“[R]rather than allege reliance on an alleged misrepresentation as required 25 by the UCL, at best Plaintiffs misbranding theory only alleges reliance on the ‘salability’ of the 26 products.”
How later courts described this case
- “[R]rather than allege reliance on an alleged misrepresentation as required 25 by the UCL, at best Plaintiffs misbranding theory only alleges reliance on the ‘salability’ of the 26 products.”
- “A violation of the UCL’s fraud prong is 17 also a violation of the false advertising law.”
- “Courts often analyze these statutes 24 together because they share similar attributes.”
- in assessing standing, the court may consider “the 19 complaint and any other particularized allegations of fact in affidavits or in amendments to the 20 complaint”
Written by the judges who cited it.
The opinion
1
2
3
4 UNITED STATES DISTRICT COURT
5 NORTHERN DISTRICT OF CALIFORNIA
6
7 PATRICIA SULTANIS, Case No. 21-cv-00162-EMC
8 Plaintiff,
ORDER GRANTING IN PART AND
9 v. DENYING IN PART DEFENDANT’S
MOTIONS TO DISMISS
10 CHAMPION PETFOODS USA INC., et al.,
Docket No. 24
11 Defendants.
12 PATRICIA SULTANIS, Case No. 21-cv-00167-EMC
13 Plaintiff,
14 v.
Docket No. 21
15 CHAMPION PETFOODS USA, INC., et
al.,
16
Defendants.
17
18
19 Pending before the Court is Defendants Champion Petfoods USA Inc. and Champion
20 Petfoods LP’s (collectively, “Champion’s”) motions to dismiss Plaintiff Patricia Sultanis’s class
21 action complaints in Sultanis v. Champion Petfoods USA, Inc. et al, No. 3:21-cv-00162-EMC
22 (N.D. Cal. filed Jan. 8, 2021) (the “Poultry Action”) and Sultanis v. Champion Petfoods USA, Inc.
23 et al, No. 3:21-cv-00167-EMC (N.D. Cal. filed Jan. 8, 2021) (the “Fish Action”) pursuant to
24 Federal Rules of Civil Procedure 12(b)(1), 12(b)(2), and 12(b)(6). See Poultry Action, Docket No.
25 24 (“Poultry Mot”); Fish Action, Docket No. 21 (“Fish Mot”). Champion also moves to strike the
26 nationwide and multi-state class allegations from both complaints. See id.
27 For the following reasons, the Court DENIES in part and GRANTS in part both
1 I. BACKGROUND
2 A. Factual Allegations
3 Ms. Sultanis’s class action complaints allege as follows. Ms. Sultanis is a resident of
4 Walnut Creek, California. See Poultry Action, Docket No. 1 (“Poultry Compl.”) ⁋⁋ 5–7; Fish
5 Action, Docket No. 1 (“Fish Compl.”) at ⁋⁋ 5. She purchased Champion’s Acana brand petfood
6 marketed and labeled as being made with “free-run” poultry and “wild-caught” fish (the
7 “Products”) for the four years preceding the filing of her complaint, and most recently on July 24,
8 2017. Poultry Compl. ⁋⁋ 1, 5; Fish Compl. ⁋⁋ 1, 5. Ms. Sultanis alleges that the poultry Products
9 were marketed with statements that included “made with fresh free-run chicken, turkey, & cage
10 free eggs”:
11 ///
12 ///
13 ///
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18 || Id. PP 15-16. Similarly, the Champion website states that “[r]aised under the highest standards for
19 animal care and food safety by people we know and trust, on family-run American farms, our free-
20 || run poultry and cage-free eggs are nourishing, natural, and antibiotic free”:
21
FREE-RUN POULTRY AND CAGE-FREE EGGS
DELIVERED FRESH OR RAW
23 Raised under the highest standards for animal care and food safety by people we know and trust, on family-run
American farms, our free-run poultry and cage-free eggs are nourishing, natural, and antibiotic free.
25 Il Id. P18. The website also describes Champion’s chicken supplier as “Todd of Clark Farms in
26 Lexington, Kentucky,” even though the person depicted alongside that statement is in fact Greg
27 Hefton of Tyson Foods:
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8 || Id. P19.
9 Based on these statements, Ms. Sultanis alleges she—and other “reasonable consumers”—
10 || expected the poultry Products were made with chickens “raised in better, more humane conditions
11 than typical chickens grown for meat,” and that “have access to the outdoors.” Jd. [P 21-22; see
12 || also id. P 29 (“‘Champion’s Free-Run Poultry Claims are intended to lead consumers into believing
5 13 || that ‘free-run’ poultry comes from birds who had free access to the outdoors and that were raised
14 || under conditions that significantly exceeded industrywide animal welfare standards.”). She also
15 alleges that “[to] reasonable consumers . . . “free-run’ is synonymous with ‘free range.’” Id. P26.
16 || Asan example, Ms. Sultanis attaches an Amazon review by a consumer stating that “[f]ree range
3 17 || chicken is the meat in [the Products].” Jd. P29. According to Ms. Sultanis, however, the poultry
Z, 18 || Products are made from “factory-farmed birds raised under standard industrial conditions—
19 || confined in crowded barns without outdoor access.” Id. P 2. Therefore, Ms. Sultanis contends that
20 || she and the putative class members she seeks to represent were “harmed by purchasing the
21 [poultry] Products under false pretenses and paying more for [them] than they otherwise would
22 || have, if they would have purchased [them] at all.” Jd. P 3.
23 Ms. Sultanis also alleges that the fish Products are marketed with statements on the
24 || package that included “ACANA Grasslands is brimming with . . . wild-caught rainbow trout” or
25 “brimming with... wild-caught fish”:
26 ///
27 | //
28 |} ///
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1 Fish Compl. P 14, 19. The packaging also depicts a fisherman next to what looks like a fresh body
2 || of water with the caption “trusted supplier of fresh wild-caught fish:”
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18 Similarly, the Champion website states that “ACANA Freshwater Fish is packed with
19 || whole, wild-caught rainbow trout” and that “[Champion’s] saltwater fish are sustainable and wild-
20 || caught from New England’s cold and fertile waters, and [their] freshwater fish from American
21 waters—all whisked to [their] DogStar Kitchen fresh or raw.” Id. PP 15-16. The Champion
22 website also described its freshwater fish (which includes rainbow trout) as “Fresh, Whole, and
23 || Wild Freshwater Fish” and specifically represented that it is “[s]ustainably caught by fishermen
24 || we know and trust,” along the photograph of a fisherman standing in what looks like a fresh-water
25 |} ///
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27 || ///
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1 lake holding a wild-caught catfish:
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Sustainably caught by fishermen we know and trust, like Dennis of Louisville Fish Company in Louisville,
Kentucky, our rainbow trout, blue catfish and yellow perch are sourced from federally inspected facilities and
13 delivered FRESH or RAW, without artificial preservatives and brimming with goodness. Sustainably harvested, our
freshwater fish are loaded with essential DHA and EPA, Omega-3 fatty acids, and richly nourishing fish protein.
IS ra. 17. Champion also allegedly describes its products on the Petco and Amazon websites as
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22
23
24 || Id. P18.
25 Based on these statements, Ms. Sultanis alleges she purchased the products believing they
26 were made with wild-caught fish. Jd. P 41. According to Ms. Sultanis, however, the fish Products
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27 are actually made with “rainbow trout from industrial fish farms” in Idaho and “do not use wild-
28 caught fish.” Jd PP 2, 22-24. In fact, she points out that Champion was sued by Animal Equality,
mn
1 which commissioned laboratory tests that revealed the fish Products tested positive for
2 ethoxyquin, a chemical that is only found in farmed fish, not wild-caught fish. Id. ⁋⁋ 25–27.
3 Therefore, Ms. Sultanis contends that she and the putative class members she seeks to represent
4 were “harmed by purchasing the [fish] Products under false pretenses and paying more for [them]
5 than they otherwise would have, if they would have purchased [them] at all.” Id. ⁋ 3.
