MARGARET M. MORROW, District Judge.
In November and December 2011, the court consolidated several cases filed against defendant ConAgra Foods, Inc. under the above caption.
Plaintiffs allege that from at least June 27, 2007 through the present, ConAgra deceptively and misleading marketed its Wesson brand cooking oils as "100% Natural," when in fact Wesson Oils are made from unnatural, genetically-modified organisms ("GMO").
Plaintiffs' complaint contains allegations concerning different plaintiffs' history of purchasing Wesson Oil. While there is some variation among plaintiffs, the complaint generally asserts that each plaintiff saw that Wesson Oils were marketed as "100% Natural," purchased the product because of the representation, and would not have purchased it but for the representation.
A Rule 12(b)(6) motion tests the legal sufficiency of the claims asserted in the complaint. A Rule 12(b)(6) dismissal is proper only where there is either a "lack of a cognizable legal theory," or "the absence of sufficient facts alleged under a cognizable legal theory." Balistreri v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir.1988). The court must accept all factual allegations pleaded in the complaint as true, and construe them and draw all reasonable inferences from them in favor of the nonmoving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th Cir.1996); Mier v. Owens, 57 F.3d 747, 750 (9th Cir.1995).
The court need not, however, accept as true unreasonable inferences or legal conclusions cast in the form of factual allegations. See Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 553-56, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ("While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the `grounds' of his `entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do"). Thus, a plaintiff's complaint must "contain sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.' ... 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." Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009); see also Twombly, 550 U.S. at 545, 127 S.Ct. 1955 ("Factual allegations must be enough to raise a right to relief above the speculative level, on the assumption that all the allegations in the complaint are true (even if doubtful in fact)" (citations omitted)); Moss v. United States Secret Service, 572 F.3d 962, 969 (9th Cir.2009) ("[F]or a complaint to survive a motion to dismiss, the non-conclusory `factual content,' and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief," citing Iqbal and Twombly). The manner in which the court should assess the adequacy and plausibility of a plaintiff's allegations is described in Telesaurus VPC, LLC v. Power, 623 F.3d 998 (9th Cir.2010). There, the court stated:
Rule 9(b) requires that, "[i]n all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with particularity." FED.R.CIV. PROC. 9(b); see also 5A Charles A. Wright & Arthur W. Miller, FEDERAL PRACTICE AND PROCEDURE § 1297 (2006) ("[Rule 9(b)] is a special pleading requirement [that is] contrary to the general approach of the `short and plain,' simplified pleading adopted by the federal rules ..."). "To avoid dismissal for inadequacy under Rule 9(b)," a "complaint [must] `state the time, place, and specific content of the false representations as well as the identities of the parties to the misrepresentation.'" Edwards v. Marin Park, Inc., 356 F.3d 1058, 1066 (9th Cir.2004) (quoting Alan Neuman Prods., Inc. v. Albright, 862 F.2d 1388, 1393 (9th Cir.1988), and Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir.1986)); see also In re GlenFed Securities Litigation, 42 F.3d 1541, 1548 (9th Cir.1994) (en banc). Conclusory allegations are insufficient, and the facts constituting the fraud must be alleged with specificity. See Moore v. Kayport Package Exp., Inc., 885 F.2d 531, 540 (9th Cir.1989) ("A pleading is sufficient under Rule 9(b) if it identifies the circumstances constituting fraud so that a defendant can prepare an adequate answer to the allegations. While statements of the time, place and nature of the alleged fraudulent activities are sufficient, mere conclusory allegations of fraud are insufficient" (citation omitted)); see also Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir.1997) (to satisfy Rule 9(b), "the complaint [must] identif[y] the circumstances of the alleged fraud so that defendants can prepare an adequate answer" (internal quotation marks omitted)).
"It is well-settled that the Federal Rules of Civil Procedure apply in federal court, `irrespective of the source of the subject matter jurisdiction, and irrespective of whether the substantive law at issue is state or federal.'" Kearns v. Ford Motor Co., 567 F.3d 1120, 1125 (9th Cir.2009) (quoting Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1102 (9th Cir.2003)). Consequently, Rule 9(b) appliers to plaintiffs' state law misrepresentation claims, as well as their federal claim. Plaintiffs do not dispute that Rule 9(b), rather than the more lenient requirements of Rule 8, govern their claims.
