695 F.Supp.3d 448
S.D.N.Y.2023Background
- Victor (PestChaser) ultrasonic "rodent repellers" were marketed as reducing rodent activity in 6–10 days, for indoor use, with broad coverage and multi-year life. Plaintiffs bought units (Maroney: single 3-pack Sep 2018; Heumann: multiple purchases over several years, with documented contacts to defendant in Oct 2017–May 2018).
- Plaintiffs allege the devices are ineffective; they cite multiple scientific studies and FTC investigations/letters finding ultrasonic devices generally unreliable and sometimes the subject of enforcement. Plaintiffs also point to an online video showing mice ignoring an operational unit.
- Claims: violations of N.Y. Gen. Bus. Law §§ 349, 350; Magnuson-Moss Warranty Act; unjust enrichment; breach of express warranty; and fraud. Plaintiffs seek class certification and a New York subclass.
- Defendant moved to dismiss under Fed. R. Civ. P. 12(b)(6). Court took judicial notice of an FTC Consent Order (public record) but declined to consider a non-public FTC "No Further Action" letter.
- The Court found plaintiffs plausibly alleged the underlying ultrasonic methodology is ineffective and that plaintiffs adequately pleaded scienter (fraudulent intent) circumstantially based on scientific literature and FTC actions putting the defendant on notice.
- Ruling: motion denied in part and granted in part. Sufficient to proceed on GBL and fraud claims and on remaining breach of warranty claims; warranty claims by Heumann predating Oct 2017 were dismissed without prejudice for lack of specificity; unjust enrichment and injunctive-relief claims dismissed with prejudice as abandoned. Plaintiffs may file a third amended complaint within 30 days.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Judicial notice of FTC materials | Consent orders and agency records are public and admissible for notice | Only public agency documents may be judicially noticed; non-public communications cannot | Court judicially noticed the 1994 FTC Consent Order (public) but did not consider the 1996 No Further Action letter (not shown to be public) |
| Falsity of product representations (GBL §§ 349/350, consumer claims) | Studies and FTC history show ultrasonic technology is ineffective; product claims therefore deceptive | Studies do not test defendant's specific products/claims; plaintiffs must show product failed to perform as advertised | Allegations that the ultrasonic method is ineffective make deceptiveness plausible; claims survive pleading stage |
| Fraud (scienter) | Defendant was on notice via literature and FTC actions; thus scienter can be inferred | Plaintiff alleges knowledge only conclusorily; no direct proof defendant knew claims were false | Court finds circumstantial a strong inference of intent plausible based on scientific studies and FTC warnings; fraud claim survives pleading standard under Rule 9(b) |
| Breach of express warranty / MMWA: pre-suit notice and timeliness | Plaintiffs gave pre-suit notices (Maroney ~11 months post-purchase; Heumann sent complaints and returned units in 2017–2018) | Notices were untimely or insufficiently specific (no purchase/use dates or product IDs) | Maroney's and Heumann's post‑Oct 2017 claims survive; warranty claims for Heumann purchases before Oct 2017 dismissed for lack of specificity/timeliness |
| Unjust enrichment & injunctive relief | Plaintiffs maintained these remedies | Defendant argued abandonment by failure to oppose dismissal | Claims were abandoned in plaintiffs' opposition and dismissed with prejudice |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must state a plausible claim to survive dismissal)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (court must accept well-pleaded facts and draw inferences favorably; legal conclusions unsupported by facts are insufficient)
- Loreley Fin. (Jersey) No. 3 Ltd. v. Wells Fargo Sec., LLC, 797 F.3d 160 (2d Cir. 2015) (Rule 9(b) fraud pleading elements and requirements)
- Lerner v. Fleet Bank, N.A., 459 F.3d 273 (2d Cir. 2006) (requirements for pleading scienter; motive/opportunity or strong circumstantial evidence)
- Fink v. Time Warner Cable Inc., 714 F.3d 739 (2d Cir. 2013) (complaint inconsistent with attached advertising may be implausible)
- Quinn v. Walgreen Co., 958 F. Supp. 2d 533 (S.D.N.Y. 2013) (scientific studies can support plausibility of deceptive advertising claims)
- Tomasino v. Estée Lauder Companies, Inc., 44 F. Supp. 3d 251 (E.D.N.Y. 2014) (pre-suit warranty-notice requirement and reasonableness analysis for consumers)
- Hughes v. Ester C Co., 930 F. Supp. 2d 439 (E.D.N.Y. 2013) (FTC letters and scientific studies may support an inference defendant knew product claims lacked support)