Natale v. 9199-4467 Quebec Inc.

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

--------------------------------X

MEGANNE NATALE and CHELSEA CHENG,

individually and on behalf of all

others similarly situated, MEMORANDUM & ORDER

21-CV-6775 (JS)(SIL)

Plaintiffs,

-against-

9199-4467 QUEBEC INC., d/b/a

EARTH RATED,

Defendant.

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APPEARANCES

For Plaintiffs: Max Stuart Roberts, Esq.

Bursor & Fisher, P.A.

1330 Avenue of the Americas, 32nd Floor

New York, New York 10019

Brittany Scott, Esq.

Lawrence T. Fisher, Esq.

Bursor & Fisher, P.A.

1990 North California Boulevard, Suite 940

Walnut Creek, California 94596

For Defendant: Alan F. Kaufman, Esq.

Nelson Mullins Riley & Scarborough LLP

330 Madison Avenue, 27th Floor

New York, New York 10017

Jahmy Graham, Esq.

Nelson Mullins Riley & Scarborough LLP

19191 South Vermont Avenue, Suite 900

Torrance, California 90502

SEYBERT, District Judge:

9199-4467 Quebec Inc. d/b/a Earth Rated (“Defendant” or

“Earth Rated”) moves, pursuant to Rules 9(b), 12(b)(1) and 12(b)(6)

of the Federal Rules of Civil Procedure (the “Rules”), to dismiss

the First Amended Complaint (the “FAC”) of Meganne Natale

(“Natale”) and Chelsea Cheng (“Cheng” and collectively with Natale

“Plaintiffs”) (hereafter, the “Motion”). (See Motion, ECF No.

21.) For the reasons that follow, Defendant’s Motion is GRANTED

IN PART AND DENIED IN PART.

BACKGROUND1

Defendant “is a Canadian corporation with its principal

place of business [in] . . . Canada.” (FAC, ECF No. 20, ¶ 40.)

One of the products Defendant sells is a range of “Earth Rated

Certified Compostable Poop Bags” (the “Product”). (Id. ¶ 4, 6.)

“Defendant markets, sells, and distributes the Product throughout

the United States, including in the State of New York.” (Id.

¶ 35.) Plaintiffs are both New York domiciliaries each of whom

relied upon Defendant’s representations that the Product was

“certified compostable” when buying the Product. (Id. ¶ 38, 39.)

“The Product comes in three different sizes: 60 bags,

105 bags, and 225 bags.” (Id. ¶ 4.) “On the packaging [of] the

60-count version of the Product, Defendant represents that the

Product is ‘Certified Compostable.’” (Id. ¶ 5.) The packaging

for the 105-count and the 225-count versions of the Product are

“identical in all respects except for the size” and likewise state

that they are “Certified Compostable.” (Id. ¶ 6.) Defendant

claims on its website that its “certified compostable bags meet

1 The following facts are drawn from the FAC with all reasonable

inferences drawn in favor of Plaintiffs.

the ASTM D6400 standard for municipal composting as well as the

EN13432 Home and Industrial standards for compostability.” (Id.

¶ 7.) Defendant also represents on its website that the Product

“is ‘certified for home composting’ and is compostable at a ‘city

compost’ facility.” (Id. ¶ 8.) “On the back of the 60-count

version of the Product,” the packaging “includes a small print

disclaimer in small font” stating: “COMPOSTABLE IN INDUSTRIAL

FACILITIES[.] Check locally, as these do not exist in many

communities.” (Id. ¶ 18.) Contrary to what is stated on the

website, the packaging also states “[n]ot suitable for backyard

composting.”2 (Id. (emphasis in original).) “Defendant also

includes a small print disclaimer on the side panel of the 60-

count version of the Product” stating: “[s]hould only be disposed

of in commercial composting facilities where pet waste is

accepted.” (Id. ¶ 19.) The 105-count and 225-count versions of

the Product also include small-print disclaimers stating: “Should

only be disposed of in commercial composting facilities where pet

waste is accepted. These facilities may not exist in your area.

If you want to compost your pet waste in a home compost, please

2 The representation on the 60-count version of the Product that

the Product is, in fact, not suitable for home composting also

contradicts representations made on the 105- and 225-count

versions of the Product which state that the Product is suitable

for backyard composting, but only with non-food crops. (See FAC

¶ 20.)

ensure to only use the resulting compost on non-food crops.” (Id.

¶ 20.)

The Product page on Defendant’s website also contains

disclaimers; however, to view the disclaimers, customers are

required to click a “Read more+” tab. (Id. ¶ 25.) Defendant’s

website also contains “several FAQs on the Product page.” (Id.

¶ 26.) However, “[t]he FAQs themselves do not indicate any sort

of disclaimer is present by their titles;” instead, users must

navigate to an innocuously titled FAQ: “[h]ow should I dispose of

the compostable poop bags” (the “How-To-Page”), to access the

disclaimers. (Id. ¶ 27.) Once accessed, the How-To-Page informs

users that the Product “can be composted in municipal facilities

that accept pet waste.” (Id. (emphasis in original).) The

disclaimer continues, “Municipal composting facilities that accept

pet waste do not exist in many communities[,] so be sure to check

locally for such facilities in your area.” (Id.) Plaintiffs aver

that “[n]o reasonable consumer would expect that by clicking on

ambiguously named or indiscriminate links, they would find small

print language on Defendant’s website . . . that would contain

language inconsistent with the representation that the Product is

capable of being composted.” (Id. ¶ 28.)

Plaintiffs contend that Defendant’s composting

representations are false citing the Federal Trade Commission (the

“FTC”) which “has stated that ‘compostable’ claims on dog waste

products are ‘generally untrue.’” (Id. ¶ 10.) Specifically,

Plaintiffs highlight language from the FTC that “dog waste cannot

be composted because it can contain harmful contaminants (e.g., E.

Coli).” (Id. at ¶ 12.) Additionally, Plaintiffs note that the

U.S. Environmental Protection Agency has stated that “[e]ven in

backyard composting . . . dog waste can contain harmful parasites,

bacteria, viruses, or pathogens.” (Id.) Plaintiffs aver that

Defendant’s statement -- that its bags can be put into a city

compost “if [the] city’s municipal composting accepts pet waste”

-- is also false and misleading because “industrial composting of

dog waste is not available in the United States.” (Id. at ¶¶ 8,

11, 14. (emphasis in original.)) Defendant admits as much “on a

blog post on its website[,] that is not linked in any way to the

Product’s page.” (Id. ¶ 14.) Plaintiffs argue that “[n]o

reasonable consumer would expect that the small print language on

the back and side panels of the Product would contain language

inconsistent with the representation that the Product is capable

of being composted.” (Id. ¶ 21.) Likewise, Plaintiffs contend

that no reasonable consumer would “expect that a ‘certified

compostable’ dog waste bag would not be capable of being

composted.” (Id. ¶ 28.)

