S. JAMES OTERO, District Judge.
This matter is before the Court on Defendant The Coca Cola Company's ("Coca Cola" or "Defendant") Motion for Summary Judgment Pursuant to Fed.R.Civ.P. 56, filed December 28, 2009, and Plaintiff Pom Wonderful LLC's ("Pom" or "Plaintiff") Motion for Partial Summary Adjudication Re: Defendant's Affirmative Defenses of Safe Harbor and Compliance with Laws, also filed December 28, 2009. The parties filed Oppositions and Replies to the respective Motions. The Court found this matter suitable for disposition without oral argument and vacated the hearings set for January 25, 2010. See Fed.R.Civ.P. 78(b). For the following reasons, Coca Cola's Motion is
Pom produces, markets, and sells POM WONDERFUL® brand bottled pomegranate juice and various pomegranate juice blends, including a pomegranate blueberry juice blend. (First Am. Compl. ("FAC") ¶ 11; Pl.'s Statement of Genuine Issues of Fact and Proposed Conclusions of Law in Opp'n to Def.'s Mot. for Summ. J. ("Pl.'s SOF Opp'n") ¶ 1.) Coca Cola, under the brand Minute Maid, is one of Pom's primary competitors in the bottled pomegranate juice market. (FAC ¶ 17; Pl.'s SOF Opp'n ¶ 2.) In September 2007, Coca Cola announced a new product in its "Minute Maid Enhanced Juices" line, entitled "Minute Maid® Enhanced Pomegranate Blueberry Flavored 100% Juice Blend." (FAC ¶ 18; Pl.'s SOF Opp'n ¶ 3.) The formal name of "Minute Maid® Enhanced Pomegranate Blueberry Flavored 100% Juice Blend" is "Pomegranate Blueberry Flavored Blend Of 5 Juices" ("the Juice"). (Def.'s Mot. for Summ. J. Pursuant to Fed.R.Civ.P. 56 ("Def.'s Mot.") 3; Pl.'s SOF Opp'n ¶ 3; Decl. of Charles Torrey in Supp. of Def.'s Mot. for Summ. J. ("Torrey Decl.") ¶ 3.) Specifically, in ranking the ingredients of the Juice by volume, apple ranks first, grape ranks second, pomegranate ranks third, blueberry ranks fourth, and raspberry ranks fifth. (FAC ¶ 22.)
"The Juice has used the same bottle and label since it was first introduced." (Pl.'s SOF Opp'n ¶ 8.) A "prominent banner or `flag' (the "Banner") on the Juice label
Coca Cola advertises the Juice "through television and print ad[vertisements], coupons, in-store promotions, and on the Minute Maid website." (Pl.'s SOF Opp'n ¶ 17.) Coca Cola maintains that its "brain-nourishment" claims, which form the centerpiece of the Juice's advertising and marketing campaign, "are based upon the unique combination of added nutrients, including not only Omega-3/DHA, but also choline, vitamin B-12, vitamin E, and vitamin C, all of which have been shown to contribute to brain development."
Coca Cola contends that its "coupons have included pictures of the Juice bottle, but have focused on savings, rather than the fruit ingredients in the product," and that "in-store promotional materials describe the Juice as a `Pomegranate Blueberry Flavored 100% Juice Blend' or `Pomegranate
Coca Cola's print advertising has included campaigns entitled `Love it or it's free!,' `Helps nourish your brain and your sense of taste,' `help nourish your brain,' `OOPS Someone forgot to boost,' and `You
Pom disputes whether the focus of Coca Cola's print advertisements is solely on the nutritional benefits of the Omega-3/DHA fortification, and the Juice's good taste, and not on the Juice's pomegranate juice content. (Pl.'s SOF Opp'n ¶¶ 22, 24; Torrey Decl. Ex. 4.) Pom argues that Coca Cola's print advertisements prominently display the words "Blueberry Pomegranate." (Pl.'s SOF Opp'n ¶¶ 24, 25, 26.) Pom cites Coca Cola's print advertisements, which include "Minute Maid Pomegranate Blueberry flavored juice blend packs goodness for your brain and body in every sip" as illustrative of Coca Cola's emphasis on the Juice's pomegranate blueberry content. (Pl.'s SOF Opp'n ¶ 24.) Furthermore, Pom cites one print advertisement that depicts only the top half of the Juice's bottle, thereby excluding "Pomegranate Blueberry Flavored Blend Of 5 Juices." (Torrey Decl. Ex. 4, p. 36.)
Coca Cola maintains that the television advertisements used to promote the Juice have "flashed images of the five fruit ingredients, but have made no other references to pomegranates or blueberries." (Pl.'s SOF Opp'n ¶ 29.) "For example, [Coca Cola cites] the `We Meet Again' commercial, [that] focused on a man who mistook his daughter's art teacher for an ex-girlfriend before drinking the Juice, but correctly identified her afterwards." (Pl.'s SOF Opp'n ¶ 30.) Coca Cola argues:
(Pl.'s SOF Opp'n ¶ 31.)
Pom, on the other hand, contends that Coca Cola's television advertising identifies the Juice as a "pomegranate and blueberry juice blend," first, and makes no explicit reference to the Juice's flavor. (Pl.'s SOF Opp'n ¶ 29; Pl.'s Addt'l SOF ¶¶ 41, 42.) Pom further alleges that the paper copy that Coca Cola submitted as evidence of the "Help Nourish Your Brain" commercial "does not depict the Juice's five fruit ingredients." (Pl.'s SOF Opp'n ¶ 31.)
