Nacarino v. Chobani, LLCNacarino v. Chobani, LLC
ORDER DENYING DEFENDANT‘S MOTION TO DISMISS THIRD AMENDED COMPLAINT
I. INTRODUCTION
Plaintiff Elena Nacarino (“Plaintiff“) brings this putative class action against Defendant Chobani, LLC (“Defendant” or “Chobani“) based in California consumer-protection law over allegedly unlawful labeling on a Chobani yogurt container. See Third Amended Complaint (“TAC“); Docket No. 51. Plaintiff now specifically alleges that the “unqualified ‘Vanilla’ representation on the front of the packaging, which she relied upon in making her purchase, violated FDA regulations in that the vanilla flavor of the Product is not independently derived from the vanilla plant but rather contains other non-vanilla plant flavoring that simulates, resembles, or reinforces the characterizing vanilla flavor of the Product.” Id. ¶ 7 (emphasis added). Pending before the Court is Defendant‘s motion to dismiss Plaintiff‘s third amended complaint. See Motion to Dismiss (“MTD“); Docket No. 54. For the following reasons, the Court DENIES Defendant‘s motion to dismiss.
II. BACKGROUND
The Court previously noted that this case was one of many recent putative class actions targeting allegedly deceptive labeling on vanilla food products that are not flavored, either exclusively or in significant part, with vanilla extract or vanilla bean. See, e.g., Clark v. Westbrae Natural, Inc., 2020 WL 7043879 (N.D. Cal. Dec. 1, 2020) (”Clark I“); Cosgrove v. Blue Diamond Growers, 2020 WL 7211218 (S.D.N.Y. Dec. 7, 2020); Zaback v. Kellogg Sales Co., 2020 WL 6381987 (S.D. Cal. Oct. 29, 2020). Notably, many plaintiffs have focused on manufacturers’ use of the term “vanilla” on product labels. See, e.g., Clark I, 2020 WL 7043879; Cosgrove, 2020 WL 7211218; Pichardo v. Only What You Need, Inc., 2020 WL 6323775 (S.D.N.Y. Oct. 27, 2020).
Plaintiff‘s counsel filed this case on behalf of Plaintiff Elena Nacarino and a purported class of California consumers on October 23, 2020. See Complaint; Docket No. 1. After a hearing on Defendant‘s motion to dismiss the second amended complaint, this Court issued an order granting in part and denying in part Defendant‘s motion to dismiss Plaintiff‘s second amended
According to the second amended complaint, Plaintiff purchased a container of Chobani yogurt (the “Product“) at a Whole Foods grocery store in San Francisco, California, in 2020. SAC ¶ 8; Docket No. 26. The Product is named “Greek Yogurt Vanilla Blended,” displaying what Plaintiff terms the “Vanilla Representations” on its container : (1) the word “Vanilla,” without qualifiers, on the front; (2) images of the vanilla flower and vanilla bean on all sides; and (3) the following text on the back:
Carried from some far-off, exotic place, where a little flower became a little bean. And that little bean, suspended and unremarkable, the cloak that conceals the magic within. Flavor like perfume, folded up in earthen envelopes, rich and warm and wonderful. Entirely vanilla, gently opening like the blossom that began it all.
Id. ¶¶ 2-5 (emphasis added). Plaintiff relied on the vanilla representations in concluding that the Product‘s vanilla flavor comes ”exclusively from ingredients derived from the vanilla plant, such as vanilla beans or vanilla extract,” and in purchasing the Product. See id. ¶¶ 6, 8 (emphasis in original). Plaintiff brought claims under (1) the unlawful prong of California‘s Unfair Competition Law (“UCL“),
In its August 9, 2021 Order, the Court held that no reasonable consumer would take the Product‘s use of the word “vanilla” on the front and the package‘s vanilla imagery as indicating that the Product‘s flavor is derived exclusively from the vanilla plant, as the Product does not display any statements “even arguably conveying that vanilla bean or extract is the exclusive source of its vanilla flavor.” Order at 11-12. The Court emphasized that “[h]ere, the Product nowhere asserts that it is, e.g., ‘made with all-natural vanilla’ or ‘100%’ vanilla, nor displays any other statements even arguably conveying that vanilla bean or extract is the exclusive source of its vanilla flavor.” Id. at 13. As such, the Court dismissed Plaintiff‘s claims under the unfair and fraudulent prongs of the UCL, the FAL, and the CLRA without leave to amend “since further amendment would be futile, given the manifest implausibility of her deceptive labeling claims. . . .” Id. at 15.