6 Ms. Sultanis brings these actions on behalf of herself and all other similarly situated
7 individuals nationwide (the “Nationwide Class”), in thirteen (13) states (the “Multi-State Class”),1
8 and in California (the “California Sub-Class”). Poultry Compl. ⁋ 64; Fish Compl. ⁋ 56. She
9 brings claims for violations of the individual states’ consumer fraud acts on behalf of the Multi-
10 State Class (Count 1); breach of express warranty on behalf of the California Sub-Class, Poultry
11 Compl. ⁋⁋ 83–89 (Count 2); violations of the California Consumers Legal Remedies Act (CLRA),
12 Cal. Civ. Code § 1761, on behalf of the California Sub-Class (Count 3); violations of the
13 California False Advertising Law (FAL), Cal. Bus. & Prof. Code § 17500, on behalf of the
14 California Sub-Class (Count 4); and California Unfair Competition Law (UCL), Cal. Bus. & Prof.
15 Code § 17200, on behalf of the California Sub-Class (Count 5). See Poultry Compl. ⁋⁋ 76–125;
16 Fish Compl. ⁋⁋ 68–117. Ms. Sultanis also brings an unjust enrichment claim on behalf of the
17 Nationwide Class and the California Sub-Class in the Poultry Action (Count 6). See Poultry
18 Compl. ⁋⁋ 126–31.
19 B. Procedural History
20 Ms. Sultanis filed both complaints on January 8, 2021. See Poultry Compl.; Fish Compl.
21 On March 19, 2021, Champion filed the pending motions to dismiss the complaints. See Poultry
22 Mot.; Fish Mot.
23 ///
24 ///
25 ///
26
1 The states included in the Multi-State Class are California, Florida, Illinois, Massachusetts,
27
Michigan, Minnesota, Missouri, New Hampshire, New Jersey, New York, Rhode Island,
1 II. LEGAL STANDARDS
2 A. Rule 12(b)(1) Motion to Dismiss for Lack of Standing2
3 Under Federal Rule of Civil Procedure 12(b)(1), a party may move to dismiss for lack of
4 subject matter jurisdiction. When subject matter jurisdiction is challenged, “[t]he party seeking to
5 invoke the court’s jurisdiction bears the burden of establishing that jurisdiction exists.” Scott v.
6 Breeland, 792 F.2d 925, 927 (9th Cir. 1986). A Rule 12(b)(1) motion will be granted if the
7 complaint, considered in its entirety, fails on its face to allege facts sufficient to establish subject
8 matter jurisdiction. See Savage v. Glendale Union High Sch., 343 F.3d 1036, 1039 (9th Cir.
9 2003). “[L]ack of Article III standing requires dismissal for lack of subject matter jurisdiction
10 under [Rule] 12(b)(1).” Maya v. Centex Corp., 658 F.3d 1060, 1067 (9th Cir. 2011). “For
11 purposes of ruling on a motion to dismiss for want of standing . . . the [trial court] . . . must
12 accept as true all material allegations of the complaint and must construe the complaint in favor of
13 the complaining party.” Id. at 1068 (quoting Warth v. Seldin, 422 U.S. 490, 518 (1975)).
14 Importantly, in determining constitutional standing, “it is within the trial court’s power to allow or
15 to require the plaintiff to supply, by amendment to the complaint or by affidavits, further
16 particularized allegations of fact deemed supportive of plaintiff’s standing.” Id. at 1067 (quoting
17 Warth, 422 U.S. 490 at 501); see also Table Bluff Reservation (Wiyot Tribe) v. Philip Morris,
18 Inc., 256 F.3d 879, 882 (9th Cir. 2001) (in assessing standing, the court may consider “the
19 complaint and any other particularized allegations of fact in affidavits or in amendments to the
20 complaint”).
21 The “irreducible constitutional minimum” of standing requires a “plaintiff must have (1)
22 suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant,
23 and (3) that is likely to be redressed by a favorable judicial decision.” Nayab v. Capital One Bank
24 (USA), N.A., 942 F.3d 480, 489 (9th Cir. 2019) (quoting Spokeo, Inc. v. Robins (“Spokeo II”), 136
25
2 Champion also argues that this Court lacks personal jurisdiction, under Rule 12(b)(2), over the
26
claims of non-California unnamed plaintiffs because there is no independent relationship between
those claims and Champion’s actions in this district. See Bristol-Myers Squibb Co. v. Sup. Ct. of
27
Cal., S.F., 137 S. Ct. 1773, 1780 (2017). As explained below, the Court need not address this
1 S. Ct. 1540, 1547 (2016)). These three elements are referred to as, respectively, injury-in-fact,
2 causation, and redressability. See Planned Parenthood of Greater Was. & N. Idaho v. U.S. Dep’t
3 of Health & Human Servs., 946 F.3d 1100, 1108 (9th Cir. 2020). “The plaintiff, as the party
4 invoking federal jurisdiction, bears the burden of establishing these elements,” which at the
5 pleadings stage means “‘clearly . . . alleg[ing] facts demonstrating’ each element.” Spokeo II, 136
6 S. Ct. at 1547 (quoting Warth, 422 U.S. at 518).
7 B. Rule 12(b)(6) Motion to Dismiss for Failure to State a Claim
8 Federal Rule of Civil Procedure 8(a)(2) requires a complaint to include “a short and plain
9 statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). A
10 complaint that fails to meet this standard may be dismissed pursuant to Rule 12(b)(6). See Fed. R.
11 Civ. P. 12(b)(6). To overcome a Rule 12(b)(6) motion to dismiss after the Supreme Court’s
12 decisions in Ashcroft v. Iqbal, 556 U.S. 662 (2009) and Bell Atlantic Corporation v. Twombly, 550
13 U.S. 544 (2007), a plaintiff’s “factual allegations [in the complaint] ‘must . . . suggest that the
14 claim has at least a plausible chance of success.’” Levitt v. Yelp! Inc., 765 F.3d 1123, 1135 (9th
15 Cir. 2014). The court “accept[s] factual allegations in the complaint as true and construe[s] the
16 pleadings in the light most favorable to the nonmoving party.” Manzarek v. St. Paul Fire &
17 Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). But “allegations in a complaint . . . may not
18 simply recite the elements of a cause of action [and] must contain sufficient allegations of
19 underlying facts to give fair notice and to enable the opposing party to defend itself effectively.”
20 Levitt, 765 F.3d at 1135 (quoting Eclectic Props. E., LLC v. Marcus & Millichap Co., 751 F.3d
21 990, 996 (9th Cir. 2014)). “A claim has facial plausibility when the Plaintiff pleads factual
22 content that allows the court to draw the reasonable inference that the Defendant is liable for the
23 misconduct alleged.” Iqbal, 556 U.S. at 678. “The plausibility standard is not akin to a
24 ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant has acted
25 unlawfully.” Id. (quoting Twombly, 550 U.S. at 556).
26 Additionally, claims sounding in fraud or mistake are subject to the heightened
27 requirements of Federal Rule of Civil Procedure 9(b), which requires that a plaintiff “state with
1 required by Rule 9(b) are the “who, what, when, where, and how” of the activity. Vess v. Ciba–
2 Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003). In addition, the allegation “must set forth
3 what is false or misleading about a statement, and why it is false.” Id. The purpose of Rule 9(b) is
4 to require that a plaintiff’s allegations be “specific enough to give defendants notice of the
5 particular misconduct which is alleged . . .so that they can defend against the charge and not just
6 deny that they have done anything wrong.” Swartz v. KPMG LLP, 476 F.3d 756, 764 (9th Cir.
7 2007). Rule 9(b) allows, however, that “[m]alice, intent, knowledge, and other conditions of a
8 person’s mind may be alleged generally.” Fed. R. Civ. P. 9(b).
9 III. DISCUSSION
10 Because a court “must dismiss the action” if it “determines at any time that it lacks subject-
11 matter jurisdiction,” Fed. R. Civ. P. 12(h)(3), this order first addresses Champion’s arguments
12 under Rule 12(b)(1) before turning to its request for relief under Rule 12(b)(6).3 See Ctr. for
13 Biological Diversity v. Mattis, 868 F.3d 803, 815 (9th Cir. 2017) (“Article III generally requires a
14 federal court to satisfy itself of its jurisdiction over the subject matter before it considers the merits
15 of a case.” (quoting Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 583 (1999)).
