Nestle Purina PetCare Company v. The Blue Buffalo Company Ltd.
MEMORANDUM AND ORDER : IT IS HEREBY ORDERED that Diversified Ingredients' motions to dismiss counts 1 and 10 of Blue Buffalo's second amended third-party complaint, # 819 and # 989 , are GRANTED in accordance with the terms of this Memo randum and Order. IT IS FURTHER ORDERED that Wilbur-Ellis's joinder to Diversified Ingredients' motion to dismiss counts 1 and 10 of Blue Buffalo's second amended third-party complaint # 827 is GRANTED in accordance with the terms of this Memorandum and Order. IT IS FURTHER ORDERED that Blue Buffalo shall file an amended third-party complaint to bring it into compliance with the terms of this Memorandum and Order no later than September 30, 2016.. Signed by District Judge Rodney W. Sippel on 9/15/16. (LGK)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
NESTLÉ PURINA PETCARE COMPANY,
THE BLUE BUFFALO COMPANY LTD.,
AND RELATED ACTIONS
Case No. 4:14 CV 859 RWS
MEMORANDUM AND ORDER
This false advertising pet food case is before me on two motions to dismiss: Diversified
Ingredients’ motion to dismiss counts 1 and 10 of Blue Buffalo’s second amended third-party
complaint, and Wilbur-Ellis’ joinder to Diversified Ingredients’ motion to dismiss counts 1 and
10 of Blue Buffalo’s second amended third-party complaint. See [#819], [#827]. Blue Buffalo
has filed a partial opposition to the motions to dismiss, and both Diversified and Wilbur-Ellis
have filed reply briefs in support of their motions to dismiss.1 The issues are fully briefed and
ready for review. For the reasons that follow, I will grant both motions to dismiss.
Plaintiff Nestle Purina Petcare Company brought this case against The Blue Buffalo
On August 23, 2016, after the motions were filed and fully briefed, Blue Buffalo filed an amended
pleading, which included a slightly revised version of its second amended third-party complaint. See
[#965]. On September 9, 2016, Diversified filed a renewed motion to dismiss counts 1 and 10 as alleged
in Blue Buffalo’s August 23, 2016 pleading, incorporating its arguments in its original motion to dismiss.
Counts 1 and 10 in Blue Buffalo’s August 23 pleading essentially restate the same allegations against
Diversified and Wilbur-Ellis as they did in the originally-challenged May 12, 2016 pleading. Because the
substance of the pleading is the same, the parties need not re-brief the issues raised in the original motions
to dismiss, and my rulings in this Memorandum and Order will apply to Blue Buffalo’s latest, operative
Company, alleging that Blue Buffalo falsely advertises its pet foods as free of poultry by-product
meal and meeting other nutritional claims in violation of the Lanham Act, 15 U.S.C. § 1125.
Blue Buffalo has since admitted that poultry by-product was in some of its pet foods. However,
it claims that its ingredient supplier, Wilbur-Ellis, and ingredient broker, Diversified Ingredients,
deceived Blue Buffalo when they sold it by-product meal instead of high quality chicken and
turkey meal. Blue Buffalo has brought third-party claims against Diversified and Wilbur-Ellis,
alleging that they are liable for Blue Buffalo’s damages. In their motions to dismiss, Diversified
and Wilbur-Ellis seek to dismiss Blue Buffalo’s claims for breach of contract (Count 1) and
indemnification (Count 10).
In ruling on a motion to dismiss brought under Fed. R. Civ. P. 12(b)(6), I must accept as
true all factual allegations in the complaint and view them in the light most favorable to the
plaintiff. Kohl v. Casson, 5 F.3d 1141, 1148 (8th Cir. 1993). “To survive a motion to dismiss, a
complaint must 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) (citing Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007)). “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.” Iqbal, 556 U.S. at 678. While a court must accept factual
allegations as true, it is “not bound to accept as true a legal conclusion couched as a factual
allegation.” Carton v. Gen. Motor Acceptance Corp., 611 F.3d 451, 454 (8th Cir. 2010) (internal
citations omitted). “Threadbare recitals of the elements of a cause of action, supported by mere
conclusory statements, do not suffice.” Iqbal, 556 U.S. at 678 (internal citations omitted).
