Herazo v. Whole Foods Mkt., Inc.

Decision Date23 July 2015
Docket NumberCase Number: 14-61909-CIV-MORENO
CourtU.S. District Court — Southern District of Florida

Plaintiffs maintain that Defendant Whole Foods Market, Inc. used deceptive labels on their homeopathic products. Due to these deceptive labels, Plaintiffs filed a three-count complaint for unjust enrichment, a violation of the Florida Deceptive and Unfair Trade Practices Act, and negligent misrepresentation. Federal law mandates that Defendant include labels on their homeopathic products providing their indications for use - the stated purpose of the law is to achieve uniformity in regulations over nonprescription drugs. 21 U.S.C. § 379r. The Food and Drug Administration is charged with oversight over labeling of homeopathic products. In view of this regulatory scheme, the Court abstains from adjudicating this case under the primary jurisdiction and implied preemption doctrines. The Court also finds Plaintiffs lack standing to sue for injunctive relief and their unjust enrichment claim cannot survive as there is an adequate legal remedy.

THIS CAUSE came before the Court upon the Defendant's Motion to Dismiss (D.E. No. 29).

THE COURT has considered the motion and the pertinent portions of the record, and being otherwise fully advised in the premises, it is

ADJUDGED that the motion is GRANTED in part and the case is STAYED pending review by the Food and Drug Administration.1 It is also

ADJUDGED that the Clerk of this Court shall mark this cause as closed for statistical purposes and place the matter in a civil suspense file. The Court shall retain jurisdiction and the case shall be restored to the active docket upon motion of a party if circumstances change so that this action may proceed to final disposition. This order shall not prejudice the rights of the parties to this litigation. Plaintiffs SHALL notify the Court by October 30, 2015 and every 3 months thereafter of the current status of the proceedings and when this action is ready to proceed.

It is ADJUDGED that all other pending motions are DENIED as moot.

I. Background

Plaintiffs filed this purported class action against Defendant Whole Foods Market, Inc., a company that sells several homeopathic products under their "365 Be Well" brand to relieve medical symptoms. Plaintiffs claim that Defendant's products do not deliver the benefits promised to consumers. The named Plaintiffs, Mario Herazo, Yaneris Almonte, Deniele Charun, and Kenan Rasabi purchased products at Whole Foods. Specifically, they purchased "Cough Ease for Kids," "Cough Ease for Adults," "Flu Ease" and "Arnica Montana 30C" - none of which they claimdelivered the promised benefits. Plaintiffs claim they relied on Defendant's deceptive and false labeling in purchasing these homeopathic products.

The three-count complaint is for unjust enrichment, a violation of the Florida Deceptive and Unfair Trade Practices Act, and negligent misrepresentation. Defendant has moved to dismiss on various grounds.

II. Legal Standard

"To survive a motion to dismiss, plaintiffs must do more than merely state legal conclusions," instead plaintiffs must "allege some specific factual basis for those conclusions or face dismissal of their claims." Jackson v. BellSouth Telecomm., 372 F.3d 1250, 1263 (11th Cir. 2004). When ruling on a motion to dismiss, a court must view the complaint in the light most favorable to the plaintiff and accept the plaintiff's well-pleaded facts as true. See St. Joseph's Hosp., Inc. v. Hosp. Corp. of Am., 795 F.2d 948, 953 (11th Cir. 1986). This tenet, however, does not apply to legal conclusions. See Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009). Moreover, "[w]hile legal conclusions can provide the framework of a complaint, they must be supported by factual allegations." Id. at 1950. Those "[f]actual allegations must be enough to raise a right to relief above the speculative level on the assumption that all of the complaint's allegations are true." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 545 (2007). In short, the complaint must not merely allege a misconduct, but must demonstrate that the pleader is entitled to relief. See Iqbal, 129 S. Ct. at 1950.

III. Legal Analysis

The motion to dismiss presents a myriad of arguments including whether the Defendant's offers of judgment to the named Plaintiffs moot their case, whether Plaintiffs have standing to pursueinjunctive relief, whether Plaintiffs' unjust enrichment claim can stand in the face of an adequate legal remedy, and whether this Court should abstain from adjudicating this case under the Florida Deceptive and Unfair Trade Practices Act's safe harbor provision, the primary jurisdiction doctrine, or principles of implied preemption.

A. Effect of the Offers of Judgment

The Eleventh Circuit in Stein v. Buccaneers, Ltd., Partnership, 772 F.3d 698 (11th Cir. 2014) addressed the issue of whether a defendant may moot a class action through an unaccepted offer of judgment under Federal Rule of Civil Procedure 68. The offers of judgment provided complete relief to the named plaintiffs, but not to class members, and were provided prior to the plaintiffs' filing of a motion to certify a class. Given the circumstances in Stein, the Eleventh Circuit found that the offers of judgment did not moot the case. Id., 772 F.3d at 700.

