Ibarrola v. Kind, LLC

83 F.Supp.3d 751

Rochelle Ibarrola, on behalf of herself and all others similarly situated, Plaintiff

v.Kind, LLC, Defendant.

No. 13 C 50377

United States District Court, N.D. Illinois, Eastern Division.

Signed March 12, 2015

Nick Suciu, III, Barbat, Mansour & Suciu PLLC, Detroit, MI, Alyson L. Oliver, Oliver Law Group P.C., Troy, MI, Amy Elisabeth Keller, Catherine C. Howlett, Dawn M. Goulet, Edward Anthony Wallace, Wexler Wallace LLP, Chicago, IL, Jordan L. Chaikin, Parker Waichman LLP, Springs, FL, Randall Seth Crompton, Eric D. Holland, Holland, Groves, Schneller & Stolze, L.L.C., St. Louis, MO, for Palintiff.

Dale J. Giali, Michael L. Resch, Mayer Brown LLP, Los Angeles, CA, Matthew David Provance, Mayer Brown LLP, Chicago, IL, for Defendant.

OPINION AND ORDER

SARA L. ELLIS, United States District Judge

Plaintiff Rochelle Ibarrola¹ brings this putative class action against Kind, LLC, a maker of food products. Ibarrola purchased one of Kind's products—Vanilla Blueberry Clusters with Flax Seeds (“Vanilla Blueberry Clusters”)—on two occasions in 2013. Ibarrola brings this suit pursuant to the Illinois Consumer Fraud and Deceptive Business Practices Act (“ICFA”), 815 Ill. Comp. Stat. 505/1 et seq. , and Illinois common law alleging that the packaging of Vanilla Blueberry Clusters was deceptive in that it claimed that the product contained “no refined sugars.” The Court previously dismissed Kind's initial complaint for failure to adequately allege deception or an injury. The First Amended Complaint (“FAC”) alleges that evaporated cane juice and molasses, the two sweeteners identified on the products' ingredient lists, are refined sugars, and thus, that the “no refined sugars” claim was false and misleading to reasonable consumers. Ibarrola seeks to represent a statewide and nationwide class of individuals who purchased any of Kind's four identified Healthy Grains products.

Kind now moves to dismiss the FAC. Because the Court finds that Ibarrola has not plausibly alleged that a reasonable consumer would be deceived by Kind's statements, her fraud claims fail. Ibarrola's express warranty claim is dismissed because she did not notify Kind of the alleged breach of warranty as required by Illinois law. Finally, the unjust enrichment claim fails because the underlying allegations are dismissed. The motion to dismiss [65] is granted, and the FAC is dismissed in its entirety with prejudice.

BACKGROUND²

Kind produces at least four snack products under the label “Kind Healthy Grains,” including Vanilla Blueberry Clusters. On May 5, 2013 and August 19, 2013, Ibarrola purchased Vanilla Blueberry Clusters from a store after reading the entire product label. At the time of the purchases, the packaging of Vanilla Blueberry Clusters stated that the product contained “no refined sugars.” This was one of twelve bullet-pointed statements on the front of the package. The other statements touted the product's fiber and Omega–3 content, as well as stating that the product was “Gluten Free,” “All Natural,” “Non GMO,” “Cholesterol Free,” and contained “No Trans Fats,” among other qualities. Doc. 60 ¶ 29. The packaging of the other Healthy Grains products also stated that the products contained “no refined sugars” and made similar positive statements as those on the Vanilla Blueberry Clusters packaging. The reverse side of each product included federally mandated nutrition and ingredient information. The nutrition label for Vanilla Blueberry Clusters stated that there were 5 grams of sugars in each 29 gram serving. Kind listed evaporated cane juice and molasses as ingredients in each of the Healthy Grains products.

Evaporated cane juice is a sweetener derived from sugar cane. It “is a type of refined sugar that is less refined than common table sugar,” in that it “does not go through the final refining process that common table sugar undergoes.” Id. ¶¶ 33, 34. As a result, evaporated cane juice contains “trace” amounts of the minerals that otherwise exist in “naturally occurring, unrefined sugar, or natural sugar cane.” Id. ¶¶ 32, 34. But evaporated cane juice “is still a refined sugar with very little nutritional value that lacks the fully intact nutritional profile of truly unrefined sugar.” Id. ¶ 34. Molasses is “a thick syrup produced during the refining of sugar” that, like evaporated cane juice, is “less refined than regular white table sugar.” Id. ¶¶ 36, 38.

Ibarrola claims that when she read “no refined sugars” on the package of Vanilla Blueberry Clusters, she thought that the product “contain[ed] only naturally occurring, unrefined sugars.” Id. ¶ 38. Ibarrola “was looking for a product which did not have refined sugars, so she could enjoy a snack without adding additional calories to her diet that had no and/or a diminished nutritional value. When Plaintiff read the claim ‘No Refined Sugars' she understood that unrefined sugars provided certain health benefits over refined sugars and chose [Kind's] Products based on this preference.” Id. ¶¶ 39–40. Ibarrola contends that she paid a premium for the Vanilla Blueberry Clusters as a result of Kind's statement that the product contained no refined sugars.