As part of its regulatory function, the FTC provides

marketers with “examples of deceptive conduct” (the “Green

Guides.”) (Id. ¶ 16.) Plaintiffs highlight two relevant examples

wherein the FTC offers the following hypothetical scenarios:

Example 2:

A garden center sells grass clipping bags

labelled as ‘Compostable in California

Municipal Yard Trimmings Composting

Facilities.’ When the bags break down,

however, they release toxins into the compost.

The claim is deceptive if the presence of

these toxins prevents the compost from being

usable [“Example 2.”]

Example 4:

Nationally marketed lawn and leaf bags state

‘compostable’ on each bag. The bags also

feature text disclosing that the bag is not

designed for use in home compost piles. Yard

trimmings programs in many communities compost

these bags, but such programs are not

available to a substantial majority of

consumers or communities where the bag is

sold. The claim is deceptive because it

likely conveys that composting facilities are

available to a substantial majority of

consumers or communities. [“Example 4.”]

(Id. (quoting 16 C.F.R. § 260.7(d) (emphasis added)).) Plaintiffs

argue these FTC examples “are analogous to the issue here.” (Id.

¶ 17.) Plaintiffs highlight that “[l]ike Example 2, the inability

to compost dog waste due to the presence of parasites, bacteria,

viruses, and pathogens prevents compost from being usable.” (Id.)

Similarly, Plaintiffs allege that “like Example 4, facilities that

can compost dog waste are not available to most (if not all) U.S.

consumers, and Defendant does not clarify this on the Product’s

packaging.” (Id.)

Regarding pricing, the 60-count version of the Product

sells for $8.99, approximately $0.15 per bag. By contrast, a

similar 120-bag product offered by Defendant, that is not certified

compostable, sells for $6.99, approximately $0.06 per bag. (Id.

¶ 36.) Plaintiffs contend “Defendant represents that the Product

is ‘certified compostable’ and charges a price premium for the

Product based on this representation.” (Id.)

On or about September 2021, “Plaintiff Natale purchased

a 60-count package of the Product from NYC Pet (a local pet store

in her neighborhood).” (Id. ¶ 38.) On or about “August 2020,

Plaintiff Cheng purchased a 225-count package of the Product from

Amazon (through which Defendant conducts significant business).”

(Id. ¶ 39.) Before purchasing the Product, Plaintiffs “reviewed

the [P]roduct’s labeling and packaging and saw that [the] Product

was labeled and marketed as ‘certified compostable’”; both

Plaintiffs “relied on Defendant’s representations that the Product

was ‘certified compostable’” in completing each respective

purchase. (Id. ¶ 38, 39.) The Plaintiffs “would not have purchased

[the] Product on the same terms had [Plaintiffs] known those

representations were not true.” (Id.)

PROCEDURAL HISTORY

Plaintiffs filed their original Complaint on December 7,

2021. (See Compl., ECF No. 1.) On March 24, 2022, Defendant filed

a pre-motion conference request in anticipation of filing a motion

to dismiss the Complaint (the “PMC Request”). (See PMC Request,

ECF No. 13.) Plaintiffs opposed Defendant’s PMC Request. (See

PMC Opp’n, ECF No. 14.) Notwithstanding Plaintiffs’ opposition,

on May 5, 2022, the Court held a pre-motion conference and set a

briefing schedule on the dismissal motion. (See Min. Entry, ECF

No. 19.) The Court also granted Plaintiffs leave to file their

FAC, which they did on May 6, 2022 (Id.; see also FAC.) Plaintiffs’

FAC asserts eight causes of action: (1) violation of N.Y. General

Business Law (“G.B.L.”) § 349; (2) violation of N.Y. G.B.L. § 350;

(3) breach of express warranty; (4) breach of implied warranty;

(5) violation of the Magnuson-Moss Warranty Act (“the “MMWA”);

(6) unjust enrichment; (7) negligent misrepresentation; and

(8) fraud. (See FAC ¶ 53-112.) Defendant moved to dismiss

Plaintiffs’ FAC on June 6, 2022. (See Motion; see also Support

Memo, ECF No. 21-1, attached to Motion.) On July 6, 2022,

Plaintiffs opposed Defendant’s Motion (see Opp’n, ECF No. 25), to

which Defendant filed a Reply on July 21, 2022. (See Reply, ECF

No. 26.)

DISCUSSION

I. Legal Standard

A. Rule 12(b)(1)

“A case is properly dismissed for lack of subject matter

jurisdiction under Rule 12(b)(1) when the district court lacks the

statutory or constitutional power to adjudicate it.” Makarova v.

United States, 201 F.3d 110, 113 (2d Cir. 2000). While the Court

must “generally accept the truth of a plaintiff’s allegations at

the motion to dismiss stage, the plaintiff still ‘bears the burden

of alleging facts that affirmatively and plausibly suggest that

[the plaintiff] has standing to sue.’” Calcano v. Swarovski N.

Am. Ltd., 36 F.4th 68, 75 (2d Cir. 2022) (quoting Cortland St.

Recovery Corp. v. Hellas Telecomms., S.a.r.l., 790 F.3d 411, 417

(2d Cir. 2015)). Thus, while the Court “must take all facts

alleged in the complaint as true and draw all reasonable inferences

in favor of [the] plaintiff . . . ‘jurisdiction must be shown

affirmatively, and that showing is not made by drawing from the

pleadings inferences favorable to the party asserting it.’”

Rosenberg v. McCarthy, Burgess & Wolff, Inc., No. 21-CV-2199, 2022

WL 3030390, at *2 (E.D.N.Y. Aug. 1, 2022) (quoting Morrison v.

Nat’l Austl. Bank Ltd., 547 F.3d 167, 170 (2d Cir. 2008)).

“Ultimately, ‘the party asserting subject matter jurisdiction has

the burden of proving by a preponderance of the evidence that it

exists.’” Id. (quoting Tandon v. Captain Cove Marina of

Bridgeport, Inc., 752 F.3d 239, 243 (2d Cir. 2014) (further

citation omitted)). “[T]he ‘irreducible constitutional minimum’

of standing” requires a plaintiff to show he has “(1) suffered an

injury in fact, (2) that is fairly traceable to the challenged

conduct of the defendant, and (3) that is likely to be redressed

by a favorable judicial decision.” Spokeo, Inc. v. Robins, 578

U.S. 330, 338 (2016) (quoting Lujan v. Defenders of Wildlife, 504

U.S. 555, 560 (1992)).