ConAgra argues that the consolidated complaint fails to meet the particularity requirement of Rule 9(b). It notes that only two of the 21 plaintiffs allege the location at which they purchased Wesson Oil.
Plaintiffs counter that the consolidated complaint pleads sufficient information to put ConAgra on notice of its allegedly wrongful conduct, and that the additional detail ConAgra demands "would do nothing to enhance Defendant's ability to answer the allegations in the Amended Complaint, i.e., [fulfill] the purpose of Rule 9(b)'s heightened pleading requirements."
As noted, to satisfy Rule 9(b), a complaint must plead "`the who, what, when, where, and how' of the misconduct charged," Vess, 317 F.3d at 1106 (quoting Cooper, 137 F.3d at 627), and further must "set forth what is false or misleading about a statement, and why it is false," GlenFed, 42 F.3d at 1548. Kearns provides an illuminating example of what is required to comply with this pleading requirement. There, plaintiff asserted that Ford made false and misleading statements concerning the safety and reliability of its certified pre-owned vehicles. Specifically, he alleged that Ford misrepresented the quality of the vehicles' complete repair and accident-history report, the level of training that inspecting technicians received, and the rigor of the certification process. Kearns, 567 F.3d at 1123. Plaintiff contended that members of the putative class he sought to represent were exposed to Ford's representations through televised national marketing campaign, sales materials at the dealerships where they bought certified pre-owned vehicles, and the statements of sales personnel working at the dealership. Id. at 1125-26. The Ninth Circuit, reviewing the complaint de novo, held that the allegations were not pled with the particularity required by Rule 9(b). It stated:
Plaintiffs argue that they have satisfied the requirement of stating "where" ConAgra made misrepresentations because the complaint alleges where the "100% Natural" claim appears on the Wesson Oil packaging. They contend it is unnecessary for every plaintiff to state where he or she purchased the product.
The court agrees with plaintiffs that Rule 9(b) does not require that they allege the specific store in which they purchased Wesson Oils, particularly because they may not have observed and relied on the representation on the product's labeling at precisely that time.
Similarly, while ConAgra asserts that plaintiffs must plead the dates on which they purchased Wesson Oils, Kearns suggests that the relevant "when" is either when the allegedly misleading statement was made or when it was viewed or heard by the plaintiff, not when it resulted in a purchase. Kearns, 567 F.3d at 1126 (stating that Kearns had failed to allege "when he was exposed to [the misleading advertisements]" or when an allegedly misleading statement about the vehicle's rigorous inspection "was made").
The complaint asserts that the "100% Natural" representation appeared on product labeling and in marketing of the products throughout the class period.
ConAgra argues finally that the complaint is not sufficiently specific because plaintiffs do not allege how they were misled.
For the reasons stated, the court cannot conclude the complaint as a whole lacks the particularity required by Rule 9(b). It therefore turns to the deficiencies ConAgra contends exist in individual causes of action.
In the face of ConAgra's arguments for dismissal, plaintiffs agree that their first cause of action, alleging violation of the Magnusson-Moss Warranty Act, 15 U.S.C. § 2301, et seq., should be dismissed in its entirety.
The Magnuson-Moss Warranty Act ("Magnuson-Moss Act"), codified at 15 U.S.C. §§ 2301-2312, et seq., provides that a consumer may assert a civil cause of action to enforce the terms of an implied or express warranty. 15 U.S.C. § 2310(d) provides that any "consumer who is damaged by the failure of a supplier, warrantor, or service contractor to comply with any obligation under this chapter, or under a written warranty, implied warranty, or service contract" may sue for damages and other legal and equitable relief.
Plaintiffs allege that ConAgra violated a "written warranty."
The statement that Wesson Oil is "100% Natural" is not an assertion that the product is defect free or that it will meet a specific level of performance over a specified period of time. Nor is it a promise to take any remedial action. Courts have declined to extend the term "written warranty" beyond its statutory definition. See Semitekol v. Monaco Coach Corp., 582 F.Supp.2d 1009, 1027 (N.D.Ill.2008) (a promise to install "patriot style" mirrors in a motor home is not a written warranty); Kelley v. Microsoft Corp., No. C07-0475MJP, 2007 WL 2600841, *3-5 (W.D.Wash. Sept. 10, 2007) (a statement that a computer is "Windows Vista Capable" is not a written warranty); In re Sears, Roebuck & Co. Tools Mktg. and Sales Practices Litig., No. MDL-1703, 05 C 4742, 05 C 2623, 2006 WL 1443737, *4 (N.D.Ill. May 17, 2006) (the phrase "Made in USA" does not constitute a written warranty). Consequently, plaintiffs' allegations are insufficient to establish a violation of the written warranty provisions of the act.