Ibarrola's initial complaint was premised primarily on the theory that Kind misled customers by referring to the primary sweetener in Vanilla Blueberry Clusters as “evaporated cane juice ” rather than identifying it as a syrup. Doc. 1 ¶ 3. The initial complaint also alleged that the statement “no refined sugars” was misleading. Id. ¶ 35. Kind moved to dismiss the complaint, asserting that Ibarrola had not plausibly alleged deception or injury. The Court granted the motion on these bases and dismissed the complaint without prejudice. Doc. 59. Ibarrola then filed the FAC, which Kind now moves to dismiss.

LEGAL STANDARD

A motion to dismiss under Rule 12(b)(6) challenges the sufficiency of the complaint, not its merits. Fed.R.Civ.P. 12(b)(6) ; Gibson v. City of Chicago, 910 F.2d 1510, 1520 (7th Cir.1990). In considering a Rule 12(b)(6) motion to dismiss, the Court accepts as true all well-pleaded facts in the plaintiff's complaint and draws all reasonable inferences from those facts in the plaintiff's favor. AnchorBank, FSB v. Hofer, 649 F.3d 610, 614 (7th Cir.2011). To survive a Rule 12(b)(6) motion, the complaint must not only provide the defendant with fair notice of a claim's basis but must also be facially plausible. Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ; see also Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678, 129 S.Ct. 1937.

Rule 9(b) requires a party alleging fraud to “state with particularity the circumstances constituting fraud.” Fed.R.Civ.P. 9(b). This “ordinarily requires describing the ‘who, what, when, where, and how’ of the fraud, although the exact level of particularity that is required will necessarily differ based on the facts of the case.” AnchorBank, 649 F.3d at 615 (citation omitted). Rule 9(b) applies to “all averments of fraud, not claims of fraud,” Borsellino v. Goldman Sachs Grp., Inc., 477 F.3d 502, 507 (7th Cir.2007), including ICFA deceptive practices claims, Camasta v. Jos. A. Bank Clothiers, Inc., 761 F.3d 732, 736 (7th Cir.2014). “A claim that ‘sounds in fraud’—in other words, one that is premised upon a course of fraudulent conduct—can implicate Rule 9(b)'s heightened pleading requirements.” Borsellino, 477 F.3d at 507.

ANALYSIS

The FAC contains four counts: common law fraud, unjust enrichment, breach of express warranty, and a violation of ICFA. Each of these counts is premised on Ibarrola's allegation that Kind falsely advertised that its products do not contain any refined sugars. Kind moves to dismiss the entire complaint, contending primarily that Ibarrola failed to adequately alleged that a reasonable consumer would be deceived by any of Kind's statements, and thus that her fraud claims fail. Kind also asserts that Ibarrola did not adequately allege an express warranty claim and, alternately, that Ibarrola did not provide the required pre-litigation notice to bring an express warranty claim. Kind contends that the unjust enrichment claim cannot stand on its own after the other claims have been dismissed. The Court takes these arguments in turn.³

I. Fraud Claims

To prevail on her ICFA claim, Ibarrola must allege and ultimately prove: (1) a deceptive act or practice by Kind, (2) that the deceptive act or practice occurred in the course of conduct involving trade or commerce, (3) that Kind intended that Ibarrola rely on the deception, and (4) that the deception caused Ibarrola actual damages. Oshana v. Coca–Cola Co., 472 F.3d 506, 513 (7th Cir.2006). In addition to these elements, common law fraud requires plaintiffs to allege that the plaintiff actually relied on the contested statement and that the defendant acted with scienter.⁴ Thacker v. Menard, Inc., 105 F.3d 382, 386 (7th Cir.1997).

Although ICFA claims often involve disputed questions of fact not suitable to a motion to dismiss, a court may dismiss the complaint if the challenged statement was not misleading as a matter of law. Bober v. Glaxo Wellcome PLC, 246 F.3d 934, 940 (7th Cir.2001) (affirming dismissal of a complaint involving Zantac 75); Pelayo v. Nestle USA, Inc., 989 F.Supp.2d 973, 978 (C.D.Cal.2013) (dismissing a suit against the makers of Buitoni pastas and citing cases).

In moving to dismiss, Kind contends that Ibarrola fails to plausibly allege that the “no refined sugars” claim was deceptive. Kind points out that Ibarrola never explains what exactly she understood the statement “no refined sugars” to mean when she purchased the Vanilla Blueberry Clusters. Ibarrola claims, somewhat obliquely, that she understood “no refined sugars” to mean that the...