter, 2023 27 WL 5011747, at *1. While a consumer that is particularly focused on the contents or safety 28 of their food might expend the time to find out Defendant’s litigation history, the resulting 16 3:2-cv-00061-RBM-KSC 1 Consent Judgment, and that it continues to apply, the Court is not persuaded ordinary 2 consumer would know these tolerances or agreed upon levels for Heavy Metals in the 3 Consent Judgment even exist. It is more likely “a significant portion of the general 4 consuming public or of targeted consumers, acting reasonably in the circumstances, could 5 be misled” into thinking their chocolate bars do not contain Heavy Metals at these levels 6 because that information is not disclosed on the packaging. McGinty, 69 F.4th at 1097.10 7 Similarly, Defendant’s arguments regarding the specific levels of Heavy Metals in 8 the Products is not well suited to this stage of the litigation on this issue. Even assuming a 9 reasonable consumer would only be misled by the lack of disclosure of Heavy Metals if 10 the amount of Heavy Metals were at a particularly high level, determining what that level 11 would be for a reasonable consumer is not amenable to resolution on a motion to dismiss. 12 Defendant seems to argue that if anything, the Court should use the Consent Judgment 13 levels, but as noted above, it is not clear why a consumer would only be deceived by the 14 non-disclosure of that amount. Plaintiffs argue any level or even just the risk of any level, 15 that is not disclosed would mislead a reasonable consumer. The Court is not inclined to 16 pick a threshold level of each Heavy Metal in each Product at which a reasonable consumer 17 would be misled by the absence of a label disclosing its presence, particularly in ruling on 18 a motion to dismiss. At this stage of the case, it is sufficient that Plaintiffs allege the 19 Products all contain Heavy Metals and at least some exceed MADL levels in one or two 20 Heavy Metals. 21 Additionally, Defendant’s assertion that the levels are trace and low, particularly 22 when the CAC includes allegations of test results for some of the Products that exceed 23 MADL levels (see CAC ¶ 76; Exhibit L (As You Sow 2022 test results on some of the 24 Products showing they exceed MADLs as to some Heavy Metals), raises a factual 25 26 27 28 Although Plaintiffs’ consumer survey results also bolster their allegations a reasonable consumer would be misled by the Products’ packaging, the Court need not address Defendant’s arguments regarding the consumer survey because the Court finds the Plaintiffs’ other allegations sufficient on this particular test. 17 10 3:2-cv-00061-RBM-KSC 1 challenge not properly raised at this stage. Grausz v. Hershey Co., Case No. 23-cv-0028- 2 AJB-SBC, 2023 WL 6206449, at *7 (S.D. Cal. Sept. 11, 2023) (rejecting a defendant’s 3 calculations showing a plaintiff’s test results were below relevant MADL’s because 4 “factual challenges are not typically adjudicated at this stage of litigation.”); see also In re 5 Plum Baby Food Litig., Case No. 4:21-CV-913-YGR, 2022 WL 16640802, at *2 (N.D. 6 Cal. Jan. 12, 2022) reconsideration denied, No. 4:21-CV-00913-YGR, 2023 WL 3493319 7 (N.D. Cal. May 3, 2023) (finding the determinations “that ‘consumers know and 8 understand that trace amounts of heavy metals are ubiquitous’ and that ‘the mere presence 9 of heavy [metals] is not material to reasonable consumers’ … are factual issues … .”); 10 Rodriguez v. Mondelēz, Case No. 23-cv-00057-DMS-AHG, 2023 WL 8115773, 2023 WL 11 8115773, at *5 (S.D. Cal. Nov. 22, 2023) (“What constitutes an ‘unsafe level’ of lead or 12 cadmium is a question of fact not appropriately resolved on a motion to dismiss.”).11 13 Plaintiffs have plausibly alleged a reasonable consumer could be misled by the lack 14 of any disclosure on the Products indicating that they contain Heavy Metals when they do 15 contain the levels of Heavy Metals alleged in the CAC.12 16 17 18 19 20 21 22 23 24 25 26 27 28 The Court notes, however, to the extent Plaintiffs are attempting to state these claims based solely on the allegations that the Products only have a material risk of containing Heavy Metals, rather than actually containing them, the claims could not proceed on that basis alone. It is somewhat unclear if this is Plaintiffs’ intention, or they are simply asserting that Defendant should have disclosed a material risk based on the actual presence of Heavy Metals in all the Products at the levels asserted in the CAC. The CAC repeatedly asserts as a basis for the claims that Defendant’s “Products contain (or have a material risk of containing) Heavy Metals.” (CAC ¶ 17.) Regardless, given the Court’s grant of leave to amend, the Court notes this for purposes of any amendment. 12 Defendant asserts the claims under Illinois, Washington, and New York should also fail under the reasonable consumer standard under those states’ consumer protection laws. (Doc. 34-1 at 22 (Defendant indicates “[b]ecause Plaintiffs’ allegations fail the reasonable consumer test, their claims fail not only under California law, but also under the parallel laws of New York, Illinois, and Washington.”) Defendant then includes a lengthy footnote citing cases that presumably apply the same or a very similar reasonable consumer test under those states’ laws. (Id. n.6.) Given the Court has found the claims do not fail under the reasonable consumer test and Defendant does not identify any distinction in these state 18 11 3:2-cv-00061-RBM-KSC 1 (2) 2 Unreasonable Safety Hazard or Unfit for Human Consumption 3 As stated above, Plaintiffs agree this is only an omissions case. (Doc. 35 at 15.) 