McMahon v. Bumble Bee Foods LLC

148 F.Supp.3d 708

Joseph McMahon, individually and on Behalf of all others similarly situated, Plaintiff(s),

v.Bumble Bee Foods LLC, Defendant(s).

No. 14 C 03346

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

Filed December 02, 2015

Signed December 12, 2015

Robert A. Clifford, Shannon Marie McNulty, Clifford Law Offices, P.C., Chicago, IL, for Plaintiff(s).

Forrest A. Hainline, III, Patrick S. Thompson, Robert B. Bader, Goodwin Procter, LLC, San Francisco, CA, Louis David Bernstein, Michael Thomas Herbst, The Bernstein Law Firm, LLC, Chicago, IL, for Defendant(s).

MEMORANDUM OPINION AND ORDER

John J. Tharp, Jr., United States District Judge

This putative class action seeks recovery from Bumble Bee Foods LLC under the Illinois Consumer Fraud and Deceptive Business Practices Act (“ICFA”), 815 ILCS 505/1, the Illinois Food, Drug and Cosmetic Act (“IFDCA”), 410 ILCS 620/1, and a variety of common law claims, including unjust enrichment.¹ The named plaintiff, Joseph McMahon, alleges that Bumble Bee engaged in deceptive conduct when it sold various seafood products with labels that indicated they were an “Excellent Source of Omega 3.” Pls.' Cmplt. at ¶ 31. Bumble Bee moves to dismiss McMahon's IFDCA claim on preemption grounds and contends that McMahon's unjust enrichment claim is not a viable cause of action under Illinois law. In the alternative, Bumble Bee moves to have McMahon's case stayed until January 1, 1016, which is when the FDCA's recently adopted rule concerning Omega-3 nutrients becomes effective. For the reasons that follow, Bumble Bee's motion is denied.

Background

McMahon alleges that Bumble Bee made a number of impermissible qualitative statements about the quantity of Omega-3 acids in its seafood products. The statements, located on the labeling of Bumble Bee's Chunk White Tuna in Water, its Chunk White Tuna in Oil, and its Albacore Tuna in Water, indicated that the products were an “Excellent Source [of] Omega-3” and displayed an American Heart Association seal. Pls.' Cmplt. at 1. McMahon contends these labels were deceptive and in violation of the IFDCA.

When labeling food products, if a food manufacturer wishes to make a qualitative statement about the nutritional value of a food product—such as that the product is an “excellent source of” or “high in” a particular nutrient—it must comply with both federal and state regulatory requirements. If it fails to do so, the product may be deemed “misbranded.” 21 U.S.C. § 343 (a) ; see 410 ILCS 620/11. The FDCA permits food manufacturers to make a qualitative statement indicating that a food item is “high in” or an “excellent source of” a nutrient only if the product contains at least twenty percent or more of the recommended daily intake (“RDI”) or the daily reference value (“DRV”), 21 C.F.R. § 101.54 (b), and food manufacturers can only claim the product is a “good source” of a particular nutrient if it contains ten to nineteen percent of the RDI or DRV of that nutrient. Id. § 101.54 (c). If the FDA has not established an RDI or DRV for a particular nutrient then food manufacturers cannot make qualitative statements about that nutrient, unless they submit a notification to the FDA and receive its approval. See 21 U.S.C. § 343 (r)(2)(G).

To receive FDA approval, the food manufacturer must submit to the FDA an “authoritative statement” that has been published by the National Academy of Sciences or a governmental public health body that identifies the appropriate nutrient level for the product. 21 U.S.C. § 343 (r)(2)(G)(ii). The manufacturer must also provide the FDA with a copy of the exact qualitative statement it wishes to make on the product. Id. If the FDA takes no action within 120 days then the manufacturer can put the submitted statement on the product's label, notwithstanding the lack of an established RDI or DRV for that nutrient. Id. At any time thereafter, however, the FDA can disallow the nutrient content claim by issuing a regulation prohibiting or modifying the claim, or by finding that the petitioner's notification lacks required information. U.S.C. § 343 (r)(2)(H). The IFDCA directly tracks the requirements of the FDCA, stating that the Illinois Food and Drug Commission should “make the regulations promulgated under [the IFDCA] conform, in so far as practicable, with those promulgated under the Federal Act.” 410 ILCS 620/21 (a). Additionally, “a federal regulation adopted pursuant to [the IFDCA] takes effect in this State on the date it becomes effective as a Federal regulation.” 410 ILCS 620/21 (i).

