Smith-Brown v. Ulta Beauty, Inc.

Filing 163

MEMORANDUM Opinion and Order. Defendant's motion to dismiss 99 is granted in part and denied in part. The motion is granted as to (1) any claims based on the purchase of new products, (2) any claims on behalf of prospective class members resi ding outside the states represented by the named plaintiffs, (3) plaintiff Sot's breach of warranty claim under New Jersey law, (4) any claim under the Alabama Deceptive Trade Practices Act, (4) any claim under the Wisconsin Deceptive Trade Practices Act, and (6) any claim under the Nevada Deceptive Trade Practices Act. The motion is otherwise denied. Signed by the Honorable Jorge L. Alonso on 2/26/2019. Notice mailed by judge's staff (ntf, )

UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
KIMBERLY LAURA SMITH-BROWN,
et al.,

)
)
)
Plaintiffs,
)
)
)
v.
)
)
ULTA BEAUTY, INC. and ULTA SALON, )
COSMETICS & FRAGRANCE, INC.,
)
)
Defendant.
)

No. 18 C 610
Judge Jorge L. Alonso

MEMORANDUM OPINION AND ORDER
Plaintiffs, twenty-two customers of defendants’ retail cosmetics stores in eighteen states,
bring this putative class action lawsuit, asserting state-law claims of breach of warranty, unjust
enrichment, and consumer fraud. Defendants have moved to dismiss. For the following reasons,
the motion is granted in part and denied in part.
I.

BACKGROUND
Defendant Ulta Salon, Cosmetics & Fragrance, Inc. (“Ulta Salon”) is a “mass retailer of

beauty products,” operating retail stores “coast to coast.” (2d Am. Compl. ¶¶ 1, 4, ECF No. 91.)
It is a wholly owned subsidiary of defendant Ulta Beauty, Inc. (“Ulta Beauty”). Plaintiffs,
consumers hailing from eighteen states, purchased cosmetics or beauty products at defendants’
stores, only to learn that defendants (collectively, “Ulta”) had a practice of reshelving products
that had been used and returned by dissatisfied customers. In some cases, plaintiffs noticed shortly
after purchase that the products appeared to have been previously used (Id. ¶¶ 13, 19-20, 26-27,
33.) In other cases, plaintiffs infer that the products may have been previously used based on the
following information about Ulta’s business practices.

On January 9, 2018, a former Ulta employee revealed that, when customers returned
products after using them, the products were “made to ‘look new’—but not sanitized—and put
back on the shelf to sell to unsuspecting customers.” (Id. ¶ 62.) The employee posted her
revelations on the microblogging website Twitter, identifying herself by the Twitter handle,
“@fatinamxo.” She posted pictures of used foundation and lipsticks, which Ulta resold as if new.
(Id.) She claimed that Ulta even trained its staff members to “restore” products, and managers
were careful to keep an eye on products in the “damage bin” to assess whether they could be resold.
(Id. ¶ 63.) Managers taught employees “how to clean eyeshadow palettes and let it dry [overnight]
so it can be repackaged and sold the next day.” (Id.)
Other Twitter users responded to @fatinamxo’s posts by claiming that they too worked at
Ulta, and what @fatinamxo reported was consistent with their own experience in various places,
including California, Washington, Texas, Florida, Michigan, South Carolina, Wisconsin, and
Ohio. (Id. ¶¶ 66-68.) One of these Twitter users even claimed to have worked at Ulta store number
1221 in Sherman Oaks, California, the same store where plaintiff Kimberly Laura Smith-Brown
routinely shopped. (Id. ¶ 70.)
@fatinamxo’s Twitter revelations created a “social media frenzy” (id. ¶ 66), and news
outlets began to pick up the story. A former Ulta manager in Ohio told Business Insider that “there
was often pressure” on managers “to sell used products”:
Our bosses constantly told us if it looked like it could be sold, put it back out. The
company always had a percentage they wanted you to stay below weekly in what
we damaged. We would literally get lectured by our boss on our conference calls
if our stores were over.
(Id. ¶ 71.) Twitter users corroborated this pressure from management above the store level to
reduce damaged product and get as much product as possible back on the shelves after it was
returned. (Id. ¶ 77.)
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The Ohio manager told Business Insider that products such as mascara and foundation were
simply returned to the shelf “because it was difficult to tell if they were used.” (Id. ¶ 72.) When
bottled products such as shampoo or lotions were returned, Ulta employees would clean them,
“wipe out the spout and turn the pump cap back down,” and then reshelve them. (Id.) A former
Ulta employee in South Carolina told Business Insider that bottled products were put back on the
shelf as long as they were at least 80% full when they were returned to Ulta. (Id. ¶ 73.)
In the wake of these and other, similar revelations about Ulta on the internet and social
media, plaintiffs obtained sworn affidavits from five former Ulta employees—Tammy Geier,
Kami Turner, Ella Soto, Laura Hornick, and Michael Fisher—who worked in Ulta stores in
Georgia, Tennessee, South Carolina, Florida, and California. (Id. ¶ 83.) Fisher, Geier, and Turner,
while working as general managers of individual Ulta stores, were trained by regional
management, apparently based on pressure from senior management, on how to restore and
repackage used makeup and beauty products in order to reduce “shrink,” or inventory going to
waste. (Id. ¶¶ 84-86.) All five former employees were instructed to use returned products as
“testers” in their stores, despite the potential to “spread disease and germs to those” who use them.
(Id. ¶ 87.)
Plaintiffs allege that Ulta’s policy of reselling or reusing returned products is “unsanitary
and hazardous to the public.” (Id. ¶ 88.) Many of the plaintiffs allege that they suffered sties,
rashes, and irritation due to skin and eye infections after purchasing and using Ulta products. (Id.
¶¶ 11-12, 16-18, 23, 25-26, 29-31, 34.) They believe the Ulta products they purchased were,
unbeknownst to them, previously used and their use of these unsanitary products caused the
infections they suffered.

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Plaintiffs seek to represent in this action not only themselves but also (a) a nationwide class
consisting of “[a]ll persons in the United States who purchased, other than for resale, beauty
products from Ulta Beauty retail locations” (2d Am. Compl. ¶ 93), or alternatively, (b) eighteen
state subclasses made up of all persons who purchased Ulta beauty products, other than for resale,
in each of the eighteen states plaintiffs represent, namely, Alabama, California, Florida, Georgia,
Illinois, Indiana, Maryland, Michigan, Nevada, New Jersey, New York, Ohio, Pennsylvania,
Rhode Island, South Carolina, Virginia, Washington, and Wisconsin.
The Second Amended Complaint consists of twenty-three claims for relief: breach of the
implied warranty of merchantability, on behalf of the nationwide class or, alternatively, each state
subclass; unjust enrichment, on behalf of the nationwide class or, alternatively, each state subclass;
and twenty-one claims under twenty-one separate consumer fraud and deceptive business practices
statutes in the various states plaintiffs represent, each claim on behalf of the subclass of persons
who purchased Ulta products in the state supplying the governing law.
II.

