La Vigne v. Costco Wholesale Corporation, 7:16-cv-07924

Background

Plaintiffs (La Vigne, Hessler, Hogan) brought a putative class action under New York GBL § 349, Pennsylvania UTPCPL, and Massachusetts Chapter 93A challenging Costco’s marketing and sale of Kirkland Signature Premium Chunk Chicken Breast (six 12.5 oz cans, sold in opaque bulk wrap). Plaintiffs purchased in NY, PA, MA.
Packaging and labels state “Premium Chunk CHICKEN BREAST,” “Packed in Water,” net weights (individual can NET WT 12.5 OZ; bulk NET WT 6‑12.5 OZ TOTAL 4.6 LB) and Nutrition Facts listing serving size as “2 oz drained” and servings per container.
Plaintiffs allege cans contain substantial free water (consumers drain ~2/3 cup leaving ~7–8 oz meat per can), so meat is <80% of contents; they claim this violates 9 C.F.R. § 381.157 and is deceptive because the label does not disclose a liquid percentage.
Costco moved to dismiss under Rule 12(b)(6) arguing (1) PPIA express preemption of state labeling claims (and FSIS preapproval of the label), (2) no private right to enforce the PPIA, and (3) no reasonable consumer would be misled given label disclosures and net-weight/unit-price information.
Court assumed FSIS preapproval and held: (a) plaintiffs’ labeling-based state-law claims are preempted by the PPIA because they would impose requirements different from or additional to the federal scheme and conflict with FSIS review; (b) remaining non-labeling marketing allegations (package size, shelf unit-price) survive preemption but fail on the merits as not misleading to a reasonable consumer; judgment for defendant, case dismissed.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether state-law claims based on product labeling/contents are preempted by the PPIA	Labeling violates 9 C.F.R. § 381.157 (product <80% meat) and plaintiffs seek to enforce equivalent federal requirements via state law	PPIA expressly preempts state marking/labeling requirements; FSIS preapproved the label, so state claims would impose different/additional requirements	Labeling-based state-law claims are preempted; FSIS preapproval entitled to preemptive effect
Whether plaintiffs may privately enforce PPIA requirements	Plaintiffs seek damages under state law based on alleged federal violation	PPIA has no private right of action and Congress excluded private enforcement	Court did not decide because labeling claims were dismissed on preemption grounds (argument reserved)
Whether non-label marketing (can size, shelf unit-price) claims are preempted	These claims are distinct from FSIS-approved label and therefore not preempted	Some marketing aspects implicate labeling and are preempted; unit price is calculated on net weight including water	Non-label marketing claims are not preempted but proceed to merits review
Whether packaging, unit-pricing, and size would mislead a reasonable consumer under NY, PA, MA consumer-protection laws	Plaintiffs say can size and unit-price created expectation of substantially more chicken than present	Defendant points to clear label disclosures: “Packed in Water,” net weights, Nutrition Facts with drained serving size; unit pricing based on net weight of contents	Court held no reasonable-consumer deception as a matter of law; plaintiffs failed to state a claim under NY §349, PA UTPCPL provisions, and Mass. Ch. 93A

Key Cases Cited

Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard: factual allegations must plausibly give rise to relief)
Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard for complaints)
LaFaro v. N.Y. Cardiothoracic Group, PLLC, 570 F.3d 471 (2d Cir. 2009) (on Rule 12(b)(6) factual-pleading limits)
Medtronic, Inc. v. Lohr, 518 U.S. 470 (1996) (interpretation of express preemption language; state requirements preempted if not equivalent to federal requirements)
Bates v. Dow Agrosciences LLC, 544 U.S. 431 (2005) (analysis of preemption clause analogous to labeling preemption)
Wyeth v. Levine, 555 U.S. 555 (2009) (FDA approval of labeling does not automatically preempt state-law claims absent an express preemption provision)