However, the Court found that Plaintiff “adequately alleged that the Product does not comply with [
(1) If the food contains no artificial flavor which simulates, resembles or reinforces the characterizing flavor, the name of the food on the principal display panel or panels of the label shall be accompanied by the common or usual name of the characterizing flavor, e.g., “vanilla“, in letters not less than one-half the height of the letters used in the name of the food, except that:
(i) If the food is one that is commonly expected to contain a characterizing food
ingredient, e.g., strawberries in “strawberry shortcake“, and the food contains natural flavor derived from such ingredient and an amount of characterizing ingredient insufficient to independently characterize the food, or the food contains no such ingredient, the name of the characterizing flavor may be immediately preceded by the word “natural” and shall be followed by the word “flavored” in letters not less than one half the height of the letters in the name of the characterizing flavor, e.g., “natural strawberry flavored shortcake,” or “strawberry flavored shortcake“.
(ii) If none of the natural flavor used in the food is derived from the product whose flavor is simulated, the food in which the flavor is used shall be labeled either with the flavor of the product from which the flavor is derived or as “artificially flavored.”
(iii) If the food contains both a characterizing flavor from the product whose flavor is simulated and other natural flavor which simulates, resembles or reinforces the characterizing flavor, the food shall be labeled in accordance with the introductory text and paragraph (i)(1)(i) of this section and the name of the food shall be immediately followed by the words “with other natural flavor” in letters not less than one-half the height of the letters used in the name of the characterizing flavor.
The Court further explained in its Order that given the “allegedly stark differences in” the mass spectrometry testing results on the Product and competitor products noted in the SAC, Plaintiff “plausibly pled that the Product is not exclusively flavored with ‘real’ vanilla.” Order at 16. “The marked differences in vanillin levels between the Product and competitor yogurts plausibly imply that the Product‘s vanillin does not come solely from the vanilla plant” and as such, the Court denied Defendant‘s motion to dismiss with respect to Plaintiff‘s claim under the UCL‘s unlawful prong which was predicated on the violation of the C.F.R. Id. at 17. The Court specifically found that “the difference in aromatic compound levels and the disparity among vanillin levels between the Product and competitor yogurts provide[d] an adequate factual basis for [Plaintiff] to state a plausible federal violation and resultant claim under the UCL‘s unlawful prong.” Id. (emphasis added).
Further, the Court determined that Plaintiff “may pursue only some of the equitable remedies that she requests under the UCL‘s unlawful prong, as she lacks an adequate remedy at law with respect to her request for injunctive relief but not her request for equitable restitution.” Id. at 19 (emphasis added). The Court acknowledged that Plaintiff does not seek damages under her UCL unlawful prong claim, but rather, she seeks an injunction and restitution and disgorgement of all monies from the sale of the Products
Notably, in its Order granting leave to amend, the Court acknowledged that the district court in Elgindy v. AGA Service Co., 2021 WL 1176535 (N.D. Cal. Mar. 29, 2021), suggested that a plaintiff could pursue equitable remedies under the UCL where such claims were “rooted in a different theory” of liability and involved different factual allegations than her claims for damages. Order at 22 (quoting Elgindy, 2021 WL 1176535 at *15). The Court noted that in the instant case, Plaintiff‘s claims were rooted in the same allegations that labeling the Product “vanilla” is misleading to consumers and a violation of the FDA regulations. Id.
In response to the Court‘s grant of leave to amend, Plaintiff‘s Third Amended Complaint (“TAC“) added the allegation that “Plaintiff lacks an adequate remedy at law because the UCL, the only claim brought by Plaintiff, does not provide for damages.” TAC ¶ 53. Additionally, as noted above, Plaintiff adds a new factual allegation that the Product label violates FDA regulations, not because the vanilla flavor allegedly does not come exclusively from the vanilla plant, but because the “vanilla flavor of the Product does not come independently from the vanilla plant.” Id. ¶ 34 (emphasis added). As noted above, Plaintiff previously alleged that “[s]cientific testing . . . revealed that the vanilla flavor of the Product does not come exclusively from . . . the vanilla plant” with regard to her deceptive labeling claims that were dismissed without leave to amend. SAC ¶ 36 (emphasis added). Plaintiff now alleges that the same “[s]cientific testing . . . revealed that the characterizing vanilla flavor of the Product does not come independently from vanilla extract or other ingredients derived from the vanilla plant” with regard to her FDA regulation violation claim. TAC ¶ 20 (emphasis added).