16 A. Rule 12(b)(1) Motion to Dismiss for Lack of Standing Over Ms. Sultanis’s Claims on
17 Behalf of the Multi-State and Nationwide Classes (Counts 1 and 6)
18 The only non-California claims in Ms. Sultanis’s complaints are for violations of the state
19 consumer fraud acts of the thirteen states in the Multi-State Class (Count 1 in both actions) and for
20 unjust enrichment on behalf of the Nationwide Class (Count 6 in the Poultry Action).4 Poultry
21 Compl. ¶¶ 76–82, 126–131; Fish Compl. ¶¶ 68–74. Champion argues that Ms. Sultanis lacks
22 standing to pursue these non-California claims because she only purchased cat food in California.
23 Poultry Mot. at 3–5, Fish Mot. at 4–6.
24
25
3 Champion also moves to strike the claims of the Multi-State and Nationwide Classes (Counts 1
and 6) “due to material variations in each states’ consumer protection laws.” Poultry Mot. at 7;
26
Fish Mot. at 7. The Court does not address those strike motions because, as discussed below, Ms.
Sultanis does not have standing to sue on behalf of unnamed plaintiffs outside of California.
27
1 This Court’s position on this question has evolved in recent years. In In re Carrier IQ,
2 Inc., Consumer Privacy Litigation, individuals from 13 different states filed claims under forty-
3 eight states’ privacy and consumer protection statutes. 78 F.Supp.3d 1051, 1059 (N.D. Cal. 2015).
4 Like here, the defendants argued that the named plaintiffs lacked standing to assert claims under
5 the laws of states in which they did not reside. At the time, “the Ninth Circuit recognized this
6 question was an open one, expressly declining to reach the ‘difficult chicken-and-egg question of
7 whether class certification should be decided before standing.’” Id. at 1069 (quoting Perez v.
8 Nidek Co., 711 F.3d 1109 (9th Cir. 2013)). Although this Court concluded “it ha[d] the discretion
9 to defer questions of standing until after class certification,” it declined to exercise that discretion
10 “as a matter of case management” because the “number of consumers from [thirty-five] other
11 states in which state law claims are asserted is vast relative to the claims to which the named
12 Plaintiffs have standing.” Id. The Court was concerned with “subjecting the [defendants] to the
13 expense and burden of nationwide discovery without Plaintiffs first securing actual plaintiffs who
14 clearly have standing and are willing and able to assert claims under these state laws.” Id. The
15 Court was also concerned, “given the breadth of the proposed class and the number of state law
16 claims asserted on behalf of the class,” that “the requirements of class certification under Rule 23
17 may not be met or, if they [were], subclasses may have to be created which would engender delay
18 (adding that any new named plaintiffs would likely be subject to another round of discovery and
19 further class certification motion practice).” Id. at 1074–75. As a result, the Court concluded that
20 “[i]t makes sense to address standing to bring some 35 state law claims before class certification,”
21 and “the named Plaintiffs do not have standing to assert claims from states in which they do not
22 reside or did not purchase their mobile device.” Id. at 1075.
23 A couple of months after this Court decided In re Carrier IQ, however, the Ninth Circuit
24 decided Melendres v. Arpaio, which involved an appeal of the district court’s injunction
25 prohibiting Sheriff Joseph Arpaio and his supervisees from using race as a factor in deciding
26 whether to stop any vehicle with a Latino occupant. See 784 F.3d 1254, 1258 (9th Cir.
27 2015). The injunction applied to stops during both “saturation patrol”—when the defendant
1 nonsaturation patrols. See id. at 1258–59. Defendants argued that the plaintiffs lacked standing to
2 bring constitutional claims on behalf of class members stopped during nonsaturation patrols,
3 because the named plaintiffs had been stopped only during saturation patrols. See id. at 1259. In
4 rejecting this argument, the Ninth Circuit broadly held that “any issues regarding the relationship
5 between the class representative and the passive class members—such as dissimilarity in injuries
6 suffered—are relevant only to class certification, not to standing.” Id. at 1262 (emphasis added)
7 (quoting Newberg on Class Actions § 2:6).
8 After Melendres, Courts in the Ninth Circuit have been split on whether a named plaintiff
9 in a putative class action has standing to assert claims under the laws of states where the named
10 plaintiff does not reside or was injured. On the one hand, most courts have held that plaintiffs can
11 only bring claims on behalf of other consumers in states where they “were injured or had any
12 pertinent connection.” Jones v. Micron Tech. Inc., 400 F. Supp. 3d 897 (N.D. Cal. 2019) (“The
13 named Plaintiffs do not allege they were injured or had any pertinent connection to the twenty
14 other states invoked by the Complaint. The named Plaintiffs therefore lack standing to bring
15 causes of action based on the laws of [those] states.”); Van Mourik v. Big Heart Pet Brands, Inc.,
16 No. 3:17-CV-03889-JD, 2018 WL 1116715, at *1 (N.D. Cal. Mar. 1, 2018) (plaintiff had no
17 standing to bring California class claims because she “[was] a resident of Texas who saw the
18 challenged advertisements in Texas and bought the defendant’s dog food there” and “ha[d] no
19 personal connection whatsoever to California”); Corcoran v. CVS Health Corp., Inc., No. 15-CV-
20 3504 YGR, 2016 WL 4080124, at *2 (N.D. Cal. July 29, 2016) (“Here, no plaintiff resides in, or
21 alleges to have suffered an injury in, any of the thirty-eight states at issue in defendant’s motion.
22 In such instances, the consensus among courts in this District, including the undersigned, is that
23 named plaintiffs ‘lack standing to assert claims based on those states’ laws.’” (quoting Fenerjian
24 v. Nongshim Co. Ltd., 72 F. Supp. 3d 1058, 1082–83 (N.D. Cal. 2014))).
25 A growing minority of courts in this circuit have held, conversely, that whether a named
26 plaintiff can represent class members whose claims arise under the laws of different states is not a
27 standing question that needs to be decided at the motion to dismiss stage. For example, Judge
1 whose claims arise under the laws of different states does not appear to be a question of standing
2 [because] Patterson does not himself seek to raise a claim under the laws of a different state;
3 rather, he seeks to represent a class member who can raise such a claim.” Patterson v. RW Direct,
4 Inc., No. 18-CV-00055-VC, 2018 WL 6106379, at *1 (N.D. Cal. Nov. 21, 2018); see also Alvarez
5 v. NBTY, Inc., No. 17-CV-00567-BAS-BGS, 2017 WL 6059159, at *8 (S.D. Cal. Dec. 6, 2017)
6 (“Thus, this secondary standing analysis relating to Plaintiff Alvarez’s standing as it relates to
7 multi-state class is best left for class certification and after further discovery.”); In re Hydroxycut
8 Mktg. and Sales Practices Litig., 801 F. Supp. 2d 993, 1005 (S.D. Cal. 2011) (“The constitutional
9 issue of standing should not be conflated with Rule 23 class action requirements.”).
10 In In re Chrysler-Dodge-Jeep Ecodiesel Marketing, Sales Practices, and Products
11 Liability Litigation (“FCA”), this Court joined the minority of its sister courts concluding that the
12 issue of whether unnamed plaintiffs have standing should not be conflated with the issue of
13 whether the named plaintiff is adequate, typical, or whether common questions predominate under
14 Rule 23. 295 F. Supp. 3d 927, 955 (N.D. Cal. 2018). In that case, the named plaintiffs—like in In
15 re Carrier IQ and here—sought to bring claims “under the laws of states where they do not reside
16 and where they did not transact with defendants, but where other class members do or did.” Id.
17 This Court concluded that, although the “disjuncture” in Melendres was different from the
18 disjuncture at issue in FCA, “Melendres requires courts in the Ninth Circuit to apply the ‘class
19 certification approach,’” whereby “once the named plaintiffs demonstrate their individual standing
20 to sue . . . the standing inquiry may be concluded; the disjuncture may better be addressed in the
21 context of class certification.” Id. at 955–56 (emphasis added) (quoting Melendres, 784 F.3d at
22 1261). Admittedly, the Court also chose to wait to decide the standing issue during class
23 certification in FCA because it did not have the same case management concerns that it did in In re
24 Carrier. First, “the ratio of states with named Plaintiffs to states without [was] almost the
25 opposite,” such that the defendants in FCA “would need to engage in near-nationwide discovery
26 even if the Court dismissed the state-law claims for states that do not have a named Plaintiff.” Id.
