Joshua Debernardis v. IQ Formulations, LLC
942 F.3d 1076
11th Cir.2019Background
- Plaintiffs Joshua Debernardis and Christina Damore purchased the dietary supplement Synedrex (manufactured by IQ Formulations) containing an ingredient alleged to be DMBA (MethylPentane Citrate).
- Plaintiffs allege DMBA is a “new dietary ingredient” under the FDCA/DSHEA (not marketed in the U.S. before Oct. 15, 1994), so supplements containing it are presumptively adulterated and barred from sale absent FDA notice or evidence of safety.
- The complaint alleges IQ (manufacturer) sold the supplements and Europa (exclusive distributor) supplied retailers (e.g., Walgreens, NaturalBodyInc.com) that sold to the plaintiffs; FDA had sent warning letters in April 2015 to sellers of DMBA-containing products.
- Plaintiffs brought putative class claims (state consumer-protection statutes, fraud, unjust enrichment), alleging they paid for products that were illegal to sell and therefore worthless, suffering economic injury.
- The district court dismissed for lack of Article III standing, reasoning plaintiffs received the benefit of the bargain (no factual allegations of nonperformance, physical harm, or premium paid).
- The Eleventh Circuit vacated and remanded, holding that alleging purchase of an FDCA-adulterated supplement that Congress barred from sale plausibly pleads an economic injury (a worthless product) and that plaintiffs adequately alleged traceability to Europa at the pleading stage.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether plaintiffs alleged an Article III injury in fact | Debernardis & Damore: paid money and received adulterated supplements that were illegal to sell and therefore worthless (economic loss = injury) | IQ/Europa: no injury because products performed, no physical harm, no premium alleged; benefit of the bargain received | Held: Allegations suffice at pleading stage — purchase of FDCA-adulterated supplement can plausibly be a concrete economic injury (worthless product) |
| Whether a supplement adjudged "adulterated" is valueless for benefit-of-the-bargain damages | Plaintiffs: Congress banned adulterated supplements to protect consumers, so such products have no value | Defendants: value remains if product works or confers benefits; mere procedural noncompliance insufficient | Held: At motion-to-dismiss stage court accepts that an adulterated supplement Congress banned from sale can be valueless, supporting full purchase-price damages theory |
| Whether plaintiffs plausibly alleged the supplements were adulterated (new dietary ingredient/no FDA premarket notice) | Plaintiffs: supplements contain DMBA, DMBA not marketed pre-1994, no FDA premarket notice was provided — so presumptively adulterated | Defendants: dispute ingredient ID and factual sufficiency | Held: Complaint plausibly alleges DMBA is a new dietary ingredient and no premarket notice was given, so presumption of adulteration was not rebutted for pleading purposes |
| Whether plaintiffs’ injuries are fairly traceable to Europa | Plaintiffs: only IQ and Europa supplied consumers; Europa was sole distributor to retailers selling to plaintiffs | Europa: plaintiffs did not allege Europa distributed the specific purchases, so causation is too attenuated | Held: Allegations permit an inference that Europa supplied the retailers from which plaintiffs bought; traceability pled adequately at pleading stage |
Key Cases Cited
- Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016) (Article III standing requires a concrete and particularized injury in fact)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (injury-in-fact must be concrete, particularized, and actual or imminent)
- Clinton v. New York, 524 U.S. 417 (1998) (economic injury qualifies as concrete injury)
- In re Aqua Dots Prods. Liab. Litig., 654 F.3d 748 (7th Cir. 2011) (purchasers of dangerous/toxic products may have standing to recover full purchase price where product is effectively worthless)
- Carriuolo v. Gen. Motors Co., 823 F.3d 977 (11th Cir. 2016) (benefit-of-the-bargain economic injury when product deprived plaintiffs of promised qualities)
- MSPA Claims 1, LLC v. Tenet Fla., Inc., 918 F.3d 1312 (11th Cir. 2019) (economic injury as paradigm of concrete injury)
- Franz v. Beiersdorf, Inc., [citation="745 F. App'x 47"] (9th Cir. 2018) (consumer had standing after purchasing a product that should not have been sold under the FDCA)
- Rollins, Inc. v. Heller, 454 So. 2d 580 (Fla. Dist. Ct. App. 1984) (benefit-of-the-bargain damages measure: difference between delivered product value and promised product value)