LEGAL STANDARDS
“A motion under Rule 12(b)(6) tests whether the complaint states a claim on which relief

may be granted.” Richards v. Mitcheff, 696 F.3d 635, 637 (7th Cir. 2012). Under Rule 8(a)(2), a
complaint must include “a short and plain statement of the claim showing that the pleader is
entitled to relief.” Fed. R. Civ. P. 8(a)(2). The short and plain statement under Rule 8(a)(2) must
“‘give the defendant fair notice of what the claim is and the grounds upon which it rests.’” Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47
(1957) (internal quotation altered)).
Under federal notice-pleading standards, a plaintiff’s “[f]actual allegations must be enough
to raise a right to relief above the speculative level.” Id. Stated differently, “a complaint must

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contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its
face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). “A claim
has facial plausibility when the plaintiff pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the misconduct alleged.” Id. (citing Twombly,
550 U.S.at 556). “In reviewing the sufficiency of a complaint under the plausibility standard,
[courts must] accept the well-pleaded facts in the complaint as true, but [they] ‘need[ ] not accept
as true legal conclusions, or threadbare recitals of the elements of a cause of action, supported by
mere conclusory statements.’” Alam v. Miller Brewing Co., 709 F.3d 662, 665-66 (7th Cir. 2013)
(quoting Brooks v. Ross, 578 F.3d 574, 581 (7th Cir. 2009)).
A party “must state with particularity the circumstances constituting fraud.” Fed. R. Civ.
P. 9(b). The requirement that fraud be pleaded with particularity “ensures that plaintiffs do their
homework before filing suit and protects defendants from baseless suits that tarnish reputations.”
Pirelli Armstrong Tire Corp. Retiree Med. Ben. Trust v. Walgreen Co., 631 F.3d 436, 439 (7th Cir.
2011). The requirement is not rigid, and what must be alleged will vary, depending on the facts
of the case. Id. at 442. The heightened pleading standard applies to all allegations of fraud (such
as a misrepresentations), not merely claims labeled fraud. Id. at 447.
“Federal Rule of Civil Procedure 12(b)(1) authorizes the Court to dismiss any claim for
which the Court lacks subject-matter jurisdiction, such as lack of standing.” Bohn v. Boiron, Inc.,
No. 11 C 8704, 2013 WL 3975126, at *2 (N.D. Ill. Aug. 1, 2013). In order to establish a justiciable
“case or controversy” that provides standing to sue under Article III, § 2 of the United States
Constitution, a plaintiff must show the following: (1) he has suffered an injury-in-fact that is both
(a) concrete and particularized and (b) actual and imminent, not conjectural or hypothetical; (2)
the injury is fairly traceable to the challenged action of the defendant; and (3) it is likely, as

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opposed to merely speculative, that the injury will be redressed by a favorable decision. See
Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 180-81 (2000) (citing
Lujan v. Defs. of Wildlife, 504 U.S. 555, 560-61 (1992)). Where a defendant seeks dismissal under
Rule 12(b)(1) for lack of standing, courts should evaluate the sufficiency of the allegations by
“us[ing] Twombly–Iqbal’s ‘plausibility’ requirement, which is the same standard used to evaluate
facial challenges to claims under Rule 12(b)(6).” Silha v. ACT, Inc., 807 F.3d 169, 174 (7th Cir.
2015). The court takes well-pleaded allegations of the complaint as true unless they are refuted
by the defendant in an affidavit. Tamburo v. Dworkin, 601 F.3d 693, 700 (7th Cir. 2010).
III.

STANDING
Defendants challenge plaintiffs’ standing in three respects, arguing as follows: (a) plaintiffs

lack standing to sue over the purchase of products that were new, not used; (b) plaintiffs lack
standing to sue on behalf of class members who did not purchase the same beauty products as
plaintiffs did; and (c) plaintiffs lack standing to sue on behalf of class members in other states
whose claims will be governed by other states’ laws.
A. Standing—New Products
Defendants argue that plaintiffs have no standing based on any purchase of new, unused
products because the purchase of such products did not cause any actual injury. Rather, according
to defendants, plaintiffs who purchased new products received exactly what they bargained for.
Plaintiffs generally allege that, during a given time frame, they purchased certain Ulta
products that they believed were new at the time, but now believe had been previously used. (See,
e.g., 2d Am. Compl. ¶ 15.) Some plaintiffs allege some personalized basis for this belief, generally
that they suffered some sort of infection after using an Ulta product (see, e.g., id. ¶ 16) or the
product showed physical signs of having been used, such as a fingerprint in a jar of lip balm (id. ¶

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27) or build-up of mascara on a brush (id. ¶ 20), or perhaps both (see, e.g., id. ¶ 26.). Other
plaintiffs apparently believe that they purchased used products based only on the revelations about
Ulta’s general business practice of reshelving returned product. None of them specifically claims
to have bought new products from Ulta. However, some portions of plaintiff’s complaint suggest
that the commingling of new and used products on Ulta shelves reduced the value of all Ulta
products. (2d Am. Compl. ¶¶ 4, 6-7, 92.) In their opposition brief, plaintiffs argue that even if
they received new products, they still received less than they bargained for because, had they
known of the risk that they might receive a used product that might cause an infection, they would
have paid less or even shopped elsewhere. According to plaintiffs, based on this theory, even
purchasers of new Ulta products suffered an injury-in-fact that confers standing.
Plaintiffs rely principally on In re Aqua Dots Products Liability Litigation, 654 F.3d 748,
751 (7th Cir. 2011), in which the Seventh Circuit recognized that plaintiffs who had unknowingly
purchased a dangerously defective toy had asserted an injury-in-fact because they claimed to have
suffered a “loss [that was] financial: they paid more for the toys than they would have, had they
known of the risks the beads posed to children.” But, as defendants correctly explain in reply,
Aqua Dots is distinguishable because the defect (the toy beads, if ingested, “metabolize[d] into
gamma-hydroxybutyric acid (GHB), which can induce nausea, dizziness, drowsiness, agitation,
depressed breathing, amnesia, unconsciousness, and death,” id. at 749) was inherent in the
products the plaintiffs purchased; all of the beads posed the same risk of harm, and every purchaser
received an inherently dangerous product. In this case, to the extent plaintiffs received new Ulta
products, there was no defect or risk of harm in the products they purchased, and therefore no
overpayment or injury.