27 at 956. Second, and relatedly, deferring the standing issue in FCA until the class certification
1 Plaintiff [was] substantially smaller than in In re Carrier IQ.” Id. The Court therefore concluded
2 in FCA that “even if Melendres does not sweep so broadly as to impose a per se rule,” it made
3 sense to wait until class certification to decide whether the named plaintiffs could assert out-of-
4 state claims on behalf of putative class members. Id.
5 More recently, in Phan v. Sargento Foods, this Court took the opposite approach, deciding
6 that it made more sense to decide whether the named plaintiff could bring claims on behalf of
7 unnamed plaintiffs who purchased the products in other states at the pleadings stage. No. 20-CV-
8 09251-EMC, 2021 WL 2224260, at *12–*13 (N.D. Cal. June 2, 2021). Importantly, however, the
9 Court did not squarely frame its decision on this question as one involving Article III standing;
10 rather, it concluded that “whether it be cast as a standing question or an early adjudication of
11 prospective class certification, the Court exercises its discretion to hold that Plaintiff, on this
12 record, cannot represent unnamed class members in states outside of California.” Id. (emphasis
13 added). In fact, the Court noted thoughtful opinions from other courts holding that whether a
14 named plaintiff can raise claims from putative class members in states where the plaintiff did not
15 reside or purchase the products at issue was a question of class certification, not standing. For
16 example, the Court cited In re McCormick & Co, in which Judge Huvelle of the District of
17 Columbia District thoughtfully explained:
18 It is more logical to consider named plaintiffs’ ability to raise other
state-law claims as a question of commonality, typicality, and
19 adequacy under Rule 23, rather than a question of standing.
Generally, the named plaintiffs in a class action do not have
20 individual standing for all of the claims that they raise, because one
individual does not have standing to claim injury to another
21 individual. Therefore, standing analysis cannot address whether one
plaintiff should be able to bring claims on behalf of others. In
22 contrast, “the requirements of Rule 23(a) – commonality, typicality,
and adequacy – exist to test the relationship between the named
23 plaintiff’s claims and those of the class.” Thus, when defendants are
“not challenging Plaintiffs’ standing to bring their own claims” but
24 rather “their standing to bring claims on behalf of the class,” “[t]his
question would be appropriately, and more efficiently addressed at
25 the class certification stage.”
26 Whether the named plaintiffs can adequately represent unnamed
class members with claims under other states’ laws depends on how
27 variable the laws are. If the laws are similar enough, or if they can
plaintiff from every state.
1
2 217 F. Supp. 3d 124, 144 (D.D.C. 2016) (quoting William B. Rubenstein, Newberg on Class
3 Actions § 2:6 (5th Ed. 2016)); Cf. Hanlon v. Chrysler Corp., 150 F.3d 1011, 1022 (9th Cir. 1998)
4 (“Variations in state law do not necessarily preclude a 23(b)(3) action, but class counsel should be
5 prepared to demonstrate the commonality of substantive law applicable to all class
6 members.”); In re US FoodServ. Pricing Litig., 729 F.3d 108, 126-27 (2d Cir. 2013)
7 (“[A]gree[ing] that putative class actions involving the laws of multiple states are often not
8 properly certified pursuant to Rule 23(b)(3) because variation in the legal issues to be addressed
9 overwhelms the issues common to the class [but] these concerns are lessened where the states’
10 laws do not vary materially.”). After giving this question more thought, the Court today cements
11 its conclusion—in line with Judges Chhabria and Huvelle, among others—that whether a plaintiff
12 can bring claims on behalf of unnamed plaintiffs under the laws of states in which the named
13 plaintiff does not reside or was injured is a matter of typicality, adequacy, and predominance
14 under Rule 23, not Article III standing.
15 Just because this question does not involve Article III standing does not mean that the
16 Court does not have discretion to conclude at the pleadings stage that Ms. Sultanis does not satisfy
17 the adequacy, typicality, or predominance requirements to bring claims on behalf of unnamed
18 plaintiffs in multiple other states where she does not reside or where she did not purchase the
19 Products. See Phan, 2021 WL 2224260, at *13 (“[T]he Court exercises its discretion to hold that
20 Plaintiff, on this record, cannot represent unnamed class members in states outside of California.”
21 (emphasis added)); Patterson, 2018 WL 6106379, at *1 (“[T]his issue will be addressed in
22 connection with class certification, [but] it is questionable whether Patterson will be able to pursue
23 a nationwide class action, and given the California-centric nature of this case it may be appropriate
24 to address adequacy and commonality before allowing Patterson to embark on nationwide class
25 discovery.”). Here, as Sargento did in Phan, Champion identifies “substantial variations in the
26 consumer protection laws of the [13] states at issue,” including whether notice, intent, reliance, or
27 causation are required, as well as whether a three-, four-, five-, or six-year statute of limitations
1 • Notice. California’s, Massachusetts’, and Missouri’s consumer protection statutes
2 appear to require some form of notice before suit can be initiated. See Cal. Civ.
3 Code § 1782(a); Mass. Gen. Laws Ch. 93A, § 9(3); Mo. Rev. Stat. § 407.025.7.
4 Ms. Sultanis admits in her complaint that she did not give Champion notice of her
5 claims. See Compl. ⁋ 105.
6 • Intent. Illinois’s, Michigan’s, and Minnesota’s consumer protection statutes appear
7 to require some form of intent to deceive on the part of the defendant. See Griffin
8 v. Univ. Cas. Co., 654 N.E.2d 694, 700–01 (Ill. Ct. App. 1995); In re OnStar
9 Contract Litig., 278 F.R.D. 352, 376 (E.D. Mich. 2011); Minn. Stat. §§ 325F.67,
10 325F.69(1).
11 • Reliance. Michigan’s consumer protection statute appears to require an
12 individualized showing of reliance. See In re OnStar Contract Litig., 278 F.R.D. at
13 376
14 • Causation. Illinois’s consumer protection statute appears to require an
15 individualized showing of causation. See, e.g., Oliveira v. Amoco Oil Co., 776
16 N.E.2d 151, 164 (Ill. 2002)
17 • Statute of Limitations. California’s, Illinois’s, and Washington’s statute of
18 limitations for consumer protection claims appears to be three years, Cal. Civ. Code
19 § 1783; 815 Ill. Comp. Stat. 505/10a(e); Shepard v. Holmes, 345 P.3d 786, 789
20 (Wash. Ct. App. 2014), Florida’s and Massachusetts’s appears to be four years, Fla.
21 Stat. Ann. § 95.11(3)(f); Mass. Gen. Laws ch. 260, § 5A., Missouri’s appears to be
22 five years, Mo. Ann. Stat. § 516.120, and Michigan’s, Minnesota’s, and New
23 Jersey’s appear to be six years, Mich. Comp. Laws Ann. § 445.911(7); Minn. Stat.
24 § 541.05(1)–(2); N.J. Stat. Ann. § 2A:14-1. To complicate matters further, Florida,
25 Minnesota, and New York do not appear to recognize or limit the application of the
26 discovery rule. See, e.g., Veldhuizen v A.O. Smith Corp., 839 F. Supp. 669, 674 (D.
27 Minn. 1993).
1 “premature request to strike class allegations at the pleading stage, before any discovery has been
2 taken, is unwarranted.” Poultry Action, Docket No. 32 (“Poultry Opp’n”) at 6. But no amount of
3 discovery will change the fact that the consumer protection laws of the thirteen states at issue here
4 are so substantively different that it would be exceedingly difficult to certify a class that satisfies
5 the adequacy, typicality, or predominance requirements particularly with only Ms. Sultanis at the
6 helm.
7 Indeed, the Court here has the same case management concerns it had in In re Carrier and
8 Phan. In fact, the ratio of named plaintiff to out-of-state putative class member is worse here (one
9 to twelve) than in In re Carrier (one to 2.6) and Phan (one to nine), raising “a meaningful risk that
10 the requirements of class certification under Rule 23 may not be met or, if they are, subclasses
11 may have to be created which would engender delay (adding that any new named plaintiffs would
12 likely be subject to another round of discovery and further class certification motion practice).” 78
13 F. Supp. 3d at 1074–75. Moreover, allowing the case to proceed currently will subject Champion
14 to nation-wide discovery because Ms. Sultanis asserts unjust enrichment claims on behalf of
15 plaintiffs who purchased the Products nationwide. These concerns make it so that it is more
16 appropriate to decide the typicality, adequacy, and predominance issues now, prior to formal class
17 certification proceedings.
