Marrache v. Bacardi U.S.A., Inc.

• Decision Date: 08 November 2021
• Docket Number: No. 20-10677,20-10677
• Citation: 17 F.4th 1084
• Parties: Uri MARRACHE, individually and on behalf of all others similarly situated, Plaintiff-Appellant, v. BACARDI U.S.A., INC., a Delaware corporation, d.b.a. The Bombay Spirits Company U.S.A., Winn-Dixie Supermarkets, Inc., d.b.a. Winn Dixie Liquors, Defendants-Appellees.
• Court: U.S. Court of Appeals — Eleventh Circuit

17 F.4th 1084

Uri MARRACHE, individually and on behalf of all others similarly situated, Plaintiff-Appellant,

v.BACARDI U.S.A., INC., a Delaware corporation, d.b.a. The Bombay Spirits Company U.S.A., Winn-Dixie Supermarkets, Inc., d.b.a. Winn Dixie Liquors, Defendants-Appellees.

No. 20-10677

United States Court of Appeals, Eleventh Circuit.

November 8, 2021

Douglas H. Stein, Law Offices of Douglas H. Stein, PA, Coral Gables, FL, Roniel Rodriguez, IV, Roniel Rodriguez IV, PA, North Miami, FL, Maury L. Udell, Beighley Myrick Udell & Lynne, PA, Miami, FL, for Plaintiff - Appellant

Melissa Linn Levitt, Bilzin Sumberg Baena Price & Axelrod, LLP, MIAMI, FL, David B. Massey, Martin Steinberg, Hogan Lovells US, LLP, MIAMI, FL, for Defendants - Appellees

Bradley Ian Brustman Marshall, Earthjustice, Tallahassee, FL, Alexis Andiman, Earthjustice, New York, NY, for Amici Curiae

Before Wilson, Lagoa, and Brasher, Circuit Judges.

Lagoa, Circuit Judge:

Uri Marrache appeals the district court's order dismissing his amended class action complaint against Bacardi U.S.A., Inc., and Winn-Dixie Supermarkets, Inc. (collectively, "Defendants"). Marrache asserted claims against Defendants under the Florida Deceptive and Unfair Trade Practices Act ("FDUTPA") and for unjust enrichment based on the purchase of Bombay Sapphire Gin containing grains of paradise by Marrache and the other class members. Marrache claimed that the inclusion of grains of paradise in Bombay Sapphire Gin was in violation of Florida Statute § 562.455.

This appeal asks us to resolve four issues: (1) whether section 562.455 is preempted by federal law, i.e., the Food Additives Amendment of 1958 (the "Food Additives Amendment"), Pub. L. 85-929, 72 Stat. 1784 (1958), which amended the Federal Food, Drug, and Cosmetic Act ("FFDCA"), and its implementing regulations; (2) whether Marrache failed to state claims under FDUTPA against Defendants; (3) whether Marrache failed to state claims for unjust enrichment against Defendants; and (4) whether the district court abused its discretion in dismissing the amended complaint with prejudice. While we conclude that section 562.455 is not preempted by the Food Additives Amendment to the FFDCA, we nonetheless affirm the district court's order dismissing Marrache's amended class action complaint with prejudice. First, Marrache's FDUTPA claims are barred by FDUTPA's safe harbor provision, which exempts acts or practices required or specifically permitted by federal or state law. See Fla. Stat. § 501.212. Second, even if the FDUTPA claims did not fall under FDUTPA's safe harbor provision, Marrache failed to state a plausible claim for actual damages under FDUTPA and thus dismissal was also proper on this ground. We further affirm the district court's dismissal of Marrache's claims for unjust enrichment and conclude that the district court did not abuse its discretion in dismissing the amended complaint with prejudice as any attempt to amend would be futile.

I. FACTUAL AND PROCEDURAL BACKGROUND

Bacardi produces Bombay Sapphire Gin ("Bombay"), and Winn-Dixie sells Bombay in its stores. According to Bombay's marketing and labeling, the gin contains ten "hand-selected botanicals from exotic locations around the world." One of those botanical ingredients is a substance known as "grains of paradise," the inclusion of which is "prominently etched on each of [Bombay's] distinctive blue bottles."

Marrache filed a class action complaint against Defendants in Florida state court "on behalf of all persons in the State of Florida who have purchased Bombay." Marrache asserted claims against Defendants under FDUTPA and for unjust enrichment based on the fact that he and the other class members had purchased Bombay containing grains of paradise, which he claimed was in violation of Florida Statute § 562.455. Bacardi, with Winn-Dixie's consent, timely removed Marrache's action to federal court pursuant to the Class Action Fairness Act. Defendants then moved to dismiss the complaint.