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In that respect, this case is similar to Lewert v. P.F. Chang’s China Bistro, Inc., 819 F.3d
963, 968 (7th Cir. 2016), in which the plaintiffs claimed “that the cost of their meals is an injury
because they would not have dined at P.F. Chang’s had they known of its poor data security.” In
dicta, the Seventh Circuit was “skeptical” that such a claim described an Article III injury. Id.
The court distinguished Aqua Dots, which acknowledged that plaintiffs who claim they would
have shopped elsewhere had they known of a safety risk may suffer a “financial injury,” but “only
where the product itself was defective or dangerous and consumers claim they would not have
bought it . . . had they known of the defect.” Lewert, 819 F.3d at 968. In this case, to the extent
plaintiffs or class members purchased new products, it was not the “product itself” (i.e., the one
with which they walked out of the store) that was “defective or dangerous,” and therefore such
purchasers have not suffered an injury-in-fact that confers Article III standing. Plaintiffs do not
have standing to assert claims arising out of the purchase of new Ulta products.
B. Standing—Different Products
Defendants argue that plaintiffs lack standing to assert claims based on Ulta products of a
kind that they themselves did not purchase. They do not point to any claims of any of the named
plaintiffs that they seek to dismiss on this basis; rather, defendants seem to be anticipating that
plaintiffs will attempt to represent unnamed class members who purchased certain kinds of Ulta
products that the named plaintiffs did not. Plaintiffs argue that they may do so, relying in part on
this Court’s decision in Ulrich v. Probalance, Inc., No. 16 C 10488, 2017 WL 3581183, at *6
(N.D. Ill. Aug. 18, 2017) (quoting Wagner v. Gen. Nutrition Corp., No. 16-CV-10961, 2017 WL
3070772, at *5 (N.D. Ill. July 19, 2017)), in which the Court recognized that a plaintiff may have
standing to bring claims on behalf of unnamed class members based on products he did not
purchase “‘so long as the products and the alleged misrepresentations are substantially similar.’”

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Based on the present allegations, the Court doubts whether the issue is ripe for resolution
at this early stage. Cf. Ulrich, 2017 WL 3581183, at *6 (complaint was unclear about whether
named plaintiff purchased “one bottle of each of the four Products or four bottles of one Product”).
In this case, the issue is better reserved for the class certification stage. But even if it were ripe,
the Court tends to agree with plaintiffs that the named plaintiffs can represent any consumer who
purchased one of defendants’ products believing it was new, but that was actually used, because
in any such case the deceptive conduct and harm are essentially the same, even if the damages
might differ. See id. (“The alleged misrepresentations are the same, they all relate to the Products’
quantity of protein, which ‘fill[s] the same function’ in each Product and is ‘used in the same
manner’ in each Product, and the protein claims are ‘inaccurate’ in ‘the same manner on every’
Product.”) (quoting Mednick, 2014 WL 6474915, at *4). Defendants’ motion is denied as to this
argument, although they may re-raise the issue at a later stage if the facts support it.
C. Standing—Class Members in Other States
Defendants argue that plaintiffs lack standing to assert claims on behalf of any class
members who may have purchased defendants’ products in states where no named plaintiffs did,
and whose claims will be governed by the laws of those states, because the named plaintiffs “‘must
possess the same interest and suffer the same injury shared by all members of the class [they]
represent[].’” See In re Dairy Farmers of Am., Inc. Cheese Antitrust Litig., No. 09 CV 3690, 2013
WL 4506000, at *7-8 (N.D. Ill. Aug. 23, 2013) (quoting Keele v. Wexler, 149 F.3d 589, 592-93
(7th Cir. 1998)). Plaintiff responds that this argument is premature at this stage because the
appropriate time to resolve the issue is at class certification. See Block v. Lifeway Foods, Inc., No.
17 C 1717, 2017 WL 3895565, at *7 (N.D. Ill. Sep. 6, 2017).

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The Court agrees with defendants. Defendants’ citation to Dairy Farmers is apt, and that
decision’s reasoning is persuasive. Plaintiffs’ only response to Dairy Farmers is to attempt to
distinguish it as a “multi-district class action composed of separate consolidated actions involving
a variety of individualized issues, including tolling of the statute of limitations,” but they do not
explain—and the Court fails to see—why the distinction matters. In Dairy Farmers, 2013 WL
4506000, at *7-8, see also Dairy Farmers, 2015 WL 3988488, at *25 (N.D. Ill. Jun. 29, 2015),
the Court’s analysis was not apparently based on any individualized issues or anything other than
the general principle that class representatives and class members must “possess the same interest
and suffer the same injury,” and the Court fails to see why the same principle does not lead to the
same result here.
As for whether the issue is premature at the present stage of the case, it is true that courts
have taken different approaches, both procedurally and substantively, toward the issue of a named
class representative in one state purporting to represent unnamed class members who reside in
other states on claims governed by those other states’ laws. See Liston v. King.com, Ltd., 254 F.
Supp. 3d 989, 998-1002 (N.D. Ill. 2017) (collecting cases and tracing different approaches). The
Court need not unravel this conceptual tangle in this case, however, because no matter which
perspective one takes, “there is plainly ample reason at this juncture to question whether [plaintiffs]
will be able to pursue claims based on statutory causes of action created by states where [plaintiffs]
neither lived nor [were] injured.” Id. at 1001. As the Seventh Circuit has explained, “[n]o class
action is proper unless all litigants are governed by the same legal rules,” because “[o]therwise the
class cannot satisfy the commonality and superiority requirements” of Rule 23.

In re

Bridgestone/Firestone, Inc., 288 F.3d 1012, 1015 (7th Cir. 2002). “[S]tate laws about theories
such as those presented by our plaintiffs differ, and such differences have led” the Seventh Circuit

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to hold that “other warranty, fraud, or products liability suits may not proceed” together in a single
class that extends across state boundaries. See id. (citing Isaacs v. Sprint Corp., 261 F.3d 679 (7th
Cir. 2001); Szabo v. Bridgeport Machines, Inc., 249 F.3d 672 (7th Cir. 2001); In re Rhone–
Poulenc Rorer Inc., 51 F.3d 1293 (7th Cir. 1995)); Dolmage v. Combined Ins. Co. of Am., No. 14
C 3809, 2017 WL 1754772, at *5-6 (N.D. Ill. May 3, 2017) (citing Bridgestone/Firestone). Where
claims must be adjudicated under the differing laws of numerous jurisdictions, it is likely that “a
single . . . class is not manageable.” Bridgestone/Firestone, 288 F.3d at 1018.
To the extent that plaintiffs attempt to assert claims on behalf of class members in states
where they do not reside and were not injured, “it would . . . be inappropriate to engage in wideranging discovery premised on a prospect as to which there is substantial doubt—namely,
[plaintiff’s] ability to assert causes of action created by other states for the benefit of other
individuals injured in those other states.” Liston, 254 F. Supp. 3d at 1001-02. Any such claims
are dismissed, although plaintiffs may move to amend their complaint if circumstances arise to
support it.
IV.

