Herndon v. EzriCare, LLC

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JESSICA HERNDON, Plaintiff, v. EZRICARE, LLC, et al., Defendants.

Civil Action No. 24-00829 (GC) (RLS)

United States District Court, D. New Jersey

October 31, 2024

NOT FOR PUBLICATION

OPINION

GEORGETT CASTNER, UNITED STATES DISTRICT JUDGE.

THIS MATTER comes before the Court upon Defendants EzriCare, LLC's and EzriRx, LLC's Motions to Dismiss Plaintiff's Complaint. (ECF Nos. 18 & 19.) Plaintiff opposed (ECF Nos. 28 & 29), and Moving Defendants replied (ECF Nos. 30 & 31). The Court has carefully considered the parties' submissions and decides the matter without oral argument pursuant to Federal Rule of Civil Procedure (Rule) 78(b) and Local Civil Rule 78.1(b). For the reasons set forth below, and other good cause shown, EzriRx's motion is DENIED, and EzriCare's motion is GRANTED in part and DENIED in part.

I. BACKGROUND

Plaintiff a Louisiana resident, claims that her eyes became infected with Pseudomonas Aeruginosa bacteria after using EzriCare artificial tears that she purchased from EzriCare on Amazon.com. (ECF No. 1 ¶¶ 1-15, 50.^[1]) Plaintiff sues EzriCare, the New Jersey-based company that sold her the product (id. at ¶¶ 1, 17, 28); EzriRx, another New Jersey-based company, which allegedly participated in the supply chain (id. ¶¶ 1, 18, 28); Global Pharma Healthcare Private Ltd., the India-based corporation that designed, manufactured, and packaged the product (id. ¶¶ 1, 19, 28); Aru Pharma, Inc., the New York-based corporation that allegedly designed, tested, manufactured, imported, and distributed the product (id. ¶¶ 1, 20, 28); and Amazon, the online platform where Plaintiff purchased the product, (id. ¶¶ 1, 21-22, 28).^[2]

In a 14-count Complaint, Plaintiff asserts claims against all Defendants for strict liability for failure to warn (Count One); strict liability for design or manufacturing defect (Count Two); negligence or gross negligence (Count Three); products liability - negligence for failure to warn (Count Four); products liability - negligence for design or manufacturing defect (Count Five); negligent misrepresentation or omission (Count Six); fraud (Count Seven); fraudulent concealment (Count Eight); breach of express warranty (Count Nine); breach of implied warranty (Count Ten); negligent failure to timely recall (Count Eleven); violations of New Jersey's Consumer Fraud Act (NJCFA), N.J. Stat. Ann. § 56:8-2 (Count Twelve); violations of the New Jersey Products Liability Act (NJPLA), N.J. Stat. Ann. § 2A:58C-1 (Count Thirteen); and punitive damages (Count Fourteen). (Id. at 19-45.)

EzriCare and EzriRx each moved to dismiss. EzriRx argues that Plaintiff lacks standing against EzriRx and fails to state a claim against EzriRx. (ECF No. 19-1 at 8-9; ECF No. 30 at 15.) EzriCare argues that: (1) Plaintiff's Complaint is insufficient on its face, (2) Plaintiff's product liability claims are subsumed by the New Jersey Products Liability Act (NJPLA), (3) Plaintiff fails to sufficiently plead a claim for breach of express warranty, and (4) Plaintiff fails to sufficiently plead a claim under the NJPLA. (ECF No. 18-1 at 12-24; ECF No. 25 at 1-10.)^[3]

II. LEGAL STANDARDS

A. Rule 12(b)(1)-Lack of Subject-Matter Jurisdiction

Under Rule 12(b)(1), a court must grant a motion to dismiss if it lacks subject matter jurisdiction to hear a claim. See Fed.R.Civ.P. 12(b)(1). A motion to dismiss for want of standing is properly brought under Rule 12(b)(1), because “standing is a jurisdictional matter.” Ballentine v. United States, 486 F.3d 806, 810 (3d Cir. 2007). On a motion to dismiss for lack of standing, plaintiff “bears the burden of establishing the elements of standing, and each element must be supported in the same way as any other matter on which the plaintiff bears the burden of proof, i.e., with the manner and degree of evidence required at the successive stages of the litigation.” Id. (citations and internal quotation marks omitted); see also Transunion LLC v. Ramirez, 141 S.Ct. 2190, 2207-08 (2021) (confirming that “plaintiffs must demonstrate standing for each claim that they press and for each form of relief they seek . . . with the manner and degree of evidence required at the successive stages of the litigation”).

In evaluating a Rule 12(b)(1) motion to dismiss, courts must first determine whether the motion “presents a ‘facial' attack or a ‘factual' attack on the claim at issue, because that distinction determines how the pleading must be reviewed.” Const. Party of Pa. v. Aichele, 757 F.3d 347, 357 (3d Cir. 2014) (quoting In re Schering Plough Corp. Intron/Temodar Consumer Class Action, 678 F.3d 235, 243 (3d Cir. 2012)). “A facial 12(b)(1) challenge, which attacks the complaint on its face without contesting its alleged facts, is like a 12(b)(6) motion in requiring the court to ‘consider the allegations of the complaint as true.'” Hartig Drug Co. Inc. v. Senju Pharm. Co., 836 F.3d 261, 268 (3d Cir. 2016) (citation omitted).