4 “[A] defendant only has a duty to disclose when either (1) the defect at issue relates to an 5 unreasonable safety hazard or (2) the defect is material, ‘central to the product’s function,’ 6 and the plaintiff alleges one of the four LiMandri factors.” Hammerling v. Google, 615 F. 7 Supp. 3d 1069, 1085 (quoting In re Toyota RAV4 Hybrid Fuel Tank Litig., 534 F. Supp. 3d 8 1067, 1102 (N.D. Cal. 2021)); see also Grauz, 2023 WL 6206449, at *9 (relying on this 9 standard for a claim that a defendant failed to disclose lead and cadmium in chocolates); 10 Rodriguez, 2023 WL 8115773, at *10 (same).13 “The LiMandri factors are: (1) the 11 defendant is in a fiduciary relationship with the plaintiff; (2) the defendant had exclusive 12 knowledge of material facts not known to the plaintiff; (3) the defendant actively conceals 13 a material fact from the plaintiff; or (4) the defendant makes partial representations but also 14 suppresses some material facts.” Hammerling, 615 F. Supp. 3d at 1085 (citing LiMandri, 15 52 Cal. App. 4th at 336). 16 Defendant argues “Plaintiffs do not and cannot show that Trader Joe’s had a duty to 17 disclose trace levels of heavy metals, much less a duty to disclose the mere risk of them.” 18 (Doc. 34-1 at 22.) Defendant argues “[t]here is no duty to disclose—and thus, no actionable 19 omission—where, as here, the plaintiff fails to allege that the undisclosed information 20 ‘caused an unreasonable safety hazard.” (Id. at 23 (citing Wilson v. Hewlett-Packard Co., 21 22 23 24 25 26 27 28 laws that would compel a different conclusion, the Court does not address the other states on this point. 13 Hammerling acknowledges that this area of law has been “marked by general disarray” with two tests in the case law. 615 F. Supp. 3d at 1085 (quoting In re Toyota RAV4 Hybrid Fuel Tank Litig., 534 F. Supp. 3d at 1101. The first is above. Id. The second finds a duty to disclose when “(1) the defect relates to an unreasonable safety hazard; (2) the defect is material and related to the product’s central function; or (3) the presence of one of the four LiMandri factors. Id. (citing In re Toyota RAV4 Hybrid Fuel Tank Litig, 534 F. Supp. 3d at 1102) (emphasis in original). The parties do not seek application of the second test. 19 3:2-cv-00061-RBM-KSC 1 668 F.3d 1136, 1141 (9th Cir. 2012)).) Additionally, Defendant argues “the alleged 2 presence (or risk of presence) of trace heavy metals in the [P]roducts is not related to the 3 chocolate’s function as a chocolate” and that “containing any amount of heavy metals does 4 not objectively render the products unfit for consumption.” (Doc. 34-1 at 23 (citing 5 Hodson, 891 F.3d at 864).)14 6 In response, Plaintiffs assert that this “is a hotly contested issue of fact” and whether 7 the Products were “unsafe … is not ripe for determination at this stage.” (Doc. 35 at 20– 8 21.) Plaintiffs also point to their allegations that: arsenic, cadmium, and lead cause a 9 variety of health problems; that Heavy Metals accumulate, and even small amounts can 10 lead to health issues with long term exposure; and that no amount of lead is safe and that 11 even low levels of cadmium can be harmful. (Id. (citing CAC ¶¶ 104–03, 107–08, 112– 12 15, 117 119–20, 122–23).) Plaintiffs also briefly assert that “the Products in this case no 13 longer serve their ‘central function’ as food” because Plaintiffs allege “the levels of Heavy 14 Metals in the Products exceed the MADL and that chocolate with appreciable amounts … 15 of Heavy Metals are not suitable for consumption … .” (Id. at 23.) 16 The Court finds that Plaintiffs have not plausibly alleged an unreasonable safety 17 hazard or that the Products’ defect is central to their function. Again, the Court is not 18 persuaded by Defendant’s characterization of the amounts of Heavy Metals as trace, 19 20 21 22 23 24 25 26 27 28 Defendant also relies on numerous FDA documents and its Consent Judgment-levels in arguing the levels alleged in the CAC cannot represent an “unreasonable safety hazard.” (Doc. 34-1 at 24–26.) However, the Court cannot find as a matter of law on a motion to dismiss that Consent Judgment-levels that Defendant asserts supplant Proposition 65 MADL-levels, preclude Plaintiffs’ claims that are based in part on health issues not covered by Proposition 65. See Rodriguez, 2023 WL 8115773, at *8 (finding a plaintiff’s claims regarding Heavy Metals in dark chocolate independent of Proposition 65 because in addition to cancer causing and reproductive harm covered by Proposition 65, the plaintiff alleged, as Plaintiffs do here, that Heavy Metals also cause other health problems). As discussed above, the Court is not taking judicial notice of these documents for purposes of disputing Plaintiffs’ allegations (see supra II.B), and the Court need not rely on them to conclude the CAC does not plausibly allege the amounts of Heavy Metals allegedly in these Products have created an unreasonable safety hazard. 