Defendant claims that Plaintiff‘s TAC should be dismissed primarily on the following two grounds: (1) Plaintiff “has again failed to allege why monetary damages are inadequate, as required by the Court‘s order“; and (2) “Plaintiff lacks standing to bring her UCL unlawful claim for injunctive relief” based on an intervening Ninth Circuit case In re Coca-Cola Prods. Mktg. & Sales Practices Litig. (No. II), No. 20-15742, 2021 WL 3878654, at *2 (9th Cir. Aug. 31, 2021). MTD at 2. Defendant also argues that if the Court declines to dismiss the TAC, the Court “should strike Plaintiff‘s new allegations that far exceed the scope of the Court‘s Order granting leave to amend.” Id. Finally, Defendant asserts that “there is an independent ground for dismissal of the TAC in its entirety: Plaintiff fails to plausibly allege a
III. LEGAL STANDARD
A. Failure to State a Claim (Rule 12(b)(6))
Claims sounding in fraud are also subject to the heightened pleading requirements of
Where a court dismisses a complaint, it “should grant leave to amend . . . unless it determines that the pleading could not possibly be cured by the allegation of other facts.” Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000). In making this determination, the court should consider factors such as “the presence or absence of undue delay, bad faith, dilatory motive, repeated failure to cure deficiencies by previous amendments, undue prejudice to the opposing party[,] and futility of the proposed amendment.” See Moore v. Kayport Package Express, 885 F.2d 531, 538 (9th Cir. 1989) (citing Foman v. Davis, 371 U.S. 178, 182 (1962)).
B. Motion to Strike (Rule 12(f))
Before responding to a pleading, a party may move to strike from a pleading any “redundant, immaterial, impertinent, or scandalous matter.”
IV. DISCUSSION
A. Failure to State a Claim Under UCL‘s Unlawful Prong
Presently, Plaintiff‘s sole claim for relief is under the unlawful prong of the UCL. Notably, Plaintiff specifically claims the Product‘s label was “unlawful” under the UCL insofar as it violated the Sherman Law, see
Defendant contends that Plaintiff‘s UCL claim should be dismissed in its entirety because Plaintiff fails to state a claim under the UCL‘s unlawful prong since she: (1) fails to plausibly allege that her reliance on the Product caused her to be deceived such that she suffered an injury in fact, and (2) fails to meet the heightened pleading requirements of (9)(b). MTD at 14-18.
Plaintiff argues that the “law of the case precludes reconsideration” of this issue since the Court already found that Plaintiff “‘plausibly pled that the Product does not comply with
In its reply, Defendant emphasizes that “the law of the case is inapposite here” since Plaintiff changed her factual allegations in the TAC and notes that the Court “only held that Plaintiff alleged a violation of a federal regulation, but did not address whether [she] adequately pleaded deception under the UCL‘s unlawful prong,
The UCL prohibits business acts or practices that are “unlawful.”
As noted above, the Court previously held that Plaintiff “adequately alleged that the Product does not comply with
1. Plausibility of Allegations Pertaining to Reliance
Defendant specifically argues that “Plaintiff‘s TAC fails to plausibly allege that her reliance on the Product label caused her to be deceived such that she suffered an injury-in-fact.” MTD at 14. Defendant claims that “Plaintiff cannot seek UCL relief—even under the UCL‘s unlawful prong—based on a strict liability theory” by merely pleading a violation of an FDA regulation. Id. at 15. Defendant further notes that “[d]espite the Court‘s finding that her interpretation of the Product label was implausible as a matter of law, Plaintiff now alleges that she ‘read and relied on Defendant‘s label on the Product to believe that the characterizing flavor of the Product was vanilla and that the vanilla flavor came independently from the vanilla plant.‘” Id. at 16 (quoting TAC ¶ 33). Defendant argues that Plaintiff “could not have plausibly reached this conclusion given that (1) the front label states ‘vanilla,’ which the Court concluded ‘merely indicates flavor and not an ingredient source,’ and (2) the ingredient list expressly provides that the Product includes ‘natural flavors’ in addition to vanilla extract.”
In Kwikset Corp. v. Super. Ct., 51 Cal.4th 310 (2011), the California Supreme Court made clear that where the essence of the claim is based on misrepresentations, “as a result of” under
The test of reliance is not inherently based on objective standard. The reasonable consumer test of reliance is a requirement under the UCL‘s unlawful prong only when it is an element of the predicate violation. The predicate violation here – California‘s Sherman Law – does not require reliance as measured by a reasonable consumer. As the Ninth Circuit in an unpublished order in Bruton v. Gerber Products Company, 703 Fed. Appx. 468, 471-472 (9th Cir. 2017) stated, the best reading of California precedent is that California‘s Sherman Law incorporates standards set by FDA regulations, and the FDA regulations include no requirement that the public be likely to experience deception. The Court thus reversed the district court‘s grant of summary judgment on the plaintiff‘s claims that the labels were unlawful in violation of the UCL.