The statutory definition of "implied warranty" is broader, however, and applies to "an implied warranty arising under State law ... in connection with the sale by a supplier of a consumer product." 15 U.S.C. § 2301(7). As courts have concluded, the statute provides a federal cause of action for state law implied warranty claims. In re Sony Grand Wega, 758 F.Supp.2d 1077, 1101 (S.D.Cal.2010); see also Schimmer v. Jaguar Cars, Inc., 384 F.3d 402, 405 (7th Cir.2004) (noting that Magnuson-Moss borrows state law causes of action). While plaintiffs have not alleged that implied warranties that attached to Wesson Oils violated the act, the court cannot conclude that such a claim would be futile, particularly given plaintiffs' allegations concerning implied warranties elsewhere in the complaint. Consequently, the court grants leave to amend.
ConAgra next seeks dismissal of plaintiffs' second cause of action for violation of Nebraska's Consumer Protection Act. The act generally provides that "[u]nfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce shall be unlawful." NEB.REV.STAT. § 59-1602. ConAgra asserts the act does not apply to regulated industries, citing a provision of the statute, which states that "the Consumer Protection Act shall not apply to actions or transactions otherwise permitted, prohibited, or regulated under laws administered by the Director of Insurance, the Public Service Commission, the Federal Energy Regulatory Commission, or any other regulatory body or officer acting under statutory authority of this state or the United States." NEB.REV.STAT. § 59-1617(1).
In analyzing the exemption set forth in § 59-1617(1), Nebraska courts have concluded that the relevant question is not whether the defendant is generally regulated, see Kuntzelman v. Avco Financial Services of Nebraska, Inc., 206 Neb. 130, 133-35, 291 N.W.2d 705 (Neb.1980) (noting the argument that a different construction "would render nugatory the Act, as virtually every phase of a person's life is regulated by one or more state bodies"), but whether the challenged practice is regulated, Wrede v. Exchange Bank of Gibbon, 247 Neb. 907, 915, 531 N.W.2d 523 (1995) ("The teaching of Kuntzelman is that while particular conduct is not immunized from the operation of the Consumer Protection Act merely because the actor comes within the jurisdiction of some regulatory body, immunity does arise if the conduct itself is also regulated"); see also id. at 916, 531 N.W.2d 523 ("Here, not only was the Bank of Gibbon heavily regulated by the state, but the form of certificate used was at least indirectly approved by virtue of the authority of the state, through the director of the Department of Banking and Finance, to constructively aid banks in maintaining proper banking standards and efficiency. Because issuance of the certificate was exempted from the purview of the Consumer Protection Act, the district court, if for no other reason, correctly determined that there had been no violation of the act" (citation omitted)); Hydroflo Corp. v. First Nat. Bank of Omaha, 217 Neb. 20, 33, 349 N.W.2d 615 (1984) ("Under the provisions of §§ 8-102 and 8-103 the Department of Banking and Finance is given broad authority over proper banking standards, and since the requirements for opening corporate accounts are governed by banking standards indirectly approved by the Department of Banking and Finance, the practice of opening accounts is excluded from the terms of the Consumer Protection Act, §§ 59-1601 et seq. The dismissal of this cause of action was correct"); McCaul v. American Sav. Co., 213 Neb. 841, 847, 331 N.W.2d 795 (Neb.1983) ("The records in the cases now before us establish that each of the loans involved here was reported to and at least indirectly approved by the Department of Banking and Finance. Under the provisions of § 59-1617 an installment loan by an industrial loan and investment company, regulated by the Nebraska Department of Banking and Finance, is exempt from the Consumer Protection Act, §§ 59-1601 et seq."); Kuntzelman, 206 Neb. at 135-36, 291 N.W.2d 705 ("This case involved a loan made by a licensed installment loan company. Such companies are strictly regulated by the Department of Banking and Finance under the terms of