20 14 3:2-cv-00061-RBM-KSC 1 particularly at this stage of the case. However, there is a disconnect in the CAC between 2 Plaintiffs’ allegations about the potential harms posed by Heavy Metals as a general matter 3 and whether these Heavy Metals are unreasonably hazardous at the particular levels in the 4 specific Products at issue in this case. The allegations that some are above MADL levels 5 in some Heavy Metals is certainly a significant step closer to plausibility. But that alone, 6 particularly when it is so unclearly stated,15 is not enough. Plaintiffs ask the Court to find 7 the levels of Heavy Metals alleged in the CAC plausibly allege an unreasonable safety 8 hazard and that humans should not be consuming them based only on general allegations 9 that there can be health issues with these Heavy Metals at low levels of exposure. While 10 the Court recognizes Plaintiffs may not be able to pinpoint a specific level at which these 11 Products would become an unreasonable safety hazard or unfit for human consumption, 12 they have to at least provide some connection between the general harms possible from 13 Heavy Metals and the levels of Heavy Metals in these Products. For example, the CAC 14 alleges “the Products have been shown to contain detectable levels of Heavy Metals which 15 are known to pose human health risks.” (Id. ¶ 16.) However, alleging that Heavy Metals 16 can pose human health risks at some unidentified level does not mean the levels in these 17 Products pose a human health risk, particularly not one great enough to constitute an 18 unreasonable safety hazard or make them unfit for human consumption. 19 Plaintiffs argue that whether the presence of these Heavy Metals makes them an 20 unreasonable safety hazard is a hotly contested fact issue. However, the issue here is not 21 a factual dispute; it is a pleading deficiency. To put it another way, Plaintiffs cannot just 22 say Heavy Metals can be unhealthy and these Products contain some level of Heavy Metals. 23 They have to connect the health risks alleged to the levels of Heavy Metals in these 24 Products and they have to be significant enough to be unfit for human consumption or an 25 unreasonable safety hazard. Other decisions on chocolate products in this district have 26 27 28 For example, as summarized above, Plaintiffs identify test results showing the levels of Heavy Metals in the Products (CAC ¶¶ 132–33), but they do not allege that these levels can cause the harms alleged. 21 15 3:2-cv-00061-RBM-KSC 1 identified the same problem with pleadings. See Grausz, 2023 WL 6206449, at *10 2 (finding the plaintiff “does not plead that the amounts of the substances in [the] Products 3 have caused harm or create an unreasonable safety hazard” after noting similar allegations); 4 see also Rodriguez, 2023 WL 8115773, at *10 (finding “nowhere do Plaintiffs allege that 5 the safety hazard was unreasonable.”) Because the CAC fails to adequately plead an 6 unreasonable safety hazard or that the Products are unfit for human consumption, 7 Plaintiffs’ California UCL, FAL, and CLRA omissions claims 16 are DISMISSED 8 WITHOUT PREJUDICE and the Court GRANTS Plaintiffs leave to amend.17 9 (3) Economic Injury 10 Although the Court has already determined Plaintiffs’ consumer protection claims 11 must be dismissed for the reasons stated above, the Court briefly addresses Defendant’s 12 additional argument that Plaintiffs have failed to plead economic injury. Defendant asserts 13 the CAC fails to plead Plaintiffs “suffered a cognizable injury as a result of [Defendant’s] 14 conduct.” (Doc. 34-1 at 27 (citing Ries v. Arizona Beverages, USA LLC, 287 F.R.D. 523, 15 529 (N.D. Cal. 2012).) Defendant challenges Plaintiffs’ premium price theory, arguing it 16 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiffs are correct that Defendant’s Motion does not address Plaintiffs’ claims under Washington, Illinois, and New York consumer protection statutes on this issue, i.e. an omission Defendant had duty to disclose. Defendant includes only a single footnote on this issue that briefly addresses a way in which Defendant argues Illinois law is more restrictive than California. (Doc. 34-1 at 22 n.7 (stating the standard is even higher in Illinois because it requires direct statements that contain material omissions). Plaintiffs accurately note that Defendant does not otherwise address this issue beyond California law. (Doc. 35 at 17.) Given Defendant did not address Plaintiffs’ consumer protection claims under other states’ laws on this issue in its Motion and only included a footnote that would not appear to provide a basis for dismissal here, the Court does not dismiss those claims on this basis. 17 As to amendment, the Court notes that just adding an allegation that these Products pose an unreasonable safety hazard or are unfit for human consumption would be too conclusory to survive a motion to dismiss. However, if those allegations were combined with more specific allegations as to the danger or severity of harm caused by these particular levels of Heavy Metals in a food product, it might be sufficient to plausibly allege they pose an unreasonable safety hazard or are unfit for human consumption. 22 16 3:2-cv-00061-RBM-KSC 1 cannot succeed when all competing products suffer from the same flaw, i.e. all dark 2 chocolate products “contain trace heavy metals.” (Id. at 27.) Defendant also argues that 3 because Plaintiffs do not allege the Products “were not edible or otherwise lacked the 4 qualities of chocolate, this theory fails.” (Id. at 28.) Defendant also asserts the Products 5 are not “valueless by trace heavy metals” because Plaintiffs still received some benefit, i.e. 6 “flavor, energy, or anything else of value” from the Products. (Id. (quoting In re Pom 7 Wonderful LLC, No. ML 10-02199 DDP (RZx), 2014 WL 1225184, at *3 n.2 (C.D. Cal. 8 Mar. 25, 2014) and citing In re Fruit Juice Prod. Mktg. & Sales Pracs. Litig., 831 F. Supp. 9 2d 507, 512 (D. Mass. 2011).) 