Whitaker v. Herr Foods, Inc., CIVIL ACTION No. 16–2017

• Decision Date: 29 July 2016
• Docket Number: CIVIL ACTION No. 16–2017
• Citation: 198 F.Supp.3d 476
• Parties: Kenneth WHITAKER, Plaintiff, v. HERR FOODS, INC., Defendant.
• Court: U.S. District Court — Eastern District of Pennsylvania

198 F.Supp.3d 476

Kenneth WHITAKER, Plaintiff,

v.HERR FOODS, INC., Defendant.

CIVIL ACTION No. 16–2017

United States District Court, E.D. Pennsylvania.

Signed July 29, 2016

Anthony J. Orshansky, Justin Kachadoorian, Counselone P.C., Beverly Hills, CA, Cynthia Z. Levin, Todd M. Friedman, Law Offices of Todd M. Friedman PC, King of Prussia, PA, Scott M. Pollins, Swarthmore, PA, for Plaintiff.

Jason Confair, Kegel Kelvin Almy & Lord LLP, Lancaster, PA, for Defendant.

MEMORANDUM

EDUARDO C. ROBRENO, District Judge.

Plaintiff Kenneth Whitaker initiated this putative class action in the Pennsylvania Court of Common Pleas of Philadelphia County against Defendant Herr Foods, Inc. ("Defendant"). Plaintiff alleges that Defendant "misbranded" approximately one dozen snack food products—namely, chips and pretzels. Defendant removed this action pursuant to the Class Action Fairness Act ("CAFA"), 28 U.S.C. § 1332(d)(2). Defendant now moves to dismiss all of Plaintiff's claims, except for the breach of express warranty claim, and to strike the class allegations. For the reasons that follow, the Court will grant Defendant's motion to dismiss and deny Defendant's motion to strike. Therefore, only the breach of express warranty claim remains.

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

Defendant is a Pennsylvania corporation that sells a variety of snack products. Compl. ¶¶ 6, 8, ECF No. 1. Plaintiff identifies at least twelve¹ of Defendant's products (hereinafter, "the products") bearing labels with the following statements: "No Preservatives," "No MSG," "All Natural," and "No Trans Fat." Id.¶¶ 1, 8-9. These statements are also displayed on Defendant's website. Id.¶ 9. According to Plaintiff, these statements are false, because many of the products' ingredients are, among other things, chemically synthesized and highly processed. Id.¶¶ 3, 10 Plaintiff further alleges that the products' labels evade federal regulations, which oblige Defendant to disclose when its products contain certain ingredients. Id.¶¶ 10-11, 14-15, 18, 21-23, 31-38, 44.

Plaintiff alleges that he prefers "healthy, wholesome, and nutritious" foods. Id.¶ 50. He tries to avoid foods containing artificial or highly processed ingredients, chemical preservatives, and artificial flavors or colors. Id. Given these preferences, Plaintiff states that he purchased Defendant's products in reliance on their labels' representations that the contents were natural and free of artificial or synthetic ingredients. Id.¶¶ 51-52. He alleges that he also paid more money than he would have paid for other products containing artificial ingredients.² Id.¶¶ 53-54.

Plaintiff filed the present action on behalf of himself and others similarly situated, based on Defendant's alleged (1) violation of Pennsylvania's Unfair Trade Practices and Consumer Protection Law ("UTPCPL"), 73 Pa. Cons. Stat. §§ 201–1 to 201–9; (2) breach of express warranty; (3) fraudulent misrepresentation; (4) negligent misrepresentation; (5) breach of contract; and (6) unjust enrichment.

Plaintiff purports to represent the following putative class:

All persons in the United States or, alternatively, Pennsylvania who purchased one or more of the Misbranded Products from six (6) years prior to the filing of the Complaint and continuing to the present.

Compl. ¶ 56. Plaintiff asserts that "the proposed class includes thousands if not millions of members." Id.¶ 60.

II. JURISDICTION

In its Notice of Removal, ECF No. 1, Defendant asserts that this Court has subject matter jurisdiction pursuant to CAFA, 28 U.S.C. § 1332(d)(2). "CAFA confers on district courts original jurisdiction where: (1) the amount in controversy exceeds $5,000,000, as aggregated across all individual claims; (2) there are minimally diverse parties; and (3) the class consists of at least 100 or more members." Neale v. Volvo Cars of N. Am., LLC, 794 F.3d 353, 357 n. 1 (3d Cir.2015) (citing 28 U.S.C. § 1332(d)(2), (5)(B), (6) ).

Although the parties do not dispute jurisdiction under CAFA, the Court "must nevertheless satisfy [itself] that federal subject matter jurisdiction exists in the first instance." Kaufman v. Allstate N.J. Ins. Co., 561 F.3d 144, 151 (3d Cir.2009). "[T]he party alleging jurisdiction [must] justify his allegations by a preponderance of the evidence." Judon v. Travelers Prop. Cas. Co. of Am., 773 F.3d 495, 501 (3d Cir.2014) (second alteration in original) (quoting McNutt v. Gen. Motors Acceptance Corp. of Ind., 298 U.S. 178, 189, 56 S.Ct. 780, 80 L.Ed. 1135 (1936) ). "Courts may consider pleadings as well as evidence that the parties submit to determine whether subject matter jurisdiction exists or an exception thereto applies." Vodenichar v. Halcon Energy Props., Inc., 733 F.3d 497, 503 n. 1 (3d Cir.2013). Here, the three elements of CAFA jurisdiction are satisfied.