In its reply brief, Defendant conceded that Stein is dispositive of its argument that the offers of judgment moot out the Plaintiffs' claims. Accordingly, the Court denies the motion to dismiss on this issue and finds the offers of judgment did not moot the named Plaintiffs' claims.

B. Unjust Enrichment (Count I)

"It is blackletter law that 'the theory of unjust enrichment is equitable in nature and is, therefore, not available where there is an adequate legal remedy.'" In re: Managed Care Litig., 185 F. Supp. 2d 1310, 1337 (S.D. Fla. 2002) (quoting Webster v. Royal Caribbean Cruises, Ltd., 124 F. Supp. 2d 1317, 1326 (S.D. Fla. 2000) (noting that under Florida law, "quantum meruit damages cannot be awarded when an enforceable contract exists.")). "An unjust enrichment claim can exist only if the subject matter of that claim is not covered by a valid and enforceable contract." Id. Thereis an adequate remedy at law when monetary damages are available via an alternative claim. Bute v. Garda CL Southeast, Inc., No. 14-21898-CIV, 2014 WL 3501546, *3 (S.D. Fla. July 14, 2014).

Plaintiffs have not alleged there is an express contract nor have they alleged there is a lack of an adequate legal remedy. Defendant argues the adequate legal remedy in this case stems from the express contract between the parties for the retail purchase of the homeopathic products -the facts of which are pled in the complaint and underlie the Florida Deceptive and Unfair Trade Practices Act claim, which is a claim for monetary damages and injunctive relief. Because the complaint provides factual allegations supporting an adequate remedy of law and a cause of action to recoup that remedy, the Defendant argues for dismissal of the unjust enrichment claim.

Plaintiffs argue that they should be allowed to plead the unjust enrichment claim in the alternative. An unjust enrichment claim can only be pled in the alternative if one or more of the parties contest the existence or validity of an express contract governing the subject of the dispute. In Re: Managed Care Litig., 185 F. Supp. 2d at 1337-38; Martorella v. Deutsche Bank Nat. Trust Co., 931 F. Supp. 2d 1218, 1228 (S.D. Fla. 2013). When an agreement is arrived at by words or in writing, the contract is said to be "express." In re Standard Jury Instructions—Contract & Bus. Cases, 116 So. 3d 284, 308 (Fla. 2013). In Prohias v. Pfizer Inc., 490 F. Supp. 1228, 1236 (S.D. Fla. 2007) (Jordan, J.), the court found the purchase of a cholesterol-reducing drug sufficient to establish the requisite contractual relationship and dismissed the unjust enrichment claim. The Prohias court wrote: "Unjust enrichment 'cannot exist where payment has been made for the benefit conferred.'" Id. (quoting N.G.L. Travel Assoc. v. Celebrity Cruises, Inc., 764 So. 2d 672, 675 (2000)). Here, the Court finds the Plaintiffs' purchase of the homeopathic products, which is not in dispute, formsthe basis of an express contract and dismisses the unjust enrichment claim.

C. Florida Deceptive and Unfair Trade Practices Act Claim2

As to the statutory claim for injunctive relief, Defendant challenges the Plaintiffs' standing under Article III. Plaintiffs' complaint indicates that the products were worthless. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 564 ("Past exposure to illegal conduct does not in itself show a present case or controversy regarding injunctive relief ... if unaccompanied by any continuing, present adverse effects.'")(citing City of Los Angeles v. Lyons, 461 U.S. 95, 102 (1983), quoting O'Shea v. Littleton, 414 U.S. 488, 495-96 (1974)). In the context of consumer protection claims challenging product labeling, the court has applied the Lujan standing maxim. Marty v. Anheuser-Busch Co., LLC, 43 F. Supp. 3d 1333, 1358 (S.D. Fla. 2014) ("There is no likelihood of injury in the future if a plaintiff has no interest in purchasing the product at issue again because it does not work or does not perform as advertised.") (quoting Mason v. Nature's Innovation, Inc., No. 12-CV-3019 BTM (DHB), 2013 WL 1969957 (S.D. Cal. May 13, 2013)). In Marty, the court emphasizedthat where the complaint only contains allegations of past injury, those allegations do not support a finding of standing where injunctive relief is sought. Id., 43 F. Supp. 3d at 1359. Similarly, the amended complaint here details past injury regarding the product labeling. It contains an allegation that but for the misleading...

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