18 The Court therefore concludes that, in the instant case, the substantial variations in the
19 consumer protection laws in the thirteen states at issue “underscore[] the problematic nature of the
20 request that [Ms. Sultanis] singularly be appointed to be the named representative of” the
21 Nationwide and Multi-State Classes. Phan, 2021 WL 2224260, at *13. Therefore, “the Court
22 exercises its discretion to hold that [Ms. Sultanis], on this record, cannot represent unnamed class
23 members in states outside of California.” Id. To be clear, the Court reaches this conclusion under
24 Rule 23, not Article III.
25 Accordingly, the Court GRANTS Champion’s motion to dismiss Ms. Sultanis’s claims on
26 behalf of the Multi-State Class under Count 1 in both actions and on behalf of the Nationwide
27 Class under Count 6 in the Poultry Action.
1 B. Rule 12(b)(6) Motion to Dismiss for Failure to State a Claim Under the CLRA, FAL, and
2 UCL Fraud Prong
3 The FAL and CLRA prohibit false or misleading advertising. Specifically, the FAL
4 prohibits the dissemination of any statement concerning property or services “which is untrue or
5 misleading, and which is known, or which by the exercise of reasonable care should be known, to
6 be untrue or misleading.” Cal. Bus. & Prof. Code § 17500. The CLRA prohibits certain “unfair
7 methods of competition and unfair or deceptive acts or practices undertaken by any person in a
8 transaction intended to result or which results in the sale or lease of goods or services to any
9 consumer.” Cal. Civ. Code § 1770(a). One practice proscribed by the CLRA is “[r]epresenting
10 that goods or services are of a particular standard, quality, or grade . . . if they are of another.” Id.
11 § 1770(a)(7). Similarly, the UCL creates a cause of action for business practices that are unlawful,
12 unfair, or fraudulent. Cal. Bus. & Prof. Code § 17200. Each “prong” of the UCL provides a
13 separate and distinct theory of liability. Lozano v. AT & T Wireless Servs., Inc., 504 F.3d 718, 731
14 (9th Cir. 2007). Ms. Sultanis asserts causes of action under all three prongs of the UCL.
15 A violation of the FAL or the CLRA is also a violation of the fraud prong of the UCL. See
16 In re Tobacco II Cases, 207 P.3d 20, 29 n.8 (Cal. 2009) (“A violation of the UCL’s fraud prong is
17 also a violation of the false advertising law.”); Consumer Advocs. v. Echostar Satellite Corp., 8
18 Cal. Rptr. 3d 22, 29 (Cal. Ct. App. 2003) (“Lavie considered only the application of the reasonable
19 consumer standard to the UCL and False Advertising Act, we do not hesitate to find that it also
20 applies to the CLRA.”). “Because the same standard for fraudulent activity governs all three
21 statutes, courts often analyze the three statutes together.” Hadley v. Kellogg Sales Co., 273 F.
22 Supp. 3d 1052, 1063 (N.D. Cal. 2017); see also In re Sony Gaming Networks & Customer Data
23 Sec. Breach Litig., 996 F. Supp. 2d 942, 985 (S.D. Cal. 2014) (“Courts often analyze these statutes
24 together because they share similar attributes.”). Ms. Sultanis does not dispute that her causes of
25 action under the FAL, the CLRA, and the fraud prong of the UCL rise or fall together.
26 1. False or Misleading
27 Under the FAL, CLRA, and the fraud prong of the UCL, conduct is considered deceptive
1 Prods. Co., 552 F.3d 934, 938 (9th Cir. 2008). The “reasonable consumer” is not necessarily a
2 “particularly sophisticated consumer.” Brod v. Sioux Honey Ass’n, Co-op, 927 F. Supp. 2d 811,
3 828 (N.D. Cal. 2013). “To the contrary, questions of judgment calling for the perspective of a
4 reasonable consumer are ‘determined in the light of the effect [such a question] would most
5 probably produce on ordinary minds.’” Id. (quoting Donaldson v. Read Magazine, 333 U.S. 178,
6 189 (1948)). “‘Likely to deceive’ implies more than a mere possibility that the advertisement
7 might conceivably be misunderstood by some few consumers viewing it in an unreasonable
8 manner.” Lavie v. Procter & Gamble Co., 105 Cal. App. 4th 496, 508 (Ct. App. 2003). “Rather,
9 the phrase indicates that the ad is such that it is probable that a significant portion of the general
10 consuming public or of targeted consumers, acting reasonably in the circumstances, could be
11 misled.” Id. (emphases added).
12 Courts have repeatedly emphasized that the reasonable consumer analysis is “usually . . . a
13 question of fact not appropriate for decision on” a motion to dismiss. Williams, 552 F.3d at 938.
14 Therefore, “[g]ranting a motion to dismiss is appropriate only in ‘the rare situation’ where ‘the
15 advertisement itself [makes] it impossible for the plaintiff to prove that a reasonable consumer was
16 likely to be deceived,’” Coe v. Gen. Mills, Inc., No. 15-CV-05112-TEH, 2016 WL 4208287, at *5
17 (N.D. Cal. Aug. 10, 2016) (quoting Williams, 552 F.3d at 939), or, similarly, where “no reasonable
18 consumer” would be misled by the advertisement, Williams, 552 F.3d at 939.
19 a. Poultry Action
20 In the Poultry Action, Ms. Sultanis plausibly alleges claims under the FAL, CLRA, and the
21 fraud prong of the UCL because the statement “made with free-run chicken” is not false or
22 misleading. The term “free-run,” on its own, could reasonably be read to imply that the chickens
23 used to make the Products can freely run outside, especially because the Products’ label also
24 depicts chicken running freely on a spacious, grassy, and outdoor field without any disclaimer that
25 those are not the chickens used to make the Products. See Williams, 552 F.3d at 936 (district court
26 erred in dismissing plaintiffs’ complaint alleging that “the use of the words ‘Fruit Juice’
27 juxtaposed alongside images of fruits such as oranges, peaches, strawberries, and cherries” was
1 1788397, at *9 (N.D. Cal. May 5, 2021) (denying motion to dismiss complaint alleging that
2 products were made with “plant-based ingredients” in part because they “also display[ed] images
3 of plants, including flowers and leaves, and use green coloring”); Tucker v. Post Consumer
4 Brands, LLC, No. 19-CV-03993-YGR, 2020 WL 1929368, at *5 (N.D. Cal. Apr. 21, 2020)
5 (“Although the package does not make any objective representations about the amount of honey in
6 the cereal, a reasonable consumer could see the prominent honey-related words and imagery and
7 be deceived into thinking the cereal contained relatively less refined sugar and more honey.”
8 (emphasis added)). Put differently, “[a] significant portion of the general consuming public or of
9 targeted consumers, acting reasonably in the circumstances, could be misled” by the term “made
10 with free-run chicken,” coupled with this imagery of chickens running outside, into thinking that
11 the chickens used to make the Products can indeed freely run outside. Lavie, 105 Cal. App. 4th at
12 508.
13 Champion does not dispute that the chickens used to make the Products cannot run outside,
14 only inside their barns. Nonetheless, Champion contends the statement “free-run chicken” is true
15 because “Canadian trade organizations” define it as chickens that are “free to run throughout the
16 barn in which they were raised.” Poultry Mot. at 11. The first problem with this argument,
17 however, is that Champion does not ask for judicial notice of this supposed “official” Canadian
18 definition of the term “free-run chicken.” Unless there is a proper way to take judicial notice of
19 this definition, the Court cannot consider it because “review is limited to the complaint” under
20 Rule 12(b)(6). Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001) (quoting Cervantes v.
21 City of San Diego, 5 F.3d 1273, 1274 (9th Cir. 1993)); see also United States v. Corinthian
22 Colleges, 655 F.3d 984, 998 (9th Cir. 2011) (“As a general rule, we ‘may not consider any
23 material beyond the pleadings in ruling on a Rule 12(b)(6) motion.’” (quoting Lee, 250 F.3d at
24 688)). “Indeed, factual challenges to a plaintiff’s complaint have no bearing on the legal
25 sufficiency of the allegations under Rule 12(b)(6).” Id. The Court therefore cannot take at face
26 value how Champion contends Canadian authorities define the term “free-run chicken.”
