Stuve v. The Kraft Heinz Co.

• Decision Date: 12 January 2023
• Docket Number: 21-CV-1845
• Parties: GABRIELLE STUVE, JESSICA NICODEMO, KELLY TARANTINO, MICHELLE FRANCIONE, LANA MOSKOWITZ, AARON CLARKE, and MICHELLE DEVERA, on behalf of themselves and all others similarly situated, Plaintiffs, v. THE KRAFT HEINZ COMPANY a/k/a, KRAFT HEINZ FOODS COMPANY, Defendant.
• Court: U.S. District Court — Northern District of Illinois

GABRIELLE STUVE, JESSICA NICODEMO, KELLY TARANTINO, MICHELLE FRANCIONE, LANA MOSKOWITZ, AARON CLARKE, and MICHELLE DEVERA, on behalf of themselves and all others similarly situated, Plaintiffs,
v.
THE KRAFT HEINZ COMPANY a/k/a, KRAFT HEINZ FOODS COMPANY, Defendant.

No. 21-CV-1845

United States District Court, N.D. Illinois, Eastern Division

January 12, 2023

MEMORANDUM OPINION AND ORDER

REBECCA R. PALLMEYER, United States District Judge.

Plaintiffs, who purchased Kraft's popular macaroni and cheese product (“Kraft Mac & Cheese”), allege that Kraft violated state laws by deceptively labeling the product. Plaintiffs have filed this action on behalf of themselves and a putative multi-state class of consumers, alleging that the Kraft Mac & Cheese label omits information and misleads purchasers into believing that Kraft Mac & Cheese is free from phthalates-plasticizing chemicals that, at certain levels, can be dangerous to consume. Plaintiffs filed this complaint in federal court pursuant to the Class Action Fairness Act of 2005, which establishes federal jurisdiction when, as here, at least one class member is of diverse citizenship from a defendant, there are more than 100 class members, and the aggregate amount in controversy exceeds $5 million, exclusive of interest and costs. Plaintiffs' amended consolidated class action complaint alleges four counts: violations of multiple state consumer fraud and deceptive business practice laws (Count I); unjust enrichment (Count II); breach of implied warranty (Count III); and breach of express warranty (Count IV). On September 23, 2022, Kraft moved to dismiss all claims. For the reasons discussed below, the motion is granted in part and denied in part. Plaintiffs' claims for false or misleading statements (Count I), breach of implied warranty for all non-Massachusetts Plaintiffs (Count III), and breach

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of express warranty (Count IV) are dismissed. Plaintiffs' claims for material omissions (Count I), unjust enrichment (Count II), and Plaintiff Michelle Francione's breach of implied warranty claim (Count III) survive this motion.

BACKGROUND

Each day, Kraft sells more than a million boxes of Kraft Mac & Cheese.^[1](Amended Consolidated Class Action Complaint (“CAC”) [60] ¶ 1.) Kraft's signature blue box touts the product's positive attributes. On what appears to be a ripped-out piece of notebook paper in the lower right-hand corner of the package's front side, the box tells consumers that inside is “The Taste You Love” with “NO Artificial Flavors,” “NO Artificial Preservatives,” and “NO Artificial Dyes.” (Id. ¶ 51.) The backside of the cardboard container lists “even more reasons to love it,” including the dish's “gooey, cheesy goodness.”^[2](Ex. 3 to Def.'s Request for Judicial Notice in Support of its Motion to Dismiss Consolidated Class Action Complaint (hereinafter “RJN”) [64-3].)

In this case, Plaintiffs from eleven states allege that Kraft has violated their states' consumer fraud laws. They claim that Kraft omits material information from its Kraft Mac & Cheese label and misleads consumers into believing that the product is healthy, wholesome, nutritious, and free from artificial substances, including harmful synthetic toxins. (CAC ¶ 1.) Specifically, Plaintiffs allege that Kraft has violated its duty to disclose to consumers that the product contains, or is at risk of containing, “ortho-phthalates,” also known as “phthalates.” (Id.)

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Plaintiffs allege that phthalates “enter food during processing and packaging” and “escape from food contact materials such as processing equipment and food packaging material into the cheese powder.” (Id. ¶ 28.)

Phthalates are synthetic chemicals that make plastics flexible. (Id. ¶ 28). They are also endocrine-disrupting chemicals, and scientific studies have linked excessive consumption of phthalates to adverse health effects including decreased semen quality in men; endometriosis in women; and asthma, allergies, and bronchial obstruction in children. (Id. ¶¶ 3, 35, 38, 39.) Scientific findings also show that pre-natal exposure to phthalates may be dangerous to the fetus, potentially leading to harms after birth including neurodevelopment problems and genital birth defects in boys. (Id. ¶¶ 4, 40.)