Finally, Coca Cola maintains that its "Minute Maid website [the "Enhanced
Coca Cola contends that "[h]eadings on [Minute Maid Webpages] refer to the Juice as `Minute Maid® Enhanced Pomegranate Blueberry Flavored 100% Juice Blend,'" but which Pom contests.
The parties disagree over other features of the Juice Webpage, too. Coca Cola asserts that the Juice Webpage sufficiently emphasizes "`Minute Maid® Enhanced Pomegranate Blueberry Flavored 100% Juice Blend,'" and places "no emphasis on pomegranates or pomegranate juice, let alone on the specific health benefits (e.g., reduced risk of cancer) that Pom claims [Coca Cola] provide[s]." (Pl.'s SOF Opp'n ¶ 40; Torrey Decl. Ex. 6, p. 47.) The Juice Webpage contains the following language:
(Torrey Decl. Ex. 6, p. 47.) Below this language is an icon entitled "get product information," that links to another page (the "Get Information Page") that includes additional information about the Juice:
(Torrey Decl. Ex. 6, p. 48.) Still more, an icon entitled "Nutrition Information" on the Get Information Page, links to another page that contains the Juice's nutritional information (the "Nutritional Information Page"). (Torrey Decl. Ex. 6, p. 50.) The Nutritional Information Page states that the Juice contains apple, grape, and pomegranate juices from concentrate, blueberry juice from concentrate, natural flavors, and raspberry juice from concentrate. (Torrey Decl. Ex. 6, p. 50.)
Consequently, Pom contends that the Minute Maid Webpages emphasize the Juice's pomegranate and blueberry juice content. (Pl.'s SOF Opp'n ¶¶ 36-40.) Pom notes that Minute Maid's Brand Director, Ashley Ann Schmidt, confirmed that the Minute Maid Webpages are intended to advertise and market the Juice.
"[T]he main ingredients in [the Juice] are neither pomegranate, nor blueberry juice, but rather, apple and grape juice." (FAC ¶ 19; supra Part I.) Specifically, the Juice "contains only 0.3% pomegranate juice and 0.2% blueberry juice." (Pl.'s Addt'l SOF ¶ 1; Silverman Decl. Ex. F.) By contrast, "[a]pple and grape juices make up more than 99.4% of the Juice's contents, with the fifth type of juice, raspberry juice, making up just 0.1%." (Pl.'s Addt'l SOF ¶ 1; Silverman Decl. Ex. F.) Therefore, Pom contends that Coca Cola labels the Juice as a "Pomegranate Blueberry" juice, and advertises and markets it, through its packaging, commercials, Minute Maid Webpages,
Pom contends that Coca Cola has received a record number of complaints regarding the Juice. (Pl.'s Addt'l SOF ¶¶ 16-23; see generally Nancy Tyndal Dep. 11-15, 43-49, 252, Dec. 10, 2009.) Nancy Tyndal ("Tyndal"), a fourteen-year employee of Coca Cola, and who has "field[ed] consumer complaints about many
(Pl.'s Addt'l SOF ¶ 19; Pl.'s Opp'n 3-4.) The Court notes that Pom has referenced several other similar complaints, but concludes that it unnecessary to reference them all. (Pl.'s Opp'n 4.)
"Pom commissioned Dr. E. Deborah Jay ("Dr. Jay") to conduct a survey (the "Field Survey") that assesse[d] consumer confusion in connection with [Coca Cola's] advertising of the Juice."
Principally, Coca Cola contests the efficacy of the Field Survey. (Pl.'s SOF Opp'n ¶¶ 43-47.) First, Coca Cola argues that "[t]he only stimulus shown to the survey participants was the bottle and the label of the Juice," and so, the Field Survey did "not attempt to evaluate the messages conveyed by Minute Maid's website or any of [Coca Cola's] other advertising." (Pl.'s SOF Opp'n ¶ 45; Def.'s Mot. 3-4.) Coca Cola notes that "[t]he [Field] [S]urvey found that the main message the [Juice's] bottle communicated to most consumers was that `the product is healthy, nutritious, nourishes the brain, is good for you, has Omega-3/DHA or has other vitamins and nutrients.'" (Pl.'s SOF Opp'n ¶ 46.) Finally, Coca Cola alleges that "Dr. Jay concluded that any consumer confusion about the [Juice] was due to packaging (the words `pomegranate blueberry' on the front of the bottle and in the product name on the back of the bottle)," and not due to the Juice's advertising or marketing. (Pl.'s SOF Opp'n ¶ 47.)
Finally, Pom argues that Coca Cola knew that the Juice was misleading, but willingly assumed the advertising risk that any misconception necessarily created. (Pl.'s Opp'n to Def.'s Mot. for Summ. J. ("Pl.'s Opp'n") 3.) Pom cites a correspondence between Coca Cola employees sent prior to the Juice's launch, and which allegedly illustrates Coca Cola's intent to launch a misleading product:
(Silverman Decl. Ex. H; Pl.'s Opp'n 3; Pl.'s Addt'l SOF ¶¶ 6-7.) According to Pom, "[t]his e-mail constitutes damning evidence of [Coca Cola's] willful consumer deception." (Pl.'s Opp'n 3.)
Based on the above-mentioned facts, Pom brought suit against Coca Cola on September 22, 2008, alleging causes of action for: (1) false advertising under the Lanham Act, 15 U.S.C. § 1125(a); (2) false advertising under California Business and Professions Code § 17500; and (3) statutory unfair competition under California
(See Order of Feb. 10, 2009.)
