Reyes v. Upfield US Inc.

694 F.Supp.3d 408

Joanne REYES, individually and on behalf of all others similarly situated, Plaintiff, v. UPFIELD US INC., Defendant

No. 22-CV-6722 (KMK)

United States District Court, S.D. New York

Signed September 26, 2023

Katherine Lalor, Esq., Theodore Hillebrand, Esq., Spencer Sheehan, Esq., Sheehan & Associates, P.C., Great Neck & Middle Village, NY, Counsel for Plaintiff.

Darci F. Madden, Esq., Courtney J. Peterson, Esq., Nora Faris, Esq., Bryan Cave Leighton Paisner LLP, New York, NY & St. Louis, MO, Counsel for Defendant.

OPINION & ORDER

KENNETH M. KARAS, United States District Judge:

Plaintiff Joanna Reyes ("Plaintiff") brings this putative class action against Upfield US Inc. ("Defendant"), alleging that the labeling on a variety of Defendant's Country Crock brand plant butter is deceptive and misleading. (See generally Compl. (Dkt. No. 1).) Plaintiff brings claims for damages against Defendant for (1) violation of §§ 349 and 350 of the New York General Business Law ("GBL"), N.Y. G.B.L. §§ 349, 350; (2) common law breach of express warranty; (3) common law fraud; and (4) common law unjust enrichment. (See id. ¶¶ 79-106.)¹ Before the Court is Defendant's Motion To Dismiss the Complaint (the "Motion"). (See Not. of Mot. (Dkt. No. 18).) For the foregoing reasons, the Motion is granted in part and denied in part.

I. Background

A. Factual Background

The following facts are drawn from the Complaint and are assumed to be true for the purposes of resolving the instant Motion. See Div. 1181 Amalgamated Transit Union-N.Y. Emps. Pension Fund v. N.Y.C. Dep't of Educ., 9 F.4th 91, 94 (2d Cir. 2021) (per curiam).

Defendant is "the world's largest manufacturer of margarines and vegetable oil spreads," which has its principal place of business in Hackensack, New Jersey. (See Compl. ¶¶ 56-57.) Included in Defendant's product lines is a vegetable oil spread under the Country Crock Brand, described as a plant butter "made with almond oil" or "with almond oil" (the "Product"). (Id. ¶¶ 1-2.) As relevant to the instant Action, Defendant describes the Product using the following representations on the Product's label: "Plant Butter," "Dairy Free," "79% Plant-Based Oil Spread," and a description that the product is made "With Almond Oil." (Id. ¶ 2.) This representation is accompanied by pictures of almonds, an almond flower, and almond leaves. (Id.)

Image materials not available for display.

(See id. ¶¶ 1, 2.)

Plaintiff alleges that the Product's advertisements are false and misleading because, "[b]y representing the Product as 'Made With Almond Oil' and made 'With Almond Oil,' with pictures of almond ingredients, consumers will expect a significant, non-de minimis amount of almond oil, in relative and absolute amounts to all oils used." (Id. ¶ 39 (italics omitted).) Instead, Plaintiff alleges that "the ingredient list reveals a negligible amount of almond oil in relative and absolute amounts to all oils used, less than all other oils." (Id. ¶ 40.) Specifically, the Product lists as its first ingredient a "blend of plant-based oils," which is then described in parenthesis by four oils: palm fruit, palm kernel, canola and almond oil. (See id. ¶¶ 40-41.) Plaintiff alleges that as the fourth listed ingredient, almond oil is "least predominant" among the listed plant-based oils. (Id. ¶ 42.) Accordingly, Plaintiff alleges that the "small relative and absolute amount of almond oil is misleading in light of the front label stating the Product is 'Made With Almond Oil' and made 'With Almond Oil,' with pictures of almond ingredients." (Id. ¶ 43.)

Between January 21, 2022, and January 28, 2022, Plaintiff purchased the Product "on one or more occasions" at various stores, including at ShopRite, 25-43 Prospect St, Yonkers, NY 10701, (id. ¶ 61), for a "premium price" of "no less than $3.99 per 10.5 oz, excluding tax and sales," (id. ¶ 47). Plaintiff alleges that she "believed and expected the Product contained a non-de minimis amount of almond oil, in absolute terms, and relative to other oils used, as opposed to containing mainly palm and canola oils, because that is what the representations and omissions on the front label said and implied." (Id. ¶ 62; see also id. ¶ 68.) In purchasing the Product, Plaintiff alleges she "relied on the words, terms coloring, descriptions, layout, placement, packaging, tags, and/or images on the Product, on the labeling," and on statements made in Defendant's marketing. (Id. ¶ 63.) Without this, Plaintiff alleges that she "would not have purchased the Product if she knew the representations were false and misleading" and that "she would not have paid as much absent Defendant's false and misleading statements and omissions." (Id. ¶¶ 69, 71.)