10 The Ninth Circuit has “consistently recognized that a plaintiff can satisfy the injury 11 in fact requirement by showing that [they] paid more for a product than [they] otherwise 12 would have due to a defendant’s false representations about the product.” McGee v. S-L 13 Snacks Nat’l, 982 F.3d 700, 706 (9th Cir. 2020). “Under California law, the economic 14 injury of paying a premium for a falsely advertised product is sufficient harm to maintain 15 a cause of action.” Davidson v. Kimberly-Clark Corp., 889 F.3d 956, 965 (9th Cir. 2018). 16 “To properly plead an economic injury, a consumer must allege that she was exposed to 17 false information about the product purchased, which caused the product to be sold at a 18 higher price, and that she would not have purchased the goods in question absent this 19 misrepresentation.” Id. at 966. 20 Here, each of the Plaintiffs allege they purchased one or more of the Products, 21 believed they were purchasing “high quality dark chocolate products from Trader Joe’s[,]” 22 and “relied upon the packaging of the Products.” (Id. ¶¶ 27, 29–30, 32–33, 35–36, 38–39, 23 41–42, 44–45, 47–48, 50–51, 53–54, 56–57, 59–60, 62–63, 65.) They also allege they 24 were “unaware the Products contained (or had a material risk of containing) any level of 25 Heavy Metals … and would not have purchased the Products if that information had been 26 27 28 23 3:2-cv-00061-RBM-KSC 1 fully disclosed.”18 (Id. ¶¶ 29, 32, 35, 38, 41, 44, 47, 50, 53, 56, 59, 62, 65.) Similarly, 2 Plaintiffs allege they “would not have purchased the Products or would have paid 3 substantially less for them but for the Omissions.” (Id. ¶¶ 18, 22 (“Plaintiffs paid more for 4 the Products than they would have had they known the truth about the Products … .”).) 5 Although, as discussed above, there is a deficiency in the CAC as to Defendant’s omission, 6 assuming that deficiency were remedied, Plaintiffs have sufficiently alleged they suffered 7 an economic injury. Grausz, 2023 WL 6206449, at *4 (finding a plaintiff plausibly alleged 8 an injury based on allegations she “bought a product that she otherwise would not have 9 purchased, or would have only purchased at a lower price, had she known it contained 10 heavy metals.”); Moore, 966 F.3d at 1020 (reversing the district court and finding plaintiffs 11 allegations, while not detailed were sufficient to survive a motion to dismiss when plaintiffs 12 alleged each plaintiff paid more for the product at issue than each would have paid in the 13 absence of the misrepresentation). The CAC is not subject to dismissal for failing to 14 sufficiently plead economic injury. 15 (4) Plaintiffs’ Knowledge 16 Defendant argues Plaintiffs’ New York and Washington claims fail because 17 Plaintiffs cannot allege they had no way of knowing the Products might contain Heavy 18 Metals. (Doc. 34-1 at 28.) Defendant points to the 2015 lawsuit and resulting Consent 19 Judgment that are referenced in the CAC. (Id. at 29.) Plaintiff relies on these in the CAC 20 to establish Defendants were aware their Products contained undisclosed Heavy Metals, 21 but here Defendant relies on them as proof that Plaintiffs could have or should have known 22 the Products contained Heavy Metals. (Id. at 29.) 23 “[A] plaintiff claiming an omission constitutes actionable deception must show 24 either that the business alone possessed the relevant information, or that a consumer could 25 not reasonably obtain the information.” See Kyszenia v. Ricoh USA, Inc., 583 F. Supp. 3d 26 27 28 The Court recognizes there is a difference between being misled by false information and an omission, however, at this stage, if Plaintiffs adequately alleged Defendant failed to disclose information it had a duty to disclose, the economic injury is adequately stated. 24 18 3:2-cv-00061-RBM-KSC 1 350, 360 (E.D.N.Y. 2022) (finding public discussions about the issue alleged undercut a 2 claim the “defendant alone possessed the knowledge,” it was “not fatal to the plaintiffs’ 3 claims because “an omission can still be actionable where it is shown that that ‘a consumer 4 could not reasonably obtain’ the omitted information.”) (quoting Pelman v. McDonald’s 5 Corp., 237 F. Supp. 2d 512, 529 (S.D.N.Y. 2003) (collecting cases); see also Levy v. Hu 6 Prods. LLC, 23 Civ. 1381 (AT), 2024 WL 897495, at *5 (S.D.N.Y. Mar. 1, 2024) (finding 7 the plaintiff has sufficiently alleged “that a consumer could not reasonably determine how 8 much lead the Products contained, as detecting these chemicals requires expensive 9 scientific testing.”); see also Favors v. Matzke, 53 Wash. App. 789, 796 (1989) (“In 10 Washington, the court will find a duty to disclose … where a seller has knowledge of a 11 material fact not easily discoverable by the buyer … .”). 12 As discussed above in addressing the reasonable consumer standard (see supra 13 III.B.a)(1)), the Court is not persuaded that Plaintiffs had or should have had knowledge of 14 Defendant’s litigation history and the resulting Consent Judgment. Additionally, Plaintiffs 15 have pled the opposite, i.e. that “it was only through testing conducted by Consumer 16 Reports that the general public became aware of the Heavy Metal content in Defendant’s 17 Products.” (CAC ¶ 17.) The CAC sufficiently alleges Plaintiffs did not have knowledge 18 that the Products contained Heavy Metals and that Defendant did. At this stage of the 19 proceeding, the Court is not inclined to find as a matter of law that Plaintiffs should have 20 known about the Heavy Metals in the Products. 