Comm'rs of Pub. Works of City of Charleston v. Costco Wholesale Corp.

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Commissioners of Public Works of the City of Charleston (d.b.a. Charleston Water System), Individually and on Behalf of All Others Similarly Situated,, v. Costco Wholesale Corporation, CVS Health Corporation, Kimberly-Clark Corporation, The Proctor &Gamble Company, Target Corporation, Walgreens Co ., and Wal-Mart, Inc., .

Civil Action No. 2:21-cv-42-RMG

United States District Court, D. South Carolina, Charleston Division

December 10, 2021

ORDER AND OPINION

Richard Mark Gergel United States District Judge

Before the Court is Defendants Costco Wholesale Corporation, CVS Health Corporation, The Proctor & Gamble Company, Target Corporation, Walgreen Co., and Wal-Mart, Inc. (collectively “Defendants”)'s motion to dismiss Plaintiff the Commissioners of Public Works of the City of Charleston (d.b.a. “Charleston Water System”)'s amended complaint (Dkt. No. 108). For the reasons set forth below the Court denies Defendants' motion.

Background

In this putative class action, Plaintiff, a public water and wastewater utility providing services to the Greater Charleston area, on behalf of itself and all others similarly situated, alleges that Defendants Costco Wholesale Corporation (“Costco”), CVS Health Corporation (“CVS”), Kimberly-Clark Corporation (“Kimberly-Clark”), The Proctor & Gamble Company (“P&G”), Target Corporation (“Target”), Walgreen Co. (“Walgreens”), and Wal-Mart, Inc. (“Wal-Mart”) design, market, manufacture distribute, and/or sell wipes labeled as “flushable” which are not actually flushable. Plaintiff alleges that when flushed, Defendants' wipes do not adequately disperse and cause clogs which damage sewer systems across the country, including Plaintiff's. See, e.g., (Dkt. No. 85 ¶¶ 37-40, 48-62).

Plaintiff brings claims for nuisance, trespass, strict products liability-defective design, strict products liability-failure to warn, and negligence. Plaintiff seeks-in addition to reasonable attorney's fees and costs for class counsel-prospective injunctive relief only.

Defendants move to dismiss the amended complaint pursuant to Fed.R.Civ.P. 12(b)(6). (Dkt. No. 108). Plaintiff opposes. (Dkt. No. 117). Defendants filed a reply. (Dkt. No. 119).

Defendants' motion is fully briefed and ripe for disposition.

Legal Standard

Rule 12(b)(6) of the Federal Rules of Civil Procedure permits the dismissal of an action if the complaint fails “to state a claim upon which relief can be granted.” A claim survives the motion if the complaint provides enough facts to “‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). This is a test of the legal sufficiency of the complaint and, therefore, Rule 12(b)(6) “does not resolve contests surrounding the facts, the merits of the claim, or the applicability of defenses.” Republican Party of N.C. v. Martin, 980 F.2d 943, 952 (4th Cir. 1992). Instead, the district court's “inquiry then is limited to whether the allegations constitute a short and plain statement of the claim showing that the pleader is entitled to relief.” Id. (internal quotation marks and citation omitted). For that analysis, the district court “need not accept as true unwarranted inferences, unreasonable conclusions, or arguments”; however, it must “assume the truth of all facts alleged in the complaint and the existence of any fact that can be proved, consistent with the complaint's allegations.” E. Shore Mkts., Inc. v. J.D. Assocs. Ltd. P'ship, 213 F.3d 175, 180 (4th Cir. 2000).

Analysis

Plaintiff Has Standing to Pursue its Claims Against Defendants

Defendants first argue that Plaintiff lacks standing to pursue this lawsuit. Defendants argue that Plaintiff's alleged injuries are not “fairly traceable” to Defendants' products. Defendants also argue that because Plaintiff's alleged harms stem from choices made by independent actors- namely consumers who flush deceptively labeled wipes as well as other non-flushable items into the sewer- “neither traceability nor redressability is met.” (Dkt. No. 108-1 at 13-14).