FAILURE TO STATE A CLAIM
Defendants argue that plaintiffs fail to state a claim because they have not pleaded their

claims with particularity in accord with Rule 9(b) and they have used improper group pleading.
A. Rule 9(b) and Particularity
Defendants argue that plaintiffs’ complaint fails to meet the Rule 9(b) standard because,
although plaintiffs’ claims depend on their allegation that the practice of reshelving used products
was widespread at Ulta stores all over the country, they do not identify who set this policy, which
products it applied to, which stores in which locations followed it, or when the alleged
misrepresentations or omissions were made. Without such details, defendants argue, plaintiffs’

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claims rest in large part on anonymous or pseudonymous allegations posted on social media
networks and declarations from a handful of employees, which are insufficient to make claims of
nationwide fraud plausible.

Additionally, defendants argue that plaintiffs’ allegations offer

insufficient detail because many plaintiffs do not identify the particular Ulta store at which they
shopped; the products they purchased, apart from generic descriptions such as “lipstick” or
“eyeliner”; or precisely when they purchased them, apart from a month or year.
The Court disagrees. First, plaintiffs were not required to plead every detail of how
defendants carried out the alleged deception, particularly considering that pleading such details
would require inside knowledge of the defendant business entities’ inner workings, which mere
customers cannot realistically obtain. Plaintiffs cannot know precise details of how, when, and by
whom used products were restored and returned to Ulta shelves. See U.S. ex rel. Ceas v. Chrysler
Grp. LLC, No. 12-CV-2870, 2016 WL 6963060, at *4 (N.D. Ill. Jan. 19, 2016) (quoting U.S. ex
rel. Heath v. AT&T, Inc., 791 F.3d 112, 125 (D.D.C. 2015)) (“‘The complaint makes clear, in other
words, that corporate levers were pulled; identifying precisely who pulled them is not an
inexorable requirement of Rule 9(b) in all cases.’”).
Plaintiffs’ allegations of defendants’ business practices are based on information and
belief. Fraud can be pleaded based on information and belief “so long as (1) the facts constituting
the fraud are not accessible to the plaintiff and (2) the plaintiff provides the ground for his
suspicions.” Pirelli, 631 F.3d at 443 (internal quotation marks omitted). As the Court has already
explained, this is a case in which “the facts constituting the fraud are not accessible” to plaintiffs
because they cannot know how Ulta stores managed their inventory, as that is a part of defendants’
operations that is hidden from public view. Further, plaintiffs have provided the ground for their
suspicions: they have pointed to specific accounts by people who claim to have personal

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knowledge of defendants’ business practice of placing used beauty products back on store shelves
for resale. Although the accounts in the media and social media are often either anonymous of
pseudonymous, they are corroborated by the five employee declarations and by the named
plaintiffs’ allegations of suffering infections after shopping at Ulta and of purchasing Ulta products
that physically appeared to have been previously used. Remaining sensitive to “information
asymmetries that may prevent a plaintiff from offering more detail,” the Court agrees with
plaintiffs that they have stated sufficient facts with a sufficient degree of particularity to make the
alleged fraud plausible. See id. at 443.
As for defendants’ arguments that the named plaintiffs were required to allege additional
details about the transactions in which they purchased used Ulta products, the Court agrees with
plaintiffs that “Rule 9(b) does not demand that level of granularity or precision, at least in this
case.” Hobbs v. Gerber Prods. Co., No. 17 CV 3534, 2018 WL 3861571, at *6 (N.D. Ill. Aug. 14,
2018). While there is a “good deal of caselaw that speaks of a journalistic-type approach to [Rule
9(b)’s] requirement of pleading ‘with particularity,’ that locution really does not fit well in dealing
with extended fraudulent schemes involving a large volume of transactions—it must be
remembered that what Rule 9(b) mandates particularity about are ‘the circumstances constituting
fraud.’” U.S. ex rel. Salmeron v. Enter. Recovery Sys., Inc., 464 F. Supp. 2d 766, 768 (N.D. Ill.
2006) (Shadur, J.). The deception in this case stems from Ulta’s behind-the-scenes inventory
management, rather than from what happened at the cash register, and plaintiffs have described
those behind-the-scenes circumstances with as much particularity as they are able, as outsiders
looking in. The details of the transactions in which they purchased Ulta products are closer to an
issue of damages, and Rule 9(b) does not require that circumstances relating to damages be pleaded

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with particularity. Hobbs, 2018 WL 3861571, at *10. Defendants’ motion to dismiss for failure
to comply with Rule 9(b) is denied.
B. Group Pleading
Defendants argue that plaintiffs’ complaint should be dismissed because plaintiffs make
no effort to differentiate between Ulta Beauty and Ulta Salon. Plaintiffs refer to defendants
collectively as “defendants” or “Ulta,” but as plaintiffs themselves recognize, Ulta Beauty is a
holding company that conducts operations only though subsidiaries such as Ulta Salon; Ulta
Beauty conducts no operations of its own. According to defendants, this is improper group
pleading because Ulta Beauty and Ulta Salon “are entitled to know the specific allegations levelled
against each of them” (Defs.’ Mem. Supp. Mot. Dismiss at 14, ECF No. 100), without having to
guess who is accused of doing what.
Plaintiffs allege that Ulta Salon was originally incorporated in 1990 with no parent
corporation and “total operating authority over its stores.” (2d Am. Compl. ¶¶ 35, 37; see Pl.’s
Mem. Opp’n at 11, ECF No. 122.)

On January 29, 2017, plaintiffs allege, the company

reorganized. Ulta Beauty was incorporated as a new company that has “on a consolidated basis,
the same assets, businesses, and operations” as Ulta Salon had prior to the reorganization. (2d
Am. Compl. ¶ 39.) Thus, Ulta Beauty became the successor to Ulta Salon, “the former publiclytraded company and now a wholly owned subsidiary” of Ulta Beauty. (Id.) Plaintiffs note that, in
forms it has filed with the Securities and Exchange Commission, Ulta Beauty has explicitly and
intentionally used collective terms such as “we,” “us,” “Ulta Beauty” or “the Company” to refer
to “Ulta Beauty, Inc. and its consolidated subsidiaries.” (Id.) Further, plaintiffs allege that Ulta
Salon “does not appear to have a CEO, Chairman of the Board, or Board of Directors separate
from Ulta Beauty, Inc. As a result, there is no separate decisionmaking apparatus for Ulta Salon .

