Peacock v. Pabst Brewing Co., LLC
2:18-cv-00568
E.D. Cal.Oct 1, 2020Background
- Pabst Brewing Company (Pabst) owns the Olympia Beer brand; the original Olympia brewery in Washington closed in 2003 and Pabst now contract-brews Olympia Beer at facilities including Irwindale, California.
- Peacock alleges Pabst’s labeling and marketing (the can text 'The Original Olympia Beer', a waterfall image, the slogan 'It’s the Water', a Facebook post, and website copy) falsely imply Olympia Beer is brewed with artesian water from the Olympia, Washington area.
- Peacock bought Olympia Beer on April 21, 2017 in Rancho Cordova, California, claims he paid a premium and would not have purchased the beer had he known the water was not from Olympia, and seeks class relief and injunctive relief under California’s UCL and FAL.
- Pabst moved to dismiss the Second Amended Complaint on four grounds: no likelihood of deception, no unlawful predicate, failure to plead fraud with particularity under Rule 9(b), and lack of standing for injunctive relief.
- The district court denied Pabst’s motion to dismiss, finding Peacock plausibly alleged that a reasonable consumer could be misled and that his pleadings satisfy the unlawful-predicate, Rule 9(b), and Article III standing requirements.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Likelihood of deception under the reasonable consumer test | Peacock: can labeling ("The Original Olympia Beer", waterfall image, "It’s the Water") conveys that the beer is brewed with water from the Olympia area | Pabst: terms like "Original" or evocative imagery are nonactionable or merely evoke a region and do not state geographic sourcing | Court: Allegations taken as true; plausible that a reasonable consumer could infer the beer is brewed with Olympia-area water; denial of dismissal |
| UCL unlawful prong (predicate violation) | Peacock: FAL violation (false/misleading advertising) supports UCL unlawful claim | Pabst: No viable FAL claim, so no UCL unlawful predicate | Court: Because FAL plausibly alleged, UCL unlawful claim stands |
| Particularity under Rule 9(b) | Peacock: alleges who, what, when, where, how — identifies Pabst, the packaging, purchase date and location, and injury | Pabst: Peacock fails to plead price paid, when he learned the true brewing location, and which specific ads he saw | Court: Pleadings sufficiently particular to give fair notice and meet Rule 9(b) |
| Article III standing to seek injunctive relief | Peacock: previously deceived and alleges he wishes to purchase again but cannot rely on labeling; thus faces future risk | Pabst: No concrete likelihood of future harm once plaintiff knows the product’s source | Court: Under Davidson framework, Peacock adequately alleged a realistic threat of future harm and has standing for injunctive relief |
Key Cases Cited
- Ashcroft v. Iqbal, [citation="556 U.S. 662"] (2009) (standards for pleading plausibility and that courts need not accept legal conclusions as true)
- Bell Atl. Corp. v. Twombly, [citation="550 U.S. 544"] (2007) (plausibility pleading standard)
- Williams v. Gerber Prods. Co., [citation="552 F.3d 934"] (9th Cir. 2008) (FAL violation is also a UCL violation; reasonable consumer test governs deceptive-advertising claims)
- Moore v. Mars Petcare US, Inc., [citation="966 F.3d 1007"] (9th Cir. 2020) (articulates pleading requirements for false-advertising claims)
- Davidson v. Kimberly-Clark Corp., [citation="889 F.3d 956"] (9th Cir. 2018) (previously deceived consumers can have standing to seek injunctive relief if future deception is likely)
- Spokeo, Inc. v. Robins, [citation="136 S. Ct. 1540"] (2016) (Article III standing requires a concrete and particularized injury)
- Cel-Tech Commc'ns, Inc. v. Los Angeles Cellular Tel. Co., [citation="20 Cal.4th 163"] (1999) (UCL unlawful prong borrows violations of other laws)
- Freeman v. Time, Inc., [citation="68 F.3d 285"] (9th Cir. 1995) (reasonable consumer standard: likelihood of deception governs false advertising claims)
- Vess v. Ciba-Geigy Corp. USA, [citation="317 F.3d 1097"] (9th Cir. 2003) (Rule 9(b) requires identification of who, what, when, where, and how for fraud-based claims)