21 22 b) Breach of Implied Warranty of Merchantability and Unjust Enrichment 23 Defendant argues Plaintiffs’ claim for breach of the implied warranty of 24 merchantability should be dismissed because the “trace levels alleged … do not render the 25 products dangerous, let alone unsafe to consume,” i.e. “that the Products are unfit for 26 human consumption.” (Doc. 34-1 at 33; Doc. 36 at 19 (challenges sufficiency of pleading 27 “mere presence of even trace levels is unsafe or renders the [P]roducts unfit for human 28 consumption” and asserting “trace heavy metals permeate … the food supply.”).) 25 3:2-cv-00061-RBM-KSC 1 Defendant also asserts Plaintiffs have failed to allege the Products “were a ’market outlier’ 2 in allegedly containing heavy metals.” (Id. at 33–34 (citing Ferry v. Mead Johnson & Co., 3 LLC, 514 F. Supp. 3d 418, 452 (D. Conn. 2021).) As to the unjust enrichment claim, 4 Defendant moves to dismiss it because it is duplicative of Plaintiffs’ statutory claims, and 5 the variance in state law precludes a nationwide unjust enrichment claim. (Doc. 34-1 at 6 34–35.) 7 As to both claims Defendant seeks dismissal because “Plaintiffs fail to allege which 8 state law governs either common law claim.” (Doc. 34-1 at 35.) On this issue, as to the 9 breach of implied warranty of merchantability claim, Plaintiffs assert “[t]he CAC makes 10 clear that California law would apply to the Class,” including this claim. (Doc. 35 at 37 11 (citing CAC ¶¶ 156–57, 25–26).) As to the unjust enrichment claim, Plaintiffs state “[t]his 12 argument should be rejected for the same reasons set forth above,” referring to its position 13 on this issue for the breach of implied warranty of merchantability claim. (Id.) 14 The Court finds the CAC does not allege which state law governs either of these 15 claims. (See CAC ¶¶ 217–230 (breach of implied warranty of merchantability); ¶¶ 231– 16 38 (unjust enrichment claim).) The Court should not have to speculate as to the law 17 applicable to any claim. Neither claim identifies the state law applicable and Plaintiffs’ 18 citation of four paragraphs of their 287-paragraph CAC, none of which are listed under 19 these two claims, does not persuade the Court that the CAC “makes clear” Plaintiffs assert 20 these claims only under California law. (Doc. 35 at 37 (citing ¶¶ 25–26, 156–57).) The 21 law under which a claim is brought is important for any claim, but it is particularly 22 important in a case where Plaintiffs bring claims on behalf of a nationwide class and state 23 subclasses and also bring claims under other states’ laws. (CAC ¶¶ 239–87.) Neither the 24 Defendant nor the Court should have to speculate as to the legal basis for a claim 25 particularly when assessing whether claims on behalf of a nationwide class should be 26 dismissed. See Augustine v. Talking Rain Beverage Co., Inc., 386 F. Supp. 3d 1317, 1333, 27 (S.D. Cal. 2019) (finding “Plaintiffs failure to identify which state laws govern their 28 common law claims means the claims brought on behalf of the nationwide class have not 26 3:2-cv-00061-RBM-KSC 1 been adequately pled.”). 2 However, Plaintiffs rightly point out this particular deficiency can be cured by 3 amendment. (Doc. 35 at 37 (“should the Court find that a more direct statement that 4 California law applies to these claims and should be included in the CAC, such a change 5 is easily cured by amendment.”).) Therefore, Plaintiffs breach of implied warranty of 6 merchantability claim and unjust enrichment claims are DISMISSED WITHOUT 7 PREJUDICE and the Court GRANTS Plaintiffs leave to amend. 19 8 C. 9 Defendant seeks dismissal or a stay of this case under the primary jurisdiction 10 doctrine. (Doc. 34-1 at 29–32; Doc. 36 at 17–18.) Defendant relies on the FDA’s authority 11 in the safety of the food supply (Doc. 34-1 at 30–31); the volume of recent cases being 12 filed based on heavy metals in chocolate bars (id. at 31–32), and “the competing policy 13 considerations that any solution will need to account for” (id. at 32). Primary Jurisdiction Doctrine 14 In response, Plaintiffs explain that their claims “do[] not turn on food regulations” 15 (Doc. 30 at 30–32); the FDA Initiative that Defendants rely on does not address labeling 16 or safe levels of heavy metals in chocolate bars (id. at 30–31, 33); courts are competent to 17 address state law claims that a reasonable consumer has been misled by packaging (id. at 18 19 20 21 22 23 24 25 26 27 28 The Court notes for purposes of amending these claims that other decisions in this district assessing the sufficiency of implied warranty of merchantability claims in cases concerning heavy metals in chocolates have only found them sufficient when the plaintiffs alleged they did not conform to like products or contained high levels of heavy metals. Grausz, 2024 WL 312688, *8–9 (finding the plaintiff failed to sufficiently plead the chocolates purchased were unfit for consumption or use as chocolates, but sufficiently pled they did not conform to like products in the trade); Rodriguez, 2023 WL 8115773, at *12–13 (finding the plaintiff sufficiently stated a claim because the complaint repeatedly alleged the chocolate products were unsafe for consumption because they contained high levels of heavy metals) (emphasis added); see also Grausz, 2023 WL 6206449, at *10–11 (dismissing this claim as to earlier version of the complaint because the plaintiff only asserted, without specific factual support, that the products at issue were unfit for human consumption and lacked allegations “showing that the chocolates purchased by [the] [p]laintiff were somehow distinct from those that are safe.”). 