Following the filing of Pom's FAC on July 27, 2009, Coca Cola filed a Motion to Dismiss First Amended Complaint Pursuant to Fed.R.Civ.P. 12(b)(6) (the "Second Motion to Dismiss"). (See generally FAC.) The Court "reasserted its previous position" and denied Coca Cola's Second Motion to Dismiss. (See Order of Sept. 15, 2009, 2009 WL 6254619.) The Court concluded that "FDA juice-naming and labeling regulations do not bar Pom from alleging that Coca Cola has advertised or marketed the Juice in a misleading manner on its website and in other advertising avenues . . . at this motion to dismiss stage it is unnecessary to demarcate and identify which (if any) of the allegations in the FAC are within the FDA's sole purview, and which allegations are encompassed by the Lanham Act." (See Order of Sept. 15, 2009.) Moreover, regarding Pom's state law claims, the Court permitted Pom to establish that Coca Cola's profits can be "`traced to ill-gotten funds,' which would [therefore,] be a `vested' interest, and entitle Pom to restitution." (See Order of Sept. 15, 2009.) However, without more facts before it, the Court declined to preclude Pom from pursuing its state law claims at the motion to dismiss stage.
Summary judgment is proper only if "the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact." Fed.R.Civ.P. 56(c). A "material" fact is one that could affect the outcome of the case under the governing substantive law, and an issue of material fact is "genuine" if "the evidence is such that a reasonable jury could return a verdict for the non[-]moving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); see Atlanta Attachment Co. v. Leggett & Platt, Inc., 516 F.3d 1361, 1365 (Fed.Cir.2008) (internal citation omitted).
In determining whether a genuine issue of material fact exists, the court must not make credibility determinations or weigh conflicting evidence. Anderson, 477 U.S. at 255, 106 S.Ct. 2505. Rather, the court must view the evidence in the light most favorable to the non-moving party, drawing all "justifiable inferences" in its favor. Id. (internal citation omitted); see Atlanta Attachment Co., 516 F.3d at 1365 (internal citation omitted); Group One, Ltd. v. Hallmark Cards, Inc., 254 F.3d 1041, 1045 (Fed.Cir.2001) (internal citations omitted).
"Under the Lanham Act, any person that uses a `false description or representation' that is `in connection with any goods' is liable to another private individual `who believes he is or is likely to be damaged by the use of any such false description or representation.'" Pom Wonderful LLC v. Ocean Spray Cranberries, Inc. ("Ocean Spray"), 642 F.Supp.2d 1112, 1117 (C.D.Cal.2009)
Finally, because "[t]he Lanham Act and the FFDCA have overlapping jurisdiction in areas such as marketing and product labeling, though the purposes of the two statutes are different," the Court now turns to an analysis of the FFDCA and FDA. Ocean Spray, 642 F.Supp.2d at 1118.
Compared to the Lanham Act, which is "primarily intended to protect commercial interests from unfair competition," the FFDCA, which was passed by Congress in response to "unsafe drugs and fraudulent marketing," is intended to "protect the public from unsafe or mislabeled products" by setting forth federal labeling requirements. Wyeth v. Sun Pharm. Industries, Ltd., 2010 WL 746394 (E.D.Mich. Mar.2, 2010) (citing Wyeth v. Levine, S.Ct. 1187, 1195 (2009))
Indeed, the FFDCA is explicit: "all such proceedings for the enforcement, or to restrain violations, of this chapter shall be by and in the name of the United States." 21 U.S.C. § 337(a). "When and if a claim strays too close to the exclusive enforcement domain of the FDA, it cannot stand." Schwarz Pharma, Inc., 388 F.Supp.2d at 973 (citing Summit Tech., Inc., 922 F.Supp. at 306); see Schering-Plough, 586 F.3d at 508-09 (holding that the FDA should be given the chance to opine on the proper labeling before a Lanham Act suit is filed because it has more experience with consumers' understanding of drug labels than judges do); see also United States v. An Article of Food ... Manischewitz, 377 F.Supp. 746, 749 (D.C.N.Y. 1974) ("The function of the court in [sic] merely to determine whether the existing label is misleading, not to tell the [FDA] what amendments may be appropriate in order to rectify the situation.)".
Id. at 30455, 30461. The FDA further suggested:
Id. at 30462. Thus, the 1991 proposals reflected the FDA's position that a multiple-juice beverage named for a represented flavor would not necessarily be misleading. Id.
Thereafter, on January 6, 1993, the FDA issued final rules in response to the NLEA (the "1993 Final Rules"). See Food Labeling; Declarations of Ingredients; Common or Usual Name for Nonstandardized Foods; Diluted Juice Beverages, 58 Fed. Reg. 2897-01 (Jan. 6, 1993) (to be codified at 21 C.F.R. §§ 101, 102). Here, the FDA explained that if a named juice is not the predominant juice:
Id. at 2900 (emphasis added); see 21 C.F.R. § 102.33(b) (2009) ("If the product is a diluted multiple-juice beverage or a blend of single-strength juices and names, other than in the ingredient statement, more than one juice, then the names of those juices must be in descending order or predominance by volume unless the name specifically shows that the juice with the represented flavor is used as a flavor (e.g., raspberry-flavored apple and pear juice.") (emphasis added)).
Again, the 1993 Final Rules reflected the FDA's position that multiple-juice beverages named for a represented or characteristic flavor or juice are not necessarily misleading. 58 Fed. Reg. 2897 at 2918-19 ("The basic nature of a product can be described in various ways, e.g., as a blend of five juices," and a product containing apple, grape, raspberry, and cranberry juice may include the name "Raspberry and cranberry flavored juice beverage in a blend of two other juices ... There are several ways in which a multiple-juice beverage can be appropriately labeled.").
