Gasser v. Aliph Brands, LLC
4:17-cv-01675
N.D. Cal.Oct 23, 2017Background
- Plaintiffs challenge front-label "natural" claims on four Kiss My Face (KMF) products (lotion, body wash, kids sunscreen, sun spray), alleging they are false because products contain phenoxyethanol and/or ethylhexylglycerin.
- Plaintiffs allege monetary loss (would not have bought or paid premium) and seek class treatment (national class; California and New York subclasses).
- KMF moved to dismiss under Rules 12(b)(1) and 12(b)(6), to stay under primary jurisdiction, and opposed appointment of interim class counsel; plaintiffs moved to appoint counsel and sought judicial notice.
- Court considered standing for injunctive relief, whether the challenged statements are actionable misrepresentations (reasonable consumer standard), Rule 9(b) particularity for fraud-based claims, express warranty, unjust enrichment, punitive damages pleading, and primary jurisdiction stay.
- Court denied political question and lack-of-substantiation jurisdictional challenges, granted dismissal of injunctive-relief claim for lack of standing (leave to amend), granted in part and denied in part 12(b)(6) as to specific label statements, denied stay, granted appointment of interim class counsel, and granted/denied judicial notice in part.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Jurisdiction / Political question | FDA rulemaking does not preclude judicial review of "natural" labeling claims | FDA oversees cosmetics and is considering "natural"; political question/call for agency action | Political question doctrine not implicated; dismissal denied |
| Private lack-of-substantiation claim | Plaintiffs assert affirmative misrepresentation (ingredients are not natural), not mere failure to substantiate | Only regulators may demand substantiation; private suits improperly resemble lack-of-substantiation claims | Plaintiffs plead affirmative falsity, not mere lack-of-substantiation; dismissal denied |
| Standing for injunctive relief | Plaintiffs seek label correction and say they'd buy if composition changed | Plaintiffs cannot show likelihood of future injury because they know ingredients and would not repurchase the same products | No standing for prospective injunctive relief; claim dismissed with leave to amend |
| Actionability of label statements (reasonable consumer) | Front-label terms convey that products are "natural" (esp. "100% natural...") and thus misleading given synthetic ingredients | Phrases are puffery or would not be read to mean entirely natural; no plausible deception | "100% natural mineral..." statements survive; "nourish naturally with our botanical blends" and "obsessively natural kids" are nonactionable as pleaded; partial dismissal granted |
| Fraud/Rule 9(b) specificity | Plaintiffs identified who, what, where, when, and how (KMF, specific labels, ingredient content, class period) | Pleading lacks details on percentages, why preservatives render product "unnatural," or defendant knowledge | Plaintiffs met Rule 9(b) specificity for surviving statements; 9(b) challenge denied for those claims |
| Express warranty (CA and NY) | Label statements create express warranties and formed basis of the bargain | No privity, no notice (NY), and statements not factual promises | Express warranty claim survives for the "100% natural..." statements but fails for the other two phrases; NY claim dismissal with leave to amend for notice defect |
| Unjust enrichment | KMF was unjustly enriched by premium paid for misbranded products | Unjust enrichment requires contract or no actionable misrepresentation | Claim permitted as quasi-contract/restitution theory; denial of motion to dismiss |
| Primary jurisdiction / stay | Court should stay pending FDA rulemaking on "natural" | Plaintiffs: FDA action concerns food and is uncertain; delay would be inefficient | Stay denied (no pending cosmetics rulemaking and no efficiency justification) |
Key Cases Cited
- United States v. Mandel, 914 F.2d 1215 (9th Cir.) (political-question factors)
- Corrie v. Caterpillar, Inc., 503 F.3d 974 (9th Cir.) (political-question doctrine and jurisdictional limits)
- Williams v. Gerber Prods. Co., 552 F.3d 934 (9th Cir.) (reasonable consumer may be misled by "natural" statements)
- Ebner v. Fresh, Inc., 838 F.3d 958 (9th Cir.) (probability standard for "significant portion" of consumers)
- Freeman v. Time, Inc., 68 F.3d 285 (9th Cir.) (reasonable consumer standard in advertising cases)
- Bates v. United Parcel Service, Inc., 511 F.3d 974 (9th Cir.) (standing for prospective injunctive relief requires likelihood of repeated injury)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (U.S. Supreme Court) (Article III standing elements)
- Kearns v. Ford Motor Co., 567 F.3d 1120 (9th Cir.) (Rule 9(b) fraud pleading requirements)
- Astiana v. Hain Celestial Group, Inc., 783 F.3d 753 (9th Cir.) (unjust enrichment/quasi-contract labeling claims)