Greene v. Gerber Products Co.
262 F. Supp. 3d 38
E.D.N.Y2017Background
- Plaintiffs (Greene, Wilkerson, Manemeit) brought putative class actions alleging Gerber’s "Good Start" infant formula was falsely marketed to reduce allergy risk and to be the "first & only" FDA-qualified formula; suits assert state consumer-protection statutes (Ohio, North Carolina, New York) and common-law fraud claims.
- Gerber previously petitioned the FDA (2005, 2009) for qualified health-claim language; FDA denied or found the company’s proposed phrasing misleading and later provided four narrower qualified-claim formulations and an advisory statement (2011).
- FDA issued a 2014 Warning Letter finding Gerber’s labeling and website contained unauthorized or misleading health claims and that required qualifying language was omitted.
- The FTC sued Gerber in 2014 alleging similar deceptive marketing; multiple related private suits followed.
- Gerber moved to dismiss or stay (primary jurisdiction), to dismiss statutory claims (OCSPA, ODTPA, NCDTPA, NY GBL), to dismiss injunctive relief for lack of standing, to dismiss common-law fraud claims and unjust enrichment, and to strike nationwide class allegations.
- Court consolidated Greene and Manemeit for this motion and (1) declined to apply primary jurisdiction, (2) dismissed OCSPA and ODTPA claims, (3) sustained NCDTPA and New York GBL claims, (4) denied dismissal of fraud-based common-law claims but dismissed unjust enrichment, (5) found no standing for injunctive relief, and (6) denied motion to strike nationwide class allegations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Primary jurisdiction (stay/dismiss) | FTC/FDA involvement doesn't require staying private suits; issues are legal and fit for court | FDA/FTC better suited to resolve labeling technicalities; stay pending agency actions warranted | Denied — primary jurisdiction not invoked; court follows prior Hasemann analysis |
| Standing for injunctive relief / third-party standing | Plaintiffs can seek injunction to stop ongoing deceptive advertising; third-party standing necessary to protect unaware consumers | Plaintiffs lack imminent risk of future injury and cannot assert rights of unidentified future purchasers | Denied — plaintiffs lack Article III standing for injunctive relief; third-party standing not permitted here |
| OCSPA class-notice requirement & Rule 23 preemption | Rule 23 preempts Ohio’s prior-notice limitation on class actions (Shady Grove) | OCSPA §1345.09(B) is substantive and survives Rule 23 under controlling Shady Grove concurrence | Dismissed OCSPA class claim — notice requirement not preempted; plaintiffs failed to show qualifying prior notice |
| ODTPA standing (consumer plaintiffs) | Consumers can sue under ODTPA for deceptive trade practices | ODTPA is like Lanham Act and protects commercial competitors, not consumers | Dismissed — consumers lack standing under ODTPA per Ohio appellate and federal precedent |
| NCDTPA / Rule 9(b) pleading | NCDTPA claims need not meet Rule 9(b); even if they do, plaintiffs pleaded with particularity | Claims are vague and lack particularized fraud allegations | Denied — Court assumes Rule 9(b) but finds plaintiffs met heightened pleading: identified statements, speakers, timing, why misleading |
| NY GBL §§349/350 — injury & safe-harbor | Manemeit alleged price-premium injury and noncompliance with FDA safe-harbor; claims state injury | Compliance with FDA guidance (2011 letter) provides safe-harbor; no cognizable injury pleaded | Denied — Plaintiff adequately alleged price-premium injury; FDA 2011 letter not shown to be a qualifying "rule/regulation" or complied with by defendant |
| Common-law fraud (fraudulent concealment, intentional & negligent misrep.) | Plaintiffs allege partial/ambiguous statements, superior knowledge, reliance, and facts supporting scienter | Defendant contends absence of fiduciary/special relationship and lack of scienter particularity | Denied — fraud and negligent misrepresentation survive: duty/knowledge, reliance, and strong inference of scienter sufficiently pleaded |
| Unjust enrichment | Plaintiffs claim Gerber was unjustly enriched by premium sales due to deception | Claim duplicates statutory and tort remedies and lacks independent basis | Granted — unjust enrichment dismissed as duplicative and not alleged in an "unusual" equitable context |
| Motion to strike nationwide class allegations | Premature; merits of predominance/commonality depend on discovery | Nationwide class unsupportable given individualized reliance and state-law differences | Denied as premature — court declines to strike class allegations at pleading stage |
Key Cases Cited
- Cortlandt St. Recovery Corp. v. Hellas Telecomms. S.A.R.L., 790 F.3d 411 (2d Cir.) (jurisdictional standards)
- Makarova v. United States, 201 F.3d 110 (2d Cir. 2000) (Rule 12(b)(1) standards)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard under Rule 12(b)(6))
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (legal conclusions not entitled to assumption of truth)
- Shady Grove Orthopedic Ass’n, P.A. v. Allstate Ins. Co., 559 U.S. 393 (2010) (Rule 23 v. state class-action rules; plurality and controlling concurrence analysis)
- Lyons v. City of Los Angeles, 461 U.S. 95 (1983) (standing for injunctive relief requires imminent future injury)
- Aetna Cas. & Sur. Co. v. Aniero Concrete Co., Inc., 404 F.3d 566 (2d Cir. 2005) (elements and duty to disclose for fraud by concealment)
- McLaughlin v. Am. Tobacco Co., 522 F.3d 215 (2d Cir. 2008) (class-action suitability for fraud claims involving common misrepresentations)