Standing is an essential component of a justiciable “case” under Article III. Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 102 (1998). Standing implicates the court's subject matter jurisdiction and is governed by Rule 12(b)(1). Crumbling v. Miyabi Murrells Inlet LLC, 192 F.Supp.3d 640, 642-43 (D.S.C. 2016). “It is well established that standing is a threshold jurisdictional issue that must be determined first because ‘[w]ithout jurisdiction the court cannot proceed at all in any cause.'” Covenant Media of N.C., LLC v City of Monroe, N.C. , 285 Fed.Appx. 30, 34 (4th Cir. 2008) (quoting Steel Co., 523 U.S. at 94). “To possess the constitutional component of standing, a party must meet three requirements: (1) [the party] has suffered an ‘injury in fact' that is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.” McBurney v. Cuccinelli, 616 F.3d 393, 410 (4th Cir. 2010) (citing, e.g., Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 180-81 (2000)). “The party invoking federal jurisdiction bears the burden of establishing these elements.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992). “At the pleading stage, general factual allegations of injury resulting from the defendant's conduct may suffice ....” Id. The failure to meet this burden constitutes a jurisdictional defect. See United States ex rel. Bunk v. Gosselin World Wide Moving, N.V., 741 F.3d 390, 402 (4th Cir. 2013).

The Court rejects Defendants' argument that Plaintiff lacks standing to pursue its claims.

First, contrary to Defendants' assertions otherwise, Plaintiff does specifically allege that each Defendant's flushable wipes are likely to cause it future harm. The amended complaint alleges that each defendant's wipes are currently sold in the Charleston area and further alleges in a non-conclusory manner that wipes allegedly marketed as flushable-but which are not actually flushable-clog or otherwise damage sewer systems including Plaintiff's. See (Dkt. No. 85 ¶ 100, et seq.). On this point, Defendants criticize Plaintiff for not “ma[king] an[] attempt to trace the extent to which . . . [each particular] Defendant's flushable wipes” harms Plaintiff. (Dkt. No. 1081 at 13-14) (emphasis removed). In effect, Defendants criticize Plaintiff for not pleading the quantitative degree to which each Defendant causes Plaintiff's alleged harms. Such detail, however, is not required to establish standing. See Bennett v. Spears, 520 U.S. 154, 168-69 (1997) (noting arguments such as Defendants' fail at the pleading stage because they “wrongly equate[] injury ‘fairly traceable' to the defendant with injury as to which the defendant's actions are the very last step in the chain of causation”).

Second the Court rejects Defendants' contention that Plaintiff's alleged harms are the mere result of “unfettered choices made by independent actors not before the court.” See Meyer v. McMaster, 394 F.Supp.3d 550, 561 (D.S.C. 2019) (noting that “[t]he traceability and redressability prongs become problematic when third persons not party to the litigation must act in order for an injury to arise or be cured” and further noting that “[r]elief that does not remedy the injury suffered cannot bootstrap a plaintiff into federal court; that is the very essence of the redressability requirement.”). Here, Plaintiff plausibly alleges that Defendants' products do not perform as advertised and are a significant cause of Plaintiff's injuries. See, e.g., (Dkt. No. 85 ¶¶ 39-40) (alleging Plaintiff retained Barry Orr, “the Sewer Compliance Officer and Sewer Outreach and Control Inspector for the City of London, Ontario and the Canadian Water and Wastewater Association representative on IWSFG, to perform flushability testing on various Flushable Wipes products manufactured and/or sold by Defendants” and that Orr found said wipes generally failed his dispersibility testing); (Id. ¶¶ 55, 57) (alleging Plaintiff removes “large quantities” of both flushable and non-flushable wipes from its sewer system). The fact that Orr did not test “actual clogs removed from Plaintiff's [w]astewater system to determine whether they in fact contain flushable wipes, ” (Dkt. No. 108-1 at 15), is again the type of argument not relevant to determining standing. Further, the fact that other objects might sometimes clog Plaintiff's sewer system, see (Dkt. No. 85 ¶ 51 n.36), is irrelevant. A plaintiff is not deprived of standing merely because it alleges a defendant's actions were a contributing cause instead of the lone cause of the plaintiff's injury. See Libertarian Party of Va. v. Judd, 718 F.3d 308, 316 (4th Cir. 2013) (finding that plaintiff had standing to challenge a petition-collection ballot-access requirement even though plaintiff's knee injury likely contributed to his failure to collect a sufficient number of signatures); Parsons v. U.S. Dep't of Justice, 801 F.3d 701, 714 (6th Cir. 2015) (holding that plaintiffs had standing to sue federal agencies for a report describing plaintiffs as a gang even though plaintiffs had already been described as a gang by other independent state agencies and noting “courts have held that the fact that a defendant was one of multiple contributors to a plaintiff's injuries does not defeat causation”); Barnum Timber Co. v. EPA, 633 F.3d 894, 901 (9th Cir. 2011) (finding that plaintiff had standing to challenge EPA's listing of plaintiff's property as an “impaired water body”...