First, the amount in controversy exceeds $5,000,000. Plaintiff seeks damages equal to the amount that the putative class members paid for the products during the class period. Compl. ¶¶ 82, 89, 96, 100. Defendant's Senior Vice President of Sales and Marketing avers that Defendant's aggregatesales revenues from the identified products during the class period was $407,903,654. Notice of Removal ¶¶ 17-18. Of those revenues, $213,026,510 was derived from sales to out-of-state customers. Id.¶ 18.

Second, CAFA's diversity requirement is satisfied. Under CAFA, only minimal diversity is required for federal jurisdiction. 28 U.S.C. § 1332(d)(2)(A). CAFA's minimal diversity requirement is an exception to the "complete diversity" otherwise required under 28 U.S.C. § 1332(a). See Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 267-68, 2 L.Ed. 435 (1806). Under CAFA, "a federal court may exercise jurisdiction over a class action if ‘any member of a class of plaintiffs is a citizen of a State different from any defendant.’ " Mississippi ex rel. Hood v. AU Optronics Corp., ––– U.S. ––––, 134 S.Ct. 736, 740, 187 L.Ed.2d 654 (2014) (quoting 18 U.S.C. § 1332(d)(2)(A)). The court looks to the "[c]itizenship of the members of the proposed plaintiff class[ ] ... as of the date of filing of the complaint." 18 U.S.C. § 1332(d)(7).

Here, although the Complaint pleads that the named plaintiff is a "resident"³ of Pennsylvania, the Complaint itself states that members of the proposed plaintiff class are "consumers throughout the United States who have purchased one or more of" the products at issue and amounts to "thousands if not millions of members." Id.¶¶ 1, 56, 60. By contrast, Defendant is incorporated and has its principal place of business in Pennsylvania. Daryl Thomas aff. ¶¶ 21-23, Notice of Removal Ex. C. Therefore, the Court concludes that at least one member of the putative class is diverse from Defendant.

Third, the Complaint alleges that there are "thousands if not millions of members." Compl. ¶ 60; see Judon, 773 F.3d at 505 ("Because [the plaintiff] explicitly asserted in her complaint that there are ‘hundreds of members,’ [the defendant] was entitled to rely on this fact as an admission in favor of jurisdiction."). Therefore, the requirement that the class be composed of at least 100 members is satisfied.

Once CAFA's jurisdictional requirements are established by the party asserting federal jurisdiction—Defendant, in this case, due to removal—the burden shifts to the opponent—Plaintiff, in this case—to prove an exception to jurisdiction. Kaufman, 561 F.3d at 154. Plaintiff does not oppose or otherwise address Defendant's removal pursuant to CAFA. Therefore, now satisfied that federal subject matter jurisdiction exists, the Court proceeds to analyze the substance of Defendants' motion.

III. MOTION TO DISMISS

The Court first addresses Defendant's motion to dismiss Plaintiff's UTPCPL, fraudulent misrepresentation, negligent misrepresentation, breach of contract, unjust enrichment, and injunctive relief claims.

A. Legal Standard

A party may move to dismiss a complaint for failure to state a claim upon which relief can be granted.

Fed. R. Civ. P. 12(b)(6). When considering such a motion, the Court must "accept as true all allegations in the complaint and all reasonable inferences that can be drawn therefrom, and view them in the light most favorable to the non-moving party." DeBenedictis v. Merrill Lynch & Co., 492 F.3d 209, 215 (3d Cir.2007) (internal quotation marks removed). To withstand a motion to dismiss, the complaint's "[f]actual allegations must be enough to raise a right to relief above the speculative level." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). This "requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do."Id. Although a plaintiff is entitled to all reasonable inferences from the facts alleged, a plaintiff's legal conclusions are not entitled to deference and the Court is "not bound to accept as true a legal conclusion couched as a factual allegation." Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986).

The pleadings must contain sufficient factual allegations so as to state a facially plausible claim for relief. See, e.g., Gelman v. State Farm Mut. Auto. Ins. Co., 583 F.3d 187, 190 (3d Cir.2009). " ‘A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.’ " Id.(quoting Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) ). In deciding a Rule 12(b)(6) motion, the Court limits its inquiry to the facts alleged in the complaint and its attachments, matters of public record, and undisputedly authentic documents if the complainant's claims are based upon these documents. See Jordan v. Fox, Rothschild, O'Brien & Frankel, 20 F.3d 1250, 1261 (3d Cir.1994) ; Pension Benefit Guar. Corp. v. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir.1993).

B. Discussion

Defendant moves to dismiss various claims on the...