27 19 3:2-cv-00061-RBM-KSC 1 32–33); and the FDA Initiative concerns heavy metals in baby food, not chocolate, and the 2 FDA has set only generalized timelines to finalize a plan by 2025 (id. at 33–34). 3 “The primary jurisdiction doctrine allows courts to stay proceedings or to dismiss 4 without prejudice pending the resolution of an issue within the special competence of an 5 administrative agency.” Clark v. Time Warner Cable, 523 F.3d 1110, 1114 (9th Cir. 2008). 6 “It applies in ‘limited circumstances’ and is ‘not designed to secure expert advice from 7 agencies every time a court is presented with an issue conceivably within the agency’s 8 ambit.’” Reid, 780 F.3d at 966 (quoting Clark, 523 F.3d at 1114); see also GCB Commc’ns, 9 Inc. v. U.S. S. Commc’ns, Inc., 650 F.3d 1257, 1263–64 (9th Cir. 2011) (“[T]he primary 10 jurisdiction doctrine is not jurisdictional at all in the usual sense; ‘it is a prudential doctrine 11 under which courts may, under appropriate circumstances, determine that the initial 12 decisionmaking responsibility should be performed by the relevant agency rather than the 13 courts.’”) (quoting Syntek Semiconductor Co., Ltd. v. Microchip Tech. Inc., 307 F.3d 775, 14 780 (9th Cir. 2002)). “When deciding whether to defer jurisdiction at the motion to dismiss 15 stage, courts must ‘apply a standard derived from Rule 12(b)(6) jurisprudence; whether the 16 complaint plausibly asserts a claim that would not implicate the primary jurisdiction 17 doctrine.’” Liou v. Organifi, LLC, 491 F. Supp. 3d 740, 751 (S.D. Cal. 2020) (quoting 18 County of Santa Clara v. Astra United States, 588 F.3d 1237, 1251–52 (9th Cir. 2009) 19 rev’d on other grounds, 563 U.S. 110 (2011)). 20 “In evaluating primary jurisdiction, [courts] consider ‘(1) the need to resolve an issue 21 that (2) has been placed by Congress within the jurisdiction of an administrative body 22 having regulatory authority (3) pursuant to a statute that subjects an industry or activity to 23 a comprehensive regulatory authority that (4) requires expertise or uniformity in 24 administration.” Astiana v. Hain Celestial Grp., Inc., 783 F.3d 753, 760 (9th Cir. 2015) 25 (quoting Syntek, 307 F.3d at 781). Additionally, “courts must also consider whether 26 invoking primary jurisdiction would needlessly delay the resolution of claims.” Id. (citing 27 Reid, 780 F.3d at 967–68 and United States v. Phillip Morris USA, Inc., 686 F.3d 832, 838 28 (D.C. Cir. 2012)). “Under [Ninth Circuit] precedent, ‘efficiency’ is the ‘deciding factor’ 28 3:2-cv-00061-RBM-KSC 1 in whether to invoke primary jurisdiction.” Id. (citing Rhoades v. Avon Prods., Inc., 504 2 F.3d 1151, 1165 (9th Cir. 2007)). 3 The Court finds this case should not be dismissed or stayed under the primary 4 jurisdiction doctrine. Significantly here, Defendant does not address the delay that would 5 result if this case were stayed until the FDA issues its anticipated guidance. (Doc. 36 at 18 6 (only referring to the FDA Initiative guidance as “upcoming” and “pending” without 7 addressing the delay in staying this litigation until the FDA’s guidance is issued).) Even 8 assuming the guidance is applicable to the full scope of Plaintiffs’ claims in this case and 9 could properly be applied to dark chocolate, invoking the primary jurisdiction doctrine 10 would cause significant delay in the resolution of Plaintiffs’ claims. Rodriguez, 2023 WL 11 8115773, at *14 (“Given the uncertainty of what action the FDA will take on lead and 12 cadmium [through the FDA Initiative], and when, the Court declines to invoke the primary 13 jurisdiction doctrine.”); In re Plum Baby Food Litig., 2022 WL 16640802, at *1 14 (“[U]ncertainty over how and when the FDA will act counsels against an indefinite stay.”); 15 see also White v. Beech-Nut Nutrition Co., 23-220-cv, 2024 WL 194699, at *2 (2d Cir. Jan. 16 18, 2024) (vacating district court dismissal of case alleging presence of certain toxic metals 17 in baby food under the primary jurisdiction doctrine because “[t]he FDA no longer expects 18 to finalize lead action levels in April 2024 and has also revised its expected timeline for 19 issuing draft guidance on proposed action levels for arsenic and cadmium.”). 20 Additionally, Plaintiff’s claims “present[] a typical consumer protection case within 21 this Court’s province because ‘allegations of deceptive labeling do not require the expertise 22 of the FDA to be resolved in the courts.” Liou, 491 F. Supp. 3d at 751 (quoting Jones v. 23 ConAgra Foods, Inc., 912 F. Supp. 2d 889, 899 (N.D. Cal. 2012)). The primary jurisdiction 24 doctrine does not “require[] that all claims within an agency’s purview … be decided by 25 the agency,” rather it “‘is properly invoked when a claim is cognizable in federal court but 26 requires resolution of an issue of first impression, or of particularly complicated issue that 27 Congress has committed to a regulatory agency.’” Syntek Semiconductor Co., Ltd., 307 28 F.3d at 780 (quoting Brown v. MCI WorldCom Network Servs., Inc., 277 F.3d 1166, 1172 29 3:2-cv-00061-RBM-KSC 1 (9th Cir. 2002)). Cases concerning dark chocolate bar labeling may be on the rise of late, 2 but cases challenging food product labels are not an issue of first impression, and these 3 cases do not necessarily require the FDA’s expertise. Grausz, 2023 WL 6206449, at *1– 4 2, 7 (finding “none of Plaintiff’s claims require such FDA expertise, offer an issue of first 5 impression, or offer an issue outside the conventional