In this case, it is clear that the ConAgra's challenged labeling and advertising is already regulated by a body acting under the authority of the United States: the Food and Drug Administration. In 1938, Congress passed the Food, Drug, and Cosmetics Act ("FDCA") as a successor to the 1906 Pure Food and Drugs Act, which was the first comprehensive federal legislation designed to protect consumers from fraud or misrepresentation in the sale of food and drugs. See James T. O'Reilly, FOOD AND DRUG ADMINISTRATION § 3:1-13 (3d ed.2009). The FDCA expressly empowers the FDA (a) to protect the public health by ensuring that "foods are safe, wholesome, sanitary, and properly labeled," 21 U.S.C. § 393(b)(2)(A). The FDCA deems a food "misbranded" if its labeling "is false or misleading in any particular." 21 U.S.C. § 343(a). The FDA has promulgated extensive regulations about the proper labeling of food. See, e.g., 21 C.F.R § 101.4 (designation of ingredients on food packaging); 21 C.F.R § 101.9 (labeling and advertising of nutrition information); 21 C.F.R § 101.13 (limits on claims that can be made about the nutritional content of food, such as labeling a product "low sodium"); 21 C.F.R § 101.14 (health claims). Indeed, as ConAgra notes,
While, as explained in the court's order in Briseno,
As with plaintiffs' first cause of action, plaintiffs acknowledge that their claim under the Nebraska Uniform Deceptive Trade Practices Act, NEB.REV.STAT. § 87-301, should be dismissed. Once again, however, they seek leave to amend.
Each of plaintiffs' final four causes of action is, in reality, multiple claims. For example, plaintiffs' fourth cause of action — for violation of state consumer protection laws — asserts that ConAgra's conduct violated the consumer protection laws of 14 different states, which protect the named plaintiffs and proposed class members from those states.
ConAgra argues that this manner of pleading is impermissible.
The court recognizes that it is burdensome for ConAgra to respond to dozens of separate statutory claims based on the law of a host of jurisdictions. ConAgra, however, has neither requested additional pages to brief its motion to dismiss nor additional time to analyze the sufficiency of plaintiffs' numerous claims. The court is aware of no limit on the number of causes of action a plaintiff can assert in a single complaint, and sees no value in requiring plaintiffs to split their causes of action into dozens of additional claims, each based on the same factual allegations. A complaint that was structured in this way would not lessen the burden on defendant. As a result, the court will not dismiss plaintiffs' causes of action because they impermissibly commingle claims. It addresses ConAgra's arguments regarding various purported deficiencies in the claims below.
ConAgra argues that plaintiffs' consumer protection law claims based on New Jersey and Oregon law are deficient, since the statutes in those states provide that plaintiffs can assert such a claim only if they can plead "ascertainable loss."
Plaintiffs argue that they have alleged that they would not have purchased Wesson Oils had ConAgra not misrepresented that the product was "100% Natural," and that this satisfies the statutory requirement.
As the court explained in Hemy, plaintiffs' allegation is not sufficient under New Jersey law. The court there stated:
Plaintiffs have failed to quantify the difference between the value of the product they believed they were purchasing and the price of the product they purchased. They have similarly failed to quantify the difference between the price of the Wesson Oils and other products they might have purchased as substitutes. Absent such information, New Jersey courts have consistently held that a plaintiff has not adequately set forth an ascertainable loss. Smajlaj v. Campbell Soup Co., 782 F.Supp.2d 84, 101 (D.N.J.2011) ("Failure to quantify this difference in value results in the dismissal of a claim"); see also Green v. Green Mountain Coffee Roasters, Inc., 279 F.R.D. 275, 282 (D.N.J.2011) ("Green fails to allege how much he paid for his brewer and how much other comparable brewers manufactured by Defendants' competitors cost at the time of purchase"); Solo v. Bed Bath & Beyond, Inc., Civil No. 06-1908(SRC), 2007 WL 1237825, *3 (D.N.J. Apr. 26, 2007) ("Plaintiff is required to plead specific facts setting forth and defining the ascertainable loss suffered").
While there is little case law regarding "ascertainable loss" under Oregon's statute, the courts of that state have
Similarly, plaintiffs here have alleged that the product was not, as represented, "100% Natural," and that they would not have paid the price they paid absent this representation. Under Oregon law, these allegations are sufficient to survive a motion to dismiss.