Although this Court stated in its prior order that Plaintiff plausibly alleged a violation under the UCL‘s unlawful prong, see Order at 16-17, it did not address the question of reliance as Defendant had not advanced the argument made herein that actual reliance under Kwikset must be shown here. The Court now addresses this issue. Plaintiff alleges that she “sought a yogurt product whose characterizing vanilla flavor is independently derived from the vanilla plant” and “read and relied on Defendant‘s label on the Product to believe that the characterizing flavor of the Product was vanilla and that the vanilla flavor came independently from the vanilla plant.” TAC ¶¶ 32-33. Additionally, Plaintiff contends that had she “known the truth—that the label Plaintiff relied upon in making the purchase was unlawful in that the vanilla flavor of the Product does not come independently from the vanilla plant—[she] would not have purchased the Product at a premium price or bought the Product at all.” Id. ¶ 34. Although given
Accordingly, the Court DENIES Defendant‘s motion to dismiss for failure to state a claim.
2. Heightened Pleading Standard of Rule 9(b)
Additionally, Defendant argues that Plaintiff fails to “satisfy the heightened pleading standard of
Notably, “[t]he Court looks to the ‘gravamen’ of Plaintiff‘s causes of action to determine if the causes of action are grounded in fraud . . . . Usually, violations of the Sherman Law and FDA labeling regulations constitute misleading actions that are grounded in fraud.” Hadley v. Kellogg Sales Co., 243 F. Supp. 3d 1074, 1098 (N.D. Cal. 2017). In Hadley, Judge Koh considered Plaintiff‘s similar admission that the “FDA regulations at issue are intended to prevent the consuming public from being misled” in determining that Plaintiff‘s unlawful prong UCL claim was grounded in fraud. Hadley, 243 F. Supp. 3d at 1098-99 (dismissing UCL unlawful claim that alleged a “bare technical violation” of federal regulations). As noted above, fraud allegations are subject to the heightened pleading standard under Rule 9(b) and as such, “[a]verments of fraud must be accompanied by “‘the who, what, when, where, and how’ of the misconduct charged,” as well as the circumstances indicating fraudulent conduct. Vess v. Ciba–Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003) (quoting Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir. 1997)).
Here, Plaintiff does explain how she relied on representations on the label to reach the conclusion that the Product‘s vanilla flavor is “independently derived” from the vanilla plant. She explicitly alleges that she “read and relied on Defendant‘s label on the Product to believe that the characterizing flavor of the Product was vanilla and that the vanilla flavor came independently from the vanilla plant.” TAC ¶ 33. Contrary to Defendant‘s assertion, it appears that Plaintiff‘s allegations satisfy 9(b)‘s how requirement.
Thus, the Court DENIES Defendant‘s motion to dismiss for failure to state a claim on the basis that Plaintiff failed to satisfy heightened pleading requirements of Rule (9)(b).
B. Adequacy of Legal Remedy
Plaintiff specifically alleges that she “lacks an adequate remedy at law because the UCL, the only claim [now] brought by Plaintiff, does not provide for damages.” TAC ¶ 53.
Defendant argues that the TAC still fails to allege that monetary damages are inadequate and argues that Plaintiff‘s allegation that the UCL does not provide for damages is conclusory.” MTD at 4. Further, Defendant states that Plaintiff failed to “add any factual allegations to explain how monetary damages are inherently inadequate to redress her alleged harm and still ‘has not demonstrated that there is an inherent limitation of the legal remedy.‘” Id. at 4 (quoting Order at 22).
In its reply, Defendant argues that Plaintiff‘s assertion that “because the Court dismissed her claim under the CLRA, she is unable to seek damages[,]” is “premised on a fundamental misunderstanding of the law.” Reply at 3; Docket No. 57. Defendant states that Plaintiff “misconstrues ‘inherent limitation’ to mean ‘unavailable.‘” Id. Defendant emphasizes that “the Court explained that Plaintiff‘s ‘inability to obtain damages here results from her CLRA claim‘s failure on the merits; she has not demonstrated that there is an inherent limitation of the legal remedy that renders it inadequate.‘” Id. (quoting Order at 22). Defendant further claims that “whether Plaintiff is able to pursue a CLRA claim for damages is irrelevant to this inquiry.” Id. Defendant agrees that Plaintiff is the “master of her complaint” and notes that she “sought damages in all three of her prior complaints” and that only “now she does not seek damages because the Court dismissed her claim as inadequately pled. But whether or not her claim for damages was dismissed on the merits or voluntarily, she cannot escape the fact that she sought damages under the CLRA and her request for restitution is based on a loss of monetary value.” Id. at 4.
“[A] federal court must apply traditional equitable principles before awarding restitution under the UCL and CLRA.” Sonner v. Premier Nutrition Corp., 971 F.3d 834, 841 (9th Cir. 2020). This includes the equitable principle that in order to obtain an equitable remedy, a plaintiff must lack an “adequate remedy at law.” Mort v. U.S., 86 F.3d 890, 892 (9th Cir. 1996); see also Anderson v. Apple Inc., No. 3:20-cv-02328-WHO, 2020 WL 6710101, at *7 (N.D. Cal. Nov. 16, 2020) (“[The adequate remedy at law] principle applies squarely to an award of restitution – an equitable remedy – under the UCL.“). Judge Seeborg explained in Sonner, “[i]n the Ninth Circuit, the relevant test is whether an adequate damages remedy is available, not whether the plaintiff elects to pursue it, or whether she will be successful in that pursuit.” Mullins v. Premier Nutrition Corp., No. 13-cv- 01271-RS, 2018 WL 510139, at *2 (N.D. Cal. Jan. 23, 2018), aff‘d sub nom. Sonner, 971 F.3d 834.
