Won Kyung Hwang v. Ohso Clean, Inc.
| Decision Date | 16 April 2013 |
| Docket Number | Case No. C-12-06355 JCS |
| Parties | WON KYUNG HWANG, Plaintiff, v. OHSO CLEAN, INC., et al., Defendants. |
| Court | U.S. District Court — Northern District of California |
Plaintiff Won Kyung Hwang brings this purported class action on behalf of a nationwide class of consumers who have purchased Defendants' CleanWell sanitizing products alleging that statements about the efficacy of these products on their labels are untrue and/or misleading. In her First Amended Complaint, Plaintiff asserts six claims under California's consumer protection laws and a claim under the federal Magnuson Moss Act. Defendants Ohso Clean, Inc. and Cleanwell Company (hereinafter, referred to collectively as "Defendants" or "CleanWell") bring a Motion to Dismiss First Amended Complaint ("Motion to Dismiss") seeking dismissal of Plaintiff's claims on the basis that they are preempted under the Federal Food Drug and Cosmetic Act ("FDCA"), and that they fail on a number of other grounds as well. Defendants also bring a Motion to Strike asking the Court to strike what they contend are improper class allegations and improper allegations relating to punitive damages and non-restitutionary monetary loss. A hearing on the Motions was held of Friday, March 22, 2013 at 9:30 a.m. For the reasons stated below, the Motion to Dismiss is DENIED. The Motion to Strike is GRANTED in part and DENIED in part.1
In the First Amended Complaint ("FAC"), Plaintiff alleges that Defendants market and sell sanitizing products nationwide. FAC ¶¶10, 11. According to Plaintiff, Defendants' product line includes foaming hand sanitizer, hand sanitizer spray, hand sanitizing wipes, and antibacterial foaming hand soap products ("Sanitizing Products"). FAC ¶1 Plaintiff alleges that until "sometime after July of 2012," Defendants prominently represented on the labels of their products that they: (1) "[k]ill[] 99.9% of germs naturally," (2) "kill 99.99% of germs including MRSA, Salmonella, Staph, and E.coli," (3) "kill 99.9% of the harmful germs that can make you sick," and (4) "Sanitize hands when you can't wash with soap and water." FAC ¶¶14, 23. Plaintiff further alleges that these claims are unfair and fraudulent and constitute "unfair, deceptive, untrue or misleading advertising." FAC ¶ 16. Plaintiff alleges that she and other reasonable consumers must and do reasonably rely on "companies such as Defendants to honestly state the nature of the products' qualities and ingredients." FAC ¶17. Additionally, Plaintiff alleges that Defendants made and endorsed these misrepresentations, despite the fact that they knew or should have known their falsity. FAC ¶18. Plaintiff alleges that Defendants "suppressed the material facts that Defendants' Sanitizing Products do not effectively perform as represented . . . with the intent to reap the financial windfall from the sale of Defendants' Sanitizing Products that do not effectively perform as represented." FAC ¶¶50, 51. Plaintiff alleges that had she and the purported class members "known the Defendants' assertion was untrue, [they] would not have purchased Defendants' Sanitizing Products." FAC ¶45.
Plaintiff asserts the following claims on the basis of these factual allegations: 1) Breach of Express Warranty, Cal. Com. Code § 2313; 2) Deceit, Cal. Civ. Code § 1710(2); 3) Concealment, Cal. Civ. Code § 1710(3); 4) False Advertising Law ("FAL"), Cal Bus. & Prof. Code §§ 17500, et seq.; 5) Unfair Competition Law ("UCL"), Cal. Bus. & Prof. Code §§ 17200, et seq.; 5) Consumers Legal Remedies Act ("CLRA"), Cal. Civ. Code §§ 1750, et seq.; and 6) Magnuson Moss Act, 15 U.S.C. §§ 22301, et seq.
In their Motion to Dismiss, Defendants contend that all of Plaintiff's claims are preempted under the FDCA, either expressly or under the doctrine of implied preemption. Motion to Dismiss at 8-12. Express preemption applies, according to Defendants, because the FDCA gives the Food and Drug Administration ("FDA") comprehensive regulatory authority for Over-the-Counter ("OTC") Topical Antimicrobial products, such as hand sanitizers and antimicrobial soaps. Id. at 8 (citing 21 C.F.R. §§ 201 et seq. and 21 U.S.C. §§ 321 et seq, 21 U.S.C. §352). Further, Defendants assert that "hand sanitizers and antimicrobial hand washes are considered by the FDA as 'drugs' and are regulated by the FDA under the 1994 Tentative Final Monograph ("TFM") . . . and, inter alia, 21 U.S.C. §352 [Misbranded Drugs and Devices]." Id. ().2 Because the FDCA contains an express preemption clause, Defendants assert, Plaintiff's claims are preempted. Id. at 9 ().