27 In any case, that Canadian authorities define “free-run chicken” as chickens that can run
1 implausible that Ms. Sultanis was aware of this Canadian definition given that she lives in the
2 United States. The Court cannot determine on the pleadings whether Ms. Sultanis knew what
3 “free-run chicken” means in Canada. In any event, what the Canadian government does via
4 regulation is not dispositive of what and how U.S. consumers are likely to react to given ads.
5 “The California Supreme Court has recognized ‘that [the CLRA, FAL, and UCL] prohibit not only
6 advertising which is false, but also advertising which [,] although true, is either actually
7 misleading or which has a capacity, likelihood, or tendency to deceive or confuse the public.’”
8 Williams, 552 F.3d at 938 (quoting Kasky v. Nike, Inc., 45 P.3d 243, 250 (Cal. 2002)). In other
9 words, “[t]he relevant question is not what [the term “free-run chicken”] mean[s], but rather what
10 [it] mean[s] to reasonable consumers, which cannot be resolved on a motion to dismiss.” Rice-
11 Sherman v. Big Heart Pet Brands, Inc., No. 19-CV-03613-WHO, 2020 WL 1245130, at *8 (N.D.
12 Cal. Mar. 16, 2020); see also Vicuna v. Alexia Foods, Inc., No. C 11-6119 PJH, 2012 WL
13 1497507, at *2 (N.D. Cal. Apr. 27, 2012) (“Because the question whether a reasonable consumer
14 would likely be deceived by the designation ‘All Natural’ is a factual dispute, the court finds that
15 these claims cannot be resolved at this stage of the litigation.”). How Canadian authorities define
16 the term “free-run chicken” is therefore irrelevant to establish, as a matter of law, whether that
17 term is false or misleading to American consumers like Ms. Sultanis. See In-N-Out Burgers v.
18 Smashburger IP Holder LLC, No. SACV171474JVSDFMX, 2018 WL 7891028, at *5 (C.D. Cal.
19 Dec. 21, 2018) (“Even if it is literally true that In-N-Out’s meat is free from ‘additives, fillers, or
20 preservatives,’ such a claim could be misleading to consumers who treat is [sic] as a claim that the
21 meat is free from any added substances (such as antibiotics) or byproducts of those substances.”);
22 Jones v. ConAgra Foods, Inc., 912 F. Supp. 2d 889, 898 (N.D. Cal. 2012) (“Notwithstanding
23 Defendant’s discussion at the motion hearing of preservatives and firming agents, the Court
24 concludes that this case is far less about science than it is about whether a label is misleading.”).
25 This is especially true given that, as Champion concedes, the nearly identical terms “free-range
26 chicken” and “free-roaming chicken” are ubiquitously used in the United States to refer to
27 chickens that can run outside. See Poultry Mot. at 11 (“If the bags of pet food at issue in this case
1 Ms. Sultanis has therefore plausibly alleged with sufficient particularity under Rule 9(b)
2 || that the statement “made with free-run chicken” is false or misleading.
3 b. Fish Action
4 Champion first argues that the statement “brimming with wild-caught fish” is not false or
5 misleading because the fish Products contain wild-caught catfish and white perch, even though
6 || they also contain farmed rainbow trout. Fish Mot. at 11. In fact, Champion points out that the
7 photos of fishermen in fresh-water lakes, one of whom is holding a wild-caught catfish, are photos
8 || of the Kentucky fishermen who supply Champion with wild-caught catfish and white perch used
9 That's why we loaded ACANA FRESHWATER FISH FORMULA with rainbow trout from Idaho plus wild-caught blue
catfish and white perch from Grand River, Kentucky — delivered fresh and whole in richly nourishing WholePrey™
10 ratios that promote peak health naturally, without long lists of synthetic additives, grains or GMO ingredients.
11 in the Fish Products. Fish Mot. at 12 (citing Compl. 20). Indeed, none of the Products’
12 packaging or website advertising cited in the fish complaint state that “all” or “100%” of the fish
13 used in the Products was wild caught. Champion also attaches to its motion screenshots” of other
14 parts of the fish Products’ packaging disclaiming that the fish Products contain rainbow trout from
15 Idaho and wild-caught catfish and white perch from Kentucky:
16
Libbey leds ed Ce eed □□□ bY
ed a ge) ee
3
18
19 ore > —
Mae aa ear aeALUNY
20 STEN ee MCE Ra Mr tee Colts Mame Cs Rel
21
22
23 Fish Mot. at 13. Considering these disclaimers, Champion urges the Court to dispense of Ms.
24
29 |] The Court takes judicial notice of these screenshots because they are part of the Products’
26 || packaging, and as such are (1) referenced in the complaint, (2) central to Ms. Sultanis’s claim, and
(3) she does not question their authenticity. See Corinthian Colleges, 655 F.3d at 999 (“[Courts]
27 || may ... consider unattached evidence on which the complaint ‘necessarily relies’ if (1) the
complaint refers to the document; (2) the document is central to the plaintiffs claim; and (3) no
2g || party questions the authenticity of the document.” (quoting Marder v. Lopez, 450 F.3d 445, 448
(9th Cir. 2006))).
1 Sultanis’s CLRA, FAL, and UCL claims to the extent they are based on the statement “brimming
2 with wild-caught fish,” because that statement is not false or misleading.
3 There are several problems with this argument. First, the Ninth Circuit has instructed
4 lower courts that “reasonable consumers should [not] be expected to look beyond misleading
5 representations on the front of the box to discover the truth from the ingredient list in small print
6 on the side of the box.” Williams, 552 F.3d at 939; see also Anthony v. Pharmavite, No. 18-CV-
7 02636-EMC, 2019 WL 109446, at *4 (N.D. Cal. Jan. 4, 2019) (“[T]here is a question of fact
8 whether a reasonable consumer would notice it and follow it to the disclaimer.”); McMorrow v.
9 Mondelez Int’l, Inc., No. 17-CV-02327-BAS-JLB, 2018 WL 3956022, at *12 (S.D. Cal. Aug. 17,
10 2018) (“[W]hile keeping in mind that the Court considers the advertising statements in context of
11 the overall advertisement, it also does not find that the Products’ mandated content disclosures
12 cure any ambiguities of the health and nutrition claims that Plaintiffs are challenging.”). Here,
13 whether a reasonable consumer read the inconspicuous disclaimers that explain the ingredients
14 include wild-caught and farmed fish is, at the very least, a question of fact.
15 Second, even assuming a reasonable consumer read the disclaimers identified by
16 Champion, “it cannot be concluded as a matter of law that the substance of the disclaimer would
17 be sufficient to disabuse the consumer of any misconceptions engendered by the [‘brimming with
18 wild-caught fish’] representation[].” Anthony, 2019 WL 109446, at *4. For instance, the
19 identified disclaimers only explain that the Products are “loaded . . . with rainbow trout from Idaho
20 and wild-caught blue catfish and white perch from Grand Rapids, Kentucky;” they do not identify
21 what percentage of the fish used in the Products is wild caught, nor do they explicitly say that the
22 rainbow trout from Idaho is farmed. It is therefore entirely possible that a reasonable consumer
23 read the disclaimers and still thought the rainbow trout was wild caught. See id. (“[I]n view of the
24 promises of the health benefit representation on the labels, ‘[t]he Court cannot find that
25 Defendant’s [disclaimer] is so unambiguous and express such that a reasonable consumer is
26 unlikely to be deceived as a matter of law’ by the health benefit representations on the Biotin
27 Products.” (quoting Sperling v. Stein Mart, Inc., No. CV 15-01411 BRO (KKx), 2016 WL
1 Third, the fact that the Products contain some wild-caught fish does not mean that the
2 statement “brimming with wild-caught fish” is not misleading. The statements do not need to use
3 qualifiers like “all” or “100%” in its representations in order to be misleading. For example, in
4 Janney v. Mills, the court explained that the absence of “100%,” or “All,” from the term “Natural”
5 is not significant in determining the deceptiveness of the “Natural” representation on the
6 packaging of a granola bar that included, although not exclusively, synthetic ingredients. 944 F.