As the Court noted in its prior order, in Sonner, a consumer brought a putative class action against a company that marketed and sold a liquid dietary supplement, asserting damages and equitable restitution claims for false or misleading advertising in violation of the UCL and CLRA, based on allegations that the company‘s advertisements and packages encouraging consumers to use the supplement to help keep their joints flexible and lubricated
On appeal, the Ninth held that the consumer was not entitled to equitable restitution for violation of the UCL and CLRA since the consumer failed to establish that she lacked an adequate remedy at law for false or misleading advertisement claims against the company and thus, the consumer was not entitled to equitable restitution for a violation of the UCL and CLRA. Id. at 844. The Ninth Circuit noted that the consumer conceded that she sought “the same sum in equitable restitution as ‘a full refund of the purchase price‘—$32,000,00—as she requested in damages to compensate her for the same past harm.” Id. The Ninth Circuit concluded that the consumer failed to “explain how the same amount of money for the exact same harm is inadequate or incomplete . . . .” Id. The Ninth Circuit further held that the district court did not abuse its discretion in denying the consumer leave to amend her complaint for a third time to reallege a damages claim for false or misleading advertisement under the CLRA against the company, emphasizing that the consumer strategically chose to amend the complaint on the eve of trial to drop the damages claim and seek only equitable restitution, the company opposed the request to amend and argued that the consumer needed to establish lack of a legal remedy before seeking equitable restitution and warned that it would bring a motion to dismiss on that basis, and the district court cautioned the consumer prior to amendment about the risk she was taking in dropping the damages claim on the eve of trial. Id. at 845.
Sonner teaches that a plaintiff, on the eve of trial, cannot create an inadequacy of a legal remedy by eliminating its availability by taking volitional action. See Guzman v. Polaris Indus. Inc., No. 8:19-cv-01543-FLA (KESx), 2021 WL 2021454, at *11 (C.D. Cal. May 12, 2021) (in granting the defendants’ motion for summary judgment the court explained that the plaintiff sought damages for violations of the CLRA in addition to restitution under the UCL in the second amended complaint but failed to identify facts to establish an inadequate legal remedy and the court noted that “the relevant question, however, is not whether [the plaintiff] has pleaded legal remedies, but whether he could have sought an adequate legal remedy.“), appeal filed May 19, 2021 (No. 21-55520). Similarly, where the plaintiff had an adequate legal remedy but forsook it (e.g. by failure to abide by the statute of limitations), the plaintiff cannot be said to have been without an adequate legal remedy. See Guzman, 2021 WL 2021454, at *11.
Thus, while a plaintiff may not through actions within its control forsake an adequate legal remedy and then claim it has no adequate legal remedy, thereby opening the door to otherwise identical equitable relief, the analysis is less clear where the legal remedy has been denied despite plaintiff‘s best efforts. In particular, it is not clear whether the plaintiff must demonstrate there is some structural impediment to an equivalent legal remedy (such as a statutory limit) as opposed to e.g. a failure of factual proof on the legal claim. Although this Court in its prior order suggested the plaintiff must demonstrate there is some “inherent limitation” on the legal remedy (Order at 22; Docket No. 48), other courts have indicated imposing such
In Junhan Jeong v. Nexo Financial LLC, et. al., No. 21-CV-02392-BLF, 2022 WL 174236 (N.D. Cal. Jan. 19, 2022), in addition to several other claims, the plaintiff sought damages under breach of contract and UCL claims, as well as restitution under the UCL and injunctive relief under the UCL and CLRA. On a motion to dismiss, the court distinguished Sonner when analyzing the plaintiff‘s claim for restitution under the UCL at the pleading stage, noting that “[c]ourts in the Ninth Circuit are divided on how exacting a standard Sonner imposes on plaintiffs who plead claims for equitable remedies at the pleading stage.” Id. at*27 (citing Byton N. Am. Co. v. Breitfeld, No. CV 19–10563–DMG (JEMx), 2020 WL 3802700, at *9 (C.D. Cal. Apr. 28, 2020) (referencing an “intra-circuit split on the issue of whether courts may allow UCL claims to proceed past the pleading stage when other adequate remedies exist” but holding that in the absence of controlling authority, the court would allow the plaintiffs to plead UCL claims in the alternative, even when other adequate remedies may exist) (citation omitted)). The court found “that Sonner has limited applicability to the pleading stage because it pertained to circumstances in which a plaintiff dropped all damages claims on the eve of trial” and as such, “provides limited guidance for pleading claims for legal and equitable relief.” Id. In so finding, the court noted other cases where courts “d[id] not consider Sonner to impose strict requirements at the pleading stage.” Id. (citing Freeman v. Indochino Apparel, Inc., 443 F.Supp.3d 1107, 1114 (N.D. Cal. 2020) (“Plaintiff may allege claims in the alternative at the pleading stage. The equitable remedies afforded by the UCL and CLRA are expressly stated to be in addition to other available remedies at law.“); Byton, 2020 WL 3802700, at *9 (“[T]he Ninth Circuit‘s general rule is that plaintiffs may plead alternative claims, even if those claims are inconsistent.“)). The court emphasized that, “in light of Sonner‘s limited applicability to the pleading stage, there is no binding precedent that holds that pleading equitable restitution in the alternative is improper.” Id. Thus, “[g]iven the general liberal policy courts have toward pleading in the alternative,” the court held that the plaintiff could “proceed with his equitable restitution claim at this stage even though he is also seeking contract damages” and that the court could “reassess at a later stage of the case . . . .” Id.
