Kelley v. WWF Operating Co.
| Decision Date | 05 June 2017 |
| Docket Number | 1:17-cv-117-LJO-BAM |
| Parties | MELANIE KELLEY, Plaintiff, v. WWF OPERATING COMPANY, Defendant. |
| Court | U.S. District Court — Eastern District of California |
Plaintiff Melanie Kelley brings this proposed class action on behalf of herself and others who purchased certain Silk Almondmilk beverages from Defendant WWF Operating Company dba Whitewave Services, Inc., alleging that Defendant's marketing practices violated and continue to violate (1) California's Consumer Legal Remedies Act ("CLRA"), Cal. Civil Code §§ 1770 et seq.; (2) California's unfair competition law ("the UCL"), Cal. Bus. & Prof. Code §§ 17200 et seq.; and (3) California's False Advertising Law ("FAL"), Cal. Bus. & Prof. Code § 17500. Doc. 1. Defendant moves to dismiss the case with prejudice under Federal Rule of Civil Procedure 12(b)(6) on a number of grounds, including that the case should be dismissed under the "primary jurisdiction doctrine." See Doc. 11.
The Court took the matter under submission on the papers pursuant to Local Rule 230(g). Doc. 15. For the following reasons, the Court agrees with Defendant that the primary jurisdiction doctrine applies here, but finds it appropriate to STAY this case pending appropriate administrative proceedings before the Food and Drug Administration ("FDA") instead of dismissing the case.
To resolve Defendant's motion, Plaintiff's allegations can be briefly summarized. Defendant makes, among other things, eight different kinds of Silk Almondmilk beverages, which Plaintiff alleges contain "false, misleading, and deceptive" information on their packaging. Doc. 1, Complaint ("Compl."), at ¶ 1; id. at1 n.1. Plaintiff purchased Silk Unsweetened Vanilla Almondmilk, id. at ¶ 18, which she claims contained misleading information that, coupled with one of Defendant's television commercials for Silk Almondmilk beverages, led her to believe that Silk Amondmilk beverages are "nutritionally superior to dairy milk and contained comparable amounts of the essential vitamins and nutrients contained in dairy milk and contained higher amounts of protein and vitamin D than dairy milk." Id. at ¶ 20. But, according to Plaintiff, Silk Almondmilk beverages are "nutritionally inferior to dairy milk," and, had she known that, she would not have purchased any, or would have paid less for them, or would have bought an alternative product. See id. at ¶¶ 12, 20, 43.
Plaintiff therefore claims the Silk Almondmilk products are "misbranded" under 21 C.F.R. § 101.3(e) ("§ 101.3(e)") "because they substitute for and resemble dairy milk, are nutritionally inferior to dairy milk, and fail to state 'imitation milk' on their labels as required." Doc. 13 at 11. According to Plaintiff's opposition, her assertion that Defendant's products violate § 101.1(e) forms the basis for all of Plaintiff's claims.2 See Doc. 13 at 7 (); see also id. at 9; id. at 12.3
Defendant moves to dismiss on a number of grounds. As a threshold matter, Defendant argues Plaintiff does not have standing. Second, Defendant contends Plaintiff's claims fail as a matter of law because no reasonable customer would be misled the use of the term "almondmilk" on its products.
As to Plaintiff's assertion that Silk Almondmilk beverages' labeling violate § 101.3(e)—the basis for Plaintiff's claims—Defendant argues that the beverages are distinct from dairy milk, their labeling complies with the applicable regulations, namely, 21 C.F.R. §§ 101.3(b)(1)-(3), and is not otherwise misleading. Defendant therefore contends Plaintiff seeks to impose labeling requirements on Silk Almondmilk beverages that go beyond what is required by the Food, Drug, and Cosmetic Act ("FDCA"), 21 U.S.C. §§ 301-399f, and, accordingly, Plaintiff's claims are expressly preempted by the FDCA.
A motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) is a challenge to the sufficiency of the allegations set forth in the complaint. A 12(b)(6) dismissal is proper where there is either a "lack of a cognizable legal theory" or "the absence of sufficient facts alleged under a cognizable legal theory." Balisteri v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir. 1990). In considering a motion to dismiss for failure to state a claim, the court generally accepts as true the allegations in the complaint, construes the pleading in the light most favorable to the party opposing the motion, and resolves all doubts in the pleader's favor. Lazy Y. Ranch LTD v. Behrens, 546 F.3d 580, 588 (9th Cir. 2008).