ConAgra next argues that reliance is a required element of a consumer protection claim under the laws of at least five of the states whose statutes plaintiffs invoke — California, Oregon, South Dakota, Texas, and Wyoming.
ConAgra asserts that the consumer protection statutes of California, Massachusetts, Texas and Wyoming require that plaintiffs give a defendant notice of their intent to sue before they commence an action.
It read: `Plaintiff received her Notice of Right to Sue letter from the U.S. Equal Employment Opportunity Commission within 90 days before filing this action, and has otherwise fulfilled all conditions precedent to institution of this action.' This general statement from Myers was sufficient to discharge her duty under Rule 9 of the Federal Rules of Civil Procedure; U.S. E.E.O.C. v. Global Horizons, Inc., 860 F.Supp.2d 1172, 1180 (D.Haw.2012) ("In any event, even assuming that conciliation is a `condition precedent' to suit by the EEOC, the Court concludes that the allegations in the SAC are sufficient to satisfy this requirement. The SAC states that `efforts to conciliate the charges failed,' and that `all conditions precedent to the institution of this lawsuit have been fulfilled.' The EEOC need not specifically plead that conciliation efforts have failed when filing suit in a district court"); Barber v. City of Chattanooga, No. 1:08-cv-294, 2011 WL 1321392, *6 (E.D.Tenn. Apr. 1, 2011) (plaintiff satisfied the pleading requirements for alleging compliance with EEOC procedures by alleging that he "has duly complied with the requirements of Title VII, and has requested a right to sue from the EEOC, which will be provided upon receipt, and has otherwise performed all conditions precedent to the maintenance of this action"); Hamilton v. Geithner, 743 F.Supp.2d 1, 8 (D.D.C.2010) (notwithstanding Iqbal, plaintiff may assert in conclusory fashion that he "timely filed his formal charges of discrimination ... with [the] Equal Employment Opportunity [Commission]," and that "[t]he condition precedent to this suit has been satisfied," since such allegations fall under Rule 9(c)).
Consequently, plaintiffs' motion to dismiss on this ground must be denied. The court notes, however, ConAgra's assertion that it has attached "the sum total of notices it has received [from] plaintiffs" to its motion.
ConAgra next contends that the consumer protection statutes of New Jersey, Oregon, and Washington require that a plaintiff provide notice to the state attorney general at the time he or she files suit.
ConAgra also contends that, while plaintiffs challenge the sale of Wesson Oils over a four-year period,
ConAgra contends that plaintiffs' express warranty claims under Indiana, Oregon, South Dakota, Washington, and Wyoming law are defective, as plaintiffs have not complied with the prefiling notice requirements in those states.
ConAgra argues that reliance is an element of express warranty claims in California, Nebraska, Oregon, South Dakota, Texas, Washington, and Wyoming, and that plaintiffs have not adequately alleged reliance.
ConAgra argues that at least four of the states under whose statutes plaintiffs bring implied warranty claims — New York, Ohio, Oregon and Washington — require privity between plaintiff and defendant.
ConAgra also contends that plaintiffs' implied warranty claims are foreclosed under the law of New Jersey and Washington,
Plaintiffs have alleged that Wesson Oils do not conform to the representation on their labels that they are "100% Natural." This allegation plainly falls within the ambit of the statutes, and plaintiffs' claims cannot be dismissed on this basis as a result.
ConAgra contends that plaintiffs' breach of implied warranty claim under Colorado law is barred by that state' three-year statute of limitations on claims for breach of any contract for sale. COLO. REV.STAT. § 4-2-725(2).
ConAgra asserts that unjust enrichment is not an independent cause of action under the law of California, Texas, and Illinois and that the unjust enrichment claims of those states' plaintiffs must be dismissed.
