Gustavson v. Wrigley Sales Co.

961 F.Supp.2d 1100

Phyllis Gustavson, individually and on behalf of all others similarly situated, Plaintiff,

v.Wrigley Sales Company, Wm. Wrigley Jr. Company, Mars, Inc., and Mars Chocolate North America, LLC, Defendants.

Case No.: 12–CV–01861–LHK

United States District Court, N.D. California. San Jose Division

Filed September 16, 2013

Ben F. Pierce Gore, Pratt & Associates, San Jose, CA, Alex Peet, Lovelace Law Firm, P.A., Miramar Beach, FL, Ananda N. Chaudhuri, Keith M. Fleischman, Fleischman Law Firm, New York, NY, Brian K. Herrington, David Malcolm McMullan, Jr., John W. (Don) Barrett, Katherine B. Riley, Don Barrett, P.A., Lexington, MS, Carol Nelkin, Nelkin, Nelkin & Krock, PC, Houston, TX, Charles F. Barrett, Charles Barrett, P.C., Nashville, TN, David Shelton, J. Price Coleman, Coleman Law Firm, Richard Barrett, Law Offices of Richard R. Barrett, PLLC, Oxford, MS, Dewitt Marshall Lovelace, Sr., Lovelace Law Firm, P.A., Miramar Beach, FL, Frank Karam, New York, NY, Jay P. Nelkin, Stuart M. Nelkin, Nelkin & Nelkin, P.C., Houston, TX, for Plaintiff.

Stephen David Raber, David Michael Horniak, Williams & Connolly LLP, Washington, DC, for Defendants.

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO DISMISS

LUCY H. KOH, United States District Judge

Plaintiff Phyllis Gustavson (“Gustavson”) brings this putative class action against Defendants Wrigley Sales Company and Wm. Wrigley Jr. Company, Mars, Inc., and Mars Chocolate North America, LLC (collectively, “Defendants”), alleging that Defendants' package labeling is “misbranded”because it is unlawful and misleading under federal and state law. Defendants move to dismiss Gustavson's First Amended Complaint, ECF Nos. 27, 29; Gustavson opposes, ECF Nos. 39, 41, and Defendants replied, ECF No. 46. Having considered the submissions of the parties, the parties' oral arguments, and the relevant law, the Court hereby GRANTS in part and DENIES in part Defendants' Motions to Dismiss the First Amended Complaint.

I. BACKGROUNDA. Factual Allegations

Defendants Wrigley Sales Company and Wm. Wrigley Jr. Company (collectively, “Wrigley”), are among the leading producers of gum, breath mints, and hard candies. First Am. Compl. (“FAC”) ¶ 2. Mars Chocolate North America, LLC (with Mars, Inc., “Mars”) is one of the leading producers of chocolate candy and other types of confectionary. Id. Mars, Inc. is the parent company of Mars Chocolate North America, LLC, Wrigley Sales Company, and Wm. Wrigley Jr. Company. Id. Defendants sell their products to consumers through grocery and other retail stores throughout California and promote their products throughout California through their websites. FAC ¶ 33.

Gustavson is a California consumer who “cares about the nutritional content of food and seeks to maintain a healthy diet.” FAC ¶ 212. Over the past four years, she purchased more than $25.00 worth of Defendants' food products, which she contends are “[m]isbranded” in violation of federal and California law. FAC ¶¶ 25, 28. Specifically, Gustavson contends that she purchased the following food products: (1) Eclipse sugar free gum, Winterfrost, 18pcs; (2) Eclipse sugar free gum, Polar Ice, 12 pcs; (3) Altoid sugar free small mints, peppermint and wintergreen, 50 mint tins; (4) Orbit sugar free gum, peppermint and spearmint, 14 pcs; (5) Lifesavers sugar free hard candy, 5 flavors, 2.75 oz; (6) M & M chocolate candy, 1.69 oz.; (7) Twix chocolate candy, 1.79 oz.; (8) Dark Chocolate Dove Bar, 3.3 oz.; (9) Milk Chocolate Dove Bar, 3.3 oz.; and (10) Snickers Fun Size, 11.8 oz. FAC ¶ 213.

Gustavson alleges that she “read the labels on Defendants' products ... before purchasing them.” FAC ¶ 214. Gustavson further alleges that she relied on Defendants' package labeling, “based and justified the decision to purchase Defendants' products in substantial part on Defendants' package labeling,” and “would have foregone purchasing Defendant's [ sic ] products and bought other products readily available at a lower price.” FAC ¶ 215. Gustavson claims that she “did not know, and had no reason to know, that Defendants' products were misbranded” and states that she would not have purchased the products “had she known the truth about them.” FAC ¶ 216. Although the FAC largely fails to distinguish between the Mars and Wrigley Defendants—despite the fact that the entities are legally distinct and do not appear to be involved in one another's labeling decisions—the various allegedly deceptive statements identified in the FAC appeared either only on Mars or only on Wrigley products. Specifically, the allegedly deceptive statements appearing on Mars products include: (1) nutrient content claims regarding flavanols, FAC ¶¶ 70–83; (2) calorie-related claims stating that a product contains a certain percentage of one's daily value of calories, FAC ¶¶ 84–100; (3) failure to identify the ingredient “polyglycerol polyricinoleic acid” (“PGPR”) by its common name, FAC ¶¶ 138–155; and (4) failure to comply with the standard of identity for milk chocolate, FAC ¶¶ 156–161. The allegedly deceptive statements appearing on Wrigley products include: (1) “low calorie” claims, FAC ¶¶ 101—105; (2) “sugar free” claims, FAC ¶¶ 106–128; and (3) “serving size” claims, FAC ¶¶ 129–137. Gustavson separately alleges that both sets of Defendants make a series of unlawful “health” claims on their websites. FAC ¶¶ 155–185.

