313 F. Supp. 3d 1031
N.D. Cal.2018Background
- Plaintiffs Kellman (CA) and Starr (NY) sue Whole Foods entities alleging certain Whole Foods–branded household and body-care products were mislabeled "hypoallergenic" despite containing known skin sensitizers/allergens; suit seeks class relief under Rule 23 and asserts warranty, unjust enrichment, CLRA, FAL, UCL, and New York GBL §§ 349/350 claims.
- Defendants named: Whole Foods Market, Inc. (WFMI), Whole Foods Market California, Inc. (WFM California), Whole Foods Market Services, Inc. (WFM Services), and Whole Foods Market Group, Inc. (WFM Group).
- Defendants moved to dismiss for lack of personal jurisdiction (12(b)(2)) over non‑California defendants, for failure to state claims (12(b)(6)) on false advertising and express warranty, and for lack of Article III standing (12(b)(1)) as to unpurchased products; they also moved to strike certain allegations (12(f)).
- Court accepted many factual allegations for pleading-stage review (e.g., products labeled "hypoallergenic" but alleged to contain sensitizers); plaintiffs alleged customers would pay a premium or buy because of that label.
- Ruling: court granted motion in part — dismissed WFMI, WFM Services, and WFM Group for lack of personal jurisdiction; dismissed Ms. Starr’s claims against WFM California for failure to state a claim; dismissed claims for products for which plaintiffs alleged no ingredients (lack of standing). In all other respects the motion was denied and plaintiffs were given leave to amend.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Personal jurisdiction over WFMI, WFM Services, WFM Group | Whole Foods parent and services entities exercise control, market and direct sales to CA consumers (thus general or specific jurisdiction) | These entities are not incorporated or headquartered in CA, do not sell the products themselves in CA, and submitted sworn declarations denying CA contacts | Dismissed non‑California defendants for lack of personal jurisdiction (no prima facie showing of general or specific jurisdiction) |
| Jurisdiction/claims by Ms. Starr against WFM California | Starr alleged purchases in NY and sought claims generally against Whole Foods entities | Defendants argued no plausible basis for Starr to sue WFM California (a CA entity) | Starr’s claims against WFM California dismissed for failure to state a plausible claim (leave to amend) |
| CLRA/FAL/UCL false‑advertising claims ("hypoallergenic" labeling) | Labeling that products are "hypoallergenic" (sometimes coupled with "independent lab results show") is misleading because products contain sensitizers at concentrations likely to cause sensitization | Labels are truthful (lab‑tested), do not guarantee zero allergens; "hypoallergenic" is ambiguous and not necessarily false | Kellman pleaded plausible CLRA/FAL/UCL claims under the reasonable‑consumer standard; dismissal denied on merits at pleading stage |
| Breach of express warranty | "Hypoallergenic" labels are affirmations of fact and basis of the bargain; products are not hypoallergenic | Statements that "lab results show" hypoallergenicity negate a warranty or are not false | Kellman pleaded a plausible express‑warranty claim; dismissal denied |
| Standing for unpurchased products | Kellman seeks relief for many unpurchased items alleged to bear same representations and shared sensitizing ingredients | Defendants argue plaintiff lacks Article III standing for products she did not buy | Plaintiff lacks standing for products for which she alleged no ingredients (tissues, paper towels, diapers, training pants) and those claims dismissed; but she has standing for unpurchased body‑care products and some detergents where ingredients and alleged injuries are substantially similar to purchased products |
| Motion to strike allegations re: unpurchased products | Plaintiffs opposed striking; allegations relevant to class claims and standing | Defendants sought to strike unspecific or immaterial allegations | Motion to strike denied (12(f) disfavored; allegations could be relevant and not plainly immaterial) |
Key Cases Cited
- Daimler AG v. Bauman, 571 U.S. 117 (2014) (general jurisdiction requires affiliations so continuous and systematic as to render a corporation essentially at home)
- Bristol‑Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017) (specific jurisdiction requires the claim to arise out of or relate to the defendant's forum contacts)
- Int'l Shoe Co. v. Washington, 326 U.S. 310 (1945) (minimum contacts test for due process personal jurisdiction)
- Ranza v. Nike, Inc., 793 F.3d 1059 (9th Cir. 2015) (plaintiff bears burden to make prima facie showing of jurisdiction; standards for alter‑ego and control analyses)
- Williams v. Gerber Prods. Co., 552 F.3d 934 (9th Cir. 2008) (reasonable consumer standard governs CLRA/FAL/UCL consumer deception claims)