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. . and the Board of Directors and CEO of Ulta Beauty exert direct control over Ulta Salon.” (Id.
¶ 36.) Additionally, the entities allegedly have the same general counsel and same address. (2d
Am. Compl., Ex. F.)
While it is true that “[e]ach defendant is entitled to know what he or she did that is asserted
to be wrongful,” Bank of America, N.A. v. Knight, 725 F.3d 815, 818 (7th Cir. 2013), defendants
have not cited a case in which a court found analogous allegations against two such intertwined
business entities to be impermissible group pleading. Plaintiffs have alleged that, less than a year
before the date of this lawsuit, and therefore during the time period that the alleged wrongdoing
was taking place, which is “at least as long as the relevant statute of limitations periods” (2d Am.
Compl. ¶ 4), Ulta Salon reorganized into two companies, which apparently share a CEO and Board
of Directors. The Court understands plaintiffs to be accusing both entities of wrongdoing, at
different times and potentially at the same time to the extent they operated as one after the
reorganization, although plaintiff cannot say at this early stage who pulled which “corporate lever.”
Ceas, 2016 WL 6963060, at *4. By providing facts to describe the reorganization and the resulting
shared corporate structure in some detail, they have alleged a plausible basis for asserting claims
against both entities. See Rysewyk v. Sears Holdings Corp., No. 15 CV 4519, 2015 WL 9259886,
at *7 (N.D. Ill. Dec. 18, 2015) (plaintiffs stated claim against holding company as well as operating
subsidiary because they alleged that holding company participated in “market[ing], sell[ing], and
servic[ing]” the offending products “through its retail establishments”). Although plaintiffs’
theory of which entity is responsible for which acts may need to be refined as the case progresses,
plaintiffs’ allegations are sufficient at this early stage to state a claim that survives defendants’
motion to dismiss.

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C. Breach of Warranty Claims and Pre-Suit Notice
Defendants contend that plaintiffs’ breach of warranty claims must be dismissed because
plaintiffs did not give defendants the pre-suit notice that the Uniform Commercial Code requires. 1
1. Pre-suit notice by plaintiff Smith-Brown as to Ulta Salon
Before plaintiff Smith-Brown filed her initial complaint in this matter, she submitted her
pre-suit notice letter only to Ulta Beauty. Defendants argue that the letter did not provide effective
notice to Ulta Salon.
Plaintiffs respond that Smith-Brown’s letter, although addressed only to Ulta Beauty,
nevertheless provided effective notice to Ulta Salon because the two entities share the same
address, the same general counsel, and the same corporate secretary. According to plaintiffs, Ulta
Salon therefore had “actual knowledge” of Smith-Brown’s grievance prior to the filing of her
complaint, and “lack of pre-litigation notice is excused” when the defendant has “actual
knowledge” of the defect. See Fuchs v. Menard, Inc., No. 17 C 1752, 2017 WL 4339821, at *6
(N.D. Ill. Sep. 29, 2017).
The Court might agree with plaintiffs’ legal reasoning under Illinois law, but Smith-Brown
is a citizen of California who allegedly purchased used Ulta products in California, so California
law presumably applies to her claims. Plaintiffs have not cited a case in which a court recognized
an “actual knowledge” exception to the pre-suit notice requirement under California law. Plaintiffs
cite In re Ford Motor Co. E-350 Van Prod. Liability Litigation (No. II), No. CIV03-4558, 2008
WL 4126264, at *10-11 (D.N.J. Sept. 2, 2008), which considered breach of warranty claims under
Alabama, Arkansas, California, and Illinois law, but that case never suggested that there is any

Defendants also argue that plaintiffs do not state breach of warranty claims as to any new products. The
Court need not address this argument because it has already concluded that plaintiffs have no standing to
bring any such claims.

1

16

“actual knowledge” exception to the pre-suit notice requirement under California law. Instead, it
recognized a California exception to the pre-suit notice requirement only for “‘injured consumers
against manufacturers with whom they have not dealt’” because an injured consumer who is not
“‘steeped in the business practice which justifies the rule’” will rarely be savvy enough to “‘give
notice to one with whom he has had no dealings.’” Id. at *10 (quoting Greenman v. Yuba Power
Prods., 377 P.2d 897, 888 (Cal. 1963)). This exception is of no use to Smith-Brown in this case
because she is not suing a remote manufacturer “with whom [she has] not dealt”; instead, she is
suing the retailer who was the immediate seller of the product that harmed her, so the exception
does not apply.
Nevertheless, the Court will not dismiss Smith-Brown’s breach of warranty claim at this
early stage. As the Court has explained above in Part IV.B. of this opinion, plaintiffs allege that
Ulta Beauty and Ulta Salon are intertwined entities that shared directors and officers, as well as a
general counsel and address. If plaintiffs’ allegations are proved true, it may be that SmithBrown’s pre-suit notice to Ulta Beauty was effective as to Ulta Salon, based on the
interconnectedness of the entities. Cf. Incubadora Mexicana, SA de CV v. Zoetis, Inc., 310 F.R.D.
166, 174 (E.D. Pa. 2015), background facts in earlier opinion at 116 F. Supp. 3d 519, 522 (E.D.
Pa. 2015) (pre-suit notice to subsidiary not effective as to parent company where subsidiary “was
to . . . operate as an independent company” and moved its “global headquarters” to another state
to “complete[] its corporate separation” from parent). Ulta Salon’s motion to dismiss SmithBrown’s breach of warranty claim for lack of pre-suit notice is denied.
2. Pre-suit notice by other plaintiffs
Smith-Brown initially filed this case as a lone plaintiff on January 26, 2018. The other
plaintiffs only became parties when they joined in the Second Amended Complaint on June 6,

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2018. Defendants argue that these other plaintiffs did not provide pre-suit notice prior to the filing
of this suit, so their breach of warranty claims must be dismissed.
Plaintiffs respond that the other plaintiffs were not required to submit pre-suit notice before
this action was filed; they were merely required to give pre-suit notice before they became parties
to it, and each of them did provide pre-suit notice prior to filing the Second Amended Complaint,
if not prior to Smith-Brown’s original complaint.
The Court agrees with plaintiffs that their notice was sufficient. “The purpose of the presuit notice requirement is to give sellers the opportunity to resolve breaches short of litigation.”
Ulrich, 2017 WL 3581183, at *8. In order to do that, they must have notice of “the trouble with a
particular product purchased by a particular buyer”; general awareness of a certain recurring
complaint with the sellers’ products is beside the point. Connick v. Suzuki Motor Co., 675 N.E.2d
584, 590 (Ill. 1996); see id. at 591-92 (“As Judge Learned Hand stated . . . : ‘The notice of the
breach required is not of the facts, which the seller presumably knows quite as well as, if not better
than, the buyer, but of buyer’s claim that they constitute a breach.’”) (quoting Am. Mfg. Co. v. U.S.
Shipping Bd. Emergency Fleet Corp., 7 F.2d 565, 566 (2d Cir. 1925)). Because the required notice
is of a particular buyer’s claim that the seller is in breach of warranty, plaintiffs complied with the
notice requirement to the extent that they individually provided notice of their claims prior to
joining this suit, regardless of whether another plaintiff had already filed suit. Defendants’ motion
to dismiss is denied as to this basis.
3. Pre-suit notice by New Jersey plaintiff Allison Sot
Defendants argue that New Jersey plaintiff Allison Sot, unlike the other plaintiffs, did not
provide notice of her claims prior to joining the Second Amended Complaint, so her breach of
warranty claim should be dismissed.

