Zeiger v. Wellpet LLC

• Decision Date: 17 January 2018
• Docket Number: Case No. 17–cv–04056–WHO
• Citation: 304 F.Supp.3d 837
• Parties: Daniel ZEIGER, et al., Plaintiffs, v. WELLPET LLC, et al., Defendants.
• Court: U.S. District Court — Northern District of California

304 F.Supp.3d 837

Daniel ZEIGER, et al., Plaintiffs,

v.WELLPET LLC, et al., Defendants.

Case No. 17–cv–04056–WHO

United States District Court, N.D. California.

Signed January 17, 2018

Gina Stassi, Robbins Arroyo LLP, Burlingame, CA, Joseph C. Bourne, Catherine Sung–Yun K. Smith, Daniel E. Gustafson, Daniel Jay Nordin, Raina Challeen Borrelli, Gustafson Gluek, PLLC, Rebecca Anne Peterson, Robert K. Shelquist, Lockridge Grindal Nauen P.L.L.P., Minneapolis, MN, Steven M. McKany, Ashley Rawlins Rifkin, Kevin Andrew Seely, Brian J. Robbins, Robbins Arroyo LLP, San Diego, CA, Charles J. LaDuca, Katherine Van Dyck, Cuneo Gilbert & LaDuca, LLP, Washington, DC, for Plaintiffs.

Amir M. Nassihi, Shook Hardy & Bacon L.L.P., San Francisco, CA, Ashley Rawlins Rifkin, Kevin Andrew Seely, Robbins Arroyo LLP, San Diego, CA, Elizabeth Anne Fessler, James P. Muehlberger, Shook, Hardy & Bacon, LLP, Kansas City, MO, Joan Alexis Rabutaso Camagong, San Francisco, CA, Paul B. LaScala, Shook, Hardy Bacon L.L.P., Irvine, CA, for Defendants.

ORDER GRANTING IN PART AND DENYING IN PART MOTION TO DISMISS

Re: Dkt. No. 34

William H. Orrick, United States District Judge

INTRODUCTION

Plaintiffs Daniel Zeiger, Danz Doggie Daytrips ("Danz"), and Amy Freeborn allege that WellPet LLC ("WellPet") and its parent company Berwind Corporation ("Berwind," and collectively with WellPet, "defendants") manufacture, market, and sell certain dog food products that are contaminated with the toxins arsenic and lead, and the chemical Bisphenol A ("BPA"). Plaintiffs allege that defendants knowingly, recklessly, or negligently sold these contaminated products without disclosing their presence on the labels, which make certain health claims and safety assurances. They now bring suit on behalf of themselves, a nationwide class, and a California subclass for negligent misrepresentation, violations of California's Consumer Legal Remedies Act ("CLRA"), violations of California's False Advertising Law ("FAL"), violations of California's Unfair Competition Law ("UCL"), breach of express and implied warranty, and violation of California Health and Safety Code Section 113095. Defendants move to dismiss all claims against them on several grounds. For the foregoing reasons, I GRANT IN PART and DENY IN PART Defendants' motion.

BACKGROUND

WellPet is a subsidiary of Berwind. Amended Complaint ("Am. Compl.") [Dkt. No. 33] ¶ 29. WellPet manufactures, markets, and sells certain dog food products, including Wellness CORE Adult Dry Ocean Whitefish, Herring Meal and Salmon Meal ("CORE Ocean") and Wellness Complete Health Adult Dry Whitefish and Sweet Potato (collectively, the "Products"). Id. ¶ 2. The Products contain "material and significant levels of arsenic and lead," "known dangerous toxins for both humans and animals, including dogs." Id. The CORE Ocean product also contains "material and significant levels of BPA," "an industrial chemical that is an endocrine disruptor" and "has been linked to various health issues, including reproductive disorders, heart disease, diabetes, cancer, and neurological problems." Id. ¶ 15.

Plaintiffs allege that defendants knew or should have known of the presence of these contaminants, but the Products do not contain any warning label or disclose the presence of these contaminants. Am. Compl. ¶¶ 9, 38–39, 53. Instead, the Products' labels contain various health claims and promises, such as "Unrivaled Quality Standards," "Optimal Health" "with Nothing in Excess and Everything in Balance," and "natural, safe and pure." Id. ¶¶ 10–11, 20. Defendants' website also makes certain quality assurance representations. Id. ¶¶ 17–19.

Plaintiff Zeiger, a citizen of California, began purchasing the Products for his pet dog in or around October 2014, and continued to purchase them monthly until approximately July 2017 when he discovered that the food was contaminated. Am. Compl. ¶ 25. Zeiger alleges that he saw defendants' false and misleading nutritional claims and marketing materials, and relied on them in deciding to purchase the Products. Id. ¶¶ 25, 50–52. He was unaware that the Products contained any level of lead, arsenic, or BPA, and would not have purchased the Products if their presence had been disclosed. Id. ¶ 25.