A factual challenge, on the other hand, “attacks allegations underlying the assertion of jurisdiction in the complaint, and it allows the defendant to present competing facts.” Id.; see Davis v. Wells Fargo, 824 F.3d 333, 346 (3d Cir. 2016) (noting that a motion “supported by a sworn statement of facts . . . must be construed as a factual, rather than a facial attack” (quoting Int'l Ass'n of Machinists & Aerospace Workers v. Nw. Airlines, Inc., 673 F.2d 700, 711 (3d Cir. 1982))). The party invoking the federal court's jurisdiction has “the burden of proof that jurisdiction does in fact exist.” Petruska v. Gannon Univ., 462 F.3d 294, 302 n.3 (3d Cir. 2006) (quoting Mortensen v. First Fed. Sav. & Loan Ass'n, 549 F.2d 884, 891 (3d Cir. 1977)). The “trial court is free to weigh the evidence and satisfy itself as to the existence of its power to hear the case” and “the plaintiff will have the burden of proof that jurisdiction does in fact exist.” Id. (quoting Mortensen, 549 F.2d at 891). “Therefore, a 12(b)(1) factual challenge strips the plaintiff of the protections and factual deference provided under 12(b)(6) review.” Hartig Drug Co., 836 F.3d at 268.

Regardless of the type of challenge, the plaintiff bears the “burden of proving that the court has subject matter jurisdiction.” Cottrell v. Heritages Dairy Stores, Inc., Civ. No. 09-1743, 2010 WL 3908567, at *2 (D.N.J. Sep. 30, 2010) (citing Mortensen, 549 F.2d at 891).

B. Rule 12(b)(6)-Failure to State a Claim

On a motion to dismiss for failure to state a claim, courts “accept the factual allegations in the complaint as true, draw all reasonable inferences in favor of the plaintiff, and assess whether the complaint and the exhibits attached to it ‘contain enough facts to state a claim to relief that is plausible on its face.'” Wilson v. USI Ins. Serv. LLC, 57 F.4th 131, 140 (3d Cir. 2023) (quoting Watters v. Bd. of Sch. Directors of City of Scranton, 975 F.3d 406, 412 (3d Cir. 2020)). “A claim is facially 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.'” Clark v. Coupe, 55 F.4th 167, 178 (3d Cir. 2022) (quoting Mammana v. Fed. Bureau of Prisons, 934 F.3d 368, 372 (3d Cir. 2019)). When assessing the factual allegations in a complaint, courts “disregard legal conclusions and recitals of the elements of a cause of action that are supported only by mere conclusory statements.” Wilson, 57 F.4th at 140 (citing Oakwood Lab'ys LLC v. Thanoo, 999 F.3d 892, 903 (3d Cir. 2021)). The defendant bringing a Rule 12(b)(6) motion bears the burden of “showing that a complaint fails to state a claim.” In re Plavix Mktg., Sales Pracs. & Prod. Liab. Litig. (No. II), 974 F.3d 228, 231 (3d Cir. 2020) (citing Davis, 824 F.3d at 349).

III. DISCUSSION

A. EzriRx's Motion

EzriRx argues that the Complaint does not allege facts establishing standing against it. (ECF No. 19-1 at 8-9.) Article III standing requires “(1) an injury-in-fact, (2) a sufficient causal connection between the injury and the conduct complained of, and (3) a likelihood that the injury will be redressed by a favorable decision.” Finkelman v. Nat'l Football League, 810 F.3d 187, 193 (3d Cir. 2016). EzriRx challenges only the causal-connection element.

EzriRx argues that Plaintiff has not and cannot plead a causal connection between her injury and EzriRx, because EzriRx operates a business-to-business online marketplace-it does not sell products to consumers. (ECF No. 19-1 at 9.) In support, EzriRx submits the affidavit of Ezriel Green, the founder and chief executive officer of EzriRx. (ECF No. 19-1 at 5-6; ECF No. 19-2 at 1-3.)^[4] Green states that “EzriRx is an online marketplace platform that assists pharmacies in purchasing prescription medications, over-the-counter drugs, and pet medication,” and that “EzriRx does not sell directly to consumers.” (Id. at 2.)

Plaintiff asserts that EzriRx and Green did not argue that it “had no involvement in the marketing, sale, and distribution of EzriCare Artificial Tears.” (ECF No. 28 at 10.) She also argues that “Ezricare” is a trademark registered and licensed to EzriRx. (Id.) Plaintiff further asserts that “even if this Court determines that EzriRx should not be held directly liable for its actions and/or inactions with respect to EzriCare, EzriRx can be held derivatively liable for the actions and products of EzriCare” under an alter ego theory and agency principles. (Id. at 11-14.)

The Court disagrees with Plaintiff's alter-ego theory of liability. Entities sharing leadership, contact information and counsel, (see id. at 12), does not alone justify disregarding their corporate separateness. See Mikhail v. Amarin Corp., plc, Civ. No. 23-01856, 2024 WL 863427, at *6-8 (D.N.J. Feb. 29, 2024) (discussing...