Under California law, the elements of unjust enrichment are: (1) receipt of a benefit; and (2) unjust retention of the benefit at the expense of another. Lectrodryer v. SeoulBank, 77 Cal.App.4th 723, 726, 91 Cal.Rptr.2d 881 (2000). Some federal courts have noted that "California courts `appear to be split on whether unjust enrichment can be an independent claim or merely an equitable remedy.'" Baggett v. Hewlett-Packard Co., 582 F.Supp.2d 1261, 1270 (C.D.Cal.2007) (quoting Falk v. General Motors Corp., 496 F.Supp.2d 1088, 1099 (N.D.Cal.2007)). See also Ghirardo v. Antonioli, 14 Cal.4th 39, 50, 54, 57 Cal.Rptr.2d 687, 924 P.2d 996 (1996) (holding that a plaintiff was "entitled to seek relief under traditional equitable principles of unjust enrichment" where other remedies were unavailable and that a claim "`for payment of money' ... rest[ed] on a theory of unjust enrichment"); Melchior v. New Line Productions, Inc., 106 Cal.App.4th 779, 793, 131 Cal.Rptr.2d 347 (2003) ("The phrase `unjust enrichment' does not describe a theory of recovery, but an effect: the result of a failure to make restitution under circumstances where it is equitable to do so," quoting Lauriedale Assocs. Ltd. v. Wilson, 7 Cal.App.4th 1439, 1448, 9 Cal.Rptr.2d 774 (1992));
Most courts discussing the split in authority contrast Melchior and Ghirardo, conclude that they conflict, and resolve the conflict by limiting Ghirardo to its facts, i.e., to situations in which a party would be without a remedy if a cause of action for unjust enrichment were not recognized. The court does not believe that Ghirardo and Melchior are in conflict. In Ghirardo, a lender pled a common count "for payment of money" seeking to recover the amount still outstanding on a promissory note debt. Ghirardo, 14 Cal.4th at 54, 57 Cal.Rptr.2d 687, 924 P.2d 996. The California Supreme Court held that the lender could pursue the common count, which "rest[ed] on a theory of unjust enrichment." Id. Ghirardo thus holds that a plaintiff may obtain relief premised on a theory of unjust enrichment by pleading a common count for the payment of money. It does not address whether a plaintiff may plead unjust enrichment as a distinct cause of action. See Webster v. Allstate Insurance Co., No. B211390, 2010 WL 60642, *7 (Cal.App. Jan. 11, 2010) ("The court ... did not hold that unjust enrichment was an independent cause of action, separate and apart from the common count.")
Although they have reached the result by resolving what they perceive to be a conflict between Ghirardo and Melchior, federal courts have consistently followed Melchior and held that California law does not recognize a cause of action for unjust enrichment, so long as another cause of action is available that permits restitutionary damages. In Falk, 496 F.Supp.2d at 1099, Judge William Alsup considered a case similar to this one. The plaintiff had alleged claims for (1) violation of the CLRA; (2) violation of the UCL; (3) fraud by omission; and (4) unjust enrichment. The court denied a motion to dismiss the first three claims. Citing California's case law regarding unjust enrichment, however, it dismissed plaintiff's fourth claim. Id. at 1100. The court reasoned that the sole remedies available to plaintiff were those it was entitled to seek under the first three causes of action. Id. at 1099. As a result, it stated, "there [was] no occasion for resort to unjust enrichment." Id.
Judge Andrew Guilford of this district reached a similar conclusion in Baggett, applying Melchior, and finding that where claims remained that enabled a plaintiff to obtain restitutionary relief, "the unjust enrichment claim ... add[ed] nothing...." Baggett 582 F.Supp.2d at 1271. See also Walker v. Equity 1 Lenders Group, No. 09cv325 WQH (AJB), 2009 WL 1364430, *9 (S.D.Cal. May 14, 2009) ("There is no cause of action in California for unjust enrichment.... Unjust enrichment is typically sought in connection with a `quasi-contractual' claim in order to avoid unjustly conferring a benefit upon a defendant where there is no valid contract"); Swanson v. USProtect Corp., No. C 05-602 JF (HRL), 2007 WL 1394485, *5 (N.D.Cal. May 10, 2007) ("There is no cause of action in California for unjust enrichment.... Unjust enrichment is a general principle, underlying various legal doctrines and remedies, rather than a remedy itself").
The court agrees that under California law, a cause of action for unjust enrichment is not cognizable. Rather, unjust enrichment is a theory that permits recovery on other recognized causes of action, including plaintiffs' UCL and CLRA claims. The court therefore dismisses plaintiff's unjust enrichment claim under California law with prejudice. This conclusion does not preclude plaintiffs from seeking restitution under the consumer protection statutes on the ground that ConAgra was unjustly enriched, however.