Consequently, in accordance with the 1993 Final Rules, 21 C.F.R. § 102.33(c) states:
See 21 C.F.R. § 102.33(c) (2009). Similarly, 21 C.F.R. § 102.33(d) provides:
See 21 C.F.R. § 102.33(d) (emphasis added). In addition to that which is explained in 21 C.F.R. §§ 102 et seq., the FDA
See 21 C.F.R. § 101.22(i)(1)(i) (emphasis added).
Finally, in the 1993 Final Rules, the FDA considered whether fruit vignettes on juice labels have the potential to mislead the public, and whether such vignettes shall be FDA-regulated. See 58 Fed. Reg. 2897, at 2919-22. The FDA concluded:
See 58 Fed. Reg. 2897 at 2918-21 (emphasis added). Thus, in the 1993 Final Rules, the FDA concluded that in the context of multi-juice beverages, manufacturers are not required to depict all the fruits or vegetables in vignettes. Id. at 1921-22. Instead, the FDA merely encouraged manufacturers to depict all fruits and vegetables present in the juice, as that would be instructive to consumers. Thus, in the context of vignettes on multi-juice beverages, the 1993 Final Rules reflect the FDA's position that it is an agency specifically tasked with regulating names and labels in order to prevent the misbranding of products. Id.
In light of the distinction between the Lanham Act and the FFDCA, and their remedial mechanisms, a line of cases has arisen finding that Lanham Act claims are barred where private litigants ask the
On one hand, "[c]ourts have refused to allow a Lanham Act claim to proceed where, in order to determine the falsity or misleading nature of the representation at issue, the court would be required to interpret and then apply FFDCA statutory or regulatory provisions." Mutual I, 459 F.Supp.2d at 934 (citing Sandoz Pharm. Corp. v. Richardson-Vicks, Inc., 902 F.2d 222, 231 (3d Cir.1990)); see Cottrell, 191 F.3d at 1255; see also All One God Faith, Inc. v. The Hain Celestial Group, Inc., 2009 WL 4907433 (N.D.Cal. Dec. 14, 2009). "Simply put, the Lanham Act does not allow a federal court to determine preemptively how a federal agency will interpret and enforce its own regulations." Summit Tech., 922 F.Supp. at 306 (citing Sandoz Pharm. Corp., 902 F.2d at 231); see Summit Tech., Inc. v. High-Line Med. Instruments, Co. ("Summit II"), 933 F.Supp. 918, 933 (C.D.Cal.1996) (refusing to allow a Lanham Act claim to proceed where the claim would force the court to rule directly on the legality of the defendant's conduct before the FDA had a chance to do so). This is especially true "in light of Congress' intention to repose in [the FDA] the task of enforcing the FDCA." Braintree Lab., Inc. v. Nephro-Tech., Inc. ("Braintree"), 1997 WL 94237, *6 (D.Kan. Feb. 26, 1997). "It is in this context that many courts have refused to allow a Lanham Act claim to proceed, as the alleged `falsity' is not something that is verifiable without ... interpretation and application of FDA regulations." Id. at 936; see also Sandoz Pharm. Corp., 902 F.2d at 231 (refusing to adjudge falsity of a cough syrup label when "the FDA ha[d] not found conclusively that [the product was mislabeled]" because doing so would require original interpretation of the FFDCA or its regulations). As the court in Mutual I concluded:
Mutual I, 459 F.Supp. at 935. In American Home Products Corp. v. Johnson & Johnson, the court similarly concluded that FDA approval was a defense to a competitor's Lanham Act claim. American Home Prods. Corp. v. Johnson & Johnson, 672 F.Supp. 135, 145 (S.D.N.Y. 1987). The court held that "[i]f FDA approval of the precise label used by a drug manufacturer is a defense to a consumer's product liability action, it should be a fortiori, a defense to a competitor's action under the Lanham Act." Id.
"On the other hand, the simple fact that a matter touches upon an area dealt with by the FDA is not a bar to proceeding with a claim under the Lanham Act." Ocean Spray, 642 F.Supp.2d at 1118 (citing Mutual I, 459 F.Supp.2d at 935). For example, a Lanham Act claim may proceed where a plaintiff alleges that the defendant has affirmatively misrepresented compliance with FDA regulations, or where a court would only need to "verify whether defendant's specific label or conduct conforms to what the FDA has already
Moreover, some courts have concluded that "false statements are actionable under the Lanham Act, even if their truth may be generally within the purview of the FDA." Cytosport, 2007 WL 1345379, at * 2 (citing Summit II, 933 F.Supp. at 933); see Cottrell, 191 F.3d at 1256; As the court in Summit Tech. explained, "a plaintiff may bring a Lanham Act cause of action for affirmatively misrepresenting facts, even if the facts may be governed by FDA regulations." Summit Tech., 922 F.Supp. at 307; see also Pfizer, Inc., 868 F.Supp. at 449 (holding that literally false statements concerning areas of the FDA's purview can be actionable under the Lanham Act).
In Grove Fresh Distributors, Inc. v. The Flavor Fresh Foods, Inc., the defendants sold orange juice labeled as "100% Orange Juice from Concentrate." Grove Fresh, 720 F.Supp. 714, 715 (N.D.Ill.1989). The plaintiff sued under the Lanham Act, "asserting that because defendants' product was not 100% orange juice, its labeling was false and misleading." Summit Tech., 922 F.Supp. at 307. The court found that plaintiff's claim was not an FFDCA cause of action "because, even without the FDA's orange juice definition, plaintiff could still establish a violation of [the Lanham Act]— indeed, the commercial definition of pure orange juice could be determined without any reference to FDA regulations." Id. The plaintiff could "rely on the FDA regulation merely to establish the standard or duty which [the] defendants allegedly failed to meet. Nothing prohibit[ed] [the plaintiff] from using the FDCA or its accompanying regulations in this fashion." Id. Likewise, in Summit II, the plaintiff argued that the defendant's imported products were improperly labeled because they were labeled as "identical" to domestically manufactured products that were FDA-approved. Summit II, 933 F.Supp. at 933. The court declined to dismiss the action because "the question of whether the domestic and international [products] are `identical' is a factual one that can be resolved without the interpretation or application of FDA regulations." Id.