With respect to Omega-3 nutrients, the FDA has not established an RDI or DRV metric. Hence, any food manufacturer that wishes to advertise its product with a qualitative statement about the presence of Omega-3s must submit to the FDA an application that follows the steps outlined in U.S.C § 343(r). In 2005, three separate food manufacturers did so and submitted nutrient content claim notifications to the FDA, claiming that the Food and Nutrition Board of the Institute of Medicine (IOM) of the National Academy of Sciences published a report that qualified as an authoritative statement concerning the RDI for Omega-3s. Def.'s Mot. to Dismiss at 5. Bumble Bee, however, was not one of these manufacturers.

Citing the IOM report, the three manufacturers claimed that if one serving of their seafood products contained at least 32 mg of Omega-3 fats, then they exceeded the FDCA threshold requirements for products to be labelled as being “high in” or an “excellent source of” a particular nutrient. They thus proposed to label their seafood products as an “Excellent source of Omega-3 EPA and DHA.” Id. The FDA took no action within 120 days and on April 9, 2006 it became permissible for the submitting manufacturers to use their proposed label. Id. Although Bumble Bee had not submitted a notification to the FDA, it also soon began making similar claims on its own seafood labels. Those claims are what McMahon alleges were deceptive.

Despite its earlier acquiescence to the manufacturers' notice, on November 27, 2007 the FDA published a proposed rule in response to the Omega-3 notifications. See Food Labeling: Nutrient Content Claims; Alpha–Linolenic Acid, Eicosapentaenoic Acid, and Docosahexaenoic Acid Omega-3 Fatty Acids, 72 Fed. Reg. 66103 (proposed Nov. 27, 2007). In its proposed rule, the FDA rejected the IOM report as an authoritative statement because IOM had determined the Omega-3s' reference values by using a method that was not recognized by the FDA. Id. at 66104. The FDA concluded that, going forward, food manufacturers could not make qualitative statements about the content of Omega-3s in their products. Id. Although the Omega-3 rule was finalized on April 28, 2014, the FDA decided to delay implementing the rule until January 1, 2016. This decision was based on comments submitted from affected manufacturers expressing concern about the costs associated with phasing out food labels that were permissible under the manufacturers' previous notification sent to the FDA. But the FDA did not indicate that civil actions enforcing current law were stayed pending the rule's implementation.

Discussion

When considering a motion to dismiss under Rule 12(b)(6), the Court accepts as true all well-pleaded facts and draws all reasonable inferences in favor of the plaintiff. Yeftich v. Navistar, Inc., 722 F.3d 911, 915 (7th Cir.2013). Exhibits that are attached to the complaint become part of the pleadings, see Fed.R.Civ.P. 10 (c), and can be considered on a motion to dismiss.² Bogie v. Rosenberg, 705 F.3d 603, 609 (7th Cir.2013). In moving to dismiss McMahon's IFDCA claim, Bumble Bee contends that McMahon's state law claim is preempted by the FDCA and, in the alternative, that this Court should stay his case until January 1, 2016. Def.'s Mot. to Dismiss at 7, 11. Bumble Bee also argues that McMahon's unjust enrichment claim does not state a viable cause of action under Illinois law. Id. at 11. These arguments are addressed in turn below.

A. Preemption

Bumble Bee contends that the FDCA expressly preempts McMahon's state law claim because he “attempts to use state law to impose different and additional food labeling requirements than [the] FDA,” which is prohibited by the FDCA's preemption provision. Def.'s Mot. to Dismiss at 10. Bumble Bee faces a strong presumption against preemption, Patriotic Veterans, Inc. v. Indiana, 736 F.3d 1041, 1046 (7th Cir.2013), and in seeking to invalidate McMahon's state law claim it must surmount “the starting presumption that Congress did not intend to supplant state law.” De Buono v. NYSA–ILA Med. and Clinical Services Fund, 520 U.S. 806, 814, 117 S.Ct. 1747, 138 L.Ed.2d 21 (1997). Federal law can, however, preempt state or local laws in three different ways: express preemption, field preemption, and conflict preemption. Aux Sable Liquid Products v. Murphy, 526 F.3d 1028, 1033 (7th Cir.2008). Express preemption, which Bumble Bee invokes here, occurs when a federal statute explicitly states that it overrides a state or local law that is inconsistent with the language of the preemption provision. Id. Bumble Bee relies on the preemption provision of the FDCA which states:

[N]o State or political subdivision of a State may directly or indirectly establish under any authority or continue in effect as to any food in interstate commerce—(1) any requirement for a food which is the subject of a standard of identity established under section 341 of this title that is not identical to such standard of identity or that is not identical to the requirement of section 343(g) of this title.

21 U.S.C. § 343–1(a)(1). The Act also prohibits states from imposing “any requirement respecting any claim of the type described in section 343(r)(1) of the FDCA…made in the label or labeling of food that is not identical to the requirement of section 343(r).” 21 U.S.C. § 343–1(a)(1)(5). Thus, a state can impose requirements that are identical to those...