Before the district court ruled on Defendants’ motion to dismiss, Marrache filed an amended complaint, which modified the proposed class to "all citizens of the State of Florida .... who are consumers of Bombay ... in the State of Florida." Marrache again alleged that Bacardi added grains of paradise to Bombay—as indicated by the labeling on Bombay's bottles—in violation of section 526.455. Marrache also alleged that "Winn-Dixie knowingly sold [Bombay]" to him and the other class members in Florida, that he and the other class members "purchased and consumed [Bombay] in Florida" and that, as a result, they were damaged. Marrache asserted claims under FDUTPA for damages and for declaratory and injunctive relief, see Fla. Stat. § 501.211, alleging that Defendants had "engaged in unfair methods of competition, unconscionable acts or practices, and unfair or deceptive acts or practices in the conduct of its trade or commerce" by adulterating Bombay with grains of paradise and then knowingly selling it to Marrache and the other class members in violation of Florida Statute § 562.455 and Florida Statute §§ 500.04(1) – (3). Marrache also asserted a claim for unjust enrichment, alleging that he and the other class members "conferred direct benefits to Defendants by purchasing Bombay" from Defendants at Winn-Dixie's stores, that Defendants appreciated those conferred benefits "by virtue of [their] retention of the money paid for the Bombay," and that it would be inequitable for Defendants to retain those benefits as they had sold an illegal product to them.

Defendants moved to dismiss the amended complaint, arguing that Marrache failed to allege facts reflecting how grains of paradise adulterated Bombay or demonstrating deceptive acts by Defendants, specifically noting that the inclusion of grains of paradise in Bombay was etched on Bombay's bottles. Defendants also argued that Marrache failed to allege FDUTPA violations, including failing to adequately allege causation and actual damages, and that Marrache's claims fell within FDUTPA's safe harbor provision, which exempts acts or practices required or specifically permitted by federal or state law. See Fla. Stat. § 501.212. Defendants further argued that Marrache failed to state a claim for unjust enrichment. Additionally, Defendants contended that the Food Additives Amendment, which amended the FFDCA, preempted section 562.455, as the Food and Drug Administration ("FDA"), pursuant to the rule-making authority delegated to it by Congress under the Food Additives Amendment, had expressly identified grains of paradise as a substance "generally recognized as safe" ("GRAS") in 21 C.F.R. § 182.10. As such, Defendants argued that because federal and state law conflicted, section 562.455 was preempted by federal law. Marrache opposed Defendants’ motion to dismiss.¹

In its order granting Defendants’ motion to dismiss, the district court found that the Food Additives Amendment preempted Florida Statute § 562.455. The district court considered the Food Additives Amendment's legislative history and explained that section 562.455 frustrated the FFDCA's purpose because the federal statute "seeks to advance food technology by allowing the use of safe food additives, and the antiquated Florida statute prohibits the use of an additive that has been found to be generally regarded as safe by the FDA."

Additionally, the district court found that Marrache failed to state a FDUTPA claim because he had not "sufficiently alleged any actual damages resulting from the purported unfair or deceptive act"—the sale of Bombay produced with grains of paradise. The district court explained that Marrache's amended complaint made no allegations of actual damages, but rather, alleged that he and the other class members were injured by purchasing an illegal product—Bombay produced with grains of paradise—that he claimed was worthless. The district court, however, noted that Marrache did not explain how the product could be worthless, as he did not allege that (1) he could not or did not drink the gin, (2) he sought a refund of or complained about the Bombay at the time of purchase or consumption, or (3) he suffered any side effect, health issue, or harm from the grains of paradise in Bombay. The district court also addressed Debernardis v. IQ Formulations, LLC , 942 F.3d 1076, 1084–85 (11th Cir. 2019), in which this Court, when analyzing whether the plaintiffs had alleged a concrete injury for purposes of standing, stated that "at the motion to dismiss stage, ... a dietary supplement that is deemed adulterated and cannot lawfully be sold has no value." While explaining this reasoning "seemingly" supported Marrache's allegation that the Bombay was worthless because it was allegedly adulterated with grains of paradise, the district court explained that because the Florida statute criminalizing the adulteration of alcohol with grains of paradise was preempted by federal law, the Bombay was not worthless. The district court also found Marrache's unjust enrichment claim failed because Defendants were not unjustly enriched when they sold a legal bottle of gin in exchange for money. The district court dismissed Marrache's amended complaint with prejudice, as Marrache had already amended his complaint once and any "repleading would be futile." This timely appeal ensued.

II. STANDARDS OF REVIEW

We review a district court's grant of a motion to dismiss with prejudice de novo , "accepting the [factual] allegations in the complaint as true and construing them in the light most favorable to the plaintiff." City of Miami v. Citigroup Inc. , 801 F.3d 1268, 1275 (11th Cir. 2015) (alteration in original) (quoting Mills v. Foremost Ins. Co. , 511 F.3d 1300, 1303 (11th Cir. 2008) ); accord Cromartie v. Shealy , 941 F.3d 1244, 1251 (11th Cir. 2019). Additionally, whether federal law preempts a state law claim is a question we review de novo . Graham v. R.J. Reynolds Tobacco Co. , 857 F.3d...