Similarly, in Cytosport, the court concluded that it would "not need to rely on the FFDCA or any FDA regulation to show that the statement `Carb Conscious' is misleading." Cytosport, 2007 WL 1345379 at *3. Specifically, the court would not need to interpret or otherwise apply FFDCA or FDA regulations. Id. "To make its case, [the plaintiff] [could] present evidence, such as consumer surveys, that indicate consumers would consider such statement misleading when [the product] contains 15 grams of carbohydrate." Id. The court in Mutual I, therefore, concluded that it could distinguish between instances where courts "find either as a matter of common sense or normal English, that which the FDA, with all of its scientific expertise, has yet to determine... [and instances where] the [FDA] should be given the first chance to exercise that discretion or to apply that discretion." Mutual I, 459 F.Supp.2d at 938.
Assuming a Lanham Act claim is not precluded by the FFDCA or FDA regulations, "in order to recover damages,... the plaintiff must demonstrate that it has been damaged by actual consumer reliance on the misleading statements." Emerging Material Tech., Inc. v. Rubicon Tech., Inc., 2009 WL 5064349, *4 (N.D.I11. Dec. 14, 2009). Here, the statements-atissue, namely Coca Cola's naming, labeling, advertising, and marketing, are not alleged to be literally false, but rather, misleading in context. Thus, "[w]here a statement is not literally false and is only misleading in context, ... proof that the advertising actually conveyed the implied message and thereby deceived a significant portion of the recipients becomes critical." Mut. Pharm. Co. II, 2009 WL 3401117 at *3 (citing The William H. Morris Co. v. Group W, Inc., 66 F.3d 255, 258 (9th Cir. 1995)); see Del Webb, 2009 WL 3053709 at * 13; see Sandoz Pharm. Corp., 902 F.2d at 228-29 (context is important in evaluating the message conveyed); see also Merck Consumer Pharm. Co. v. Smithkline Beecham Corp., 960 F.2d 294, 297-98 (2d Cir.1992) (requiring plaintiff to demonstrate that a "statistically significant part of the commercial audience holds the false belief allegedly communicated by the challenged advertisement"). Indeed, "[e]ven if an advertisement is not literally false, relief is available under [the] Lanham Act § 43(a) if it can be shown that the advertisement has misled, confused, or deceived the consuming public." Southland Sod Farms, 108 F.3d 1134 at 1140.
"Reactions of the public are typically tested through the use of consumer surveys." Southland Sod Farms, 108 F.3d 1134 at 1140; see also J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 27:55 (4th ed. 1996) ("If the ad is not clear, plaintiff must produce evidence, usually in the form of market research or consumer surveys, showing exactly what message ordinary consumers received from the ad .... [T]he moving party must provide expert testimony or other evidence.") (internal citations omitted). "To assess the truth of [the] more amorphous, [or] misleading statements, the courts favor testing by consumer reaction surveys, but have also found falsity based on their own independent reaction and the reaction of witnesses testifying before the court, including testimony based on test results, consumer surveys, complaints received, allegations of more than a few instances of misrepresentation and otherwise." Cottrell, 191 F.3d at 1252. In Cottrell, the Tenth Circuit concluded that "if [the plaintiff] can establish by consumer surveys or other means that [the defendant's] advertising is likely to confuse or actually confuses consumers, then the effect of the false `implication' of EPA approval that [the plaintiff] now assumes could be as damaging for Lanham Act purposes as an express false claim of EPA approval." Id. at 1256; see also Mut. Pharm. Co. II, 2009 WL 3401117 at *3 (holding that the plaintiff did not need to rely on the FDCA or any FDA regulations in order to determine whether a statement was misleading, and instead, could "present evidence, such as consumer surveys, to indicate [that] consumers would consider [said] statement misleading"). However, "[t]o prove that use of [a] particular marketing channel conveys such a false impression... [the plaintiff] cannot ... obtain relief by arguing how consumers could react; it must be shown how consumers actually do react." Mutual I, 459 F.Supp.2d at 940 (internal citations omitted) (emphasis added). Similarly, in Sandoz, the Third Circuit concluded:
Sandoz, 902 F.2d at 228-29. However, "[s]ubjective claims about products, which cannot be proven either true or false, are not actionable under the Lanham Act." (Cytyc Corp. v. Neuromedical Sys., Inc., 12 F.Supp.2d 296, 300 (S.D.N.Y.1998)) (citing Lipton v. Nature Co., 71 F.3d 464, 474 (2d Cir.1995)), and "[a]s a general rule, summary judgment is inappropriate where an expert's testimony supports the nonmoving party's case." Southland Sod Farms, 108 F.3d at 1144.