Unlike state courts which often require detailed statements of fact in a petition, however, the
federal rules require only notice pleading. Under Fed. R. Civ. P. 8(a):
[A] complaint must include only a short and plain statement of the claim showing
that the pleader is entitled to relief. Such a statement must simply give the
defendant fair notice of what the plaintiff's claim is and the grounds upon which it
rests. This simplified notice pleading standard relies on liberal discovery rules
and summary judgment motions to define disputed facts and issues and to dispose
of unmeritorious claims.
Romine v. Acxiom Corp., 296 F.3d 701, 711 (8th Cir. 2002).
A. Breach of Contract (Count 1)
In Count 1, Blue Buffalo brings a breach of contract claim against Diversified and
Wilbur-Ellis. Both Diversified and Wilbur-Ellis argue that I should dismiss the breach of
contract claim because it is subsumed by Blue Buffalo’s warranty claims. As discussed in my
Memorandum and Order of April 19, 2016, see [#756], and as the Missouri Supreme Court has
Under Missouri law, remedies for economic loss sustained by reason of damage
to or defects in products sold are limited to those under the warranty provisions of
the UCC. The UCC recognizes that breach of contract and breach of warranty are
not the same cause of action. The remedies for breach of contract are set forth in
section 2–711 and are available to a buyer “[w]here the seller fails to make
delivery or repudiates or the buyer rightfully rejects or justifiably revokes
acceptance.” § 400.2–711.1. The remedies for breach of warranty are set forth in
section 2–714 and are available to a buyer who has finally accepted goods, but
discovers that the goods are defective in some manner. § 400.2–714; see also 1
White & Summers, UCC 702–3 (“We believe that only buyers who have accepted
and neither rightfully rejected nor effectively revoked can use 2–714.”). Here, the
plaintiffs do not assert that Great Plains failed to make delivery or repudiated or
that Crush rightfully rejected or justifiably revoked acceptance. There is no
dispute that Crush accepted delivery of the T1055 and notified Great Plains about
the machine's inability to perform terrain leveling adequately. Accordingly,
Renaissance and TEAM cannot recover under section 400.2–711 for breach of
contract. Their contract claims are subsumed by their breach of warranty claims
for damages under section 400.2–714, which already have been addressed above.
Plaintiffs' breach of contract claims fail as a matter of law.
Renaissance Leasing, LLC v. Vermeer Mfg. Co., 322 S.W.3d 112, 130-31 (Mo. 2010) (internal
Here, Blue Buffalo expressly alleges that it took delivery of goods from Diversified.
Moreover, in its partial opposition to Diversified’s motion to dismiss, Blue Buffalo concedes that
its breach of contract claim against Diversified is subsumed by its warranty claims. As a result, I
will dismiss Count 1 against Diversified.
Blue Buffalo does oppose dismissal of its breach of contract claim against Wilbur-Ellis,
arguing that whether its breach of contract claim is subsumed by its warranty claims depends on
the state law that applies to its claims against Wilbur-Ellis. Blue Buffalo contends that either
Connecticut, California, or Texas law will likely apply to its claims against Wilbur-Ellis, that
breach of contract claims are not subsumed by warranty claims in Connecticut and California,
and that it is too early to resolve the present choice of law issue.
As Wilbur-Ellis argues, however, there is no choice of law issue here. It is the UCC itself
(and the corresponding state laws adopting the UCC in each of the relevant states) that
distinguishes between breach of contract and warranty claims. Specifically, the UCC provides
that warranty claims are properly brought when a buyer accepts nonconforming product, while
breach of contract claims apply when a buyer rejects acceptance of nonconforming goods. See
Cal. Com. Code §§ 2712-2714; Conn. Gen. Stat. Ann. §§ 42a-2-712-714; Mo. Ann. Stat. §§
400.2-712-714; Tex. Bus. & Com. Code Ann. §§ 2.712-2.714; see also 1 White, Summers, &
Hillman, Uniform Commercial Code § 11:1 (6th ed.) (“We believe that only buyers who have
accepted and neither rightfully rejected nor effectively revoked can use 2-714. Thus, in our
view, sections 2-713 and 2-712 on the one hand and 2-714 on the other are mutually exclusive.”)
(collecting cases). Although Blue Buffalo has cited to a few cases from Connecticut and
California that included claims for both breach of contract and for breach of warranty, those
cases did not directly address whether the breach of contract claims are subsumed by breach of
warranty claims, and therefore do not have precedential value.