In the alternative, Defendants assert, Plaintiff's claims are impliedly preempted under the doctrine of field preemption because Congress and the FDA have "promulgated a vast body offederal law regulating the food, drug and cosmetic industry, especially with regard to labeling of antimicrobial products." Id. at 11 (). According to Defendants, these laws and regulations reflect an intent to "occupy the entire field of antimicrobial product labeling regulation," thus preempting state law claims based on alleged deceptive labeling of antimicrobial products. Id.
Defendants assert that the Ninth Circuit's decision in POM Wonderful LLC v. Coca-Cola Co., 679 F.3d 1170 (9th Cir. 2012) is applicable here; in that case, the court found that the plaintiff's Lanham Act claim that defendant's juice product label was misleading was barred by the FDCA and the regulations promulgated thereunder by the FDA, because those regulations indicated that the FDA had already "considered and spoken to what content a label must bear" and had apparently authorized the defendant's labeling. Defendants argue that the same can be said here, pointing to the letter sent by the FDA dated July 19, 2012, stating that Defendants had "addressed the violation(s)" contained in its earlier Warning Letter. Id. at 11-12 ().
Defendants argue that Plaintiff's claims also fail for the following reasons:
1) Rule 8 of the Federal Rules of Civil Procedure: According to the allegations in the FAC, the testing cited by Plaintiff measured the percentage of germs killed by Defendants' products in thirty seconds whereas the allegedly misleading statements on the labels contained no such time limitation, rendering the allegation that the statements on the product labels were misleading implausible. Id. at 12-14 (citing FAC ¶ 21). Therefore, Defendants assert, Plaintiff's allegations do not satisfy the pleading requirements of Rule 8 of the Federal Rules of Civil Procedure under Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009). Id. at 2-3, 12-14. Defendants cite to Rosen v. Unilever United States, Inc., 2010 WL 4807100 (N.D. Cal., May 3, 2010) as instructive example in which the court found the plaintiffs' claims implausible.
2) Allegations relating to materiality: Defendants contend that even assuming the results of the testing cited in the FAC are accurate as to the efficacy of their products, Plaintiff has failed toallege any facts that would establish that a reasonable consumer would consider the discrepancies between the statements on the labels and the actual percentage of germs killed by Defendants' products to be material. Id. at 3, 14-16. According to Defendants, liability on Plaintiff's UCL, FAC and CLRA claims can be established only if the misrepresentation contained within an allegedly misleading advertisement would be found material by a reasonable consumer. Id. at 15 (citing Williams v. Gerber Products Co., 552 F.3d 934, 938 (9th Cir. 2008); Glenn K. Jackson Inc. v. Roe, 273 F.3d 1192, 1201 n. 2(9th Cir. 2001)). To meet this standard, Defendants assert, Plaintiff must allege that "a significant portion of the general consuming public or of targeted consumers, acting reasonably under the circumstances could be misled," id. at 16 (citing Lavie v. Procter & Gamble Co., 105 Cal. App. 4th 496, 512 (2003)), or that the alleged misrepresentation would "play a substantial part" in the reasonable consumer's decision to purchase the product. Id. (citing Ross v. Sioux Honey Assoc, 2013 U.S. Dist. LEXIS 6181, *49 (N.D. Cal. January 14, 2013)).
3) Allegations relating to reliance: Defendants argue that Plaintiff's UCL, false advertising, CLRA, fraud and warranty claims fail for the additional reason that Plaintiff has not alleged any facts showing that she actually relied on the misstatements. Id. at 4-5, 16-19. According to Defendants, the only allegation in the FAC as to reliance is in Paragraph 19, which states, "[h]ad Plaintiff known that there was insufficient evidence to support these claims, she would not have purchased the product." Id. at 4 (citing FAC ¶ 19). This amounts to a failure to substantiate claim, Defendants assert, which cannot be brought by private individuals but rather, can only be asserted by the Federal Government. Id. Defendants contend that Plaintiff does not...
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