In any event, the "failure to establish that a significant number of consumers [are] actually deceived is not necessarily fatal to [a plaintiff's] case. If [the defendant has] intentionally misled consumers, [the court will presume that] consumers were in fact deceived and [the defendant] would have the burden of demonstrating otherwise." The William H. Morris Co. v. Group W, Inc., 66 F.3d 255, 258 (9th Cir. 1995); see Del Webb, 2009 WL 3053709 at *13; see also Novartis Consumer Health, Inc. v. Johnson & Johnson, 290 F.3d 578, 594 (3d Cir.2002). Indeed, where a defendant "intentionally misl[eads]" consumers, by "deliberate conduct of egregious nature," courts may presume that consumers have been deceived. William H. Morris Co., 66 F.3d at 258; see also Gonzalez v. Allstate Ins. Co., 2005 WL 5891935, *10 (C.D.Cal. Aug. 2, 2005). Accordingly, even if Pom cannot establish by a preponderance of evidence that consumers were actually deceived by Coca Cola's allegedly misleading statements, if Pom can establish willful misconduct by Coca Cola, then the Court may presume that consumers have been deceived.
Since this Court's September 15, 2009 Order, several other courts in the Central District have addressed the issue of whether Pom has standing to assert similarly pled state law claims, and which the Court finds compelling. See Pom Wonderful LLC v. Tropicana Products, Inc., et al. ("Tropicana"), CV 09-00566 DSF (CTx) (C.D.Cal. Oct. 21, 2009); Pom Wonderful LLC v. Welch Foods, Inc. ("Welch"), CV 09-00567 AHM (AGRx), (C.D.Cal. Dec. 21, 2009). Specifically, to have standing under California Business & Professions Code § 17200, referred to as California's Unfair Competition Law ("UCL"), and California Business & Professions Code § 17500, referred to as California's False Advertising Law ("FAL"), Pom must show that it has suffered an injury in fact, namely that it has "lost money or property as a result of... unfair competition." Cal. Bus. & Prof. Code §§ 17204, 17535. "[L]ost money or property" have been interpreted as requiring that a plaintiff show he is entitled to restitution from a defendant. See Citizens of Humanity, LLC v. Costco Wholesale Corp., 171 Cal.App.4th 1, 89 Cal.Rptr.3d 455, 472 (2009) (holding that the alleged harm to a plaintiff's goodwill is not a loss of "money or property as a result of the unfair competition," and is insufficient to confer standing on the plaintiff); see also Buckland v. Threshold Enterprises, Ltd., 155 Cal.App.4th 798, 66 Cal.Rptr.3d 543, 557-58 (2007) (holding that a plaintiff's purchase of goods which was made expressly in order to establish standing for an action in the public interest was "not reasonably viewed as lost money or property under the standing requirement").
In Korea Supply Corp. v. Lockheed Martin Corp., the California Supreme
Here, it has been shown that Pom is not entitled to restitutionary relief. Specifically, it is clear that Pom has no vested share of the pomegranate juice market, or a vested interest in Coca Cola's profits from the Juice. As Judge Dale S. Fischer succinctly explained in Tropicana, "there is no reasonable definition of vested interest that would include market share." Tropicana, CV 09-00566, at 2. Similarly, Judge Howard A. Matz concluded that "like the plaintiff in Korea Supply, Pom seeks to recover nonrestitutionary disgorgement of profits that are nothing more than a `contingent expectancy of a payment from a third party'—in this case, consumers." Welch, CV 09-00567, at 5 (citing Korea Supply Corp., 131 Cal. Rptr.2d at 42, 63 P.3d 937). Moreover, Pom is not entitled to seek injunctive relief under the UCL and FAL, either. Indeed, as both Judge Dale S. Fischer and Judge Howard A. Matz noted, a restitutionary interest is required for standing, even if the plaintiff does not seek restitution as a remedy. See Welch, CV 09-00567, at 5; see Tropicana, CV 09-00566, at 2; see Walker, 558 F.3d at 1027. Because Pom's state law claims are strikingly similar to those it has pled in the above-mentioned cases, and because the Court finds Judge Howard A. Matz and Judge Dale S. Fischer's reasoning to be compelling, Coca Cola's summary adjudication as to this issue is GRANTED.
Accordingly, Coca Cola's Motion is
Principally, Pom contends that Judge A. Howard Matz, Judge Dean D. Pregerson, and Judge Dale S. Fischer, as well as this Court, "all got it right at the motion to dismiss stage that federal law does not preclude or preempt Pom's claims against juice product naming and labeling." (Pl.'s Opp'n 2.) To that end, Pom seeks to have this Court indirectly require that Coca Cola change the Juice's naming and labeling to reflect what Pom believes is a more appropriate naming and/or labeling of the Juice's bottle. (FAC ¶ 20.) Pom states:
Coca Cola contends that the Juice's name, "Pomegranate Blueberry Flavored Blend Of 5 Juices," "complies with all applicable FDA regulations," and so, is precluded from being challenged by the Lanham Act. Def.'s Mot. 8; see 58 Fed. Reg. 2897 at 2920; see also 21 C.F.R. § 102.33 (stating that "this revision of new § 102.33 along with the others discussed below are adequate to prevent misleading labels on multiple-juice beverages"). In support of its contention that the Juice's naming and labeling comport with the relevant FFDCA and FDA regulations, Coca Cola states that the Juice's "name includes two identified juices, pomegranate and blueberry. Because these named juices are not the predominant juices by volume, the product name includes the word `flavored,' as required by 21 C.F.R. § 102.33(d), and as expressly permitted by 21 C.F.R. § 101.22(i)(1)(i), based upon the inclusion of `natural flavors' in the Juice." (Def.'s Mot. 8.) Coca Cola further maintains that "because there are additional juices in the product, the [Juice's] name also includes the word `blend,' as required by 21 C.F.R. § 102.33(c)." (Def.'s Mot. 8.)
