Leonard v. Mondelez Glob.
| Decision Date | 08 March 2023 |
| Docket Number | 21-cv-10102-PAC |
| Parties | CHRISTOPHER LEONARD, individually and on behalf of all others similarly situated, Plaintiff, v. MONDELEZ GLOBAL LLC, Defendant. |
| Court | U.S. District Court — Southern District of New York |
Plaintiff Christopher Leonard (“Plaintiff”) brings this putative class action against Mondelez Global LLC (“Defendant”). Defendant manufactures and sells Fudge Covered Mint Creme OREO cookies (“the Product”), which consist of chocolate sandwich cookies containing mint creme covered in a chocolate-flavored coating. Plaintiff claims, in large part, that the Product's label misleads consumers because it purports to contain “fudge” when, under Plaintiff's definition of fudge, it does not. Plaintiff proposes a New York class and a multi-state class based on all persons in North Dakota, Kansas, and Wyoming “who purchased the Product during the statute of limitations for each cause of action alleged” (the “Consumer Fraud Multi-State Class”). Plaintiff seeks money damages for (1) violations of New York General Business Law (“NY GBL”) §§ 349 and 350; (2) violations of the “Consumer Fraud Acts of the States in the Consumer Fraud Multi-State Class”; (3) breach of express warranty; (4) breach of implied warranty of merchantability (5) fraud; (6) and unjust enrichment.[1] Defendant moves to dismiss the Complaint in its entirety under Federal Rule of Civil Procedure 12(b)(6). For the reasons stated below, Defendant's motion is GRANTED and the Complaint is dismissed in its entirety with prejudice.
The following facts are taken from the Complaint and, for the purposes of this motion, are accepted as true and construed in the light most favorable to the Plaintiff. See Lively v. WAFRA Inv. Advisory Grp., Inc., 6 F.4th 293, 299 n.1 (2d Cir. 2021).
Defendant is a Delaware limited liability company with a principal place of business in East Hanover, New Jersey. Compl ¶ 50, ECF No. 1. Defendant's “forerunner” was “the National Biscuit Company (‘Nabisco') formed in 1898 from a merger of over 100 bakeries.” Id. ¶ 59. “Nabisco introduced numerous staples of American pantries, including Oreos” and, together with its successor, Defendant, “emphasizes its commitment to quality products, labeled honestly.” Id. ¶¶ 61, 63. Defendant currently manufactures, labels, markets, and sells chocolate sandwich cookies containing mint creme identified as “Fudge Covered” under the OREO brand. Id. ¶ 1. The Product is labeled as follows:
Fudge is a “type of sugar candy that is made by mixing sugar, butter and milk.” Id. ¶ 2. While fudge can have any flavor, “milkfat is the central component.” Id. ¶ 3. The quality of the fudge “depends on the amount and type of fat-contributing ingredients.” Id. ¶ 17. The fatcontributing ingredients typically come from diary and are based on milkfat-mainly butter-or vegetable oils like palm and palm kernel oil. Id. ¶ 19-24. “Dairy ingredients impart a creamy, rich taste and texture” to fudge, Id. ¶ 21, while vegetable oils “provide less satiety, a waxy and oily mouthfeel, and leave an aftertaste.” Id. ¶ 26.
The Product's “fudge” is made of palm and palm kernel oil, nonfat milk, cocoa, and natural flavor, as determined by comparing the Product's ingredients against non-coated regular OREOS. Id. ¶ 32-33. Two ingredients lists for the Product are pictured below:
Id. ¶ 31 (emphasis in original).
According to the Plaintiff, consumers expect that the label “Fudge Covered” and the picture of the cookie “coated with what appears to be fudge” means the Product contains fudge “made of dairy ingredients containing milk fat.” Id. ¶ 34. The Product, however, lacks these dairy ingredients because it contains “nonfat milk and [] palm oils for its fat content.” Id. ¶ 35. The Product's packaging is therefore misleading because it creates “an erroneous impression that essential fudge ingredients are present.”