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Plaintiffs respond that, under New Jersey law, plaintiffs need not provide pre-suit notice at
all; rather, the filing of the complaint is sufficient to permit the seller to redress the buyer’s
grievance by settling the dispute. See Strzakowlski v. Gen. Motors Corp., No. CIV.A. 04-4740,
2005 WL 2001912, at *3-4 (D.N.J. Aug. 16, 2005). But this relaxed version of the pre-suit notice
requirement only applies, if at all, to claims against remote manufacturers, not claims against
immediate sellers of defective products. Id. Because Sot’s claim is against the immediate seller of
the defective beauty products she complains of purchasing, the pre-suit notice requirement applies
in full force. Plaintiff Sot’s breach of warranty claim is dismissed.
D. Unjust Enrichment
Defendants argue that plaintiffs fail to state a claim for unjust enrichment because they
have adequate remedies at law and because there is no private cause of action for unjust enrichment
under California or New Jersey law. 2
1. Adequate remedies at law
Defendants argue that unjust enrichment is unavailable where there is an otherwise
adequate remedy at law, such as a cause of action for breach of contract. Plaintiffs respond that,
under Rule 8, which permits them to plead alternative theories of relief, Fed. R. Civ. P. 8(a)(3),
(d)(2)-(3), they may plead their unjust enrichment claims in the alternative to their breach of
contract and consumer fraud claims. Plaintiffs are correct. See, e.g., Estate of Stepney v. UMG
Recordings, Inc., No. 10 C 8266, 2011 WL 2119130, at *3 (N.D. Ill. May 26, 2011) (“Although
Plaintiffs may not recover under a theory of unjust enrichment where there is an adequate remedy
at law, Plaintiffs may plead both breach of contract and unjust enrichment in the alternative.”);

Defendants also argue that plaintiffs do not state unjust enrichment claims as to any new products, but the
Court need not address this argument because it has already concluded that plaintiffs have no standing to
bring any such claims.
2

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Sharbaugh v. First Am. Title Ins. Co., No. 07 C 2628, 2007 WL 3307019, at *2 (N.D. Ill. Nov. 2,
2007) (“[P]laintiff may plead an alternative claim for unjust enrichment, even if he alleges in other
counts that the parties have a contract or he has an adequate remedy at law.”); see also Horwitz v.
Sonnenschein Nath & Rosenthal LLP, 926 N.E.2d 934, 947 (Ill. App. Ct. 2010) (“But where a
party pleads breach of contract, he also can plead unjust enrichment in the alternative.”).
Defendants cite federal and state court decisions in a number of states—California, Florida,
Georgia, Indiana, Maryland, Michigan, Nevada, New York, Ohio, and Washington—dismissing
unjust enrichment claims because the plaintiffs had an adequate remedy at law. (Defs.’ Mem. at
19.) Many of these cases are distinguishable because the complaints did not admit of any
possibility that the plaintiffs’ allegations were true and that they had no adequate remedy at law,
but defendants do not establish that that is precisely the case here. They argue that an unjust
enrichment claim simply cannot be pleaded alongside a claim for a legal remedy, but as a general
matter, under Rule 8, defendants are incorrect, as even courts in some of the jurisdictions they cite
have recognized. See, e.g., Napa Overseas, S.A. v. Nextran Corp., No. 16-20862-CIV, 2016 WL
3841677, at *5 (S.D. Fla. July 12, 2016) (“[N]othing prevents Plaintiff from pursuing alternative
claims of breach of contract and unjust enrichment in separate counts.”); GlaxoSmithKline LLC v.
Beede, No. 1:13-CV-00001, 2014 WL 896724, at *7 (N.D.N.Y. Mar. 6, 2014) (“Initially, Plaintiff
is permitted at this stage of the proceedings to pursue the alternate theories of breach of contract
and unjust enrichment.”). The basic proposition that unjust enrichment is unavailable to a plaintiff
with an adequate remedy at law, by itself, does not require this Court to dismiss plaintiffs’
alternative unjust enrichment claim. Defendants’ motion is denied as to this basis.

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2. California and New Jersey law
Defendants argue that plaintiffs’ unjust enrichment claim should be dismissed to the extent
it is governed by California or New Jersey law because unjust enrichment is not a stand-alone
cause of action under the law of these states.
In similar circumstances, a court of this district has recognized an unjust enrichment claim
under California law. See Carrol v. S.C. Johnsons & Son, Inc., No. 17-CV-05828, 2018 WL
1695421, at *5-6 (N.D. Ill. Mar. 29, 2018). This Court is persuaded by that court’s reasoning to
follow suit and deny defendants’ motion to dismiss plaintiffs’ unjust enrichment claim under
California law.
As for unjust enrichment under New Jersey law, defendants argue that plaintiffs must show
not only that defendants received a benefit that it would be unjust to retain, but also that plaintiffs
“expected remuneration” from defendants at the time they “performed or conferred a benefit” on
defendants. Nelson v. Xacta 3000 Inc., No. 08 C 5426, 2009 WL 4119176, at *7 (D.N.J. Nov. 24,
2009). According to defendants, plaintiffs have not alleged that they “expected remuneration” at
the time they purchased defendants’ products. But other New Jersey decisions have phrased the
remuneration element differently, instead requiring that the plaintiff “expected remuneration, or,
if the true facts were known to plaintiff, he would have expected remuneration from defendant,
at the time the benefit was conferred.” Callano v. Oakwood Park Homes Corp., 219 A.2d 332,
334-35 (N.J. App. Div. 1966) (emphasis added); see In re NorVergence, Inc., 384 B.R. 315, 36162 (Bankr. D.N.J. 2008) (denying motion to dismiss unjust enrichment claim brought by plaintiffs
who alleged that they signed “leases for significantly overvalued equipment” because “it [was]
plausible that if the [plaintiffs] had known the truth about the [equipment] when they entered the
equipment lease, then they would have expected remuneration from Nortel who arguably benefited

21

from the arguably overpriced [equipment].”) The Court is not persuaded that New Jersey would
not recognize plaintiffs’ unjust enrichment claim. Defendants’ motion is denied as to the unjust
enrichment claim.
A. State Deceptive Business Practices Statutes
Defendants argue that plaintiffs’ claims fail under certain state consumer fraud and
deceptive business practices statutes for the following various reasons. 3
1. California, Florida, Pennsylvania, and Michigan—No Facts About Used
Products
Defendants argue that the Florida, Pennsylvania, and Michigan plaintiffs, as well as
California plaintiff Robin Okman, fail to state a claim under the deceptive business practices
statutes of those states because they state no facts to support or corroborate their belief that they
purchased used products. Unlike some of the plaintiffs, defendants argue, these plaintiffs’ claims
are purely conclusory because they do not allege that they suffered infections from using
defendants’ products or that the products they purchased were noticeably used.
But the Court is not required to view these particular plaintiffs’ allegations in isolation.
When their allegations are viewed in light of all the other allegations of the complaint, including
the social media revelations, the former employee declarations, and the allegations of the other
named plaintiffs who suffered infections or bought products that appeared to be used, it is at least
plausible that these plaintiffs also received used products. These plaintiffs may ultimately have
difficulty proving their claims, but they need not prove them in the complaint; their claims need
only be plausible. FKFJ, Inc. v. Vill. of Worth, No. 18 C 2828, 2019 WL 277723, at *5 (N.D. Ill.