This Court's previous Order held that Pom's Lanham Act claim against the Juice's formal name and label, "Pomegranate Blueberry Flavored Blend Of 5 Juices," "impermissibly challeng[es] the FDA's labeling for a multiple-juice beverage." (Order of Feb. 19, 2009). The FDA has directly spoken on the issues that form the basis of Pom's Lanham Act claim against the naming and labeling of the Juice, and has therefore, reached a conclusion as to what is permissible. See 21 C.F.R. §§ 102.33(c), (d). Indeed, the FDA has spoken on several occasions, and each time, it has concluded that manufacturers of multiple-juice beverages may identify their beverages with a non-primary, characteristic juice, as Coca Cola does here. See 56 Fed. Reg. 30452; see 58 Fed. Reg. 2897; see Holk v. Snapple Beverage Corp., 574 F.Supp.2d 447, 454 (D. New Jersey 2008), cited with disapproval in Lockwood v. Conagra Foods, Inc., 597 F.Supp.2d 1028, 1034 (N.D.Cal.2009) ("the FDA under the broad authority granted to it by the FFDCA, has promulgated comprehensive regulations pertaining to, inter alia,... the common or usual name for diluted multiple-juice beverages or a product containing a blend of single-strength juices...."). The rules promulgated by the FDA are intended to protect the public from unsafe or mislabeled products by setting forth federal labeling requirements, and with which the Juice's naming and labeling comply. Wyeth v. Sun Pharm. Indus., Ltd., 2010 WL 746394 (E.D.Mich. Mar. 2, 2010) (citing Wyeth v. Levine, ___ U.S. ___, 129 S.Ct. 1187, 1195, 173 L.Ed.2d 51 (2009)). Thus, the name "Pomegranate Blueberry Flavored Blend Of 5 Juices" sufficiently comports with the requirements of 21 C.F.R. §§ 102.33(c),(d).
Moreover, although the Juice's name appears in different fonts and on different lines, Pom has not provided the Court with evidence that the Juice's naming and labeling is not prominently displayed, and so not in compliance with 21 U.S.C. § 343(f).
In any event, any such determination that naming and labeling must be displayed in a particular way or fashion, as Pom suggests, would necessarily be for the FDA to determine, and so, is not for this Court to construe or interpret. See Braintree, 1997 WL 94237 at *6. Thus, because "Pomegranate Blueberry Flavored Blend Of 5 Juices" complies with the relevant FDA regulations and is prominently displayed on the Juice's front panel, pursuant to 21 U.S.C. § 343(f), even if not to the liking of Pom, this Court cannot conclude that the Juice's naming and labeling is misleading, inaccurate, or outside the purview of the FDA.
Of course, "Pom is free to lobby Congress or petition FDA to change its rules...." Def.'s Opp'n 2; see also American Home Prods. Corp., 672 F.Supp. at 145 ("If the intercession of a private attorney general is needed to press the FDA to perform that duty with respect to a particular product label, the quickest and most effective relief could be obtained through a direct petition to the agency and not through an unfair competition action against the manufacturer ... There is no apparent reason why [the plaintiff] cannot ask the FDA to reconsider that approval in light of the survey evidence it has presented here to show the message users take from ... [the defendant's] package.") As a private litigant, Pom cannot seek to have this Court indirectly attack FDA regulations as courts may not be used to secondguess the considered judgments of the FDA.
Accordingly, because Coca Cola's naming and labeling of the Juice comports with the relevant FFDCA and FDA regulations, Coca Cola's Motion is
Pom contends that the imagery on the Juice's bottle's front panel, which includes the Fruit Vignette, intentionally misleads consumers. (Pl.'s Opp'n 11; Def's Statement in Opp'n ¶ 2.) Specifically, because the centrally-placed Fruit Vignette includes a large half-open pomegranate, Pom argues that consumers will incorrectly believe that the Juice consists primarily of pomegranate juice. (Pl.'s Opp'n 11; Torrey Decl. Ex. 1; Def's Statement in Opp'n ¶ 2.) In response, Coca Cola contends that because the Fruit Vignette complies with FDA regulations, Pom is necessarily precluded from alleging that the Fruit Vignette violates the Lanham Act. (Def.'s Mot. 8.)
In the FDA's 1993 Final Rules, whereby the FDA discussed the depiction of fruits on a label vignette, the FDA expressed the belief that vignettes depicting pictures of the fruit or vegetable sources of all juices present in a product would be useful to consumers, and so encouraged manufacturers to use vignettes. See 58 Fed. Reg. 2897 at 2918-21; see Ocean Spray, 642 F.Supp.2d at 1119-20. The fact that the FDA discussed vignettes within the context of juice labels suggests that vignettes are related to and/or part of a juice's label. Specifically, the FDA stated that "a vignette that pictures only some of the fruit or vegetables in the beverage would not be misleading where the name of the food adequately and appropriately describes the contribution of the pictured juice." See 58 Fed. Reg. 2897 at 2918-21. Indeed, it is generally a juice's name, as well as the vignette, that instructs consumers as to what a juice contains. Thus, it would be inconsistent, if not nonsensical, for the FDA to say that a determination of whether a juice's naming and labeling is misleading depends on the interplay between a juice's naming and labeling, and any accompanying vignette, but that it, nonetheless, declines to regulate such vignettes. Rather, because vignettes are intricately related to a determination of whether a juice label and/or name is misleading, vignettes, like the Fruit Vignette, are within the FDA's purview.
To that end, the example used by the FDA in its 1993 Final Rules indicates that the Fruit Vignette clearly complies with FDA requirements relating to the depiction of vignettes. See 58 Fed. Reg. 2897 at 2918-21. Specifically, the FDA indicated that for a "100 percent juice product consisting of apple, grape, and raspberries, in which the raspberry juice provides the characterizing flavor," it would not be misleading if the vignette depicts only raspberries, as long as "the statement of identity [is] `raspberry juice
Subsequent to the FDA's 1993 Final Rules, a handful of courts have looked at whether the FDA is tasked with regulating fruit vignettes on products, and in each instance, the court has concluded that the regulation of vignettes comes within the FDA's purview. See R. McKinnis v. Kellogg, USA, 2007 WL 4766060, *4 (C.D.Cal. Sept. 19, 2007); see Holk v. Snapple Beverage Corp., 574 F.Supp.2d at 454.
