Pontrelli v. Mona Vie Inc
2:17-cv-01215
| D. Utah | Aug 19, 2014Background
- Plaintiff Lisa Pontrelli (New Jersey resident) filed a putative class action alleging MonaVie falsely advertised health benefits of its açai-based juice products and sold them at a premium.
- MonaVie (Inc. and LLC) markets products through a multi-level distribution network of independent "Distributors" who sell bottles (≈25 oz) priced around $40 and allegedly touted numerous medical benefits (e.g., cancer, diabetes, circulation).
- FAC alleges MonaVie corporate officers admitted the products lacked the claimed curative properties and that MonaVie knew Distributors made outlandish health claims despite company policies forbidding such statements.
- Plaintiff claims she relied on MonaVie advertising, paid a premium, did not receive the benefits, and suffered ascertainable loss; she asserts NJCFA, common law fraud, and unjust enrichment.
- MonaVie moved to dismiss under Fed. R. Civ. P. 12(b)(6), arguing the complaint fails to identify actionable misrepresentations by the company (only by third-party Distributors) and that fraud allegations do not meet Rule 9(b).
- The Court denied the motion, finding agency liability for Distributor statements plausible, Rule 9(b) satisfied, and all three substantive claims plausibly pleaded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether MonaVie can be vicariously liable for Distributors' misrepresentations | Distributors are agents: they pay MonaVie for rights, use MonaVie mark, follow company policies, and act on MonaVie’s behalf | Distributors’ statements are third-party actions; MonaVie did not itself make the alleged misrepresentations | Court: Allegations plausibly show an agency relationship; MonaVie can be liable for Distributor misrepresentations |
| Whether fraud-based claims meet Rule 9(b) heightened pleading | FAC identifies who, what, when, where, and how (defendants, products, class period, advertising venues, specific claimed benefits and examples) | Allegations are nonspecific and do not allege MonaVie itself made the statements; plaintiff’s disappointment in benefits is insufficient | Court: Plaintiff’s allegations give adequate notice and satisfy Rule 9(b) for pleading fraud/NJCFA claims |
| Whether the NJ Consumer Fraud Act claim is adequately pleaded (unlawful practice, ascertainable loss, causation) | Defendants made false health claims (unlawful); plaintiff paid a premium and got less than promised (ascertainable loss); loss resulted from false advertising (causation) | Defendants challenged sufficiency of pleading on the statutory elements | Court: All three NJCFA elements plausibly pleaded; claim survives dismissal |
| Whether unjust enrichment is viable absent direct retail purchase from defendant | MonaVie retained financial benefit from product sales and distributor scheme; retaining benefit would be unjust | Defendants argued a direct relationship is required and third-party retailers insulate them | Court: Direct relationship not required here; unjust enrichment claim plausibly pleaded |
Key Cases Cited
- New Jersey Lawyers’ Fund for Client Protection v. Stewart Title Guaranty Co., 203 N.J. 208 (N.J. 2010) (defines agency formation and analysis focusing on conduct rather than formal agreement)
- Sears Mortgage Corp. v. Rose, 134 N.J. 326 (N.J. 1993) (agency may be inferred from control and conduct)
- Frederico v. Home Depot, 507 F.3d 188 (3d Cir. 2007) (Rule 9(b) fraud pleading standards in Third Circuit)
- Lum v. Bank of America, 361 F.3d 217 (3d Cir. 2004) (fraud pleadings must plead who, what, when, where, and how)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (Twombly plausibility standard for pleadings)
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (Iqbal clarifies pleading plausibility framework)
- Thiedemann v. Mercedes-Benz USA, LLC, 183 N.J. 234 (N.J. 2005) (defining unlawful practices under NJCFA as including deception and misrepresentation)
- Mason v. Coca-Cola, 774 F. Supp. 2d 699 (D.N.J. 2011) (false product claims can constitute affirmative deception under NJCFA)
- Hedges v. United States, 404 F.3d 744 (3d Cir. 2005) (movant bears burden on Rule 12(b)(6) dismissal)
- Umland v. PLANCO Financial Services, Inc., 542 F.3d 59 (3d Cir. 2008) (pleading plausibility and Rule 12(b)(6) principles)