Defendants also argue that plaintiffs’ claims fail under the various state statutes to the extent they seek
relief for the purchase of new products. The Court need not address this argument because it has already
explained that plaintiffs have no standing to assert claims for the purchase of new products.
3

22

Jan. 22, 2019) (citing Iqbal, 556 U.S. at 678). These plaintiffs’ claims survive defendants’ motion
to dismiss.
2. Alabama—Pre-Suit Notice
Next, defendants argue that plaintiffs’ claim under the Alabama Deceptive Trade Practices
Act (“ADTPA”) must be dismissed because plaintiffs did not provide adequate pre-suit notice at
least fifteen days prior to filing the Second Amended Complaint, as the statute requires. Ala. Code
§ 8-19-10(e). The Court agrees with defendants. Plaintiffs provided their pre-suit notice letter on
May 23, 2018, only fourteen days prior to the filing of the Second Amended Complaint on June 6,
2018. Plaintiffs argue that the Court should excuse their failure to provide timely pre-suit notice
because they substantially complied with the fifteen-day requirement by providing notice fourteen
days before filing suit and because defendants had actual notice of the issues plaintiffs raised long
before May 23, 2018. But plaintiffs cite no authority to support giving the ADTPA’s fifteen-day
requirement a liberal construction or implying a substantial compliance or actual notice exception,
nor is the Court aware of any. With only the plain language of the statute for guidance, the Court
must apply the statute as written. Plaintiffs’ claim under the ADTPA must be dismissed.
3. California—“Unfair” conduct
Defendants argue that plaintiffs’ claim under California’s Unfair Competition Law
(“UCL”) must be dismissed because plaintiffs have not alleged any conduct that is “unfair” within
the meaning of that statute. According to defendants, the “unfair” conduct that the statute prohibits
is the sort of unfair competition that the antitrust laws are meant to protect against. Plaintiffs
respond that, while there is a split of authority, some California courts have taken a different
approach, instead analyzing whether a challenged business practice is unfair by “weigh[ing] the
utility of the defendant’s conduct against the gravity of the harm to the alleged victim.” S. Bay

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Chevrolet v. Gen. Motors Acceptance Corp., 72 Cal. App. 4th 861, 886-87, 85 Cal. Rptr. 2d 301,
316 (1999).
Defendants’ position is based on Cel-Tech Communications, Inc. v. Los Angeles Cellular
Telephone Co., 973 P.2d 527, 543-44 (Cal. 1999), in which the California Supreme Court criticized
the balancing test plaintiffs proffer as “amorphous,” and instead explained that “unfair” conduct is
that which “threatens an incipient violation of an antitrust law, or violates the policy or spirit of
one of those laws because its effects are comparable to or the same as a violation of the law, or
otherwise significantly threatens or harms competition.” However, the court specifically cautioned
that its “discussion and this test are limited to [the] context” of “an action by a competitor alleging
anticompetitive practices.” Id. at 544 n.12. California decisions are split on whether the test differs
in consumer actions—like this one—alleging unfairness to the defendant’s customers, as opposed
to “suits involving unfairness to the defendant’s competitors,” such as Cel-Tech. See Lozano v.
AT & T Wireless Servs., Inc., 504 F.3d 718, 735-36 (9th Cir. 2007) (citing cases). Notably, the
case plaintiffs cite in support of applying the balancing test, South Bay Chevrolet v. General
Motors Acceptance Corp., was decided a month after the California Supreme Court’s decision in
Cel-Tech, and it expressly interpreted that case as limited to the competitor context. S. Bay, 85
Cal. Rptr. 2d at 309 n.9. The Court is not persuaded that plaintiffs’ allegations do not fall within
a valid theory of unfairness under the UCL. See Lozano, 504 F.3d at 736. Defendants’ motion to
dismiss is denied as to this claim.
4. Wisconsin—Omissions Not Actionable
Defendants argue that plaintiffs’ claims fail under the Wisconsin Deceptive Trade Practices
Act (“WDTPA”) because omissions are not actionable under that statute. 4 Plaintiffs respond that
In their opening brief, defendants made a similar argument about the Indiana Deceptive Consumer Sales
Act (“IDCSA”), but in response, plaintiffs explained that that statute has recently been amended and

4

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they are proceeding not on an omission theory but on the theory that defendants affirmatively
represented that their products were new by offering them for sale in Ulta stores. But plaintiffs
have not cited a case in which any court recognized any such theory under Wisconsin law. The
only case plaintiffs cite is distinguishable because, there, the plaintiffs claimed to have been
deceived by affirmative misrepresentations of quality on the packaging of the defendants’
products. See Loeb v. Champion Petfoods USA Inc., No. 18-CV-494-JPS, 2018 WL 2745254, at
*6-7 (E.D. Wis. June 7, 2018) (denying motion to dismiss WDTPA claim that dog food was
contaminated with heavy metals because dog food packaging contained “representations of quality
and fitness for [even] human consumption”). In this case, plaintiffs have not pointed to any
specific misrepresentations defendants made about whether their products were new or used.
Defendants’ motion to dismiss is granted as to the WDTPA claim.
5. Nevada—No Affirmative Misrepresentations And No Duty To Disclose
Defendants move to dismiss plaintiffs’ claims under the Nevada Deceptive Trade Practices
Act (“NDTPA”) because they are not grounded in affirmative misrepresentations about Ulta
products, and plaintiffs have not identified any special relationship or other circumstance giving
defendants a duty to disclose facts about Ulta products to plaintiffs. The NDTPA defines an
actionable deceptive trade practice in various ways, see NRS § 598.0915, and all pertinent
definitions contain the element of making a false representation of fact. As the Court explained in
the preceding subsection of this opinion, plaintiffs have not alleged that defendants made any such
affirmative misrepresentation to plaintiffs.
One district court has suggested, in the context of an NDTPA claim, that “the suppression
or omission of a material fact is equivalent to a false representation . . . when a party is bound in
expanded to cover omissions. Defendants apparently concede the point because they do not mention the
statute at all in their reply. The Court considers defendants to have waived their argument on this point.