B. Rule 12(b)(6)

“The standard of review for a motion to dismiss under

Rule 12(b)(6) . . . is ‘substantively identical’ to the Rule

12(b)(1) standard.” Epstein v. JPMorgan Chase & Co., No. 13-CV-

4744, 2014 WL 1133567, at *5 (S.D.N.Y. Mar. 21, 2014) (quoting

Lerner v. Fleet Bank, N.A., 318 F.3d 113, 128 (2d Cir. 2003)),

abrogation on other grounds recognized by Am. Psychiatric Ass’n v.

Anthem Health Plans, Inc., 821 F.3d 352, 359 (2d Cir. 2016). When

considering a motion to dismiss under Rule 12(b)(6), the court

must “accept as true all factual statements alleged in the

complaint and draw all reasonable inferences in favor of the non-

moving party.” McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184,

191 (2d Cir. 2007). To survive a motion to dismiss under Rule

12(b)(6), a complaint must state “enough facts to state a claim to

relief that is plausible on its face.” Bell Atl. Corp. v. Twombly,

550 U.S. 544, 570 (2007). A claim is plausible “when the plaintiff

pleads factual content that allows the court to draw the reasonable

inference that the defendant is liable for the misconduct alleged.”

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Consequently, a

complaint is properly dismissed where, as a matter of law, “the

allegations in a complaint, however true, could not raise a claim

of entitlement to relief.” Twombly, 550 U.S. at 558. Similarly,

a complaint is also properly dismissed “where the well-pleaded

facts do not permit the court to infer more than the mere

possibility of misconduct.” Iqbal, 556 U.S. at 679.

C. Rule 9(b)

A higher pleading standard applies to allegations of

“fraud or mistake,” which “must state with particularity the

circumstances constituting fraud or mistake.” FED. R. CIV. P. 9(b).

Rule 9(b) “ordinarily requires a complaint alleging fraud to

‘(1) specify the statements that the plaintiff contends were

fraudulent, (2) identify the speaker, (3) state where and when the

statements were made, and (4) explain why the statements were

fraudulent.’” United States ex rel. Chorches for Bankr. Est. of

Fabula v. Am. Med. Response, Inc., 865 F.3d 71, 81 (2d Cir. 2017)

(quoting U.S. ex rel. Ladas v. Exelis, Inc., 824 F.3d 16, 25 (2d

Cir. 2016)).

II. Analysis

A. Rule 12(b)(1): The FAC Adequately Alleges Economic

Injury Sufficient for Purposes of Standing

As an initial matter, the Court addresses Defendant’s

argument that Plaintiffs lack standing because they cannot allege

injury-in-fact.

To demonstrate injury-in-fact, a plaintiff must show:

(1) “the ‘invasion of a legally protected interest’”; (2) “that is

‘concrete and particularized’”; and (3) “‘actual or imminent, not

conjectural or hypothetical.’” Strubel v. Comenity Bank, 842 F.3d

181, 188 (2d Cir. 2016) (quoting Lujan, 504 U.S. at 560-61). “To

demonstrate a concrete injury, a plaintiff must show that it

‘actually exist[s],’ meaning it is ‘real and not abstract.’”

Duchimaza v. Niagara Bottling, LLC, 619 F. Supp. 3d 395, 408

(S.D.N.Y. 2022) (quoting Strubel, 842 F.3d at 188.)) “[T]he law

is clear that economic injury -- including that caused by paying

a premium -- is sufficient to establish injury for standing

purposes.” Kacocha v. Nestle Purina Petcare Co., No. 15-CV-5489,

2016 WL 4367991, *7 (S.D.N.Y. Aug. 12, 2016); see also Belfiore v.

Procter & Gamble Co., 94 F. Supp. 3d 440, 447 (E.D.N.Y. 2015)

(“Courts have construed the payment of a premium price to be an

injury in and of itself”); Segedie v. Hain Celestial Grp., Inc.,

No. 14-CV-5029, 2015 WL 2168374, *12 (S.D.N.Y. May 7, 2015)

(“Plaintiffs have also adequately alleged injury by claiming that

they paid a price premium that they would not have paid if the

products were not labeled ‘natural’ or ‘all natural.’”).

Summarily Defendant’s standing argument is that since

the Product is, in fact, “Certified Compostable” as advertised,

the Plaintiffs received the benefit of their bargain when they

purchased the Product. (See Support Memo at 13.) Defendant

highlights that the Product meets “the ASTM D6400 and EN13432

Standards for compostability” and that the FAC does not dispute

the Product’s certifications. (Id. at 13-14.) Defendant also

contends that the Product complies with the applicable sections of

the FTC’s Green Guides. (Id. at 14-15.) Specifically, Defendant

argues that the disclaimers on the Product regarding the limited

availability of suitable composting facilities are in-line with

example language promulgated by the FTC that would allow a marketer

of such a product to avoid marketing a deceptive product. (Id.)

As to Cheng, Defendant inconspicuously raises, in a footnote, that

it “has no record of a customer by [that] name purchasing the

Product via Amazon.com as alleged. (Id. at 8 n.6.)3

3 Plaintiff did not respond to Defendant’s footnote regarding

Cheng. (See Opp’n, in toto.) Nevertheless, given that Defendant’s

standing challenge is based on the pleadings, the Court must

“accept as true all material allegations of the complaint,” Carver

v. City of New York, 621 F.3d 221, 225 (2d Cir. 2010), which

includes Cheng’s factual assertion that she purchased the Product

via Amazon.com. To the extent Defendant later becomes aware of

evidence which disproves Cheng’s factual assertion, Defendant may

renew its argument then, and without first filing a motion for a

pre-motion conference.

Plaintiffs counter that Defendant charges a premium

price for the Product because it is “Certified Compostable” and

that “overpaying for a product due to actionable

misrepresentations or omissions is generally concrete and

particularized enough to establish an injury for standing

purposes.” (Opp’n at 14-15 (internal citations omitted).)

Plaintiffs continue that they relied upon Defendant’s “‘Certified

Compostable’ claim in deciding to purchase the Product at a

premium.” (Id. at 15.) This claim, Plaintiffs allege, is “false

and not properly or conspicuously disclaimed.” (Id.) Plaintiffs

clarify that Defendant’s “Certified Compostable” claim is false

because the Product is not capable of being composted. (Id. at 5,

15). Specifically, Plaintiffs allege that: (1) the nature by which

dog waste releases harmful bacteria when it decomposes means it

cannot safely be composted in a backyard setting; and (2) while

the Product can be composted in certain municipal industrial

facilities that accept pet waste, there are no such facilities

currently available in the United States. (Id.) Notwithstanding

the Product’s certifications, Plaintiffs allege that the Product

is not capable of being composted, and that Defendant’s disclaimers

on this point were not curative. Absent Defendant’s

representations as to the compostability of the Product,

Plaintiffs aver that they would not have purchased the Product or

would have paid less for it than they ultimately did.