In Johnson v. Trumpet Behav. Health, LLC, No. 3:21-CV-03221-WHO, 2022 WL 74163, at *3 (N.D. Cal. Jan. 7, 2022), Judge Orrick similarly ruled on a motion to dismiss that “because Sonner was decided at a later posture, I agree with the plaintiffs that, if a plaintiff pleads that she lacks an adequate legal remedy, Sonner will rarely (if ever) require more this early in the case . . . [and that] it is too early to determine whether the plaintiffs’ legal remedies will ultimately be adequate, so it makes sense to defer this determination.”
These ruling are consistent with
As such, the Court DENIES Defendant‘s motion to dismiss Plaintiff‘s claim for restitution.
C. Standing to Seek Injunctive Relief
Defendant specifically claims that under In re Coca-Cola Products Marketing & Sales Practices Litigation (No. II), No. 20-15742, 2021 WL 3878654 (9th Cir. Aug. 31, 2021), Plaintiff lacks standing under Article III to pursue injunctive relief since her “conditional promise to purchase a reformulated product is insufficient as [a] matter of law” and she has not attempted to allege that she has or imminently will suffer from any “imminent or particularized harm.” Id. at 11. As such, Defendant argues that Plaintiff‘s UCL claim should be dismissed in its entirety with prejudice. Id.
Plaintiff broadly asserts that “the law of the case precludes reconsideration of issues already decided by this Court.” Opp‘n at 4. Plaintiff argues that “Defendant identifies no proper basis for this Court to reconsider its prior rulings that Plaintiff plausibly pled her claim under the unlawful prong of the UCL and that she has standing with respect to that claim.” Id. at 9. Plaintiff specifically argues that In re Coca-Cola does not constitute an intervening change in the law as it simply reiterated the standing requirement of Davidson v. Kimberly-Clark Corp., 889 F.3d 956 (9th Cir. 2018). Id. at 6-7.
Defendant argues that an “intervening change in the law” constitutes an exception to the law of the case. Reply at 7; see United States v. Moore, No. 20-30273, 857 Fed. Appx. 409 (9th Cir. 2021) (the Ninth Circuit recognizes the following exceptions to the law of the case doctrine: (1) the decision is clearly erroneous and its enforcement would work a manifest injustice, (2) intervening controlling authority makes reconsideration appropriate, or (3) substantially different evidence was adduced at a subsequent trial). Defendant contends that the Ninth Circuit‘s decision in In re Coca-Cola constitutes intervening authority warranting reconsideration. Defendant specifically argues that “Plaintiff‘s allegation[] that she ‘would likely purchase’ the product again in the future if it was reformulated is insufficient under the Ninth Circuit‘s recent decision.” Id.