“By labeling the Product in this manner, Defendant gained an advantage against other companies, and against consumers who sought to purchase a product that contained fudge ingredients such as dairy ingredients with milkfat.” Id. ¶ 42. Plaintiff purchased the Product for Id. ¶ 46. Had Plaintiff and the proposed class members “known the truth, they would not have bought the Product or would have paid less for it.” Id. ¶ 45.
“To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). The plaintiff's factual allegations must “raise a right to relief above the speculative level” to cross “the line from conceivable to plausible.” Twombly, 550 U.S. at 555, 570. “A claim has facial plausibility when the pleaded factual content allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 663. Although the Court must accept the plaintiff's factual allegations as true, it is “not bound to accept as true a legal conclusion couched as a factual allegation.” Papasan v. Allain, 478 U.S. 265, 286 (1986). In deciding a motion to dismiss, the court may consider both “the allegations on the face of the complaint” and “[d]ocuments that are attached to the complaint or incorporated in it by reference.” Roth v. Jennings, 489 F.3d 499, 509 (2d Cir. 2007).
Article 22-A of NY GBL protects consumers from deceptive acts and practices. While Section 349 involves unlawful deceptive acts and practices and Section 350, unlawful false advertising, the standard for recovery under both is “identical.” Denenberg v. Rosen, 897 N.Y.S.2d 391, 395 (N.Y.App.Div. 1st Dep't 2010) (quoting Goshen v. Mut. Life Ins. Co. of New York, 774 N.E.2d 1190 (N.Y. 2002)). To plead a cause of action under Sections 349 and 350, a plaintiff must show that “(1) the challenged transaction was ‘consumer-oriented'; (2) defendant engaged in deceptive or materially misleading acts or practices; and (3) plaintiff was injured by reason of defendant's deceptive or misleading conduct.” Id. at 395-96 (quoting Oswego Laborers' Local 214 Pension Fund v. Marine Midland Bank, NA, 85 N.Y.2d 20, 25 (1995)).
Defendant does not appear to contest for the purposes of this motion that the transaction was consumer oriented or that Plaintiff was injured. The parties' main dispute centers on whether the Defendant's representations were deceptive or materially misleading. An alleged act is materially misleading if it is “likely to mislead a reasonable consumer acting reasonably under the circumstances.” Orlander v. Staples, Inc., 802 F.3d 289, 300 (2d Cir. 2015) (internal quotations omitted). Courts consider whether a reasonable consumer would be misled by viewing “each allegedly misleading statement in light of its context on the product label or advertisement as a whole.” Pichardo v. Only What You Need, Inc., 20-CV-493 (VEC), 2020 WL 6323775, at *2 (S.D.N.Y. Oct. 27, 2020). While a plaintiff is not required to meet Rule 9(b)'s heightened pleading requirements, Cosgrove v. Oregon Chai, Inc., 520 F.Supp.3d 562, 575-76 (S.D.N.Y. 2021), a plaintiff “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-CV-6409, 2020 WL 729883, at *3 (E.D.N.Y. Feb. 13, 2020) (internal quotation marks omitted)). Rather, a plaintiff 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. (quotation marks omitted). “It is well settled that a court may determine as a matter of law that an allegedly deceptive advertisement would not have misled a reasonable consumer.” Fink v. Time Warner Cable, 714 F.3d 739, 741 (2d Cir. 2013).
Plaintiff claims the Product's “Fudge Covered” description is false, deceptive, and misleading because the Product does not contain dairy ingredients that a reasonable consumer would expect to find in fudge. Compl. ¶¶ 34-35. Defendant asserts that the term “fudge” refers to the Product's chocolate flavor, not its ingredients,[2] and in any event, no reasonable consumer would associate “fudge” with the presence of milk or butter. Def.'s Mem. of Law at 4, 8, ECF No. 14. The Court agrees that “Fudge Covered,” without more, would not mislead a reasonable consumer into believing the product necessarily contained milkfat or butter, regardless of whether “Fudge Covered” refers to the Product's flavor or an ingredient.[3]
Plaintiff does not represent that the Product's label or ingredients list is misleading because it advertises it contains butter, milkfat or “fudge” made with any specific ingredients, nor could he; the Product represents no such thing. See Pichardo, 2020 WL 6323775 at *4. Plaintiff instead argues that because milkfat is the “central component” in fudge, Compl. ¶...
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