Plaintiff Danz, a citizen of California, is a dog sitting business that used the Products as one of the primary foods for its clients' dogs. Am. Compl. ¶ 26. It purchased the Products approximately monthly from October 2014 to July 2017, when it discovered that the Products were contaminated. Id. It bought the Products in reliance on the false and misleading claims and marketing materials, and would not have purchased them had the presence of lead, arsenic, or BPA been disclosed. Id. ¶¶ 26, 50–52. Similarly, Freeborn is also a citizen of California, who purchased the Products approximately monthly from January 2010 to July 2017 when she too discovered that the Products were contaminated. Id. ¶ 27. She alleges that in reliance on defendants' false and misleading claims and marketing materials, she was unaware that the Products contained any level of lead, arsenic, or BPA, and would not have purchased the Products had that been disclosed. Id. ¶¶ 27, 50–52.

Plaintiffs each allege that they were economically injured when they paid the purchase price or a price premium for the Products, assuming "that it was healthy, clean, and safe for dogs to ingest, as well as natural and pure." Am. Compl. ¶ 28. They would not have paid this money had they known of the presence of the contaminants. Id. They do not allege any physical injuries. They now bring suit individually and on behalf of two nationwide classes and two California subclasses, one for the Products collectively and another for CORE Ocean only, asserting several claims under California law.

LEGAL STANDARD

I. Rule 12(b)(1): Subject Matter Jurisdiction

Under Federal Rule of Procedure 12(b)(1), a district court must dismiss a complaint if it lacks subject matter jurisdiction to hear the claims alleged in the complaint. Fed. R. Civ. P. 12(b)(1). "Standing is a threshold matter central to our subject matter jurisdiction." Bates v. United Parcel Serv., Inc. , 511 F.3d 974, 985 (9th Cir. 2007). "The Supreme Court has made clear that when considering whether a plaintiff has Article III standing, a federal court must assume arguendo the merits of his or her legal claim." Lorenz v. Safeway, Inc. , 241 F.Supp.3d 1005, 1014 (N.D. Cal. 2017).

II. Rule 12(b)(2) : Personal Jurisdiction

A district court must also dismiss any defendant over which it lacks personal jurisdiction. Fed. R. Civ. P. 12(b)(2). "In opposition to a defendant's motion to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of establishing that jurisdiction is proper." Boschetto v. Hansing , 539 F.3d 1011, 1015 (9th Cir. 2008). Absent an evidentiary hearing, plaintiffs need only make a prima facie showing of jurisdictional facts. Id. Uncontroverted allegations in the pleadings must be taken as true. See AT & T v. Compagnie Bruxelles Lambert , 94 F.3d 586, 588 (9th Cir. 1996). However, the court "may not assume the truth of allegations in a pleading which are contradicted by affidavit." Data Disc, Inc. v. Sys. Tech. Assocs., Inc. , 557 F.2d 1280, 1284 (9th Cir. 1977).

III. Rule 12(b)(6) : Failure to State a Claim

Under Federal Rule of Procedure 12(b)(6), a district court must dismiss a complaint if it fails to state a claim upon which relief can be granted. To survive a Rule 12(b)(6) motion to dismiss, the plaintiff must allege "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). A claim is facially plausible when the plaintiff pleads facts that "allow[ ] the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citation omitted). There must be "more than a sheer possibility that a defendant has acted unlawfully." Id. While courts do not require "heightened fact pleading of specifics," a plaintiff must allege facts sufficient to "raise a right to relief above the speculative level." Twombly , 550 U.S. at 555, 570, 127 S.Ct. 1955.

In deciding whether the plaintiff has stated a claim upon which relief can be granted, the court accepts the plaintiff's allegations as true and draws all reasonable inferences in favor of the plaintiff. See Usher v. City of Los Angeles , 828 F.2d 556, 561 (9th Cir. 1987). However, the court is not required to accept as true "allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences." In re Gilead Scis. Sec. Litig. , 536 F.3d 1049, 1055 (9th Cir. 2008).

If the court dismisses a complaint, it "should grant leave to amend even if no request to amend the pleading was made, unless it determines that the pleading could not possibly be cured by the allegation of other facts." Lopez v. Smith , 203 F.3d 1122, 1127 (9th Cir. 2000). In making this determination, the court should consider factors such as "the presence or absence of undue delay, bad faith, dilatory motive, repeated failure to cure deficiencies by previous amendments, undue prejudice to the opposing party and futility of the proposed amendment." See Moore v. Kayport Package Express , 885 F.2d 531, 538 (9th Cir. 1989).

IV. Rule 9(b): Heightened Pleading for Fraud Claims

Claims sounding in fraud or mistake are subject to the heightened pleading standard of Federal Rule of Civil Procedure 9(b), which requires that such claims "state with particularity the circumstances constituting fraud or mistake," Fed. R. Civ. P. 9(b), including "the who, what, when, where, and how of the misconduct charged." Vess v. Ciba–Geigy Corp. USA , 317 F.3d 1097, 1106 (9th Cir. 2003) (internal quotation marks and citation omitted). "The plaintiff must set forth what is false or misleading about a statement, and...