There is much the same split in authority among Texas courts as there is in California. A number of Texas courts have concluded that unjust enrichment is not an independent claim under state law. See Show Services, LLC v. Amber Trading Co. LLC, Civil Action No. 3:09-CV-2385-D, 2010 WL 4392544, *2 (N.D.Tex. Oct. 29, 2010) (citing, inter alia, Redwood Resort Props., LLC v. Holmes Co., Civil Action No. 3:06-CV-1022-D, 2006 WL 3531422, *9 (N.D.Tex. Nov. 27, 2006)); Celanese Corporation v. Coastal Water Authority, 475 F.Supp.2d 623, 639 (S.D.Tex.2007) (holding that "[r]estitution and unjust enrichment are remedies, not causes of action"); Wood v. Gateway, Inc., 2003 WL 23109832, *12 (N.D.Tex. Dec. 12, 2003). Others have treated unjust enrichment as a cause of action. Pepi Corp. v. Galliford,
The Texas Supreme Court has not addressed the question directly, but has spoken of unjust enrichment as if it were an independent cause of action on two occasions. See Fortune Production Co. v. Conoco, Inc., 52 S.W.3d 671, 685 (Tex.2000) ("A cause of action for unjust enrichment is not available to recover payments in addition to the contract price the parties agreed upon for the entire gas stream"); HECI Exploration Company v. Neel, 982 S.W.2d 881, 885 (Tex.1998) (recognizing that a two-year statute of limitations governs "unjust enrichment" claims).
The dispute is largely academic, however, as plaintiffs can either plead unjust enrichment as a separate cause of action or cite it as grounds for seeking their requested relief on other claims. Newington Ltd. v. Forrester, Civil Action No. 3:08-CV-0864-G ECF, 2008 WL 4908200, *3-4 (N.D.Tex. Nov. 13, 2008) ("Texas courts may waffle about whether unjust enrichment is a theory of recovery or an independent cause of action, but either way, they have provided the plaintiff with relief when the defendant has been unjustly enriched"). Given the state supreme court's references to unjust enrichment as an independent cause of action, the court concludes that ConAgra's motion to dismiss the unjust enrichment claim under Texas law should be denied.
As with California and Texas, Illinois courts appears divided as to whether unjust enrichment is an independent cause of action. Compare Allstate Ins. Co. v. Morgan Guar. Trust Co. of New York, No. 93 C 6527, 1994 WL 48585, *4 (N.D.Ill. Feb. 16, 1994) ("unjust enrichment is not a cognizable separate cause of action under Illinois law") with Peddinghaus v. Peddinghaus, 295 Ill.App.3d 943, 949, 230 Ill.Dec. 55, 692 N.E.2d 1221 (1998) ("Defendants contend Illinois does not recognize an independent cause of action for unjust enrichment. We disagree. Our supreme court has expressly held that to `state a cause of action based on a theory of unjust enrichment, a plaintiff must allege that the defendant has unjustly retained a benefit to the plaintiff's detriment, and that defendant's retention of the benefit violates the fundamental principles of justice, equity, and good conscience,'" quoting HPI Health Care Services, Inc. v. Mt. Vernon Hospital, Inc., 131 Ill.2d 145, 160, 137 Ill.Dec. 19, 545 N.E.2d 672 (1989)). Again, the practical effect of the distinction is minimal, and the court follows the suggestion of the Illinois Supreme Court that such a claim exists. It therefore denies ConAgra's motion to dismiss the Illinois unjust enrichment claims.
ConAgra advances a number of arguments in an attempt to demonstrate that, by its very nature, an unjust enrichment claim is inconsistent with plaintiffs' factual allegations.
Finally, ConAgra asserts that privity is an element of an unjust enrichment claim under New Jersey and Ohio law, and that plaintiffs cannot plead privity.
The Ohio Supreme Court has held that "an indirect purchaser cannot assert a common-law claim for restitution and unjust enrichment against a defendant without establishing that a benefit had been conferred upon that defendant by the purchaser." Johnson v. Microsoft Corp., 106 Ohio St.3d 278, 286, 834 N.E.2d 791 (2005). It concluded that a plaintiff, who had purchased a Gateway computer preinstalled with defendant Microsoft's operating system, failed to allege such a benefit. Id. "In order for a plaintiff to confer a benefit on a defendant, an economic transaction must exist between the parties." Hoffer v. Cooper Wiring Devices, Inc., No. 1:06CV763, 2007 WL 1725317, *4 (N.D.Ohio June 13, 2007).