Here, Blue Buffalo does not allege that Wilbur-Ellis failed to make delivery or that Blue
Buffalo rejected acceptance. Rather, the complaint establishes that Blue Buffalo accepted
delivery of numerous shipments originating from Wilbur-Ellis. As a result, its breach of contract
claim is subsumed by its warranty claims as a matter of law, whether under Missouri, California,
Connecticut, or Texas law, and I will dismiss Count 1 against Wilbur-Ellis.
B. Implied-in-Fact Indemnity (Count 10)
Diversified and Wilbur-Ellis move to dismiss Count 10 (Indemnification), to the extent it
seeks implied-in-fact indemnity,2 arguing that Blue Buffalo has failed to plead any facts showing
the parties intended there to be an indemnity provision in their contracts.
Implied-in-fact contractual indemnity stems from the existence of a binding
contract between two parties that necessarily implied the right of indemnification.
The party asserting such indemnity must show that the parties to the contract
“intended the indemnitor to be responsible for the loss.” Thus, a claim of impliedin-fact indemnity asserts a contractual right to indemnity, even though no express
contract for indemnity exists.
Am. Nat. Prop. & Cas. Co. v. Ensz & Jester, P.C., 358 S.W.3d 75, 84 (Mo. Ct. App. 2011)
(internal citations omitted) (emphasis in original).
In its indemnification claim, Blue Buffalo alleges that “Blue Buffalo’s contracts with
Wilbur-Ellis and Diversified entitle Blue Buffalo to implied-in-fact indemnity. The contracting
parties intended that, in such a situation, Wilbur-Ellis and/or Diversified would be responsible
for the loss.” See [#783 at ¶ 273], [#965 at ¶ 296]. As Diversified and Wilbur-Ellis note, this
Although the motions are titled as motions to dismiss “Counts 1 and 10,” the parties only challenge Count 10 to the
extent it seeks implied-in-fact indemnity. There is no argument or request to dismiss Count 10 to the extent it seeks
equitable indemnity. As a result, this Memorandum and Order does not address or dismiss Blue Buffalo’s claim for
conclusory allegation does not meet the pleading standards of Iqbal. 556 U.S. at 678. Blue
Buffalo argues that its factual allegations throughout the complaint, however, support its claim
for implied-in-fact indemnity, such as its allegations that both Diversified and Wilbur-Ellis
acknowledged in company emails that they might be liable for Blue Buffalo’s losses once this
lawsuit was filed. Blue Buffalo argues that these factual allegations support its claim for
implied-in-fact indemnity because it shows that its damages were foreseeable consequential
damages caused by Diversified and Wilbur-Ellis’ alleged breaches. Foreseeability of damages,
however, is not the relevant inquiry. As stated above, “The party asserting [implied-in-fact]
indemnity must show that the parties to the contract ‘intended the indemnitor to be responsible
for the loss.’” Am. Nat. Prop. & Cas. Co., 358 S.W.3d at 84 (Mo. Ct. App. 2011) (internal
citations omitted) (emphasis in original).
While Blue Buffalo’s complaint certainly alleges that its damages were foreseeable to
Diversified and Wilbur-Ellis, which is relevant to any damage calculations that might arise from
Blue Buffalo’s warranty or equitable indemnity claims, these allegations do not support its claim
for implied-in-fact indemnity. Blue Buffalo has not alleged any facts to plausibly suggest that
the parties intended that Blue Buffalo have a right of indemnification against Diversified or
Wilbur-Ellis, which is the relevant inquiry. As a result, I will dismiss Blue Buffalo’s claim for
implied-in-fact indemnity against both Diversified and Wilbur-Ellis.
IT IS HEREBY ORDERED that Diversified Ingredients’ motions to dismiss counts 1
and 10 of Blue Buffalo’s second amended third-party complaint, # and #, are
GRANTED in accordance with the terms of this Memorandum and Order.
IT IS FURTHER ORDERED that Wilbur-Ellis’s joinder to Diversified Ingredients’
motion to dismiss counts 1 and 10 of Blue Buffalo’s second amended third-party complaint
# is GRANTED in accordance with the terms of this Memorandum and Order.
IT IS FURTHER ORDERED that Blue Buffalo shall file an amended third-party
complaint to bring it into compliance with the terms of this Memorandum and Order no later
than September 30, 2016.
RODNEY W. SIPPEL
UNITED STATES DISTRICT JUDGE
Dated this 15th day of September, 2016.
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