The Court finds that payment of a premium price is

sufficient for standing purposes. Defendant’s arguments to the

contrary essentially require the Court to “do what [it] cannot,”

at this stage, that is, “decide the merits of [Plaintiffs’]

claim[s] en route to determining [their] justiciability.”

Dubuisson v. Stonebridge Life Ins. Co., 887 F.3d 567, 575 (2d Cir.

2018); see also Cummings v. FCA US LLC, 40 F. Supp. 3d 288 (N.D.N.Y.

2019) (“Article III standing is not based on a determination of

the merits of any of Plaintiff’s substantive claims.”)

Consequently, the economic injury alleged in the FAC is sufficient

for Article III standing purposes.4

B. Rule 12(b)(6) Motion5

1. Plaintiffs Have Adequately Pled Claims Under N.Y.

G.B.L. Sections 349 & 350

Section 349 of the N.Y. G.B.L. prohibits “[d]eceptive

acts or practices in the conduct of any business, trade or commerce

or in the furnishing of any service.” “Deceptive acts” are acts

which are “likely to mislead a reasonable consumer acting

reasonably under the circumstances.” Fink v. Time Warner Cable,

714 F.3d 739, 741 (2d Cir. 2013). “To make out a prima facie case

4 To the extent Defendant’s arguments are relevant to the Rule

12(b)(6) portion of its Motion, the Court will address them in

that context.

5 The Court will analyze Defendant’s Rule 12(b)(6) arguments as to

the applicable causes of action.

under [N.Y. G.B.L.] Section 349, a plaintiff must demonstrate that

(1) the defendant’s deceptive acts were directed at consumers,

(2) the acts are misleading in a material way, and (3) the

plaintiff has been injured as a result.” Chufen Chen v. Dunkin’

Brands, Inc., 954 F.3d 492, 500 (2d Cir. 2020) (quoting Maurizio

v. Goldsmith, 230 F.3d 518, 521 (2d Cir. 2000)). Likewise, N.Y.

G.B.L. § 350 makes unlawful “[f]alse advertising in the conduct of

any business, trade or commerce or in the furnishing of any

service” within New York State. Duchimaza, 619 F. Supp. 3d at

411. “Although GBL § 350 is specific to false advertising, its

standards are identical to those of § 349.” Id. (citing Denenberg

v. Rosen, 71 A.D.3d 187, 194 (2d Dep’t 2010); see also Braynina v.

TJX Cos., No. 15-CV-5897, 2016 WL 5374134, at *4 (S.D.N.Y. Sept.

26, 2016) (“[C]ourts have found that the scope of § 350 is as broad

as that of § 349 . . . and that its essential elements are the

same[.]” (internal citation omitted)). “Under either” G.B.L.

§ 349 or § 350, “[i]t is well settled that a court may determine

as a matter of law that an allegedly deceptive advertisement would

not have misled a reasonable consumer.” Chufen Chen, 954 F.3d at

500 (quoting Fink, 714 F.3d at 741).

i. Plaintiffs Have Plausibly Alleged the

Product’s Packaging Does Not Comply with the

Green Guides

Pursuant to N.Y. G.B.L. § 349(d), it is a “complete

defense” to liability under that section if Defendant’s “act or

practice is . . . subject to and complies with the rules and

regulations of, and the statutes administered by, the [FTC] or any

other official department, division, commission or agency of the

United States.” The same is true under N.Y. G.B.L. § 350. See

N.Y. G.B.L. § 350-d(a) (“[I]t shall be a complete defense that the

[allegedly unlawful] advertisement is subject to and complies with

the rules and regulations of, and the statutes administered by the

[FTC] or any official department, division, commission or agency

of the state of New York.”).

Under 16 C.F.R. Section 260.7:

A marketer claiming that an item is

compostable should have competent and reliable

scientific evidence that all the materials in

the item will break down into, or otherwise

become part of, usable compost . . . in a safe

and timely manner . . . in an appropriate

composting facility, or in a home compost pile

or device.

16 C.F.R. § 260.7(b). Furthermore, “to avoid deception” marketers

are required to “clearly and prominently qualify compostable

claims to the extent necessary to avoid deception” if an item

“cannot be composted safely or in a timely manner in a home compost

pile or device.” Id. § 260.7(c) (emphasis added). Additionally,

“[t]o avoid deception about the limited availability of municipal

or institutional composting facilities, a marketer should clearly

and prominently qualify compostable claims if such facilities are

not available to a substantial majority of consumers or communities

where the item is sold.” Id. § 260.7(d) (emphasis added).

Defendant argues that it should be able to take advantage

of the safe harbor provisions because it “has provided appropriate

disclaimers in compliance with 16 C.F.R. § 260.7.” (Support Memo

at 17.) Specifically, Defendant notes it “places a clear and

prominent disclaimer on the back panel of the 60-count Product

packaging stating that the Product is ‘compostable in industrial

facilities’ but that consumers should ‘check locally; as these do

not exist in many communities.’” (Id. at 15.) Additionally,

Defendant maintains it warns on its 60-count packaging that the

Product is “[n]ot suitable for backyard composting.” (Id.) As to

the 105-count and 225-count Product packaging, Defendant states

that the packaging contains the same limiting disclaimer regarding

the availability of composting facilities; moreover, there is a

disclaimer warning that “any home composting of pet waste should

not be used on food crops.” (Id.) Defendant contrasts its

disclaimers with those provided in the FTC’s Example 4, asserting

they are “nearly identical.” (Id.)

Plaintiffs counter that Defendant’s disclaimers are not

compliant with the FTC’s Green Guides because the disclaimers are

not “clearly and prominently” displayed since they are located on

the side and rear panels of the Product’s packaging and contradict

Defendant’s “Certified Compostable” claim, which is prominently

located on the face of the Product. (Opp’n at 13-14.) Further,

Plaintiffs argue that Defendant’s disclaimers are inconsistent

both with information on Defendant’s website, which states

“industrial composting of dog waste is not available in the United

States,” and with each other in that the 60-count package contains

a disclaimer stating the Product is not suitable for home

composting but the larger count Products state they are compostable

at home, but not for food crops. (Id.) Regardless, of the

contradiction, Plaintiffs also allege that pet waste is not safe

to compost at all due to its release of harmful bacteria as it

decomposes; Plaintiffs analogize this argument to the FTC’s

Example 2. (Id. at 5, 6.)

