Prescott v. Nestle USA, Inc
5:19-cv-07471
N.D. Cal.Apr 8, 2022Background:
- Plaintiffs Steven Prescott and Linda Cheslow purchased Nestlé Toll House “Premier White Morsels” and allege they reasonably believed the product was white chocolate based on the packaging and placement.
- The package reads "Nestlé Toll House Premier White Morsels" and shows a dark cookie with white morsels and scattered white chip-shaped morsels.
- Plaintiffs submitted a consumer survey (alleging ~95% believed the product contains white chocolate) and reproduced consumer complaints claiming the product is not white chocolate and does not melt like chocolate.
- Plaintiffs asserted California UCL, FAL, and CLRA claims on behalf of a proposed nationwide or California class, seeking injunctive relief and restitution.
- The action was removed to federal court; the FAC was previously dismissed with leave to amend. Plaintiffs filed a second amended complaint (SAC).
- The district court granted Nestlé’s Rule 12(b)(6) motion, dismissed all claims and injunctive relief without leave to amend, and dismissed the action with prejudice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether labeling/packaging is misleading under the reasonable consumer test | "Premier White" label, images of white morsels/cookie, Nestlé brand and aisle placement lead reasonable consumers to believe product is white chocolate | Words "white" and "premier" and images indicate color/form only, not chocolate; reasonable consumers would not infer "chocolate"; survey insufficient | Dismissed — label and images do not plausibly mislead a reasonable consumer to think product is white chocolate |
| Whether brand name/placement can render label misleading | Nestlé brand and product placement in baking/chocolate aisle support inference consumers expect chocolate | Brand and placement alone are insufficient; manufacturer control over placement not plausibly alleged | Dismissed — allegations about placement and brand do not create a plausible claim |
| Whether consumer survey supports plausibility | Survey showing ~95% belief that product is white chocolate proves deception | Survey cannot override common-sense reading of label where terms do not connote chocolate (per Becerra) | Dismissed — survey does not salvage implausible claim |
| Standing to seek injunctive relief | Plaintiffs would buy in future if product actually contained white chocolate or label clarified | Plaintiffs failed to show a likelihood of future deception or a concrete plan to be injured; court cannot compel product formulation or price changes | Dismissed — plaintiffs lack standing to seek injunctive relief |
Key Cases Cited
- Becerra v. Dr Pepper/Seven Up, Inc., 945 F.3d 1225 (9th Cir. 2019) (survey evidence cannot save a claim when label interpretation is unreasonable)
- Moore v. Mars Petcare US, Inc., 966 F.3d 1007 (9th Cir. 2020) (brand names can be misleading when dictionary meaning supports a deceptive inference)
- Williams v. Gerber Prod. Co., 552 F.3d 934 (9th Cir. 2008) (reasonable consumer test governs UCL/FAL/CLRA deception claims)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (complaint must state a plausible claim to survive dismissal)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard for pleadings)
- Kwan v. SanMedica Int'l, 854 F.3d 1088 (9th Cir. 2017) (product testing and factual support for deception allegations)
- Davidson v. Kimberly-Clark Corp., 889 F.3d 956 (9th Cir. 2018) (standing requires likelihood of future harm to obtain injunctive relief)
- Conservation Force v. Salazar, 646 F.3d 1240 (9th Cir. 2011) (Rule 12(b)(6) legal standard discussion)
- Foman v. Davis, 371 U.S. 178 (1962) (factors guiding leave to amend)
- Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048 (9th Cir. 2003) (considerations for denying leave to amend)