Reid v. Unilever United States, Inc.

• Decision Date: 07 August 2013
• Docket Number: No. 12 C 06058.,12 C 06058.
• Citation: 964 F.Supp.2d 893
• Parties: Sidney REID and Angel Lake, on behalf of themselves and all others similarly situated, Plaintiffs, v. UNILEVER UNITED STATES, INC., Defendant.
• Court: U.S. District Court — Northern District of Illinois

964 F.Supp.2d 893

Sidney REID and Angel Lake, on behalf of themselves and all others similarly situated, Plaintiffs,

v.UNILEVER UNITED STATES, INC., Defendant.

No. 12 C 06058.

United States District Court,

N.D. Illinois,

Eastern Division.

Aug. 7, 2013.

Jana Eisinger, Law Office of Jana Eisinger, PLLC, Mount Vernon, NY, Andrew Szot, Lori Ann Fanning, Miller Law LLC, Marvin Alan Miller, Chicago, IL, Christopher S. Polaszek, Morgan & Morgan, PA, Tampa, FL, Elizabeth S. Metcalf, Peter G.A. Safirstein, Morgan & Morgan, PC, New York, NY, for Plaintiffs.

Paula J. Morency, Sondra A. Hemeryck, Schiff Hardin LLP, Chicago, IL, for Defendant.

MEMORANDUM OPINION AND ORDER

RUBEN CASTILLO, Chief Judge.

Sidney Reid and Angel Lake, on behalf of themselves and all others similarly situated (collectively “Plaintiffs”), bring this putative class action against Unilever United States, Inc. (“Unilever”) asserting breaches of express and implied warranties, unjust enrichment, violations of the Magnuson–Moss Warranty Act, 15 U.S.C. § 2301 et seq. (the “Magnuson–Moss Act”), and several state laws. Plaintiffs' action arises out of their purchase and use of a hair treatment sold as Suave Professionals Keratin Infusion 30 Day Smoothing Kit (the “Hair Treatment”) that allegedly caused Plaintiffs to suffer hair loss and damage. (R. 1, Compl. ¶¶ 1, 6.) Presently before the Court are Unilever's motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), (R. 23, Def.'s Mot.), Plaintiffs' motion to limit or supervise Unilever's communications with absent class members, (R. 30, Pls.' Mot. Limit Commc'ns), and Reid's motion for approval to serve discovery, (R. 41, Pls.' Mot. Disc). For the reasons set forth below, each of the motions is granted in part and denied in part.

RELEVANT FACTS

Unilever is a wholly owned subsidiary of Unilever NV and Unilever PLC, (R. 22, Def.'s Corp. Disclosure Statement), and is located in New Jersey, (R. 1, Compl. ¶ 16). Reid is a resident of Chicago, Illinois, and Lake is a resident of Foley, Alabama. ( Id. ¶¶ 14, 15.) Plaintiffs allege that on or about December 9, 2011, Unilever made the Hair Treatment available for sale to consumers on a nationwide basis. ( Id. ¶¶ 1, 17.) According to Plaintiffs, the Hair Treatment “contains an ingredient or combination of ingredients that causes significant hair loss upon proper application.” ( Id. ¶ 1.) Plaintiffs allege that as early as December 2011, consumers complained on the internet that use of the Hair Treatment was causing hair loss and chemical burns. ( Id. ¶¶ 7, 33.) Despite these complaints, Plaintiffs aver that Unilever did not disclose the risk of hair loss on the Hair Treatment's packaging, “or on [Unilever's] websites or other marketing materials.” ( Id. ¶ 6.)

In early March 2012, Reid purchased the Hair Treatment for approximately eleven dollars from a retail store in Chicago, Illinois. ( Id. ¶ 49.) Reid alleges that she applied the Hair Treatment properly and thereafter experienced hair loss. ( Id.) According to Reid, “[h]er hair became progressively thinner at the top of her crown until there were visible bald spots.” ( Id. ¶ 50.) As a result of the damage that the Hair Treatment caused to her hair, Reid needed to “have all but half an inch of her hair cut off.” ( Id. ¶ 57.) She alleges that she “incurred in excess of $100 dollars in expenses to date relating to her attempts to restore or salvage what was left of her hair” and that her expenses continue to accrue. ( Id.) In April 2012, Reid wrote to Unilever on its website informing them that use of the Hair Treatment caused her to experience hair loss, but she avers that she did not receive a response from Unilever. ( Id. ¶ 58.) On July 23, 2012, Reid again wrote to Unilever, and Unilever sent her an e-mail response advising her that someone would contact her. ( Id.) According to Reid, as of August 1, 2012, she had not received any follow-up communication from Unilever. ( Id.)

In early May 2012, Lake purchased the Hair Treatment for approximately ten dollars from a retail store in Alabama. ( Id. ¶ 51.) Lake alleges that she applied the Hair Treatment properly, but “within minutes of use, her hair began melting together and falling out in clumps.” ( Id. ¶ 52.) Lake then sent Unilever a letter setting forth her experience with the Hair Treatment. ( Id. ¶ 53.) Unilever responded to Lake's letter and asked for additional information to investigate the problem. ( Id. ¶ 54.) Although Unilever also refunded Lake fifteen dollars for the purchase of the Hair Treatment, Lake contends that she incurred and continues to incur expenses in repairing the damage caused by the Hair Treatment. ( Id.) Lake avers that she has spent hundreds of dollars attempting to repair the damage caused by the Hair Treatment. ( Id. ¶ 59.) Lake also alleges that she has been “forced to cut approximately 12 inches off the length of her hair” and that her remaining hair continues to fall out and “is no longer in the good condition it was in prior to her use of the [Hair] Treatment.” ( Id.)

