Backus v. General Mills, Inc.
122 F. Supp. 3d 909
N.D. Cal.2015Background
- Plaintiff Troy Backus filed a putative class action alleging General Mills sold boxed baking mixes containing partially hydrogenated oils (PHOs), i.e., artificial trans fats, since 2008 and that he purchased them frequently over years.
- Backus alleges PHOs cause inflammation and organ damage and that any amount increases risk of heart disease, diabetes, cancer; he claims physical injury and economic loss (would not have purchased illegal/unsafe products).
- FDA issued a tentative finding in 2013 and a final determination on June 17, 2015 that PHOs are no longer GRAS, but set a compliance date of June 18, 2018 and invited food additive petitions for limited/low-level uses.
- Claims: violations of California Unfair Competition Law (UCL) — unlawful and unfair prongs, public nuisance, and breach of implied warranty of merchantability; seeks class of purchasers of General Mills baking mixes containing PHOs since Jan 1, 2008.
- Procedural posture: General Mills moved to dismiss for lack of standing and failure to state claims and to stay/dismiss under the primary jurisdiction doctrine; the court granted in part and denied in part, stayed the case pending FDA action, dismissed nuisance and warranty claims with prejudice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing — physical injury | Backus alleges present organ inflammation from consuming PHO-containing mixes | General Mills says alleged injury is speculative and insufficient for Article III | Court: physical-injury allegations (even minimal) and economic loss suffice; standing denied as to increased-risk-only theory but granted on physical and economic injuries |
| Standing — economic injury (UCL) | Backus says he lost money buying products he would not have purchased if lawful/ safe | General Mills contends purchase of labeled product does not show economic injury or reliance | Court: economic injury pleaded plausibly (purchase of allegedly illegal/unsafe product) and satisfies UCL standing |
| UCL — unlawful prong (basis) | Backus: sale of PHO-containing mixes violates state Sherman Act (adulterated food) and thus is unlawful under UCL | General Mills: federal law (FDCA/FDA) treated PHOs as GRAS historically, FDA only recently revoked GRAS and allowed use until 2018 — federal law does not render sale unlawful | Court: federal law does not plausibly render sale unlawful now; but state Sherman Act claim is plausible given FDA action and lack of formal federal sanction — UCL unlawful claim survives |
| UCL — unfair prong | Backus: PHOs cause public harm, safe low-cost alternatives exist, utility is outweighed by harm | General Mills: use of PHOs is lawful and thus has utility | Court: unfair claim plausible under balancing and public-policy tests; survive at pleading stage |
| Public nuisance | Backus: sale of PHO mixes injures public and plaintiff specially | General Mills: injuries alleged are the same kind as those suffered by public generally | Court: dismissed with prejudice — plaintiff failed to allege injury different in kind from general public |
| Implied warranty of merchantability | Backus: mixes unfit for ordinary use because PHOs make them unsafe | General Mills: labels disclosed PHOs; plaintiff could have discovered ingredient; labeling preemption bars indirect state labeling claims | Court: dismissed with prejudice — plaintiff failed to show unfitness and claim impaired by federal labeling preemption |
| Primary jurisdiction / stay | Backus: FDA already decided PHOs are not GRAS, case should proceed | General Mills: questions about safety/allowable low-level uses require FDA expertise; FDA invited petitions and set compliance date | Court: applied primary jurisdiction — stayed proceedings (not dismissed) pending FDA determination; parties to file joint statement within 14 days after FDA action |
Key Cases Cited
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (standing requires injury in fact, traceability, redressability)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (pleading must state a plausible claim)
- Ashcroft v. Iqbal, 556 U.S. 662 (courts need not accept legal conclusions disguised as factual allegations)
- Kwikset Corp. v. Superior Court, 51 Cal.4th 310 (California UCL standing and showing economic injury)
- Covington v. Jefferson Cnty., 358 F.3d 626 (physical/injury allegations and standing in environmental context)
- Clapper v. Amnesty Int'l USA, 133 S. Ct. 1138 (future-risk standing requires injury that is certainly impending or substantial risk)
- Syntek Semiconductor Co. v. Microchip Tech., Inc., 307 F.3d 775 (primary jurisdiction factors)
- Rubio v. Capital One Bank, 613 F.3d 1195 (UCL standing and unfairness analysis)