25

good faith to disclose that material fact.” Mallory v. McCarthy & Holthus, LLP, No. 2:14-CV00396, 2015 WL 2185413, at *3 (D. Nev. May 11, 2015). But the court apparently imported this
principle from Nevada’s common law of fraud without any authority for applying it to NDTPA
claims, and neither in Mallory nor in any other case plaintiffs have cited has a court permitted a
plaintiff to proceed under the NDTPA without pleading that the defendant made specific,
affirmative misrepresentations. Applying the plain language of the statute, the Court concludes
that plaintiffs must plead an affirmative misrepresentation in order to state a claim under the
NDTPA. Defendants’ motion to dismiss is granted as to the NDTPA claim.
6. South Carolina—Class Action Bar
Federal courts must apply federal procedural law, including Rule 23, even when they are
applying state substantive law, so long as doing so does not “abridge, enlarge or modify any
substantive right.” 28 U.S.C. § 2072(b). Defendants argue that the class claim under the South
Carolina Unfair Trade Practices Act (“SCUTPA”) should be dismissed because the SCUPTA
expressly prohibits class actions:
(a) Any person who suffers any ascertainable loss of money or property, real or
personal, as a result of the use or employment by another person of an unfair or
deceptive method, act or practice declared unlawful by § 39-5-20 may bring an
action individually, but not in a representative capacity, to recover actual damages.
S.C. Code § 39-5-140 (emphasis added). Defendants cite only a single case, Fejzulai v. Sam's
West, Inc., 205 F. Supp. 3d 723, 727-28 (D.S.C. 2016). Fejzulai reasoned that the SCUTPA’s class
action bar is part and parcel of the substantive right that the SCUTPA confers because it is
incorporated into the core provision of the SCUTPA, and the bar therefore applies in any action to
enforce that substantive right, whether in federal or state court. Id.
Plaintiffs argue that the SCUTPA’s class action bar is procedural, not substantive, and Rule
23 “unambiguously authorizes any plaintiff, in any federal civil proceeding, to maintain a class
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action if the Rule’s prerequisites are met,” so the Court must apply Rule 23 instead of the
SCUTPA’s class action bar. See Shady Grove Orthopedic Assocs., P.A. v. Allstate Ins. Co., 559
U.S. 393, 416-17 (2010) (New York class action bar does not preclude federal courts sitting in
diversity from entertaining Rule 23 class actions governed by New York substantive law).
A leading treatise states that “[m]ost courts considering the question have determined that
the legislature’s placement of a class action prohibition within a specific state consumer protection
act (as opposed to a free-standing rule of procedure) does not necessarily mean that the prohibition
is a substantive one.” 1 McLaughlin on Class Actions § 2:47 (15th ed.) (citing Reed v. Dynamic
Pet Prods., No. 15CV0987-WQH-DHB, 2016 WL 3996715, at *6 (S.D. Cal. July 21, 2016) and
In re Hydroxycut Mktg. & Sales Practices Litig., 299 F.R.D. 648, 654 (S.D. Cal. 2014)); but see
Delgado v. Ocwen Loan Servicing, LLC, No. 13CV4427, 2017 WL 5201079, at *10 (E.D.N.Y.
Nov. 9, 2017) (reasoning that “the specific inclusion of a class action bar in . . . consumer
protection laws evinces a desire by the state legislature to limit not only the form of the action but
also the remedies available”). This Court agrees with those decisions holding that the fact that a
class action bar is included within a consumer protection statute does not make it any more
substantive than if it were found instead among the state’s rules of procedure. See Lisk v. Lumber
One Wood Preserving, LLC, 792 F.3d 1331, 1336 (11th Cir. 2015) (“[H]ow a state chooses to
organize its statutes affects the analysis not at all. . . . [T]he question whether a federal rule
abridges, enlarges, or modifies a substantive right turns on matters of substance—not on the
placement of a statute within a state code.”). The class action mechanism is merely a way of
joining numerous plaintiffs’ claims together in order to adjudicate them more efficiently; a law
permitting it or prohibiting it is procedural, not substantive, because it does not alter the nature of

27

the claim or the right that gives rise to it. In this vein, one district court, guided by Shady Grove,
reasoned as follows:
In Shady Grove, Justice Scalia explained:
A class action no less than traditional joinder (of which it is a
species), merely enables a federal court to adjudicate claims of
multiple parties at once, instead of separate suits. And like
traditional joinder it leaves the parties’ legal rights and duties intact
and the rules of decision unchanged.
Shady Grove, 559 U.S. at 408. Conversely, a rule barring class actions does not
prevent individuals who would otherwise be members of the class from bringing
their own separate suits or joining in a preexisting lawsuit. The substantive rights
of these individuals are not affected. The prohibitions against class actions only
affect “how the claims are processed.” Id. The fact that the class action prohibitions
are within the individual state consumer protection acts, as opposed to free-standing
rules, does not alter the Court’s conclusion.
Hydroxycut, 299 F.R.D. at 654 (internal citation altered). The Court finds Hydroxycut’s analysis
persuasive. Defendants’ motion to dismiss is denied as to the SCUTPA claim.
7. Georgia—Injunctive Relief
Defendants argue that plaintiffs’ Georgia Uniform Deceptive Trade Practices Act
(“GUDTPA”) claims must fail because they do not allege future injury, and the only remedy that
the GUDTPA provides is injunctive relief. Plaintiff Veronica Sanders, the only plaintiff who
resides in Georgia, alleges that she wants to shop at Ulta again, but is hesitant to do so while she
knows that, in doing so, she would run the risk of purchasing a product that has been previously
used by someone else. (2d Am. Compl. ¶ 25.)
This Court has previously recognized that a plaintiff alleges sufficient facts to assert a claim
for injunctive relief in a consumer protection action if she alleges that she faces a “threat of future
harm” because “she will be unable to rely on the product’s advertising or labeling in the future,
and so will not purchase the product although she would like to.” Curran v. Bayer Healthcare

28

LLC, No. 17 C 7930, 2019 WL 398685, at *5 (N.D. Ill. Jan. 31, 2019) (citing Davidson v.
Kimberly-Clark Corp., 889 F.3d 956, 969-70 (9th Cir. 2018)). Defendants do not explain—nor
does the Court see—why plaintiff Sanders’s allegations do not similarly state a claim for injunctive
relief for similar reasons. The case that plaintiffs cite, Collins v. Athens Orthopedic Clinic, 815
S.E.2d 639, 646-47 (Ga. App. Ct. 2018), sheds little light on the question because it concerned a
defendant’s lax information security practices, which had allowed a hacker to steal plaintiffs’
personally identifiable information. Once stolen, such information cannot be stolen again; but a
consumer who unwittingly buys previously used beauty products could be victimized again in the
same way by the same retailer. Collins is distinguishable, and defendants’ motion is denied as to
this claim.
CONCLUSION
Defendant’s motion to dismiss [99] is granted in part and denied in part. The motion is
granted as to (1) any claims based on the purchase of new products, (2) any claims on behalf of
prospective class members residing outside the states represented by the named plaintiffs, (3)
plaintiff Sot’s breach of warranty claim under New Jersey law, (4) any claim under the Alabama
Deceptive Trade Practices Act, (4) any claim under the Wisconsin Deceptive Trade Practices Act,
and (6) any claim under the Nevada Deceptive Trade Practices Act. The motion is otherwise
denied.
SO ORDERED.

ENTERED: February 26, 2019

_________________________________
JORGE L. ALONSO
United States District Judge

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