7 Supp. 2d 806, 817 (N.D. Cal. 2013); see also Jou v. Kimberly-Clark Corp., No. C-13-03075 JSC,
8 2013 WL 6491158, at *6 (N.D. Cal. Dec. 10, 2013) (“While the use of ‘all’ in ‘all natural’ may
9 make the inference even more plausible than the inference arising from the use of just ‘natural,’
10 the use of ‘natural’ still provides the plausible inference required to defeat a Rule 12(b)(6)
11 motion.”). Likewise here, although it is certainly more plausible that Ms. Sultanis would have
12 been misled by the statements “all wild-caught fish” or “100% wild-caught fish,” that does not
13 mean it is entirely implausible that she was misled into thinking that the Products were free from
14 farmed fish by the term “brimming with wild-caught fish.”
15 Recently cases involving cleaning products that illustrate the idea that statements broadly
16 describing a certain type of ingredient can mislead consumers into thinking the products at issue
17 contain only that type of ingredient. For example, in Maisel v. S.C. Johnson & Son, Inc., the court
18 concluded that a plaintiff plausibly alleged she was misled by the term “plant-based ingredients”
19 into thinking the cleaning products at issue contained only plant-based ingredients, even though
20 “[t]here is no dispute that the products contain[ed] at least some plant and/or mineral ingredients.”
21 No. 21-CV-00413-TSH, 2021 WL 1788397, at *9 (N.D. Cal. May 5, 2021); see also Balser, 640
22 F. App’x 694, 696 (9th Cir. 2016) (“[T]he statements that the products were ‘natural’ . . . could be
23 taken as a claim that no synthetic chemicals were in the products, a claim the complaint alleges, in
24 detail, is false.”); Przybylak v. Bissell Better Life LLC, No. CV 19-2038 PA (GJSX), 2019 WL
25 8060076, at *6 (C.D. Cal. July 19, 2019) (“Plaintiffs plausibly allege that Defendant falsely or
26 misleadingly represented that its products were “natural” or “plant-derived,” . . . and that a
27 reasonable consumer would understand those representations to mean that the products did not
1 RS, 2018 WL 5886611, at *4 (N.D. Cal. Nov. 9, 2018) (rejecting William-Sonoma’s argument
2 that “the label phrase ‘Active Ingredients Derived from Natural Sources’ is literally true, and
3 [therefore] no reasonable consumer would expect the products necessarily to be completely free
4 from ‘unnatural and/or synthetic ingredients’”); Gregorio v. Clorox Co., No. 17-CV-03824-PJH,
5 2018 WL 732673, at *4 (N.D. Cal. Feb. 6, 2018) (“While defendant appears to concede that
6 ‘100% natural’ and ‘all natural’ would be misleading, defendant fails to recognize that the court is
7 not free to dismiss claims because defendant chose not to use a potentially more misleading
8 phrase. And ‘the phrase [“naturally derived”] may be tantamount to, or at least could reasonably
9 be understood to mean “all natural” or “100% natural.”’” (quoting Pecanha v. The Hain Celestial
10 Grp., Inc., 2018 WL 534299, at *3 (N.D. Cal. Jan. 24, 2018))); Shank v. Presidio Brands, Inc.,
11 No. 17-CV-00232-DMR, 2018 WL 510169, at *9 (N.D. Cal. Jan. 23, 2018) (“The statement
12 ‘naturally-derived,’] on the labels of Every Man Jack products ‘could easily be interpreted by
13 consumers as a claim that all the ingredients in the product[s] were natural,’ which Shank has
14 plausibly alleged is false.” (quoting Williams, 552 F.3d at 939)). As in these cases, although
15 Champion does not make any objective representations about the amount of wild-caught fish in
16 the Products, it is plausible that a reasonable consumer could be deceived by the statement
17 “brimming with wild-caught fish” into thinking the products only—or mostly—contain fish that
18 was caught in the wild.
19 Finally, Champion acknowledges in its motion that at least one of the statements identified
20 by Ms. Sultanis in the fish complaint, “admittedly (and inadvertently) misstated that it contained
21 wild-caught rainbow trout.” Fish Mot. at 2. The fish complaint indeed attaches screenshots of not
22 one, but several websites, including Champion’s website, describing the products as “brimming
23 with wild-caught rainbow trout” or “with wild-caught rainbow trout.” See Fish Compl. ¶¶ 15–19.
24 After reading these statements, there is no disclaimer, and certainly not one simply stating that the
25 products are made “with rainbow trout,” that would disabuse a reasonable consumer from
26 assuming the products contain wild-caught rainbow trout. Because it is undisputed that Products
27 did not contain “wild-caught rainbow trout,” the Court cannot conclude that statement is not false
1 Ms. Sultanis has therefore plausibly alleged with sufficient particularity under Rule 9(b)
2 that the statements “brimming with wild-caught fish” and “brimming with wild-caught rainbow
3 trout” are either false or misleading.
4 2. Reasonable Reliance
5 a. Poultry Action
6 Champion argues that Ms. Sultanis failed to plausibly allege that she relied on the “free-
7 run chicken” statement and that a reasonable person would attach importance to the fact that the
8 Products were made with chickens that can run outside. To the contrary, the complaint in the
9 Poultry Action plainly states that Ms. Sultanis purchased the ACANA Meadowland Regional
10 Formula Grain Free Dry Cat & Kitten Food on July 24, 2017 on Chewy.com, after reviewing the
11 “free-run chicken” statement “as stated on the packaging and in Champion’s marketing and
12 advertising materials described herein.” Poultry Compl. ⁋ 57–60. It also states that she purchased
13 the Products believing these statements to be true, and that she would not have purchased the
14 Products, or would have paid less for the Products, had she known that they were not made with
15 chickens that were allowed to run outside. See id. at 60–62. Several cases, including those cited
16 by Champion, establish that these types of allegations are sufficiently specific to plausibly allege
17 reliance in the context of the FAL, CLRA, and the UCL’s fraud prong. See e.g., Rice-Sherman,
18 2020 WL 1245130, at *8 (“Plaintiffs have alleged [reasonable reliance because t]hey state that
19 they relied upon the ‘Grain Free,’ ‘No Corn,’ and ‘No Soy Protein’ representations on the product
20 packaging in deciding to purchase the product and that they would not have purchased the food if
21 the actual ingredient list was fully disclosed.”); Anthony, 2019 WL 109446, at *5 (dismissing
22 plaintiffs’ UCL claim without prejudice because “[t]hey do not specify what part of the labels and
23 representations they saw and relied upon.”); Figy v. Frito-Lay N. Am., Inc., 67 F. Supp. 3d 1075,
24 1088 (N.D. Cal. 2014) (“[R]rather than allege reliance on an alleged misrepresentation as required
25 by the UCL, at best Plaintiffs misbranding theory only alleges reliance on the ‘salability’ of the
26 products.”).
27 Champion points out that the complaint alleges that other products, but not the cat food
1 Compare Poultry Compl. ¶ 16 (“‘Wholesome Grains Free-Run Poultry Recipe’ dog food”), with
2 id. ¶ 59 (“ACANA Meadowland Regional Formula Grain-Free Dry Cat & Kitten Food”). But Ms.
3 Sultanis explains that “although not alleged in the Complaint, the variety [she] purchased also
4 prominently displays an image of a green pasture on the front of the label with the accompanying
5 claim ‘Free-Run Poultry.’” Poultry Opp’n at 12 n.6. Notably, Champion does not contend that
6 some of its Poultry Products did not contain the “free-run chicken” statement. Since there appears
7 to be no material differences in the Products’ packaging, Champion cannot argue that it does not
8 have fair notice of Ms. Sultanis’s claims simply because it does not know exactly what product
9 she purchased.
10 Moreover, the Ninth Circuit has admonished lower courts for dismissing false advertising
11 claims under California law “solely on [their] own review of an example of the packaging.”
12 Williams, 552 F.3d at 938. Rather, determining “[w]hether a practice is deceptive, fraudulent, or
13 unfair is generally a question of fact which requires ‘consideration and weighing evidence from
14 both sides’ [] which usually cannot be made on demurrer.” Id. at 938–39 (quoting Linear Tech.
