Pichardo v. Only What You Need, Inc.

• Decision Date: 27 October 2020
• Docket Number: 20-CV-493 (VEC)
• Parties: TANIA PICHARDO, JENNIFER JONES, individually and on behalf of all others similarly situated, Plaintiffs, v. ONLY WHAT YOU NEED, INC., Defendant.
• Court: U.S. District Court — Southern District of New York

TANIA PICHARDO, JENNIFER JONES,individually and on behalf of all others similarly situated, Plaintiffs, v. ONLY WHAT YOU NEED, INC., Defendant.

20-CV-493 (VEC)

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

October 27, 2020

MEMORANDUM OPINION AND ORDER

VALERIE CAPRONI, United States District Judge:

Plaintiffs Tania Pichardo and Jennifer Jones bring this putative class action against Only What You Need, Inc. (OWYN). Plaintiffs allege that the labeling on Defendant's vanilla-flavored protein drink violates New York General Business Law §§ 349-50 (GBL §§349-50) because the vanilla flavor is not derived exclusively from the vanilla plant.¹ Defendant moved to dismiss the First Amended Complaint (FAC) under Rule 12(b)(6), arguing that Plaintiffs have not adequately pled material misrepresentation or injury. For the following reasons, OWYN's motion to dismiss is GRANTED.

BACKGROUND

Defendant manufactures, distributes, markets, labels, and sells a non-dairy, vanilla-flavored protein beverage. FAC (Dkt. 22) ¶ 1. The label on Defendant's product has a vanilla flower vignette and the words "Smooth Vanilla." Id. ¶ 3.

Plaintiff Pichardo purchased Defendant's beverage in the winter of 2018, and Plaintiff Jones purchased it on "numerous occasions between January 2018 and the middle of 2020." Id. ¶¶ 70-71. Both allege that they purchased the product because they believed the vanilla taste came exclusively from the vanilla plant. Id. ¶ 68. They further allege that the absence of qualifying terms like "flavored" or "naturally flavored" on the label led them to believe that the drink had more vanilla from vanilla beans than it actually did. Id. ¶ 72.

Plaintiffs rely on a consumer survey they commissioned to support their contentions. They claim that the survey demonstrates that, based on what appears on the product label, over 70% of respondents believed the flavor in Defendant's product came "only from vanilla beans." Id. ¶ 22. According to Plaintiffs, the survey also found that almost 50% of the respondents would be less likely to purchase the product if the vanilla flavor were not exclusively from the vanilla plant. FAC, Ex. A, at 8; Pl. Reply (Dkt. 31) at 11. Plaintiffs concede that the product contains some vanilla from the vanilla plant, FAC ¶ 24, but point to the results of a Gas Chromatography-Mass Spectrometry (GC-MS)² test performed on the product, which demonstrates that "the product contains added vanillin from a natural source material other than vanilla,"³ to allege that the vanilla taste does not derive exclusively from the vanilla plant. Id. ¶ 42.

Plaintiffs filed this action against OWYN, alleging violation of New York General Business Law §§ 349-50, which prohibits deceptive acts, practices, and false advertising. See N.Y. Gen. Bus. Law §§ 349-50. They claim the labeling on Defendant's product is materially misleading because the product's vanilla flavor does not come 100% from vanilla extract butinstead has additional flavoring ingredients. FAC ¶ 4. Plaintiffs further allege that they relied on these misrepresentations when purchasing the product, and they would not have purchased the product or paid as much for it had they known the flavor did not come 100% from the vanilla plant. Id. ¶¶ 89-90.

OWYN moved to dismiss the First Amended Complaint, arguing that Plaintiffs have not adequately pled misrepresentation, materiality, or injury. Def. Mem. (Dkt. 26) at 9.

DISCUSSION

I. STANDARD OF REVIEW

To survive a motion to dismiss under Rule 12(b)(6), "a complaint must allege sufficient facts, taken as true, to state a plausible claim for relief." Johnson v. Priceline.com, Inc., 711 F.3d 271, 275 (2d Cir. 2013) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555-56, (2007)). "[A] complaint does not need to contain detailed or elaborate factual allegations, but only allegations sufficient to raise an entitlement to relief above the speculative level." Keiler v. Harlequin Enters., Ltd., 751 F.3d 64, 70 (2d Cir. 2014) (citation omitted). The Court accepts all factual allegations in the complaint as true and draws all reasonable inferences in the light most favorable to the plaintiff. See Gibbons v. Malone, 703 F.3d 595, 599 (2d Cir. 2013). The Court is not required, however, "to accept as true a legal conclusion couched as a factual allegation." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 555).

