1:17-cv-01717
N.D. Ill.Sep 6, 2017Background
- Plaintiff Andrew Block (Illinois resident) bought Lifeway plain low-fat kefir marketed as "99% lactose-free" but alleges it contains ~4% lactose, similar to regular milk.
- Block alleges Lifeway knew the true lactose content (citing a 2003 Ohio State–funded study) and misrepresented the product to charge a premium.
- He filed a putative class action seeking certification of: (1) a national class, (2) a consumer-fraud multi-state class (13 states), and (3) an Illinois sub-class.
- Causes of action: ICFA claims (in the alternative), multi-state consumer-fraud claims, breach of express and implied warranty, common-law fraud, and unjust enrichment; remedies sought include injunctive relief and damages.
- Lifeway moved to dismiss all counts; the court denied dismissal of the fraud/consumer-fraud, unjust-enrichment, and class-related challenges, but granted dismissal of counts for breach of express and implied warranty for failure to allege required pre-suit notice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 1. Can an Illinois plaintiff assert an ICFA-based national class (Count 1)? | Block: He states an ICFA claim and alleges his own Illinois purchase and injury; unnamed non-Illinois members need not be resolved now. | Lifeway: ICFA cannot apply to non-Illinois residents; national class improper. | Denied dismissal; court allows Count 1 to proceed at pleading stage because named plaintiff (Block) alleges ICFA-applicable facts and whether non-residents can be included is a class-certification question. |
| 2. Standing to pursue multi-state consumer-fraud class (Count 2)? | Block: Standing is satisfied by his own injury; choice-of-law/class-certification issues are premature. | Lifeway: Block lacks standing to assert other states' laws for non-Illinois residents. | Denied dismissal; court finds Block has Article III standing and whether he can represent others under other states’ laws is for class certification. |
| 3. Sufficiency of ICFA and common-law fraud pleadings (Counts 1, 3, 6) — fraud, causation, damages? | Block: Alleged misrepresentation caused him to buy product and pay a premium; he would not have purchased if truth known. | Lifeway: Claims are merely breach-of-contract restatements; damages and reliance not adequately pled; plaintiff may not have read labels. | Denied dismissal; court finds allegations (intentional scheme, reliance, actual damages, proximate cause) sufficient and not merely contract breach. |
| 4. Breach of express and implied warranty (Counts 4 & 5) — notice/privity? | Block: Lifeway knew product line contained higher lactose (Ohio State study) so notice excused. | Lifeway: Plaintiff failed to give required pre-suit notice; implied-warranty claim also defective for lack of privity. | Granted dismissal of Counts 4 and 5 for failure to allege that Lifeway had notice of the particular transaction; court did not address privity due to dismissal on notice. |
Key Cases Cited
- Camasta v. Jos. A. Bank Clothiers, Inc., 761 F.3d 732 (7th Cir.) (motion-to-dismiss standard for well-pled facts)
- Crichton v. Golden Rule Ins. Co., 576 F.3d 392 (7th Cir.) (plausibility and Rule 9(b) standards)
- Morrison v. YTB Int'l, Inc., 649 F.3d 533 (7th Cir.) (choice-of-law/class standing issues are for certification, not dismissal)
- Avery v. State Farm Mut. Auto. Ins. Co., 216 Ill.2d 100 (Ill.) (ICFA requires circumstances to occur primarily and substantially in Illinois for out-of-state plaintiffs)
- Connick v. Suzuki Motor Co., 174 Ill.2d 482 (Ill.) (UCC notice requirement: seller must have actual knowledge of the particular transaction to excuse pre-suit notice)
- Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (U.S.) (Article III standing requires concrete, traceable, redressable injury)