Tonight, with great pleasure, we will hand out candy to tiny costumed neighbors – the three- and five-year-olds from across the street, who call us “Miss Rachel,” and the seven- and 10-year-olds from next door, who come over daily to play with the new puppy, among others. (Not too many others, we fear – we have purchased enough candy for at least 100 kids, and the doorbell rang about six times last year.) These small people pretending to be what they are not reminds of a memory that resurfaced last week at our law school reunion. We came from modest means and attended public school and a state university. During the three years we spent in law school, surrounded by people of privilege, we periodically fought “imposter syndrome”: did we really belong here? Did the admissions office make a mistake? And, sure enough, reunions remind us that our class includes people whose names all of you would recognize and many others who have amassed significant wealth. But we also spoke to the classmate who runs a cat rescue. And the one who has been a public defender for all of the decades since graduation. It was lovely, all these years later, to break bread with the people with whom we shared this life-changing interlude. And it seems that most of us, some after many detours and “roads not taken,” have found our way to lives that feel like the ones we should be living. Present company included.
Today’s decision may be less of a revelation, but it is solid and satisfying (with subtle glimpses into the author’s sense of humor). It is not a drug case – it involves the labeling of baby food. Davidson v. Sprout Foods, Inc., 2022 WL 13801090 (N.D. Cal. Oct. 21, 2022) involves a putative class action against a manufacturer of pouches of foods for babies and toddlers. The complaint alleged that the labeling on the pouches, containing statements about grams of protein and fiber and vitamin content, constituted “nutrient content claims” that violated FDA regulations prohibiting such claims on foods intended for babies and toddlers. California’s Sherman Food, Drug, and Cosmetic Act expressly adopted these FDA regulations, and the plaintiffs alleged that the defendant’s alleged violations of the Sherman Law violated a prong of the California Unfair Competition Law (“UCL”) prohibiting “unlawful” conduct.
The plaintiffs also alleged that the labels “deceived and misled” consumers into believing that the products were “healthy” for their children, when, the plaintiffs alleged, the products were harmful “nutritionally and developmentally.” According to the plaintiffs, the “deceptive” labeling constituted common-law fraud and violated California’s False Advertising Act (“FAL”) and Consumer Legal Remedies Act (“CLRA), along with the prong of the UCL prohibiting fraudulent statements in business acts or practices.
Fraud-Based Claims
The court concluded that the fraud-based claims, including the common-law fraud claims and the claims under the FAL, the CLRA, and the “fraudulent” prong of the UCL, were “too mushy” (we love this stuff). As the court explained, the plaintiffs “claim[ed] to make two showings: first, that the labels communicated a message that the Products provide[d] health benefits for children; and second, that the Products [were] ‘harmful both nutritionally and developmentally.’” Davidson, 2022 WL 13801090 at *3 (citation to complaint omitted). The plaintiffs did not claim that the labels explicitly promised health benefits; rather, they claimed that the labels “implicitly tout[ed] the Products’ health benefits.” Id. The court found enough support for this proposition to hold that, “for purposes of surviving a motion to dismiss,” the plaintiffs had plausibly alleged that the labels implicitly promised health benefits
But, as the court explained, there was a “second required showing,” and it was “harder to swallow.” (LOL) While the plaintiffs claimed that the products were unhealthy because they contained “high amounts of free sugars,” they didn’t “place [that] averment in context” by describing when or why a sugar level becomes harmful. The plaintiffs also claimed that pouch-based foods might be unhealthy, but they “rel[ied] for support on speculative research conclusions and hypothetical scenarios” that did not make clear why or how consistently the products were harmful or why, even if the harms existed, they outweighed the products’ benefits.
The court pointed out that “the California Court of Appeals [had] cautioned against permitting food labeling claims that rel[ied] on inferential leaps” and that could “ultimately place almost any advertisement truthfully touting a product’s attributes at issue for litigation.” Id. Against the backdrop of Rule 9(b)’s heightened pleading standard, this led to the conclusion that the plaintiffs had not plausibly alleged that the labels were misleading and to the dismissal, without prejudice, of the common-law fraud claim and the fraud-based FAL, CLRA, and UCL claims
UCL “Unlawful” Prong Claim
The defendant argued that the plaintiff’s claim under the UCL’s “unlawful” prong was preempted by federal law, because the alleged Sherman Law violation required a finding that the FDCA had been violated, and the FDCA, in turn, could be enforced only by the United States. The court cited another Northern District of California case, Chong v. Kind., which we discussed here. Chong concluded that a plaintiff’s claims under the Sherman Law were impliedly preempted by the FDCA because the Sherman Law postdated the FDCA and expressly adopted it and its implementing regulations as state law. The court found “no reason to depart from Chong’s earlier holding,” and granted the plaintiff’s motion to dismiss the claim under the UCL’s “unlawful” prong. In other words, the court held that the plaintiffs could not make an end run around federal preemption by alleging a violation of a California statute that expressly adopted the federal regulations in question. (Interestingly, the court relied in part on the absence of “controlling” Ninth Circuit precedent, but the recent Nexus Pharmaceuticals decision, discussed here, actually provides Ninth Circuit support for these propositions, albeit in a drug case rather than a food case). Because this defect was “one of legal theory, not factual insufficiency,” the court dismissed this claim with prejudice.
All in all, a tasty decision. We will keep an eye out for motion practice addressed to an amended complaint re-pleading the fraud-based claims. In the meantime, have a great Halloween, and stay safe out there.