1. Claims Against Mars

a. Flavanol Nutrient Content Claims

Gustavson first challenges Mars's use of statements such as “natural source of cocoa flavanols,” “flavanols [are] found in cocoa,” and “[o]ur special patented and proprietary COCOAPRO® process helps retain much of the naturally occurring cocoa flavanols,” on the labels of Mars chocolate products—specifically, Dove Dark Chocolate. FAC ¶¶ 72, 75, 77; Exs. L, O. Gustavson alleges that these claims are “nutrient content claims,” i.e., claims about specific nutrients contained in a product that, pursuant to Section 403 of the Food, Drug, and Cosmetic Act (“FDCA”), 21 U.S.C. § 343(r), must be made in accordance with federal regulations. FAC ¶ 70 (citing 21 C.F.R. §§ 101.13, 101.54 (identifying the requirements for making lawful nutrient content claims)); see also21 U.S.C. § 343(r)(1)(A) (defining “nutrition levels and health-related claims” as pertaining to “a food intended for human consumption which is offered for sale and for which a claim is made in the label or labeling of the food which expressly or by implication ... characterizes the level of any nutrient”).

According to the FAC, Mars's flavanol “source” claims are unlawful because under applicable federal regulations, a food may only be described as a “source” of a given nutrient if it contains at least 10% of the established daily value for that nutrient. FAC ¶ 72. Mars chocolate cannot possibly contain adequate flavanols to meet this requirement, Gustavson alleges, because the Food and Drug Administration (“FDA”) has not established a daily value for flavanols. FAC ¶¶ 70–72, 77–78. Alternatively, the FAC alleges that Mars's flavanol source claims are unlawful because the term “source” is not specifically defined by FDA regulation and therefore may not be used in food labeling. FAC ¶¶ 70, 73.

b. Calorie–Related Nutrient Content Claims

Gustavson next alleges that Mars makes unlawful nutrient content claims regarding the calories in their chocolate products. Specifically, each chocolate product identified in the FAC states in a colored box appearing on the front of the package that the product contains a “certain percentage of the Daily Value (“DV”) of calories.” FAC ¶¶ 85, 89, 93. The FAC contends that these statements are false and unlawful, however, because “there is no DV for calories and food manufacturers are precluded from making such claims unless a DV actually exists.” FAC ¶ 85. Gustavson additionally alleges that Mars's calorie-related claims are unlawful, because FDA regulations require that nutrient content claims made on products whose fat, saturated fat, cholesterol, or sodium contents exceed certain levels be accompanied by a statement disclosing that high levels of fat, saturated fat, cholesterol, and/or sodium are present in the food. FAC ¶ 88 (quoting 21 C.F.R. 101.13(h)(1)). Although Mars chocolate products allegedly contain levels of fat and/or saturated fat that are sufficient to trigger disclosure, none of the chocolate products mentioned in the FAC complies with the FDA's disclosure requirements. FAC ¶ 93; see also Exs. J–N (reproducing the product labels).

c. PGPR

Gustavson next objects to Mars's practice of identifying the ingredient “polyglycerol polyricinoleic acid” by the acronym “PGPR” on the ingredient list for Twix bars. FAC ¶ 148. According to the FAC, federal regulations require that ingredients be identified by their “common or usual name[s],” 21 C.F.R. § 101.4(a)(1), which the regulations state “shall accurately identify or describe, in as simple and direct terms as possible, the basic nature of the food or its characterizing properties or ingredients,” 21 C.F.R. § 102.5(a), and which “may be established by common usage or by ... regulation,” 21 C.F.R. § 102.5(d). Gustavson alleges that PGPR is not the common or usual name for polyglycerol polyricinoleic acid, and that its use on Twix labels is unlawful and deceptive. See FAC ¶¶ 148, 150.

d. Milk Chocolate Standard of Identity

Gustavson's final claim directed at Mars challenges its unqualified use of the term “milk chocolate” on the front of its product labels for M & Ms, Twix, and Dove Milk Chocolate. FAC ¶¶ 156–161. The FAC alleges that the FDA has established a “standard of identity” for milk chocolate that requires food manufacturers to disclose the use of certain processing techniques or the inclusion of certain ingredients when identifying their products as “milk chocolate.” FAC ¶¶ 157, 159. According to Gustavson, Mars chocolate products are subject to these disclosure requirements,...