Ohio courts have found that plaintiffs conferred a benefit on defendants absent privity of contract in cases involving subcontractors, or sales to a customer whose identity defendant knew and from whom it specifically tailored the product. Id. (citing cases). This case falls into neither category. Plaintiffs purchased Wesson Oils from retailers, and did not confer a direct economic benefit on ConAgra. See id. ("Ohio courts have not similarly held that purchase of products within a `chain of sale' is sufficient to establish that a plaintiff has bestowed a benefit on a defendant"). Consequently, plaintiffs' Ohio unjust enrichment claim must be dismissed.
For the reasons stated, the court grants in part and denies in part defendant's motion to dismiss. Plaintiffs' second and third causes of action are dismissed with prejudice, as are their implied warranty claims under New York, Ohio, Oregon, and Washington law, and their California, New Jersey, and Ohio unjust enrichment claims. Plaintiffs' first cause of action is dismissed with leave to amend, as is their New Jersey consumer protection claim. Plaintiffs may file an amended complaint within twenty (20) days of the entry of this order.
The court takes this opportunity to remind plaintiffs of their responsibilities under Rule 11 of the Federal Rules of Civil Procedure. Under Rule 11, by presenting a pleading to the court, the party or attorney "represents that to the best of the person's knowledge, information, and belief, formed after an inquiry reasonable under the circumstances ... [that] the claims, defenses, and other legal contentions are warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing existing law or for establishing new law." FED.R.CIV.PROC. 11(b). In filing any amended complaint, plaintiffs should take care to examine more carefully the nuances of the various statutes they cite, and to remember that it is they who bear the burden of convincing the court that resolving a multitude of state law claims asserted on behalf of a multitude of classes is the superior method of litigating the claims. The parties are also cautioned that the court takes seriously their obligation to meet and confer under Local Rule 7-3. While ConAgra's notice of motion recites that the required
The court found these allegations sufficient to survive a motion to dismiss. Id. at 1078. The court recognizes, as ConAgra noted in its briefing and at the hearing on the motion, that plaintiffs could have alleged expressly that they were deceived because a product made from genetically modified organisms would not, in their minds, be considered natural. But such a statement can be reasonably inferred from the detailed allegations presently in the complaint. Even under Rule 9(b), reasonable inferences such as this must be drawn in plaintiffs' favor. Drobnak v. Andersen Corp., 561 F.3d 778, 781 (8th Cir.2009).
Plaintiff contended that the products at issue in that case — baby bath wash and moisture lotion — were not fit for their ordinary purpose since they did not help babies sleep as the labeling suggested. Id. at 543-44. The court rejected this argument, stating: "Plaintiff has cited no case law to support the idea that advertising alone, no matter how deceptive, may transform the clear and ordinary purpose of a product into an entirely different and unrelated purpose. Indeed, the Court notes that Plaintiff appears to be attempting to fit the square peg of a false advertising or consumer fraud type claim into the round hole of an entirely unrelated warranty claim." Id. As there were no allegations that the products were not fit for their ordinary purpose of cleaning and moisturizing babies' skin, the claim was must be dismissed. Id.
Neither the plaintiff nor the court in Lieberson addressed the language of New Jersey's implied warranty law regarding the labeling of products. To the extent the decision can be read to state that deceptive labeling can be misleading under § 12A:2-314(2)(f) only if the deception concerns the main purpose of the product, the statutory language does not support this conclusion. It clearly provides that goods are merchantable only if they are both "fit for the ordinary purposes for which such goods are used" and labeled accurately. N.J. STAT. ANN. (2); Nelson v. Xacta 3000 Inc., Civil Action No. 08-5426(MLC), 2010 WL 1931251, *8 (D.N.J. May 12, 2010) ("These factual allegations, while minimal, state a plausible claim that the Kinoki Pads do not work as advertised on the product packaging, by suggesting that the color change is due to the presence of moisture rather than the absorption of impurities through the feet during sleep"). Were ConAgra's reading correct, the subsection regarding labeling would be superfluous, because a product not fit for its ordinary purpose would be unmerchantable whether or not it was properly labeled.