Lauren Yu v. Dreyer's Grand Ice Cream, Inc.
| Decision Date | 15 March 2022 |
| Docket Number | 20 Civ. 8512 (ER) |
| Parties | LAUREN YU, individually and on behalf of all others similarly situated, Plaintiff, v. DREYER'S GRAND ICE CREAM, INC., Defendant. |
| Court | U.S. District Court — Southern District of New York |
Lauren Yu brings this putative class action against Dreyer's Grand Ice Cream, Inc. (“Dreyer's”), alleging that the representations on the label of certain Dreyer's ice cream bars sold under its Häagen-Dazs brand are misleading, because the bars' chocolate coating contains vegetable oil.[1] Yu seeks injunctive relief and monetary damages for: (1) violations of Sections 349 and 350 of the New York General Business Law (“GBL”), which prohibit deceptive business practices and false advertising (2) breach of express warranty; (3) breach of the implied warranty of merchantability; (4) violation of the Magnuson Moss Warranty Act, 15 U.S.C. §§ 2301, et seq. (“MMWA”); (5) fraud; and (6) unjust enrichment. Yu brings this action on behalf of a putative class of similarly situated individuals.
Before the Court is Dreyer's motion to dismiss the First Amended Complaint (“FAC”) pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be granted.[2] For the reasons set forth below the motion to dismiss is GRANTED.
Dreyer's is a Delaware corporation with a principal place of business in Oakland, California. ¶¶ 53, 58. It is a leading seller of premium frozen dairy desserts under the Häagen-Dazs brand. ¶ 59. Dreyer's sells its Häagen-Dazs Coffee Ice Cream Dipped in Rich Milk Chocolate, Almonds, and Toffee bars (the “Product”) in tens of thousands of stores nationwide, including warehouse club stores, supermarkets, convenience stores, gas stations, and drug stores. ¶¶ 60-61.
In May, June, and July of 2020, among other times, Yu, a resident of Manhattan, purchased the Product on numerous occasions, including at a Key Food grocery store and a Rite Aid drug store in Manhattan. ¶¶ 57, 62.
The Product consists of “ice cream bars purporting to be dipped in milk chocolate and covered with almonds and toffee.” ¶ 1. The representations on the front label identify the Product as “coffee ice cream dipped in rich milk chocolate, almonds, and toffee.” ¶ 2. Photos of the Product's label and its ingredient list, as included in the FAC, are below.
Image Omitted
Yu alleges that the Product's front label is misleading because the representation that the ice cream is “dipped in ‘rich milk chocolate, '” is false, since the addition of vegetable oil to the chocolate coating “fundamentally changes the nature of the bar's coating.” ¶ 25. According to the FAC, chocolate is “a food prepared from ground roasted cacao beans, ” that are ground to produce cocoa mass or chocolate liquor and then combined with dairy ingredients, sweetener, and flavorings. ¶¶ 3-6. With respect to the Product's front label, Yu claims that since it “represents the Product contains ‘rich milk chocolate' without qualification, consumers expect that it only has chocolate ingredients, when this is not accurate.” ¶ 18. With respect to the ingredient list, which indicates that the Product contains coconut oil and vegetable oil, Yu argues that “[c]onsumers of a high-end premium ice cream bar that claims to be dipped in ‘milk chocolate' will not be so distrustful such as to scrutinize the fine print of the ingredient list and uncover the deception, ” because the label is unambiguous. ¶ 43. She claims that the average consumer “spends seconds choosing between similar foods, ” and thus will not examine the fine print of the ingredient list in order to confirm that the front label is accurate. ¶ 44.
The Product is sold at a “premium price, ” approximately $5.99 for a package of three three-ounce bars. ¶ 50. Yu contends that as a result of the “false and misleading representations, ” Dreyer's sells the Product at a higher price than other similar products represented in a non-misleading way, and higher than it would be sold “absent the misleading representations and omissions.” Id. Yu further alleges that she, as well as the proposed class members consisting of all purchasers of the Product who reside in New York, Virginia, Delaware, and Maine during the applicable statutes of limitations, would not have bought the Product or would have paid less for it if they had known the truth. ¶¶ 68, 82, 89, 94. Yu alleges that she intends to purchase the Product again when she can do so with the assurance that the representations on its labeling are consistent with its ingredients. ¶ 67.
Yu brought this action against Froneri US, Inc., on October 13, 2020. Doc. 1. On March 5, 2021, Defendant moved to dismiss the complaint and noted that Yu had sued the wrong entity.[3] Docs. 14, 15. Yu filed the FAC against Dreyer's, the correct Defendant, on April 26, 2021. Doc. 22. On May 26, 2021, Dreyer's moved to dismiss the FAC pursuant to Rule 12(b)(6). Doc. 23.