R. McKinnis, 2007 WL 4766060 at *4 (emphasis added).
Accordingly, because the depiction of vignettes on multi-juice beverages is an area of regulation within the FDA's purview, as the FDA's 1993 Final Rules and subsequent caselaw reflect, and because the Fruit Vignette is clearly not misleading pursuant to the FDA's 1993 Final Rules, Coca Cola's Motion is
This Court previously concluded that Pom is not prevented from alleging that Coca Cola "has otherwise advertised and marketed [the Juice] in a misleading manner ..." (Order of Sept. 15, 2009.) Coca Cola "fully accepts, and does not contest ... that advertising apart from the Juice's formal name and label is subject to
"The party offering a survey as proof of consumer confusion bears the burden of proving its reliability." Pfizer, Inc., 868 F.Supp. at 447. To that end, Pom alleges that "[t]he 35% differential which the Field Survey found between the test and control groups' respective belief that the Juice only contains pomegranate and blueberry juice far exceeds the percentage that district courts typically find acceptably for a consumer survey in support of a Lanham Act claim." Decl. of Steven A. Zalesin ("Zalesin Decl.") Ex. 1; Pl.'s Opp'n 5; see Novartis Consumer Health, Inc., 290 F.3d at 594 (finding that 15.5% would be sufficient to support a finding of substantial consumer confusion). The Field Survey provides some evidence of consumer deception. (Zalesin Decl. Ex. 1.) Pom contends that the Field Survey directly demonstrates the generally misleading effect that the Juice has on consumers, such that consumers are likely "to believe that the Juice mainly contains pomegranate and blueberry juice (and not other types of fruit juice)." (Zalesin Decl. Ex. 1; Pl.'s Addt'l SOF ¶¶ 32-33.)
Coca Cola "hotly disputes the methodology and conclusions of [the Field Survey]." (Def.'s Mot. 17; Decl. of Dr. Ran Kivetz in Supp. of Def.'s Mot. for Summ. J. ("Kivetz Decl.") ¶ 2.) Coca Cola argues that "Pom has not identified a shred of evidence that any of [Coca Cola's] ads are false or misleading in any respect," and so "Pom has offered no evidence that [Coca Cola's] website or ads have misled consumers." (Def.'s Mot. 14; Def.'s Reply 5.) As such, Coca Cola contends that because the Field Survey fails to address Coca Cola's advertising or marketing, and instead, only addresses the Juice's name and label, it is "unreliable." (Def.'s Reply 3; Kivetz Decl. ¶ 3, Ex. A.) Specifically, Coca Cola states that "[t]he only stimulus shown to the survey participants was the bottle and label of the Juice," and so the Field Survey "did not attempt to evaluate the messages conveyed by the Juice's website of any of [Coca Cola's] other advertising." (Def.'s Mot. 3-4; see generally Kivetz Decl. Ex. A.)
The Ninth Circuit holds that "surveys in trademark cases are to be admitted as long as they are conducted according to accepted principles ... [Moreover,] [t]echnical reliability goes to the weight accorded a survey, not its admissibility." CKE Rest., 494 F.Supp.2d at 1144 (citing E.J. Gallo Winery v. Gallo Cattle Co., 967 F.2d 1280, 1292 (9th Cir.1992)); see also Pfizer, Inc., 868 F.Supp. at 447 ("The probative value of a survey depends entirely upon its fundamental fairness and objectivity, which in turn depends on many factors, such as whether it is properly `filtered' to screen out those who got no message from the advertisement, whether the questions are directed to the real questions, and whether the questions are leading or suggestive."). Furthermore:
In any event, even if the Field Survey is defective as to the advertising and marketing claim, if Pom has other evidence of consumer deception, or if Pom can show that Coca Cola intentionally misled consumers, the burden may shift to Coca Cola to demonstrate otherwise. See The William H. Morris Co., 66 F.3d at 258.
Coca Cola, however, contends that Pom cannot "circumvent the consumer survey requirement by arguing that [Coca Cola's] false advertising is `willful' and `thus inherently establishes that consumers are substantially deceived.'" (Def.'s Reply 4; Pl.'s Opp'n 18.) Coca Cola argues that Pom's evidence of alleged "willful deception" does not relate to its website or advertisements for the Juice. (Def.'s Reply 4-5.) First, Coca Cola states that the Reid correspondence, referred to by Pom as a "smoking gun," relates solely to the Juice's name, not its advertising, marketing, or website. (Def.'s Reply 5.) Coca Cola further notes that the Reid correspondence illustrates Coca Cola's desire to comply with FDA regulations, and so, does not evidence an egregious or willful intent to deceive. (Def.'s Reply 5.) Finally, Coca Cola argues that the consumer complaints cited by Pom are based on consumers who bought the Juice in stores, not consumers who viewed the website or Coca Cola's other advertising media. (Def.'s Reply 5.)
Coca Cola's claims are seemingly meritorious. However, the Court concludes that Pom should have the opportunity to demonstrate otherwise. Accordingly, drawing all inferences in favor of Pom as this Court must, the Court concludes that triable issues of material fact remain as to Pom's advertising and marketing claims.
For the foregoing reasons, Coca Cola's Motion is
IT IS SO ORDERED.