As the Court previously noted, when seeking injunctive relief, the injury-in-fact requirement is met when the consumer alleges that she (1) cannot “rely on the product‘s advertising or labeling in the future, and so will not purchase the product although she would like to” or (2) might purchase the product again, “as she may reasonably, but incorrectly, assume the product was improved.” Davidson, 889 F.3d at 969-70. Notably, the Court previously held that Plaintiff had “standing to seek injunctive relief, albeit solely with respect to her claim under the UCL‘s unlawful prong.” Order at 18. The Court expressly found that Plaintiff had “standing
In In re Coca-Cola, Coca-Cola appealed a district court order granting class certification in a multidistrict consumer action alleging mislabeling of Coke. In re Coca-Cola Products Marketing & Sales Practices Litigation (No. II), 2021 WL 3878654 at *1. The plaintiffs claimed that “phosphoric acid is a chemical preservative or an artificial flavor; that Coca-Cola misled the public by using the advertising slogan ‘no artificial flavors. no preservatives added. since 1886’ even though Coke contains phosphoric acid; and that Coca-Cola continues to mislabel its product by not including a required disclosure that phosphoric acid is an ‘artificial flavor’ or a ‘preservative.‘” Id. The Ninth Circuit explained that ”Davidson offered two non-exclusive examples of threatened future harm a consumer complaining of assertedly false labeling might plausibly allege: ‘she will be unable to rely on the product‘s advertising or labeling in the future, and so will not purchase the product although she would like to’ and ‘she might purchase the product in the future, despite the fact it was once marred by false advertising or labeling, as she may reasonably, but incorrectly, assume the product was improved.‘” Id. (quoting Davidson, 889 F.3d at 969-70). The Ninth Circuit noted that two of the plaintiffs, Engurasoff and Dube, did not specify whether they would want to purchase Coke in the future and concluded that “[w]ithout any stated desire to purchase Coke in the future, [they did] not have standing to pursue injunctive relief.” Id. at *2. Additionally, the Ninth Circuit noted that four of the plaintiffs, Ogden, Merritt, Sowizrol, and Lazaroff, “submitted declarations stating that they ‘would consider purchasing’ Coke depending on ‘several factors, including but not limited to what disclosures Coca-Cola provided regarding phosphoric acid or any other ingredient in Coke, whether Coca-Cola removed phosphoric acid, and what, if anything replaced phosphoric acid, and the price of [Coke] relative to other beverages.‘” Id. The Ninth Circuit emphasized that the “‘threatened injury must be certainly impending to constitute injury in fact‘” and held that “[t]hese plaintiffs’ declarations that they would ‘consider’ purchasing properly labeled Coke are insufficient to show an actual or imminent threat of future harm.” Id. (citations omitted). Additionally, as for two plaintiffs, Woods and Marino, that asserted that “they would be interested in purchasing Coke again if its labels were accurate, regardless of whether it contained chemical preservatives or artificial flavors,” the Ninth Circuit concluded that this allegation of a bare procedural violation could not satisfy the demands of Article III standing as it was “insufficient to demonstrate that they suffered any particularized adverse effects.” Id. Thus, the Ninth Circuit held that none of the plaintiffs had demonstrated the requisite harm or imminence
It appears that In re Coca-Cola explains and expands upon Davidson‘s standing requirement, and this is sufficient to warrant reconsideration. However, In re Coca-Cola does not change the outcome here. It is factually distinguishable. The In re Coca-Cola plaintiffs either: (1) did not specify whether they would purchase the allegedly mislabeled Coke in the future; (2) alleged that they “would consider purchasing” Coke depending on several factors, including but not limited to what disclosures Coca-Cola provided regarding phosphoric acid or any other ingredient in Coke; or (3) asserted that “they would be interested in purchasing Coke again if its labels were accurate, regardless of whether it contained chemical preservatives or artificial flavors.” See In re Coca-Cola Products Marketing & Sales Practices Litigation (No. II), 2021 WL 3878654 at *2. In contrast to the In re Coca-Cola plaintiffs, Plaintiff here alleges that she would purchase the Product again in the future if the Product were reformulated such that the characterizing vanilla flavor of the Product is independently derived from the vanilla plant or if the labelling complied with federal and state regulations. See TAC ¶ 8. Plaintiff alleges more than “a bare procedural violation” and that the Court‘s prior finding that Plaintiff establish standing for injunctive relief still obtains. See Order at 19 (“Every consumer who satisfies Davidson‘s first scenario would purchase the contested product only ‘if’ it changed in some way.“); see also Vizcarra v. Unilever U.S., Inc., 2020 WL 4016810, at *6 (N.D. Cal. July 16, 2020) (finding that the plaintiff had standing where she alleged that she would purchase an ice cream product again “if it were truly flavored as labeled and advertised“); cf. Lanovaz v. Twinings N. Am., Inc., 726 Fed. Appx. 590, 591 (9th Cir. 2018) (finding that a plaintiff lacked standing where she only alleged that she would “consider buying” a product again).
Thus, the Court DENIES Defendant‘s motion to dismiss Plaintiff‘s request for injunctive relief on standing grounds.