At this nascent stage of the case, the Court finds

Plaintiffs have plausibly alleged that Defendant’s Product does

not comply with the Green Guides. Example 4, upon which Defendant

relies does not support its argument. In Example 4, the

hypothetical product is compostable as part of a composting

program. Example 4, further presupposes that while not available

to the majority of consumers, a significant percentage of

communities do offer the program. Here, by contrast Plaintiffs

plausibly allege, and Defendant’s website seems to affirm, that no

appropriate industrial facilities presently exist in the United

States, i.e., there is no such composting program available. In

such circumstances, where appropriate facilities are not merely

limited, but are in fact non-existent, the suggested language that

customers should “check locally” because such facilities “do not

exist in many communities,” or that facilities “may not exist in

[the customer’s] area,” is plausibly deceptive in that it suggest

that if consumers were to look for an appropriate facility they

may find one, when, in actuality, no such facilities exist. See

Downing v. Keurig Green Mountain, Inc., No. 20-CV-11673, 2021 WL

2403811, at *6 (D. Mass. June 11, 2021) (finding manufacturer’s

disclaimer that customers should “check locally” may be

insufficient to avoid deceptive marketing where plaintiff alleged

“most recycling centers [did] not accept [Keurig] Pods and only

30% of Keurig Pods were recyclable at facilities that accepted

them”). This issue is compounded by Defendant’s contradictory

disclaimers. If the Product cannot safely be composted in a

backyard setting, which Plaintiffs plausibly allege is the case

“due to the presence of parasites, bacteria, viruses, and

pathogens”, and if there are no appropriate composting facilities

in the United States, the “Certified Compostable” statement,

regardless of whether the statement is itself true by industry

standards, is potentially deceptive in that, in reality, the

Product cannot be composted by American consumers at all. See

Smith v. Keurig Green Mountain, Inc., 393 F. Supp. 3d 837, 847-48

(N.D. Ca. 2019) (finding defendant’s disclaimer advising consumers

to “check locally to recycle empty cup[s]” was potentially

misleading because the disclaimer “indicate[s] that the Pods are

recyclable somewhere, whereas the complaint alleges that the Pods

are not recyclable at all”).

Additionally, the extent to which Defendant’s

disclaimers, which are located on the side and rear of the

Product’s packaging and in small font, are “clearly and

prominently” displayed is a question unsuitable for resolution on

a motion to dismiss.

ii. Plaintiffs Have Plausibly Alleged a Reasonable

Customer Could Have Been Misled by Defendant’s

Product Advertising

“[I]n determining whether a reasonable consumer would

have been misled by a particular advertisement, context is

crucial.” Fink, 714 F.3d at 742. “For example, under certain

circumstances, the presence of a disclaimer or similar clarifying

language may defeat a claim of deception.” Id. “In other words,

courts assess ‘each allegedly misleading statement in light of its

context on the product label or advertisement as a whole,’

contemplating ‘[t]he entire mosaic . . . rather than each tile

separately.” Mogull v. Pete and Gerry’s Organics, LLC, 588 F.

Supp. 3d 448, 453 (S.D.N.Y. 2022) (quoting Belfiore, 311 F.R.D. at

53.) While “[i]t is well settled that a court may determine as a

matter of law that an allegedly deceptive advertisement would not

have misled a reasonable consumer,” Nelson v. MillerCoors, LLC,

246 F. Supp. 3d 666, 674 (E.D.N.Y. 2017) (quoting Fink, 714 F.3d

at 741), “[t]here is significant authority supporting the idea

that it is inappropriate for a court to decide whether a reasonable

consumer could be misled at the Rule 12(b)(6) stage.” Lugones v.

Pete and Gerry’s Organic, LLC, 440 F. Supp. 3d 226, 242 (S.D.N.Y.

2020) (citing Kacocha, 2016 WL 4367991, at *14 (collecting cases)).

“Consequently, ‘[d]ismissal [at the motion to dismiss stage] is

warranted only in a rare situation where it is impossible for the

plaintiff to prove that a reasonable consumer was likely to be

deceived.’” Mogull, 588 F. Supp. 3d at 453 (quoting Hesse v.

Godiva Chocolatier, Inc., 463 F. Supp. 3d 453, 467 (S.D.N.Y.

2020)).

Defendant argues that the Court should determine, as a

matter of law, that no reasonable consumer would be misled by the

Product’s packaging because the “Certified Compostable” statement

on the front of the packaging “is congruent with the disclaimer

that pet waste should not be used in a home compost for growing

food crops or that a facility to compost pet waste may not be in

the consumer’s area.” (Support Memo at 18.) Defendant emphasizes

that “[t]he Product is still capable of being composted even if it

cannot be composted in exactly the way Plaintiffs desire.” (Id.)

Regarding the disclaimer language, Defendant highlights that it is

“set apart and is not contained in other text, so that it can be

clearly identified.” (Id.) Finally, Defendant notes that its

compostable claim is qualified by the “certified” language “which

indicates that in advertising its Product as ‘certified

compostable’ [Defendant] was communicating something specific

about its compostable nature, and that is the fact that

the . . . Product meets a specific standard.” (Reply at 3-4.)

Defendant further states that its website makes clear that

“Certified Compostable” “means that the Product meets certain ASTM

and EN standards.” (Id. at 5.)

Plaintiffs counter that “[n]owhere in or around”

Defendant’s “Certified Compostable” claim ‘or anywhere on the

consumer-facing side of the package, is there any link between

that claim and any sort of industrial standard.” (Opp’n at 4.)

Additionally, Plaintiffs argue that it is irrelevant whether the

Product meets industrial standards because “the FTC has noted,

‘compostable’ claims on dog waste products are ‘generally

untrue[’] because ‘animal waste doesn’t simply decompose’ and ‘is

generally not safe to compost at home.’” (Id. at 5.)

Here, the Court has already found that the FAC plausibly

pleads facts supporting Plaintiffs’ claim that the compostability

of the Product, notwithstanding its industry certifications, is

potentially deceptive in that there exist no appropriate

facilities within the United States that will compost the Product

and accompanying pet waste, and that the Product’s home

compostability disclaimers are contradictory. As to Defendant’s

argument that a reasonable consumer would understand that the word

“certified” was intended to qualify the Product’s compostable

nature, the Court is unconvinced. Plaintiffs have each pled that

they relied upon the “Certified Compostable” claim in purchasing

the Product and that in doing so they believed that they would be

able to actually compost the Product. Plaintiffs paid a premium

for the Product based upon this belief. Additionally, the

Product’s packaging makes no reference to industry standards, nor

does the packaging refer consumers to Defendant’s website for an

explanation as to what the “certified” term is meant to convey.

Even if the packaging had referred consumers to its website, the

term “Certified Compostable” allegedly is stated throughout

Defendant’s website separately from the industry standards which

are contained in FAQs that users have to actively seek out.