II. NEW YORK GENERAL BUSINESS LAW SECTIONS 349 AND 350

Section 349 of the New York General Business Law prohibits "[d]eceptive acts or practices in the conduct of any business, trade or commerce or in the furnishing of any service in this state." N.Y. Gen. Bus. Law § 349(a). Section 350 of the New York General Business Law prohibits "[f]alse advertising in the conduct of any business, trade or commerce or in the furnishing of any service in this state." N.Y. Gen. Bus. Law § 350. In order to state a claimunder either Section 349 or 350, a plaintiff must allege that "(1) the defendant's act, practice or advertisement was consumer-oriented;⁴ (2) it was materially deceptive and misleading; and (3) that [the moving party] was injured as a result." Verizon Directories Corp. v. Yellow Book USA, Inc., 309 F. Supp. 2d 401, 405 (E.D.N.Y. 2004) (citing cases); see also New World Solutions, Inc. v. NameMedia Inc., No. 11-CV-2763, 2015 WL 8958390, at *25 (S.D.N.Y. Dec. 15, 2015) ("The standard for recovery under General Business Law § 350, while specific to false advertising, is otherwise identical to section 349.") (quotation and citations omitted).

When analyzing whether a label is deceptive, courts do not view the label in isolation. Instead, "[c]ourts view each allegedly misleading statement in light of its context on the product label or advertisement as a whole." Wurtzburger v. Kentucky Fried Chicken, No. 16-CV-08186, 2017 WL 6416296, at *3 (S.D.N.Y. Dec. 13, 2017) (quotations omitted); see also Fink v. Time Warner Cable, 714 F.3d 739, 742 (2d Cir. 2013) ("In determining whether a reasonable consumer would have been misled by a particular advertisement, context is crucial."). Moreover, the test is an objective one - would a reasonable consumer be misled. Oswego Laborers' Local 214 Pension Fund v. Marine Midland Bank, 85 N.Y.2d 20, 27 (1995).

Although consumer deception is a matter of fact often left for the jury, "[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, 714 F.3d at 741.

A. Overview of Vanilla

Vanilla is one of the most common ingredients in food, whether as a primary flavor or a component of another flavor. FAC ¶ 6. The source of the vanilla flavor is an orchid, V. planifolia. Id. ¶ 5. "Vanilla extract" refers to vanilla from vanilla beans, the vanilla flower, orthe vanilla plant. The main flavor component of vanilla is vanillin. Id. ¶ 17. Vanillin comes from vanilla and from other natural sources. Id. ¶ 42. In this opinion, "vanilla extract" is used to refer to vanilla derived from V. planifolia. As acknowledged in the original complaint, virtually all commercial references to vanilla are to vanillin; very few commercial products have vanilla taste that derives entirely from vanilla extract. Compl. (Dkt. 1) ¶ 17.⁵

B. Plaintiffs Have Not Adequately Pled A "Material Misrepresentation"

1. A Reasonable Consumer Would Not Be Misled by Defendant's Label

Plaintiffs have not alleged facts from which the Court can infer that the label in question is materially misleading. The drink, labeled "Smooth Vanilla," is a vanilla-flavored drink that tastes like vanilla and is flavored, in part, with vanilla extract.⁶ In large measure, this case is indistinguishable from a case involving vanilla ice cream recently decided by Judge Stanton. In Steele v. Wegmans Food Markets, Inc., the plaintiffs argued that the label on Wegmans' vanillaice cream was misleading because it stated that the product was "made with . . . natural vanilla flavor," when the ice cream contained only a tiny amount of vanilla extract. No. 19-CV-9277, 2020 WL 3975461, at *1 (S.D.N.Y. July 14, 2020). Judge Stanton found:

The Wegmans container does not mention vanilla beans, or bean extract, and even if vanilla or bean extract is not the predominant factor, if the sources of the flavor are natural, not artificial, it is hard to see where there is deception. What is misrepresented? The ice cream is vanilla flavored. The sources of the flavor are natural, not artificial.

Id. at *3. Similarly, the label on Defendant's protein drink does not state that it is "made with vanilla extract" or even contain the words "vanilla extract." There is no basis, therefore, to conclude that a reasonable consumer would be misled by the label to believe that all (or even most) of the vanilla taste comes from vanilla extract.

Although the vast majority of vanillin used commercially is not from vanilla extract, Compl. ¶ 17, Plaintiffs nevertheless argue that they have plausibly asserted that the label on the product is misleading based on the results of a consumer survey that Plaintiffs' counsel conducted. Although survey evidence can be persuasive in cases of alleged consumer deception, see Danone, US, LLC v. Chobani, LLC, 362 F. Supp. 3d 109, 120 (S.D.N.Y. 2019) (finding that a consumer survey was persuasive extrinsic evidence to demonstrate that customers are misled by "Chobani's 33% less sugar" label), even construing Plaintiffs' survey in the light most favorable to Plaintiffs, the survey does not plausibly support Plaintiffs' claim. Plaintiffs contend that the consumer survey demonstrates that over 70% of the respondents believed the flavor in Defendant's product came "only from vanilla beans." FAC ¶ 22. The language used in the survey itself, however, shows that over 70% of the respondents believed the vanilla taste came from vanilla plants; 70% did not say that they believed the vanilla taste came only from vanillaplants.⁷ FAC, Ex. A, at 7....