To survive a 12(b)(6) motion to dismiss, the plaintiff must, in accordance with Rule 8, allege"enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). "A claim has facial plausibility when the Plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). "The plausibility standard is not akin to a 'probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id. (quoting Twombly, 550 U.S. at 556). "While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a Plaintiff's obligation to provide the 'grounds' of his 'entitlement to relief requires more than labels and conclusions." Twombly, 550 U.S. at 555 (internal citations omitted). Thus, "bare assertions . . . amount[ing] to nothing more than a 'formulaic recitation of the elements' . . . are not entitled to be assumed true." Iqbal, 556 U.S. at 681. "[T]o be entitled to the presumption of truth, allegations in a complaint . . . must contain sufficient allegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively." Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011). In practice, "a complaint . . . must contain either direct or inferential allegations respecting all the material elements necessary to sustain recovery under some viable legal theory." Twombly, 550 U.S. at 562.
Plaintiff's claims are premised on her contentions that Defendant's Silk Almondmilk beverages are (1) mislabeled, in violation of § 101.3(e), because they should be identified as "imitation" dairy milk; and (2) the use of the term "almondmilk" is misleading. See Doc. 13 at 9. Among other things, Defendant contends Plaintiff lacks standing to bring any claim under the UCL, CLRA, or FAL because she has suffered no cognizable injury and, in any event, her claim fails as a matter of law.
Although Defendant mentions Article III standing principles, its argument that Plaintiff lacks standing is based on its position that Plaintiff lacks statutory standing under the UCL, FAL, and CLRA because she has not suffered a cognizable injury under those statutes. See Doc. 11 at 25; see alsoHinojos v. Kohl's Corp., 718 F.3d 1098, 1104 n.3 (9th Cir. 2013) ().
To determine whether a plaintiff has standing under these statutes, the Court must assess whether the plaintiff's complaint sufficiently alleges she suffered a sufficient economic injury as a result of the defendant's allegedly unfair, unlawful, or fraudulent business practice that is the basis for the complaint. See Kwikset Corp. v. Superior Court, 51 Cal. 4th 310, 323 (2011); see also Swearingen v. Santa Cruz Natural, Inc., No. 13-cv-4291-SI, 2016 WL 4382544, at *3 (N.D. Cal. Aug. 17, 2016).
Plaintiff sufficiently alleges that she suffered an economic injury under the UCL, FAL, and CLRA. She alleges that (1) the Silk Almondmilk products were mislabeled because they failed to state that they are "imitation" dairy milk; (2) she bought at least one of the almondmilks, relying in part on their purportedly misleading labels; and (3) had she known that the almondmilk was nutritionally inferior to dairy milk, she would not have bought it, would have paid less for it, or would have bought an alternative product. This is sufficient to satisfy Kwikset's requirements. See Hinojos v. Kohl's Corp., 718 F.3d 1098, 1105 (9th Cir. 2013). Because Plaintiff has statutory standing under Kwikset, it follows that she has Article III standing as well. See id. at 1104, 1104 n.4.
Defendant disputes whether Plaintiff has standing to assert claims against the Silk Almondmilk beverages that she did not buy. There is no controlling authority on the issue, and district courts within the Ninth Circuit are severely split. Khasin v. R.C. Bigelow, Inc., No. C 12-02204 JSW, 2013 WL 2403579, at *4 (N.D. Cal. May 31, 2013). But "[t]he majority of the courts that have carefully analyzed the question . . . hold that a plaintiff may have standing to assert claims for unnamed class members based on products he or she did not purchase so long as the products and alleged misrepresentations are substantially similar." Id. The Court finds the majority position more persuasive and follows it here.
"Primary jurisdiction is a prudential doctrine that permits courts to determine that an otherwisecognizable claim implicates technical and policy questions that should be addressed in the first instance by the agency with regulatory authority over the relevant industry rather than by the judicial branch." Astiana v. Hain Celestial Group, Inc., 783 F.3d 753, 760 (9th Cir. 2015) (citation and quotation marks omitted). "The doctrine applies when protection of the integrity of a...
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