Compare Mogull, 588 F. Supp. 3d at 454 (finding it plausible that

a reasonable consumer “would not understand ‘free-range eggs’ to

convey that [Defendant’s] eggs meet the ‘Certified Humane’

standard” where “free-range” was “displayed as a standalone phrase

throughout defendant’s packaging, and only appear[ed] once

directly adjacent to ‘Certified Humane’”). Therefore, at this

stage, the Court declines to determine whether a reasonable

consumer could be misled by Defendant’s Product advertising.

2. Plaintiffs’ Breach of Express Warranty Claims

Under New York law, “[a]ny affirmation of fact or promise

made by the seller to the buyer which relates to the goods and

becomes part of the basis of the bargain creates an express

warranty that the goods shall conform to the affirmation or

promise.” Goldemberg v. Johnson & Johnson Consumer Cos., Inc., 8

F. Supp. 3d 467, 482 (S.D.N.Y. 2014) (quoting Avola v. La.-Pac.

Corp., 991 F. Supp. 2d 381, 391 (E.D.N.Y.)). To plead a claim for

breach of express warranty, a plaintiff must plausibly allege

“(1) the existence of a material statement amounting to a warranty,

(2) the buyer’s reliance on this warranty as a basis for the

contract with the immediate seller, (3) breach of the warranty,

and (4) injury to the buyer caused by the breach.” Catalano v.

MarineMax, 590 F. Supp. 3d 487, 501 (E.D.N.Y. 2022) (quoting

Goldenmberg, 8 F. Supp. 3d at 482). “[W]here, as here, the alleged

express warranty is based on product advertising or labelling, the

representations made by the manufacturer are sufficient to form

‘[a]n express warranty . . . and privity is not required to

sustain a cause of action.’” Mancuso v. RFA Brands, LLC, 454 F.

Supp. 3d 197, 207 (W.D.N.Y. 2020) (quoting Perez v. B. Braun Med.

Inc., No. 17-CV-8512, 2018 WL 2316334, at *5 (S.D.N.Y. 2018)); see

also Catalano v. BMW of N. Am., LLC, 167 F. Supp. 3d 540, 556

(S.D.N.Y. 2016) (“New York has long since dispensed with the

privity requirement for express warranty claims.” (citing Randy

Knitwear, Inc. v. Am. Cyanamid Co., 11 N.Y.2d 5, 13 (1962))).

Defendant argues that Plaintiffs have neither alleged

“the existence of an express warranty from Earth Rated to

Plaintiffs,” nor alleged a breach. (Support Memo at 19.)

Defendant elaborates that the Product “is certified as having met

specific ASTM and EN standards regarding compostability in

industrial or municipal and home composts in accordance with the

criteria set by ASTM and EN.” (Id.) Defendant further argues

that if dog waste can never be composted “the . . . FTC article

cited by Plaintiffs would have said that claims about

compostability of pet waste are ‘always’ untrue--not ‘generally

untrue.’” (Id. at 20.)

Plaintiffs aver that Defendant offers no legal support

for its claim that the “Certified Compostable” claim is not an

express warranty. (Opp’n at 18.) Indeed, Plaintiffs argue that

the “Certified Compostable” claim “was an express warranty that

the Product was capable of being composted.” (Id.) Plaintiffs

highlight that the industry certifications of the Product are not

represented anywhere on the Product’s packaging, such that a

reasonable consumer would understand the “Certified Compostable”

claim to simply mean that the Product met certain standards. (Id.)

Plaintiffs maintain that the Product is incapable of being

composted in a backyard compost due to the dangerous bacteria that

is released when dog waste decomposes. (Id.) Furthermore,

Plaintiffs highlight that, on the issue of at-home composting,

Defendant’s disclaimers are contradictory. (Id.) Additionally,

Plaintiffs have pled that there are currently no available

industrial municipal facilities presently available in the United

States that will compost the Product and accompanying waste. (Id.)

Here, whether Defendant created an express warranty that

the Product was capable of being composted, or merely warranted

that the Product met certain, specific, and articulated industry

standards is a question of fact unsuited for determination on a

motion to dismiss. See Paulino v. Conopco Inc., No. 14-CV-5145,

2015 WL 4895234, at *2 (E.D.N.Y. Aug. 17, 2015) (“What a reasonable

consumer’s interpretation of a seller’s claim might be is generally

an issue of fact which is not appropriate for decision on a motion

to dismiss.” (quoting Ault v. J.M. Smicker Co., No. 13-CV-3409,

2014 WL 1998235, at *6 (S.D.N.Y. May 15, 2014))); see also

Goldemberg, 8 F. Supp. 3d at 483 (finding that because “the Court

[was] unable to determine as a matter of law that the statements

[at issue were] not misleading under GBL § 349,” it was “equally

inappropriate to determine they are not misleading for the warranty

claim”). Likewise, the extent to which Defendant breached, or did

not breach, any potential express warranty that the Product was

actually compostable, is a question of fact. Thus, in the context

of a Rule 12(b)(6) dismissal motion, Plaintiffs’ allegations of

breach of express warranty are plausible, thereby surviving

Defendant’s challenge.

3. Plaintiffs’ Magnuson-Moss Warranty Act Claims

“[T]he MMWA . . . ‘incorporates and federalizes state-

law breach of warranty claims, including state-law standards for

liability and damages,” Brady v. Basic Rsch., L.L.C., 101 F. Supp.

3d 217, 234 (E.D.N.Y. 2015) (quoting Ebin v. Kangadis Food Inc.,

No. 13-CV-3311, 2013 WL 3936193, at *3 n.2 (S.D.N.Y. July 26,

2013)), such that “plaintiffs’ breach of express warranty and MMWA

claims stand or fall together.” Id.

The parties agree that Plaintiffs’ MMWA claims “rise and

fall” with their state law claims. (See Support Memo at 21; Opp’n

at 20-21.) Since the Court finds that Plaintiff’s express warranty

claim survives Defendant’s motion to dismiss, Plaintiffs’ MMWA

claims must also survive. See Sitt v. Nature’s Bounty, Inc., No.

15-CV-4199, 2016 WL 5372794, at *18 (E.D.N.Y. Sept. 26, 2016)).

4. The Court Need Not Reach the Merits of Defendant’s

Arguments Regarding Plaintiffs’ Implied Warranty

and Unjust Enrichment Claims

In their Opposition to Defendant’s Motion, Plaintiffs

have voluntarily dismissed their implied warranty claims, unjust

enrichment claims, and any requests for injunctive relief, without

prejudice. (See Opp’n at 25 n.7.) Since Plaintiff’s withdrawal

of these claims moots those respective branches of Defendant’s

Motion, the Court declines to address Defendant’s arguments on

these points

C. Rule 9(b) Motion

1. Plaintiffs’ Fraud Claims Are Plausibly Pled

To establish fraud under New York law, a plaintiff must

allege: “(1) a material misrepresentation or omission of a fact,

(2) knowledge of that fact’s falsity, (3) an intent to induce

reliance, (4) justifiable reliance by the plaintiff, and

(5) damages.” Loreley Fin. (Jersey) No. 3 Ltd. v. Wells Fargo

Sec., LLC, 797 F.3d 160, 170 (2d Cir. 2015) (quoting Eurycleia

Partners, LP v. Seward & Kissel, LLP, 12 N.Y.3d 553, 559 (2009)).