B. Procedural History

Plaintiff filed her initial Complaint on August 8, 2022. (See Compl.) On October 7, 2022, Defendant filed a pre-motion letter in anticipation of filing a motion to dismiss the Complaint. (See Dkt. No. 10.) Following Plaintiff's response to Defendant's pre-motion letter, (see Dkt. No. 12), the Court held a pre-motion conference on November 14, 2022, and set a briefing schedule, (see Dkt. (minute entry for November 14, 2022); Order (Dkt. No. 16)).

Pursuant to the briefing schedule, Defendant filed the instant Motion on December 15, 2022. (See Not. of Mot.; Mem. of Law in Supp. of Mot. To Dismiss ("Def's Mem.") (Dkt. No. 19).) Plaintiff filed her Opposition on January 17, 2023, (see Mem. of Law in Opp'n to Mot. To Dismiss ("Pl.'s Mem.") (Dkt. No. 20)), and Defendant filed its Reply on January 31, 2023, (see Def's Reply Mem. of Law in Supp. of Mot. To Dismiss ("Def's Reply") (Dkt. No. 21)). Defendant also filed a notice of supplemental authority on May 23, 2023. (See Dkt. No. 22.)

II. Discussion

A. Standard of Review

Defendant moves to dismiss the Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). (See Not. of Mot.) The Supreme Court has held that although a complaint "does not need detailed factual allegations" to survive a Rule 12(b)(6) motion to dismiss, "a plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (alteration and quotation marks omitted). Indeed, Rule 8 of the Federal Rules of Civil Procedure "demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). "Nor does a complaint suffice if it tenders naked assertions devoid of further factual enhancement." Id. (alteration and quotation marks omitted). Rather, a complaint's "[f]actual allegations must be enough to raise a right to relief above the speculative level." Twombly, 550 U.S. at 555, 127 S.Ct. 1955. Although, "once a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint," id. at 563, 127 S.Ct. 1955, and a plaintiff must allege "only enough facts to state a claim to relief that is plausible on its face," id. at 570, 127 S.Ct. 1955, if a plaintiff has not "nudged [his] claim[ ] across the line from conceivable to plausible, the[ ] complaint must be dismissed," id.; see also Iqbal, 556 U.S. at 679, 129 S.Ct. 1937 ("[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged—but it has not 'show[n]'—'that the pleader is entitled to relief.' " (second alteration in original) (citation omitted) (quoting Fed. R. Civ. P. 8(a)(2))); id. at 678-79, 129 S.Ct. 1937. ("Rule 8 marks a notable and generous departure from the hypertechnical, codepleading regime of a prior era, but it does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions.").

"[W]hen ruling on a defendant's motion to dismiss, a judge must accept as true all of the factual allegations contained in the complaint," Erickson v. Pardus, 551 U.S. 89, 94, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007) (per curiam), and "draw all reasonable inferences in the plaintiff's favor," Division 1181, 9 F.4th at 95 (citation omitted). Additionally, "when ruling on a Rule 12(b)(6) motion to dismiss," district courts are directed to confine their consideration to "the complaint in its entirety, . . . documents incorporated into the complaint by reference, and matters of which a court may take judicial notice." Bellin v. Zucker, 6 F.4th 463, 473 (2d Cir. 2021) (quotation marks omitted); see also Dashnau v. Unilever Mfg. (US), Inc., 529 F. Supp. 3d 235, 240 (S.D.N.Y. 2021) (same).

Finally, fraud claims—including common law fraud claims—are subject to the heightened pleading standard set forth in Rule 9(b). See Matana v. Merkin, 957 F. Supp. 2d 473, 484 (S.D.N.Y. 2013) ("[A] claim for common law fraud under New York law must satisfy the requirements of the heightened pleading standard under Federal Rule of Civil Procedure 9(b)." (collecting cases)). Rule 9(b) provides: "In alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake. Malice, intent, knowledge, and other conditions of a person's mind may be alleged generally." Fed. R. Civ. P. 9(b). However, courts " 'must not mistake the relaxation of Rule 9(b)'s specificity requirement regarding condition of mind for a license to base claims of fraud on speculation and conclusory allegations,' " rather " 'plaintiffs must allege facts that give rise to a strong inference of fraudulent intent.' " Lerner v. Fleet Bank, N.A., 459 F.3d 273, 290 (2d Cir. 2006) (quoting Acito v. IMCERA Grp., Inc., 47 F.3d 47, 52, (2d Cir. 1995)). "An inference is 'strong' if it is cogent and at least as compelling as any opposing inference one could draw from the facts alleged." Pilkington N. Am. Inc. v. Mitsui Sumitomo Ins. Co. of Am., 460 F. Supp. 3d 481,...