Plaintiffs allege that they “would not have purchased the [Hair] Treatment but for the Defendant's false and fraudulent marketing that promoted the [Hair Treatment] as a safe ‘smoothing’ product whose effects would last no longer than 30 days, its false statement that the [Hair Treatment] does not contain [f]ormaldehyde, and its misleading claim that it was Keratin-based.” ( Id. ¶ 55.) Plaintiffs further allege that Unilever was aware or should have been aware that the Hair Treatment contained an inherent defect that caused significant hair loss upon proper application, ( Id. ¶¶ 11, 45), but that despite such knowledge, Unilever did not disclose the risk of hair loss to consumers, ( Id. ¶ 48).

On May 2, 2012, Unilever recalled the Hair Treatment, ( Id. ¶ 35), in what Plaintiffs characterize as a belated and incomplete recall. ( Id. ¶¶ 9, 34, 39, 48.) Unilever advised retailers to immediately cease the distribution of the Hair Treatment and asked retailers to send the Hair Treatment back to Unilever. ( Id. ¶ 36.) On its website, Unilever explained that the Hair Treatment was recalled “because of potential consumer misunderstanding of the product's suitability for certain hair conditions.” ( Id. ¶ 34.) Nevertheless, Plaintiffs aver that Unilever did not make any public announcement and did not publicly respond to complaints stemming from the use of the Hair Treatment. ( Id. ¶ 38.) Plaintiffs allege that despite the recall of the Hair Treatment, Unilever has continued to advise consumers that the Hair Treatment is safe and has not disclosed to consumers complaints of hair loss, or issued warnings about potential hair loss to consumers. ( Id. ¶¶ 39–40.)

MOTION TO DISMISS

I. Procedural History

On August 1, 2012, Plaintiffs filed their six-count complaint (“Complaint”) with this Court in their individual capacities and on behalf of others similarly situated. (R. 1, Compl. at 1). That same day, Plaintiffs moved for class certification and a stay of briefing. (R. 4, Pls.' Class Cert. Mot.) On March 6, 2013, the Court granted a stay of briefing on the class certification motion pending the resolution of Unilever's motion to dismiss. (R. 45, Min. Entry.)

In Count I of the Complaint, brought individually and on behalf of all putative class members, Plaintiffs allege that they formed a contract with Unilever at the time they purchased the Hair Treatment, and that “[t]he terms of that contract include the promises and affirmations of fact” made by Unilever through its advertising, marketing and packaging. (R. 1, Compl. ¶ 73.) Specifically, Plaintiffs contendthat Unilever expressly warranted that the Hair Treatment “was a hair ‘Smoothing’ Product and not a chemical relaxer, that the effects of the [Hair] Treatment would last no more than 30 days, and that it contained No Formaldehyde and was safe.” ( Id. ¶ 74.) Plaintiffs further allege that Unilever breached these express warranties because its statements were false. ( Id. ¶ 76.) Plaintiffs contend that they would not have purchased the Hair Treatment had they known its true nature. ( Id. ¶ 76.) In Count II, Plaintiffs allege that Unilever breached implied warranties because the Hair Treatment was defective and therefore not merchantable. ( Id. ¶ 80.) As a result of the non-merchantability of the Hair Treatment, Plaintiffs allege that they sustained damages. ( Id. ¶ 82.)

In Count III, Plaintiffs bring consumer fraud claims, individually and on behalf of all putative class members, against Unilever. ( Id. ¶¶ 83–97.) Reid brings her consumer fraud claims pursuant to the Illinois Consumer Fraud and Deceptive Businesses Practices Act (the “ICFA”), 815 Ill. Comp. Stat. 505/1 et seq. ( Id. ¶ 85 n. 2.) Lake brings her consumer fraud claims pursuant to the Alabama Deceptive Trade Practices Act (the “ADTPA”), Ala.Code § 8–19–1 et seq. ( Id. ¶¶ 84–85.) In a footnote, Plaintiffs note that pursuant to Shady Grove Orthopedic Assocs., P.A. v. Allstate Ins. Co., 559 U.S. 393, 130 S.Ct. 1431, 176 L.Ed.2d 311 (2010) (plurality opinion), although class relief is not permitted under Alabama State law, an Alabama class may nonetheless be maintained in a diversity suit under Federal Rule of Civil Procedure 23. ( Id. at 19 n. 1.) In a separate footnote, Plaintiffs also note that the consumer fraud claims of nonresident absent class members are brought under the consumer protection statutes of their respective states of residence. ( Id. ¶ 85 n. 2.) In support of their consumer fraud claims, Plaintiffs allege that Unilever knowingly misrepresented and/or omitted material facts to consumers, such as Plaintiffs, and that these material misrepresentations violate the consumer fraud laws at issue. ( Id. at ¶¶ 87–96.) Specifically, Plaintiffs allege that Unilever misrepresented that the Hair Treatment “was a Keratin-based ‘smoothing’ conditioner” and that by placing “No Formaldehyde” in all capital letters on the front of...