experience of judges” in case 6 alleging the labels on certain dark chocolate bars omitted the presence of lead and 7 cadmium). Rodriguez, 2023 WL 8115773, at *1–2, 14 (finding “[t]he issues raised in 8 Plaintiffs’ claims ‘do not clearly require the FDA’s expertise or benefit from the uniformity 9 in administration,” and “[c]ourts can determine the viability of such claims” in cases 10 concerning misleading labeling of dark chocolate bars); Rodriguez v. Endangered Species 11 Chocolate, LLC, Case No. 23-cv-54-BTM-JLB, at 5 (S.D. Cal. March 18, 2024) (finding 12 primary jurisdiction doctrine inapplicable in case alleging non-disclosure of lead in dark 13 chocolate); In re Plum Baby Food Litig., 2022 WL 16640802, at *1 (“The Court need not 14 rely on the FDA’s expertise or its potential guidance on action levels to determine whether 15 [Defendant’s] alleged omissions are actionable given the allegations of the operative 16 complaint,” i.e. allegations the defendant “failed to disclose that its baby food products 17 contain (or have a risk of containing) heavy metals (namely arsenic, cadmium, lead, and 18 mercury), and perchlorate.”) 19 20 Defendant’s motion to dismiss or stay Plaintiffs claims based on the primary jurisdiction doctrine is DENIED. 21 D. 22 Defendant raises three standing challenges: (1) that Plaintiffs lack standing to bring Standing 23 claims on behalf of a nationwide class (Doc. 34-1 at 35–37); (2) that Plaintiffs lack 24 standing to pursue injunctive relief (id. at 37–38); and (3) that Plaintiffs lack standing as 25 to products they did not purchase (id. at 38–39). Because most of Plaintiffs’ claims have 26 been dismissed, the Court only briefly addresses these issues. 27 28 30 3:2-cv-00061-RBM-KSC 1 1. Standing for Nationwide Class Claims 2 Defendant argues Plaintiffs are improperly attempting to bring “common-law claims 3 on behalf of a nationwide class, including putative class members in dozens of states with 4 which they allege no connection.” (Doc. 34-1 at 36.) Anticipating Plaintiffs’ position, 5 Defendant asserts this issue should not be deferred to class certification because the parties 6 would waste resources on class discovery for 50 states when they only can pursue claims 7 for “a small sliver” of them. (Id. at 36.) 8 In response, Plaintiffs assert this is not a standing issue, but rather an issue to be 9 raised through analysis of typicality and adequacy of representation at the class 10 certification stage. (Doc. 35 at 38–39.) More specifically, Plaintiffs argue the Ninth 11 Circuit has “warned against ‘conflating standing and class certification.’” (Doc. 35 at 39 12 (quoting Melendres v. Arpaio, 784 F.3d 1254, 1261–62 (9th Cir. 2015).) 13 “District courts in California are split on the issue of whether standing inquiries can 14 be deferred until after class certification, but they note a trend that courts can address 15 standing at the pleadings stage and dismiss claims brought under state laws that have no 16 connection to the named plaintiff.” Walcoff v. Innofoods USA, Inc., No. 22-CV-1485- 17 MMA (AHG), 2023 WL 3262940, at *5–6 (S.D. Cal. May 4, 2023) (collecting cases and 18 finding a plaintiff did not have standing to pursue claims under the laws of states where 19 she did not reside or purchase products); see also Vitiosus v. Alani Nutrition, LLC, No. 21- 20 cv-2048-MMA-MDD, 2022 WL 2441303, at *10 (S.D. Cal. July 5, 2022) (“It is well 21 within the Court’s discretion to strike or dismiss Plaintiffs’ nationwide class allegations at 22 the pleadings stage [rather] than at class certification.”). Given the lack of clarity in 23 Plaintiffs’ claims for breach of the implied warranty of merchantability and unjust 24 enrichment, as well as dismissal of most of Plaintiffs other claims with leave to amend, the 25 Court declines to address Plaintiffs’ standing to bring claims on behalf of a nationwide 26 class. However, the Court does not preclude Defendant from raising the issue in response 27 to an amended pleading. 28 31 3:2-cv-00061-RBM-KSC 1 2. Standing for Injunctive Relief 2 Defendant argues Plaintiffs lack standing to pursue injunctive relief because they 3 have no possibility of future injury from the Products. (Doc. 34-1 at 37–38.) In Opposition, 4 Plaintiffs explain that their allegations that they want to purchase an uncontaminated 5 version of the Products in the future is sufficient for standing. (Doc. 35 at 40.) 6 “For injunctive relief, which is a prospective remedy, the threat of injury must be 7 ‘actual and imminent, not conjectural or hypothetical.’” Davidson v. Kimberly-Clark 8 Corp., 889 F.3d 956, 967 (9th Cir. 2018) (quoting Summers v. Earth Island Inst., 555 U.S. 9 488, 493 (2009)). In resolving a split among district courts, the Ninth Circuit settled the 10 “split in favor of plaintiffs seeking injunctive relief” and held “that a previously deceived 11 consumer may have standing to seek an injunction against false advertising or labeling, 12 even though the consumer now knows or suspects that the advertising was false at the time 13 of the original purchase, because the consumer may suffer an ‘actual and imminent, not 14 conjectural or hypothetical’ threat of future harm.” Id. at 969 (quoting Summers, 555 U.S. 15 at 493). The court explained that “knowledge that the advertisement or label was false in 16 the past does not equate to knowledge that it will remain false in the future.” Id. at 969– 17 70. The court explained that “[i]n some cases, the threat of future harm may be the 18 consumer’s plausible allegations that she will be unable to rely on the products advertising 19 or labeling in the future, and so will not purchase the product although she would like to.” 20 Id. at 969–70 (citations omitted). Here, the CAC includes allegations that Plaintiffs “would 21 be willing to purchase Trader Joe’s dark chocolate products in the future if [they] could be 22 certain that they do not contain (or have a material risk of containing) Heavy Metals.” (Id. 23 ¶¶ 29, 32, 35, 38, 41, 44, 47, 50, 53, 59, 62.) This is sufficient at this stage. 