Additionally, Rule 9(b) requires claims of common law fraud to

satisfy a heightened pleading standard. See FED. R. CIV. P. 9(b).

However, “[m]alice, intent, knowledge, and other conditions of a

person’s mind may be alleged generally.” Id. Nevertheless,

“courts ‘must not mistake the relaxation of Rule 9(b)’s specificity

requirement regarding condition of mind for a license to base

claims of fraud on speculation and conclusory

allegations[,] . . . plaintiffs must allege facts that give rise

to a strong inference of fraudulent intent.’” Duchimaza, 619 F.

Supp. 3d at 416 (quoting Lerner, 459 F.3d at 290). A “strong

inference” may be established either “(a) by alleging facts to

show that defendant[] had both motive and opportunity to commit

fraud, or (b) by alleging facts that constitute strong

circumstantial evidence of conscious misbehavior or recklessness.”

Lerner, 459 F.3d at 290-91 (quoting Shields v. Citytr. Bancorp,

Inc., 25 F.3d 1124, 1128 (2d Cir. 1994)). “To determine whether

the ‘strong inference’ requirement is met, a court should ‘consider

the complaint in its entirety and take into account plausible

opposing inferences.’” Duchimaza, 619 F. Supp. 3d at 416 (quoting

Loreley, 797 F.3d at 177). If an inference is “cogent and at least

as compelling as any opposing inference one could draw from the

facts alleged,” then it is sufficiently strong. Loreley, 797 F.3d

at 177 (quoting Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551

U.S. 308, 324 (2007)). “At the pleadings stage, the alleged fraud

need only be plausible based on the complaint; it need not be more

likely than other possibilities.” Mogull, 588 F. Supp. 3d at 455

(quoting Loreley, 797 F.3d 160, 174 (2d Cir. 2015)).

Defendant argues that the FAC fails to “plausibly

allege[] an actionable statement” sufficient to satisfy the

threshold element of a fraud claim. (Support Memo at 23.)

Defendant relies primarily upon its argument that the Product is

“Certified Compostable” as advertised and is properly marketed in

compliance with the Green Guides. (Id.) Plaintiffs counter that

they have plausibly set forth the “who, what, when, where, and how

of the alleged fraud.” (Opp’n at 22.) For example, Plaintiffs

assert that the FAC plausibly pleads that the material

misrepresentation at issue is the claim that the Product is

“Certified Compostable,” notwithstanding the fact that pet waste

is generally not safe to compost at home and there are currently

no available facilities which will compost the Product and

accompanying waste in the United States. (Id. at 22.) Plaintiffs

maintain they pled that Defendant’s website acknowledges there are

presently no facilities in the United States capable of composting

the Product, and that Defendant’s disclaimers to the safety of

composting the Product at home are contradictory. (Id.)

Plaintiffs argue that it is inconsequential that the Product meets

certain industry standards because a reasonable consumer would

understand the “Certified Compostable” claim to mean that the

Product is actually capable of being composted. (Id.) Plaintiffs

elaborate that the misrepresentation appears prominently on the

front of every Product package and that the statements are an

example of “Greenwashing,” that is designed to allow Defendant to

charge a premium for what the public perceive to be an

environmentally friendly product. (Id.)

The Court agrees with Plaintiffs that they have

plausibly alleged the requisite “who, what, when, where, and how”

of the alleged fraud, such that their fraud claims survive

Defendant’s motion. Plaintiffs have plausibly alleged that

Defendant markets its product as “Certified Compostable” and that

the extent to which the Product is actually suitable for backyard

composting is questionable. Plaintiffs have also plausibly

alleged that there are no appropriate composting facilities in the

United States presently available to compost the Product and

accompanying waste. Consequently, notwithstanding the Product’s

industry certifications, Plaintiffs have plausibly alleged that

American consumers cannot actually compost the Product. The FAC

further highlights that Defendant’s own website acknowledges the

fact that industrial facilities are not presently available in the

United States which constitutes strong circumstantial evidence of

conscious misbehavior. Notwithstanding Defendant’s knowledge in

this area, Defendant markets the Product as “Certified

Compostable” and attempts to disclaim the lack of available

industrial facilities by encouraging consumers to “check locally”

because appropriate facilities “may not” be available. Plaintiffs

further allege that they each relied upon Defendant’s “certified

compostable” claims in purchasing the Product and that they paid

a premium price for the compostable version of the Product.

Drawing all reasonable inferences in Plaintiffs’ favor, which the

Court must do at this stage, the Court finds these allegations

plausibly allege facts giving rise to a strong inference of

fraudulent intent. Similarly, the facts alleged in the FAC are

sufficient to meet the heightened pleading standard of Rule 9(b).

2. Plaintiffs Plead Plausible Claims for Negligent

Misrepresentation

Where a Plaintiff asserts “negligent misrepresentation

claim[s] . . . based on the same set of facts as those upon which

a fraud claim is grounded, Rule 9(b) applies to the negligent

misrepresentation claim[s] as well.” Brumfield v. Merck & Co.,

Inc., No. 17-CV-6526, 2018 WL 2277835, at *3 (E.D.N.Y. May 18,

2018) (quoting Eaves v. Designs for Fin., Inc., 785 F. Supp. 2d

229, 254-55 (S.D.N.Y. 2011) (collecting cases))). Under New York

law, to assert a claim for negligent misrepresentation, a plaintiff

must plead “(1) the existence of a special or privity-like

relationship imposing a duty on the defendant to impart correct

information to the plaintiff; (2) that the information was

incorrect; and (3) reasonable reliance on the information.” Hughes

v. Ester C Co., 930 F. Supp. 2d 439, 474 (E.D.N.Y. 2013) (quoting

Abu Dhabi Com. Bank v. Morgan Stanley & Co. Inc., 910 F. Supp. 2d

543, 546 (S.D.N.Y. 2012)); see also Aetna Cas. and Sur. Co. v.

