Counts v. Arkk Food Company
1:23-cv-00236
N.D. Ill.Nov 3, 2023Background
- Wahlburgers-branded retail pickles ("Fresh Dill Spears," "Fresh Dill Chips," "Fresh Dill Chips Hot") were labeled “Fresh,” “All Natural,” and “No Preservatives.”
- Laboratory testing by a third party (Biogen) of Wahlburgers pickles purchased in California, Florida, and Michigan between May 2022–March 2023 detected sodium benzoate (a preservative).
- Plaintiff Counts purchased Wahlburgers pickles in Illinois in Sept/Oct 2022 and alleges he would have paid less or not purchased had he known about sodium benzoate.
- Counts sued Arkk (distributor/licensee) and Wahlburgers asserting ICFA, multi-state consumer fraud claims, and nationwide warranty and unjust enrichment claims; defendants moved to dismiss under Rules 12(b)(6) and 12(b)(1) and to strike class allegations under Rule 23.
- District court accepted lab results as adequate pre-suit evidence under Rule 9(b) (information-and-belief allowed where facts inaccessible) and denied dismissal of ICFA and unjust enrichment counts; dismissed breach-of-express-warranty claims for failure to give required pre-suit notice and struck warranty-related class allegations; denied standing and class-striking challenges as premature for the remaining claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether ICFA claim must meet Rule 9(b) and whether Counts pleaded fraud with particularity | Counts: ICFA sounds in unfair practice but pleaded fraud with lab tests supporting reasonable inference; information-and-belief permissible because original pickles unavailable | Defs: Counts lacked particularized facts about the exact jars he bought and cannot rely on third‑party tests of other batches/locations | Court: Rule 9(b) applies; Counts met it—verified lab tests from same timeframe/various locations provided plausible grounds on information-and-belief |
| Unjust enrichment tied to same allegations | Counts: unjust enrichment seeks restitution for same misleading labeling | Defs: move to dismiss as duplicative/insufficient | Court: Denied; unjust enrichment claim survives insofar as it seeks restitution connected to viable ICFA allegations |
| Breach of express warranty — pre-suit notice requirement | Counts: initial complaint or same-day mailing sufficed as notice (or implicit notice) | Defs: Illinois law requires meaningful pre-suit notice; same‑day mailing or waiting to assert in amendment is insufficient | Court: Dismissed warranty claim with prejudice for failure to provide required pre-suit notice; exceptions inapplicable |
| Article III standing to assert non-Illinois statutory/common‑law claims on behalf of multi-state/nationwide classes | Counts: Article III standing challenge is premature; class certification rules (Rule 23) govern who may represent non‑resident claims | Defs: Counts lacks standing to pursue other states' laws because he was injured only in Illinois | Court: Denied 12(b)(1) challenge—Counts has Article III standing to litigate claims and later Rule 23 will address adequacy as class rep |
| Motion to strike class allegations (Rule 23) — viability/manageability of multi-state/nationwide classes | Counts: narrowed multi-state subclass after legal analysis; class issues require discovery | Defs: state-law variations make classes unmanageable; warranty/unjust enrichment nationwide classes improper | Court: Struck class allegations tied to dismissed warranty claims; declined to strike other class claims as premature pending discovery and class-certification proceedings |
Key Cases Cited
- Pirelli Armstrong Tire Corp. Retiree Med. Benefits Trust v. Walgreen Co., 631 F.3d 436 (7th Cir. 2011) (Rule 9(b) information‑and‑belief standard and limits on relying on other lawsuits)
- Camasta v. Jos. A. Bank Clothiers, Inc., 761 F.3d 732 (7th Cir. 2014) (ICFA claims sounding in fraud are governed by Rule 9(b))
- TransUnion LLC v. Ramirez, 141 S. Ct. 2190 (U.S. 2021) (Article III standing requires concrete, particularized injury causation and redressability)
- Freeman v. MAM USA Corp., 528 F. Supp. 3d 849 (N.D. Ill. 2021) (named plaintiff may represent multi‑state class; Article III does not bar non‑resident statutory claims at pleading stage)
- Vanzant v. Hill’s Pet Nutrition, Inc., 934 F.3d 730 (7th Cir. 2019) (unjust enrichment/restitution claims can track consumer‑fraud statutory claims)
- Szabo v. Bridgeport Machines, Inc., 249 F.3d 672 (7th Cir. 2001) (nationwide warranty/fraud classes present choice‑of‑law and manageability problems)