Sonner v. Premier Nutrition Corp.

• Decision Date: 29 September 2022
• Docket Number: 21-15526
• Citation: 49 F.4th 1300
• Parties: Kathleen SONNER, on behalf of herself and all others similarly situated, Plaintiff-Appellee, v. PREMIER NUTRITION CORPORATION, FKA Joint Juice, Inc., Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

49 F.4th 1300

Kathleen SONNER, on behalf of herself and all others similarly situated, Plaintiff-Appellee,
v.
PREMIER NUTRITION CORPORATION, FKA Joint Juice, Inc., Defendant-Appellant.

No. 21-15526

United States Court of Appeals, Ninth Circuit.

Argued and Submitted May 23, 2022 San Francisco, California
Filed September 29, 2022

James R. Sigel (argued) and Jessica Grant, Morrison & Foerster LLP, San Francisco, California; Angel A. Garganta, Steven E. Swaney, Amit Rana, and Antonio I. Stabile, Venable LLP, San Francisco, California; for Defendant-Appellant.

Leslie E. Hurst (argued), Timothy G. Blood, Thomas J. O'Reardon II, and Paula R. Brown, Blood Hurst & O'Reardon LLP, San Diego, California; Todd D. Carpenter, Lynch Carpenter LLP, San Diego, California; Craig M. Peters, Altair Law, San Francisco, California; for Plaintiff-Appellee.

Before: Carlos F. Lucero,^* Consuelo M. Callahan, and Bridget S. Bade, Circuit Judges.

BADE, Circuit Judge:

49 F.4th 1302

In Sonner v. Premier Nutrition Corp. (Sonner I ), 971 F.3d 834 (9th Cir. 2020), we affirmed the district court's dismissal, without leave to amend, of Plaintiff-Appellee Kathleen Sonner's class-action complaint. We held that federal courts sitting in diversity must apply federal equitable principles to claims for equitable restitution brought under California law and that, under such principles, dismissal was appropriate because Sonner could not show that she lacked an adequate remedy at law. Sonner I , 971 F.3d at 837, 839–44.

Immediately after the Sonner I opinion was issued and her federal case was terminated, Sonner filed a virtually identical complaint in California state court. Defendant-Appellant Premier Nutrition responded to Sonner's new complaint by returning to the district court and seeking a permanent injunction against the state court action under the "relitigation exception" of the Anti-Injunction Act, 28 U.S.C. § 2283. The district court denied the injunction, expressing uncertainty about whether our holding in Sonner I barred relitigation of Sonner's claims under principles of res judicata, also known as claim preclusion.

We are now asked to determine the preclusive effect of our opinion in Sonner I , and to decide whether the district court abused its discretion in denying the permanent injunction. Because the district court did not abuse its discretion in denying the injunction regardless of Sonner I 's preclusive effect, we decide only the second of these issues, and we affirm.

I

A

As our opinion in Sonner I explains, this case has a long history. 971 F.3d at 837–39. The original complaint was filed in 2013. Id. at 837. Sonner and a putative class sought relief under California's Unfair Competition Law ("UCL") and Consumers Legal Remedies Act ("CLRA") for Premier's alleged false advertising of its "Joint Juice" product. Id. at 837–38. Premier markets Joint Juice as supporting healthy joints; Sonner alleges it fails to provide the advertised benefits. Id. at 837.

In 2017, shortly before trial was scheduled to begin, and after over four years of discovery and extensive motions practice—including the certification of a class and Sonner's prevailing on Premier's motion for summary judgment—Sonner sought leave to file a second amended complaint. Id. at 838. Her then-operative complaint requested injunctive relief, restitution, and damages, and demanded a jury trial. Id. But Sonner sought leave to file an amended complaint dropping her damages claim so that she could proceed to a bench trial rather than a jury trial. Id.

Premier opposed the motion for leave to amend, arguing that amendment would be futile because the proposed second amended complaint, with no damages claim, would be subject to dismissal for failure to allege the lack of an adequate remedy at law. Id. During a hearing on the issue, the district court explained that Sonner was taking a "chance" in amending the complaint, warning that, if Premier filed a

49 F.4th 1303

motion to dismiss, it would be "open season" on the amended complaint in light of the inadequate-remedy-at-law issue. Id. Sonner's counsel responded that he understood that his client was "taking that chance." The district court then warned Sonner "that if it granted the motion and she dropped the damages claim, ‘we are never going to hear again anything about a damage claim under the CLRA’ " and advised Sonner "not to ‘put a lot of money’ on a future motion to amend to re-allege the [damages] claim." Id. Sonner's counsel responded that he "completely agree[d]" with the district court and that he understood that Sonner would "maybe not be granted [further] leave to amend to put back in" the CLRA damages claim. The district court granted leave to file the second amended complaint.

Sonner filed the second amended complaint and, unsurprisingly, Premier moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which provides for dismissal for "failure to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6) ; see Sonner I , 971 F.3d at 838. Consistent with its admonitions, the district court granted the motion to dismiss, concluding that California law required Sonner to show that her remedy at law was inadequate, and she had not done so. During a hearing on the motion to dismiss, the district court explained that, given its prior warnings, it would not grant leave to amend the complaint to re-allege the damages claim. The district court added that allowing a further amendment to cure the inadequate-remedy-at-law defect would amount to "total prejudice to the court system," "an abuse of the court system," and would be "totally unfair."

On appeal, we affirmed the district court's Rule 12(b)(6) dismissal. Sonner I , 971 F.3d at 839, 844. Reviewing the dismissal de novo, we concluded that federal common law, not California law, governed whether dismissal was proper. Id. at 839–44. We further held that federal common law required Sonner to establish the lack of an...