Aniero Concrete Co., Inc., 404 F.3d 566, 583 (2d Cir. 2005) (“A

negligent misrepresentation is actionable . . . where the

defendant has been careless ‘in imparting words upon which others

were expected to rely and upon which they did or failed to act to

their damage,’ and where the author of the statement has ‘some

relationship or duty . . . to act with care’ vis-à-vis the party

at whom the statement is directed.” (quoting White v. Guarente, 43

N.Y.2d 356, 401 (1977))). Where the negligent misrepresentation

is made in connection with a commercial transaction “a plaintiff

must plead justifiable reliance.” Hughes, 930 F. Supp. 2d at 474

(quoting Landesbank Baden-Wurttemberg v. Goldman, Sachs & Co., 821

F. Supp. 2d 616, 623-24 (S.D.N.Y. 2011)). In assessing justifiable

reliance, courts must consider three factors: (1) “whether the

person making the representation held or appeared to hold unique

or special expertise”; (2) “whether a special relationship of trust

or confidence existed between the parties”; and (3) “whether the

speaker was aware of the use to which the information would be put

and supplied it for that purpose.” Landesbank Baden-Wurttemberg,

821 F. Supp. 2d at 624 (quoting Kimmell v. Schaefer, 89 N.Y.2d

257, 264 (1996)). However, “not all representations made by a

seller of goods . . . will give rise to a duty to speak with care.”

Dallas Aerospace, Inc. v. CIS Air Corp., 352 F.3d 775, 788 (2d

Cir. 2003) (quoting Kimmell, 89 N.Y.2d at 263). “Instead, the law

of negligent misrepresentation requires a closer degree of trust

between the parties than that of the ordinary buyer and seller in

order to find reliance on such statements justified.” Id. Where

“a plaintiff fails to allege the existence of a special

relationship or the relationship is only ‘sparsely pled,’ the

plaintiff must ‘emphatically allege’ the other two factors

enunciated in Kimmell.” Greene v. Gerber Prod. Co., 262 F. Supp.

3d 38, 75 (E.D.N.Y. 2017) (quoting Eternity Glob. Master Fund Ltd.

V. Morgan Guar. Tr. Co. of N.Y., 375 F.3d 168, 188 (2d Cir. 2004)).

Defendant argues that the FAC is “devoid of allegations

that would suggest there was any relationship between Plaintiffs

and Earth Rated other than buyer and seller.” (Support Memo at

24.) Similarly, Defendant avers that the FAC makes no allegation

that Defendant “held itself out in the marketing of the Product as

having special expertise, nor are there any allegations regarding

a close degree of trust between the Plaintiffs and Earth Rated.”

(Id.; see also Reply at 7-9.) Plaintiff counters that Defendant

“held or appeared to hold unique or special expertise because it

had superior knowledge of the characteristics of the Product, i.e.,

that the Product was not capable of being composted when used for

its intended purpose.” (Opp’n at 23.) Plaintiffs highlight that

Defendant’s “contention that the Product [met] certain industry

standards . . . support[s]” Plaintiffs’ argument that Defendant

“had special expertise and knowledge.” (Id. at 23-24.) They argue

that in placing its “Certified Compostable” representations

prominently on the front of the Product’s packaging, “Defendant

knew that Plaintiffs would rely on its representations” in choosing

to purchase the product. (Id.)

Here, the Court agrees with Defendant in that the FAC

fails to allege a special relationship between Plaintiffs and Earth

Rated that goes beyond that of regular buyer and seller. However,

at this stage, Plaintiffs failure in this regard is not fatal to

their claim, since the Court also finds that Plaintiffs have

emphatically alleged that Defendant held itself out to have, or

indeed held, unique or special expertise regarding the

compostabilty of the Product. As Defendant aptly notes, the term

certified is defined by the Oxford English Dictionary as

“officially recognized as possessing certain qualifications or

meeting certain standards.” (Reply at 4.) The FAC alleges that

Defendant’s website states the “certified compostable bags are

made from a blend of PBAT and vegetable starches and meets the

ASTM D6400 and EN13432 Standards for compostability.” (FAC ¶ 7.)

The quoted language is visible to consumers that view the Product

on Defendant’s website.6 By touting the Product as “certified” on

the Product’s packaging and expounding upon those certifications

on its website, it is plausible that Defendant has held itself out

as possessing “specific scientific information” related to the

Product upon which consumers could rely. The industry

certifications of compostable products; what those certifications

mean in laymen’s terms; and the limitations associated with those

6 Consumers have to click on the “Read more+” prompt to learn that,

“[m]unicipal composting facilities that accept pet waste do not

exist in many communities so be sure to check locally.”

Notwithstanding this warning, and as discussed throughout this

Memorandum & Order, this claim itself is arguably deceptive in

that there are no municipal composting facilities that accept pet

waste in the entirety of the United States.

certifications are not the sort of common knowledge topics that

the average consumer would be expected to possess. Similarly, the

average consumer is unlikely to possess knowledge that pet waste

is generally unsafe to compost. Instead, and as Plaintiffs argue,

regular consumers are likely to read that the Product is “Certified

Compostable” and to understand that term as meaning the Product

is, in fact, capable of being composted either at home or in an

appropriate facility. Consequently, Plaintiffs have plausibly

pled reasonable and justified reliance upon Defendant’s

representations. See Hughes, 930 F. Supp. 2d at 475 (finding the

existence of a special relationship between the parties where

defendants “held themselves out as holding a type of special

expertise regarding the purported health benefits of Ester-C”);

see also Rossi v. Gem Nation Corp., No. 21-CV-2197, 2021 WL

7906550, at *4 (E.D.N.Y. July 27, 2021) (inferring the existence

of a special relationship based upon plaintiff’s allegations that

defendant possessed specialized knowledge which plaintiff, as a

layperson, did not possess, and where defendant claimed “it relied

on independent certifying agencies to ascertain the quality of its

gemstones”); cf Dallas Aerospace, 352 F.3d at 788-89 (dismissing

negligent misrepresentation claim because, inter alia, plaintiff

was found to have held the relevant expertise with which to assess

the alleged misrepresentation at issue such that plaintiff could

not plead justifiable reliance); Eternity Glob., 375 F.3d at 189

(dismissing negligent misrepresentation claim because both the

defendant and plaintiff possessed expertise in the same area and,

consequently, plaintiff’s reliance on defendant’s representation

was unjustified).

CONCLUSION

For the stated reasons, IT IS HEREBY ORDERED that

Defendant’s Motion to Dismiss (ECF No. 21) is GRANTED IN PART AND

DENIED IN PART to the extent that Plaintiffs’ claims for Breach of

Implied Warranty (Count IV), and Unjust Enrichment (Count VI) are

DISMISSED WITHOUT PREJUDICE, but Plaintiffs’ remaining claims

survive said motion.

SO ORDERED.

/s/ JOANNA SEYBERT

Joanna Seybert, U.S.D.J.

Dated: July 28, 2023

Central Islip, New York