Mantikas ex rel. Situated v. Kellogg Co.
910 F.3d 633
| 2d Cir. | 2018Background
- Plaintiffs (Mantikas, Burns, Castle) bought Kellogg’s Cheez-It varieties labeled "WHOLE GRAIN" or "MADE WITH WHOLE GRAIN" and alleged those labels conveyed that the product's grain content was predominantly whole grain.
- Ingredients lists and Nutrition Facts on the box disclosed that a serving was 29g and that "enriched white flour" was the first (predominant) ingredient; the front panel also stated "MADE WITH 5G [or 8G] OF WHOLE GRAIN PER SERVING."
- Plaintiffs claimed they would not have purchased the crackers had they known enriched white flour predominated and brought state-law consumer-protection and false-advertising claims (New York and California) plus an unjust enrichment claim (Michigan law).
- Kellogg moved to dismiss under Fed. R. Civ. P. 12(b)(6), arguing the front-panel statements were accurate and qualified by the gram disclosure and ingredient panel; Kellogg also raised preemption and standing defenses.
- The district court dismissed, holding that the labeling, read in context, would not mislead a reasonable consumer and therefore failed to state a claim; Plaintiffs appealed.
- The Second Circuit vacated and remanded, holding Plaintiffs plausibly alleged the front-of-package "whole grain" statements could mislead a reasonable consumer into believing the grain content was predominantly whole grain despite disclosures.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether front-label "WHOLE GRAIN" / "MADE WITH WHOLE GRAIN" is misleading to a reasonable consumer | The prominent statements convey that the product's grain is predominantly whole grain; gram and ingredient disclosures do not dispel that impression | Statements are literally true and qualified by the front-panel gram disclosure and the ingredient/Nutrition Facts, so no deception as a matter of law | Reversed: plausible that front claims mislead a reasonable consumer; dismissal was improper |
| Whether front-panel gram disclosure ("5g/8g of whole grain per serving") cures any deception | Disclosure does not communicate that enriched white flour exceeds whole grain; it can imply predominance of whole grain and thus is misleading | Gram disclosure on front accurately quantifies whole grain per serving and prevents deception | Court: gram disclosure does not necessarily cure deception; allegations that it misleads are plausible |
| Whether side-panel ingredient list / Nutrition Facts cures deception | Consumers need not be expected to "look beyond" front claims to small-print ingredient lists; those disclosures may contradict, not confirm, the front message | Ingredient list and Nutrition Facts accurately disclose that enriched white flour is predominant, negating deception | Court: side-panel disclosures do not, as a matter of law, defeat the plausibility of consumer deception claims |
| Whether Plaintiffs have standing for injunctive relief given alleged lack of ongoing harm | (Not decided on appeal; district court tied standing to failure to state a claim) | (Defendant argued lack of future harm; court below relied on its merits ruling) | Court vacated the district court's standing ruling because it depended on the erroneous merits conclusion; left for district court to address on remand |
Key Cases Cited
- Fink v. Time Warner Cable, 714 F.3d 739 (2d Cir. 2013) (12(b)(6) standard; consumer-deception framework)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (plausibility standard for pleading)
- Freeman v. Time, Inc., 68 F.3d 285 (9th Cir. 1995) (reasonable-consumer deception standard; consider advertisement as a whole)
- Oswego Laborers' Local 214 Pension Fund v. Marine Midland Bank, N.A., 85 N.Y.2d 20 (N.Y. 1995) (New York reasonable-consumer standard for deceptive practices)
- Williams v. Gerber Prods. Co., 552 F.3d 934 (9th Cir. 2008) (consumers should not be expected to look beyond prominent front-label misrepresentations to small-print disclosures)
- Belfiore v. Proctor & Gamble Co., 311 F.R.D. 29 (E.D.N.Y. 2015) (contextual label analysis; disclaimers can defeat deception claims in some circumstances)