15 Corp. v. Applied Materials, 61 Cal. Rptr. 3d 221 (Cal. App. 2007)). It is entirely plausible that
16 Ms. Sultanis reasonably relied solely on the use of the statement “made with free-run chicken,”
17 which Champion does not dispute was on the label of all the Products. It is also plausible that the
18 product Ms. Sultanis purchased also had depictions of chickens running in outdoor grass fields.
19 Either way, further discovery is necessary to resolve this factual issue. In the meantime, Ms.
20 Sultanis’s allegations are sufficient to plausibly state reasonable reliance with particularity for
21 purposes of Rule 9(b).
22 Champion also argues that even if Ms. Sultanis plausibly alleged that she relied on the
23 “made with free-run chicken” statement, that reliance was unreasonable because she has not
24 plausibly pled that a reasonable person would attach importance to the fact that the Products were
25 made with chickens that can run outside. This argument has little force because Ms. Sultanis
26 supports her allegation that “the use of the terms ‘free-run poultry’ are powerful statements that
27 are important to consumers” by citing studies showing that, for example, “84% of food shoppers
1 Compl. ⁋⁋ 50–51. She also cites studies allegedly showing that “89% of consumers” are very
2 concerned about farm animal welfare; “74% stated that they were willing to pay more for
3 humanely raised meat products.” Id. ⁋ 52. Similarly, the complaint points to a 2018 survey from
4 the National Chicken Council where three-quarters of respondents “said they were concerned
5 about how chickens are raised for meat.” Id. at 53. The list goes on, and includes studies showing
6 that consumers’ concerns with how farm animals—particularly chickens—are raised are
7 “increasingly carrying over to pet foods.” Id. ⁋⁋ 54–56. Ms. Sultanis also cites in her complaint
8 statements from other consumers who were deceived by the “made with free-run chicken”
9 statement. Id. ¶¶ 27–28. Taking all of these allegations as true, as the Court must at the motion to
10 dismiss stage, requires concluding that Ms. Sultanis has plausibly pled that reasonable consumers
11 care that the Products were made with chickens that can run outside.
12 The Court therefore concludes that Ms. Sultanis has plausibly pled reasonable reliance
13 with sufficient particularity under Rule 9(b).
14 b. Fish Action
15 Like the poultry complaint, the fish complaint also alleges that Ms. Sultanis purchased the
16 ACANA Meadowland Regional Formula Grain Free Dry Cat & Kitten Food on July 24, 2017 on
17 Chewy.com, after reviewing the “wild-caught fish” and “wild-caught rainbow trout” statements
18 “as stated on the packaging and in Champion’s marketing and advertising materials described
19 herein.” Fish Compl. ⁋ 39–41. It also states that she purchased the Products believing these
20 statements to be true, and that she would not have purchased the Products, or would have paid less
21 for the Products, had she known that they were made with farmed fish. See Id. at 41–42. Unlike
22 the poultry complaint, however, these allegations are insufficient to plead reliance with sufficient
23 particularity under Rule 9(b).
24 The first problem with these allegations is that Ms. Sultanis now admits that she did not in
25 fact review, let alone rely upon, the statements on Champion’s, Amazon’s, or PetCo’s websites
26 stating that the products were “brimming with wild-caught rainbow trout.” See Fish Action,
27 Docket No. 27 (“Fish Opp’n”) at 12. Champion cornered Ms. Sultanis into admitting this by
1 purchased the Products in July 2017, making it impossible for her to have relied on them. See
2 Fish Opp’n at 16.
3 The allegations that Ms. Sultanis viewed and relied upon the statement “brimming with
4 wild-caught fish”—which Champion does not dispute was on the package of the Products Ms.
5 Sultanis purchased—would have been sufficient to establish reasonable reliance had Champion
6 not pointed out that the packaging also contains the disclaimers identified above. See supra Part
7 III.B.1.b. Those disclaimers to some extent explain that the Products are made with rainbow trout
8 and wild-caught blue catfish/white perch. As this Court noted in Anthony, a plaintiff fails to plead
9 reliance with sufficient particularity under Rule 9(b) if their “complaint is devoid of any
10 allegations regarding whether Plaintiffs saw the asterisk, read the corresponding disclaimer, and if
11 they did read it, how the disclaimer affected their purchasing decision.” 2019 WL 109446, at *5.
12 Here, as in Anthony, the complaint makes no mention of the disclaimers Champion identifies. In
13 fact, Ms. Sultanis “do[es] not specify what part of the labels and representations [she] saw and
14 relied upon.” Id.; see also Chase v. Hobby Lobby Stores, Inc., No. 17-CV-00881-GPC-BLM,
15 2017 WL 4358146, at *9 (S.D. Cal. Oct. 2, 2017) (dismissing false advertising claim for failure to
16 satisfy Rule 9(b) because plaintiff did not allege whether she saw the asterisk in the challenged
17 advertisement or if she read the corresponding disclaimer); Sperling, 2016 WL 8925347, at *8
18 (dismissing false advertising claim because complaint “fails to adequately plead, with any
19 particularity,” any allegations regarding the asterisk on defendant’s price tags that directs
20 consumers to defendant’s pricing policy). Unlike in the Poultry Action, where the package had no
21 competing language contextualizing the “made with free-run chicken” statement, the misleading
22 “brimming with wild-caught fish” statement in the Fish Action was potentially cured by the
23 disclaimers. Ms. Sultanis does not allege, for instance, whether she read the disclaimers and did
24 not understand them to mean that only the trout was wild caught, or that she did not read them at
25 all because they were too small or inconspicuous.
26 The Court therefore GRANTS Champion’s motion to dismiss Ms. Sultanis’s Counts 3
27 (CLRA), 4 (FAL), and 5 (UCL) in the Fish Action with leave for her to add, with sufficient
1 relied upon, and understood.
2 C. Rule 12(b)(6) Motion to Dismiss Breach of Express Warranty Claims
3 The Court DENIES Champion’s motions to dismiss Ms. Sultanis’s express warranty
4 claims in both actions because they are predicated on the same unavailing arguments that the
5 “free-run chicken” and “wild-caught fish/rainbow trout” statements are neither false nor
6 misleading. Rice-Sherman, 2020 WL 1245130, at *11; Koehler v. Litehouse, Inc., No. CV 12-
7 04055 SI, 2012 WL 6217635, at *4 (N.D. Cal. Dec. 13, 2012).
8 D. Rule 12(b)(6) Motion to Dismiss Unjust Enrichment Claim in Poultry Action
9 The Court DENIES Champion’s motion to dismiss Ms. Sultanis’s unjust enrichment claim
10 (Count 6) in the Poultry Action because it is predicated on the same unavailing arguments that the
11 “free-run chicken” statement is neither false nor misleading under the CLRA, FAL, or UCL.
12 Poultry Mot. at 13.
13 IV. CONCLUSION
14 For the foregoing reasons, the Court GRANTS in part and DENIES in part Champion’s
15 motions to dismiss as follows:
16 • Ms. Sultanis’s claims on behalf of the Nationwide Class under Count 6 of the Poultry
17 Action are DISMISSED without leave to amend.
18 • Ms. Sultanis’s claims on behalf of the Multi-State Class under Count 1 of both Actions are
19 DISMISSED with leave to amend. If Ms. Sultanis amends her complaint to add similarly
20 situated named plaintiffs in some or all of the states currently comprising the Multi-State
21 Class and survives a further motion to dismiss, class certification would not be decided
22 until a formal motion is filed under Rule 23 – the Court would then examine, inter alia,
23 issues of manageability.
24 • Ms. Sultanis’s claims on behalf of herself and the California Sub-Class under Counts 3
25 (CLRA), 4 (FAL), and 5 (UCL) in the Fish Action are DISMISSED for failure to state a
26 claim with leave to amend.
27 • The motions are DENIED as to all other counts.
1 Ms. Sultanis is instructed to file any amended complaint no later than thirty (30) days after
2 the date of this order.
3 This order disposes of Docket No. 24 in the Poultry Action (C-21-0162 EMC) and Docket
4 No. 21 in the Fish Action (C-21-0167 EMC).
5
6 IT IS SO ORDERED.
7
8 Dated: August 3, 2021
9 ______________________________________
EDWARD M. CHEN
10 United States District Judge
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