24 Defendant’s motion to dismiss based on lack of standing for injunctive relief is 25 DENIED. See In re Plum Baby Food Litig., 2022 WL 16640802, at *1 (denying dismissal 26 based on lack of standing when plaintiffs alleged they would be willing to purchase baby 27 food in the future “if [they] could be certain that they do not contain (or have a material 28 risk of containing Heavy Metals or perchlorate.”) (citing Davidson, 889 F.3d at 967); see 32 3:2-cv-00061-RBM-KSC 1 also Stewart v. Kodiak Cakes, LLC, 537 F. Supp. 3d 1103, 1127–28, 2021 WL 1698695 2 (S.D. Cal. 2021) (finding plaintiffs had standing based on being unable to rely on or check 3 defendant’s statements on its packaging and distinguishing from information available on 4 the products). 5 3. Standing as to Products Plaintiffs Did Not Purchase 6 Defendant argues Plaintiffs lack standing as to the Trader Joe’s Swiss 72% Cacao 7 Dark Chocolate Bar because, unlike the other seven bars identified, none of the Plaintiffs 8 purchased this bar. (Doc. 34-1 at 38.) Defendant acknowledges that “some courts allow 9 claims about unpurchased products if plaintiffs can demonstrate that those products are 10 substantially similar to purchased products” but argues Plaintiffs have not pled “that the 11 Swiss Bar is substantially similar to products they did purchase.” (Id. at 39.) Defendant 12 specifically points to the Swiss Bar being imported from a different country that other bars 13 and explains this is significant because the CAC points to the point of origin, growing 14 practices, and manufacturing practices having a role in the levels of heavy metals in 15 chocolate. (Id.) In Opposition, Plaintiff points to the Swiss Bar being similar to the other 16 Products because it is a dark chocolate bar, has the same omission regarding Heavy Metals, 17 and that is has similar consumer expectations. (Doc. 35 at 42–43.) 18 As the Court explained in a recent decision, “there is no controlling authority on 19 whether plaintiffs have standing for products they did not purchase.” Anderberg v. Hain 20 Celestial Grp., Inc., 652 F. Supp. 3d 1232, 1240 (S.D. Cal. 2023), reconsideration denied, 21 No. 3:21-CV-01794-RBM-SBC, 2023 WL 7311200 (S.D. Cal. Nov. 6, 2023). “Some 22 federal courts have held that a plaintiff lacks standing to assert such claims … and [o]thers 23 ‘hold that a plaintiff may have standing to assert claims for unnamed class members based 24 on products he or she did not purchase so long as the products and alleged 25 misrepresentations are substantially similar.’” Id. (quoting Miller v. Ghirardelli Chocolate 26 Co., 912 F. Supp. 2d 861, 869 (N.D. Cal. 2012) (other citations omitted). Additionally, 27 “[s]ome courts have held that the standing inquiry is more appropriately resolved on a 28 motion for class certification.” Id. (citing Cardenas v. NBTY, Inc., 870 F. Supp. 2d 984, 33 3:2-cv-00061-RBM-KSC 1 992–92 (E.D. Cal. 2012) and Forcellati v. Hyland’s, Inc., 876 F. Supp. 2d 1155, 1161 (C.D. 2 Cal. 2012)). Here, while the Court recognizes there may be important distinctions in the 3 origins of the chocolate bars, the Court finds the Swiss Bar is similar to the other Products 4 in that they are all chocolate bars, they all have higher cacao percentages, they all lacked 5 any disclosure of Heavy Metals, but they all contain Heavy Metals. Accordingly, the Court 6 declines to require dismissal of the Swiss Bar, although the issue may be revisited if the 7 case proceeds to class certification. 8 IV. 9 CONCLUSION Plaintiffs UCL, FAL, CLRA, Breach of Implied Warranty of Merchantability, and 10 Unjust Enrichment claims (claims one through five) are DISMISSED with leave to 11 amend. Assuming Plaintiffs amend, the amended complaint must be filed by April 22, 12 2024 20 and Defendant’s response to the amended pleading must be filed by May 13, 13 2024. 14 15 IT IS SO ORDERED. Dated: March 27, 2024 16 17 18 19 20 21 22 23 24 25 26 27 28 After this Motion was briefed, the parties sought and obtained an extension of time for Defendant to respond to the Complaint in an additional related case, Tarantino v. Trader Joe’s Company, Case No. 23-cv-853-RBM-KSC. The parties in Tarantino sought an extension of Defendant’s time to respond to the Tarantino complaint until after the Court ruled on the Motion to Dismiss in this consolidated case because the parties agreed that the Tarantino case should be consolidated with this action if this case was not dismissed with prejudice. (Case No. 23-cv-853-RBM-KSC, Doc. 13.) The Court granted the Tarantino parties’ request to delay Defendant’s response deadline and indicated the parties could file a joint motion to consolidate the Tarantino action with this one after the Court’s ruling. (Case No. 23-cv-853-RBM-KSC, Doc. 14.) If the parties seek to consolidate the Tarantino action, they should file a joint motion to consolidate in advance of the filing of an amended consolidated class action complaint. 34 20 3:2-cv-00061-RBM-KSC

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