D. Striking New Allegations
If the Court does not dismiss Plaintiff‘s UCL claim in its entirety, Defendant argues in the alternative that the Court should strike Plaintiff‘s revised allegations under Rule 12(f) for exceeding the scope of the Court‘s order granting leave to amend with regard to her claim for equitable relief. MTD at 12. Defendant states that the Court‘s “Order granted Plaintiff limited leave to amend her complaint to plead that damages are inadequate.” Id. Defendant argues that not only did Plaintiff fail to plead that damages are an inadequate remedy “but she added new and different allegations to her TAC, in an effort to bolster her claim that the Product‘s label fails to comply with FDA‘s regulations.” Id. Defendant emphasizes that “Plaintiff‘s prior complaints were based on her theory that [Defendant‘s] label was deceptive based on her allegations that the Product‘s vanilla flavoring did not come ‘exclusively from the vanilla plant,’ [but now she] contends that the vanilla flavor does not come ‘independently’ from the ‘vanilla plant.‘” Id. (quoting SAC ¶ 8, TAC ¶¶ 33-34). Defendant specifically states that Plaintiff‘s “improper amendments include the following allegations:
- Adding the image of the 5.3-ounce product label (id. ¶ 2), which was not included in the SAC;
- Repackaging her allegations that the Product‘s vanilla flavor does not come “exclusively from the vanilla plant” (SAC ¶ 8) to allege that the
“characterizing vanilla flavor” of the Product is not “independently derived from the vanilla plant” (TAC ¶¶ 7, 8, 32) or “does not come independently from . . . the vanilla plant,” (id. ¶¶ 20, 33, 34); - Removing images of the back product label (SAC ¶¶ 5, 26)
- Adding conclusory allegations regarding laboratory testing results of other products (TAC ¶ 28);
- Adding [the] allegation that Plaintiff purchased the 32 ounce size Product (id. ¶ 7);
- Adding allegations regarding the source and characteristics of vanillin (id. ¶¶ 14, 22);
- Changing her purported “benefit of the bargain allegations” [] from alleging that she was denied the benefit of the bargain because she would have purchased other products that “contain the same or immaterially different amounts of real vanilla” (SAC ¶ 68), to alleging that she would have purchased other products that “are properly labeled . . .” (TAC ¶ 50); and
- Changing her requested remedy from a request for injunctive relief to “commence a corrective advertising campaign” (SAC ¶ 69) to a request for injunctive relief ordering Chobani to “commence corrective action” (TAC ¶ 51).
Id. at 12-13. Further, Defendant states that “this case is past the point where Plaintiff may file an amended complaint as a matter of course” and argues that Plaintiff‘s new allegations are outside the scope of the Court‘s Order and an “impermissible attempt to change her factual allegations without leave of Court as required under Rule 15.” Id. at 13.
In her opposition Plaintiff notes that she “took into account this Court‘s analysis of Elgindy” and states that all of her new allegations “stem directly from the Court‘s Order dismissing her deception claims and granting her leave to amend her complaint to plead that damages are inadequate.” Opp‘n at 13. Plaintiff claims that “[u]nder the unusual circumstances of this case, where only the claim under the UCL‘s unlawful prong survived, Plaintiff amended her complaint in good faith.” Id. Moreover, she argues that striking her allegations would be improper even if this Court finds that she exceeded the scope of the amendment the Court authorized because “that by itself does not necessarily warrant striking the unauthorized allegations.” Id. at 14. Further, Plaintiff states that nothing in the TAC is redundant, immaterial, or scandalous, and “certainly nothing that is prejudicial.” Id. at 15. Additionally, Plaintiff argues that she did “not put forth any new allegations of which Defendant was unaware or that increases its expenditure of time and money from litigating spurious issues” and as such, there are “no grounds to strike any of Plaintiff‘s allegations in the TAC.” Id.
In its reply, Defendant argues that “[n]either
“District [c]ourts in this circuit generally allow plaintiffs to add new claims and/or parties to an amended complaint where a prior order of dismissal granted
As noted above, the Court‘s Order expressly “[g]ave [Plaintiff] leave to amend her complaint to plead that damages are inadequate and that she is thus entitled to seek equitable restitution under the UCL‘s unlawful prong.” Order at 23. In finding that Plaintiff failed to demonstrate that there was an inherent limitation of the legal remedy, the Court noted that Elgindy, 2021 WL 116535 “suggested that a plaintiff could pursue equitable remedies under the UCL where such claims were ‘rooted in a different theory’ of liability that involved different allegations that her claims for damages.” Id. at 22 (quoting Elgindy, 2021 WL 1176535 at *15). Further, the Court noted that Plaintiff‘s various claims were rooted in the same allegations that the labeling of the Product was misleading to consumers and a violation of FDA regulations. Id.
Defendant appears correct in that the Court‘s order was somewhat limited as it specifically granted Plaintiff leave to
The Court thus GRANTS in part and DENIES in part Defendant‘s motion to strike Plaintiff‘s new allegations.
V. CONCLUSION
For the foregoing reasons, the Court DENIES Defendant‘s motion to dismiss and GRANTS in PART and DENIES in PART Defendant‘s motion to strike Plaintiff‘s new allegations in the TAC.
This order disposes of Docket No. 54.
IT IS SO ORDERED.
Dated: February 4, 2022
EDWARD M. CHEN
United States District Judge