II. LEGAL STANDARD
Under Rule 12(b)(6), a complaint may be dismissed for failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). When ruling on a motion to dismiss pursuant to Rule 12(b)(6), the Court must accept all factual allegations in the complaint as true and draw all reasonable inferences in the plaintiff's favor. Koch v. Christie's Int'l, PLC, 699 F.3d 141, 145 (2d Cir. 2012). However, the Court is not required to credit “mere conclusory statements” or “threadbare recitals of the elements of a cause of action.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)).
“To survive a motion to dismiss, a complaint must contain sufficient factual matter . . . to ‘state a claim to relief that is plausible on its face.'” Id. (quoting Twombly, 550 U.S. at 570). A claim is facially plausible “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. (citing Twombly, 550 U.S. at 556). Federal Rule of Civil Procedure 8 “marks a notable and generous departure from the hypertechnical, code-pleading regime of a prior era, but it does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions.” Id. at 678-79. If the plaintiff has not “nudged [the] claims across the line from conceivable to plausible, [the] complaint must be dismissed.” Twombly, 550 U.S. at 570.
III. DISCUSSION
Section 349 of the GBL prohibits “[d]eceptive acts or practices in the conduct of any business, trade or commerce . . . .” Section 350 of the GBL prohibits “[f]alse advertising in the conduct of any business, trade or commerce . . . .” While the standard for recovery under Section 350 is specific to false advertising, it is otherwise identical to Section 349. Cosgrove v. Oregon Chai, Inc., 520 F.Supp.3d 562, 575 (S.D.N.Y. 2021). To state a claim under either Section 349 or Section 350, “a plaintiff must allege that a defendant has engaged in (1) consumer-oriented conduct that is (2) materially misleading and that (3) plaintiff suffered injury as a result of the allegedly deceptive act or practice.” Orlander v. Staples, Inc., 802 F.3d 289, 300 (2d Cir. 2015) (quoting Koch v. Acker, Merrall & Condit Co., 944 N.Y.S.2d 452, 452 (2012)). While plaintiffs are not required to meet the heightened pleading requirements of Rule 9(b) for their claims, Cosgrove, 520 F.Supp.3d at 575-76, “plaintiffs must do more than plausibly allege that a ‘label might conceivably be misunderstood by some few consumers.'” Twohig v. Shop-Rite Supermarkets, Inc., 519 F.Supp.3d 154, 160 (S.D.N.Y. 2021) (quoting Sarr v. BEF Foods, Inc., No. 18 Civ. 6409 (ARR) (RLM), 2020 WL 729883, at *3 (E.D.N.Y. Feb. 13, 2020) (internal quotation marks omitted)). Plaintiffs must “plausibly allege that a significant portion of the general consuming public or of targeted customers, acting reasonably in the circumstances, could be misled.” Id. (quoting Sarr, 2020 WL 729883, at *3 (internal quotation marks omitted)).
“The primary evidence in a consumer-fraud case arising out of allegedly false advertising is, of course, the advertising itself.” Fink v. Time Warner Cable, 714 F.3d 739, 742 (2d Cir. 2013). In order to determine whether a reasonable consumer would have been misled by an advertisement, “context is crucial.” Id. “For example, under certain circumstances, the presence of a disclaimer or similar clarifying language may defeat a claim of deception.” Id. “Although the question of whether a business practice or advertisement is misleading to a reasonable consumer is generally a question of fact, it is ‘well settled that a court may determine as a matter of law that an allegedly deceptive [practice or advertisement] would not have misled a reasonable consumer.'” Wynn v. Topco Assocs., LLC, No. 19 Civ. 11104 (RA), 2021 WL 168541, at *2 (S.D.N.Y. Jan. 19, 2021) (internal citation omitted) (quoting Fink, 714 F.3d at 741).
As Dreyer's points out, the Food, Drug, and Cosmetic Act (the “FDCA”), pursuant to which the United States Food and Drug Administration (the “FDA”) issues regulations, does not create a private right of action. See PDK Labs Inc. v. Friedlander, 103 F.3d 1105, 1113 (2d Cir. 1997). While Yu argues that she is not pursuing a private action for violations of the FDCA and is instead bringing separate claims under the New York GBL, the parties dispute whether her GBL claims are an attempt to privately enforce FDA regulations instead of premised on consumer protection grounds.
A plaintiff may not circumvent a lack of a private right...
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