In 2017, the Coalition for Safer Food Processing and Packaging (the “Coalition”), a group of nonprofit health and food safety advocacy organizations, tested several cheese products- including cheese powder in ten varieties of macaroni and cheese produced by various manufacturers-and published the results. (Id. ¶ 29.) According to the study, the Coalition detected phthalates in nine of the ten tested cheese powder products and found that the phthalate levels in those cheese powders were on average four times higher than in the 15 natural cheeses tested. (Id.) Specifically, the Coalition found an average of 106 parts per billion (or .106 milligrams per kilogram of dry product) of phthalates in the ten tested varieties of macaroni & cheese, with a range between 34 and 218 parts per billion.^[3](See “Testing Finds Industrial Chemical Phthalates in Cheese” (hereinafter “The Coalition's Study”), Ex. 4 to RJN [64-4].)

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The study itself did not specifically identify Kraft as the producer of one of the tested cheese products, but, on June 14, 2017, the Coalition issued a public letter to Bernardo Hees, Kraft's Chief Executive Officer, stating that it had detected phthalates in Kraft's products and asking to meet with Kraft to discuss the matter. (CAC ¶ 30.) The letter noted that Kraft is the leading U.S. seller of macaroni and cheese and asked Kraft to “eliminate toxic industrial chemicals known as ortho-phthalates from [its] food products.” (Id.) The letter also enumerated health concerns associated with phthalates and stated that the Coalition planned to launch a public outreach campaign regarding the issue. (Id.)

Kraft is aware that some consumers are concerned about phthalates. On its website, the first of its published “Frequently Asked Questions” queries, “Should I be concerned about food and phthalates?” (Id. ¶ 9.) Kraft's response acknowledges that customers have inquired about phthalates in its Mac & Cheese and states, “We take your questions about phthalates and food safety and quality very seriously because we know moms and dads trust Kraft Mac & Cheese as a quality, tasty, and safe food for the family.” (Id.) The website also seeks to dispel concerns about phthalates in its Mac & Cheese by stating that

[t]he safety of phthalates has been assessed by the U.S. Food and Drug Administration and other authorities, such as the Centers for Disease Control. The trace levels found in the one limited test of mac & cheese are well below any level of concern. Hundreds of servings of mac & cheese would need to be consumed daily over an entire lifetime in order to exceed levels determined as safe.^[4]

(Ex. 5 to RJN [64-5].)

In a public statement, the Coalition rebuffed Kraft's effort to minimize the significance of the Coalition's finding. Although language on Kraft's website assures consumers that the amount of phthalates detected is many times “lower than levels that scientific authorities have identified

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as acceptable,” the Coalition noted, the “acceptable level” Kraft referred to accounts for phthalate intake from all sources combined, not from a single product alone. (CAC ¶ 31.) Essentially, the Coalition asserted-and Plaintiffs allege in their complaint-that a Kraft Mac & Cheese packet could indeed constitute a large enough slice of a person's daily-intake pie chart to warrant a warning label. Because the effect of phthalates is cumulative, Plaintiffs urge that even if an amount of phthalates in the product is small in absolute terms, the amount is significant relative to other sources of phthalate exposure. This relative significance may move a consumer away from choosing the product in favor of a potentially healthier option. (See id. ¶¶ 31, 34-37, 77.)

For its part, the FDA has not set a specific threshold for the level of phthalates it allows in food products. (Id. ¶ 33.) The FDA has, however, promulgated regulations and issued findings about the safety of phthalates in other contexts. For example, the FDA permits the use of phthalates in food contact applications, such as processing tools and packaging materials. (See Def.'s Mem. in Supp. of Mot. to Dismiss [63] (hereinafter “Def.'s Br.”) at 1, 3, 7 (citing 21 C.F.R. § 178.3740).)

Plaintiffs originally filed this suit on April 6, 2021, but the court stayed proceedings, on Plaintiffs' motion, pending a ruling on motion to transfer a related case from the Eastern District of New York. Judge Azrack of the Eastern District of New York granted that motion on May 26, 2022. Tarantino v. The Kraft Heinz Company, No. 1:22-cv-2807 (E.D.N.Y. May 26, 2022). On August 19, 2022, Plaintiffs filed an amended Consolidated Class Action Complaint [60], asserting that Kraft has been fully aware of the presence of risk of phthalates in Kraft Mac & Cheese since at least 2017, but has chosen not to disclose this information to consumers. Furthermore, Plaintiffs assert, Kraft makes deceptive statements in its macaroni and cheese packaging that create the overall impression that its macaroni and cheese products are “wholesome, safe, and healthy, and do not contain dangerous chemicals or artificial substances like phthalates.” (CAC ¶ 50.)

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Plaintiffs bring claims on behalf of themselves and a multi-state class^[5] under multiple consumer fraud and business practice laws^[6](Count I); unjust enrichment (Count II); breach of implied warranty (Count III); and breach of express warranty (Count IV). On September 23, 2022, Kraft moved the court to dismiss Plaintiffs' lawsuit for failure to state a claim.

DISCUSSION

To survive a motion to dismiss under Rule 12(b)(6), a complaint must “state a claim to relief that is plausible on its...