Shirley v. Reynolds Consumer Prods., LLC

636 F.Supp.3d 907

Veronica SHIRLEY, individually and on behalf of all others similarly situated, Plaintiff, v. REYNOLDS CONSUMER PRODUCTS, LLC, Defendant.

No. 22 C 278

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

Signed October 21, 2022

Michael Robert Reese, Reese LLP, New York, NY, Francis Richard Greene, Greene Consumer Law, Highland Park, IL, George Volney Granade, II, Reese LLP, Los Angeles, CA, Peter S. Lubin, Patrick Doyle Austermuehle, Lubin Austermuehle, P.C., Oakbrook Terrace, IL, Terrence Buehler, The Law Office of Terrence Buehler, Chicago, IL, Spencer Sheehan, Sheehan & Associates, P.C., Great Neck, NY, for Plaintiff.

Jonathan Hale Claydon, Brian Charles Miller, David Stephen Repking, Greenberg Traurig, LLP, Chicago, IL, for Defendant.

Memorandum Opinion & Order

Elaine E. Bucklo, United States District Judge

In this action, plaintiff Veronica Shirley alleges on behalf of herself and putative Illinois and multistate classes that Reynolds Consumer Products violates the consumer protection statutes and common law of Illinois and eleven other states by labeling its aluminum foil "Made in USA" when, in fact, the primary raw material used to make the product—bauxite—is imported from abroad. Plaintiff alleges that Reynolds sells its aluminum foil at "a price premium compared to other similar products, for no less than $4.99 per 75 square feet, excluding tax or any sales, a higher price than it would otherwise be sold for, absent the misleading representations and omissions." Compl. at ¶ 27. According to the complaint, Reynolds intended to deceive consumers who, like plaintiff, are willing to pay a premium for American-made products, and that plaintiff and the classes were misled into doing so by the "Made in USA" label. Plaintiff also alleges that she and the classes "would not have bought the product or would have paid less for it" had they "known the truth." Id. at ¶ 26.

Plaintiff asserts violations of the Illinois Consumer Fraud and Deceptive Practices Act ("ICFA") and unidentified consumer protection statutes of Iowa, New Hampshire, New Mexico, Georgia, Michigan, Texas, Arkansas, Delaware, Wyoming, Virginia, and Oklahoma, which plaintiff claims are similar to the ICFA. She also asserts claims for breach of contract, breach of express warranty, breach of the implied warranty of merchantability, and violation of the Magnusson Moss Warranty Act, 15 U.S.C. §§ 2301. Finally, plaintiff claims negligent misrepresentation, fraud, and unjust enrichment under the common law of the foregoing states. Reynolds moves to dismiss the complaint in its entirety, asserting myriad flaws in plaintiff's various claims, and moves in the alternative to transfer the case to the Western District of Arkansas. For the reasons that follow, the motion to dismiss is granted in part, and the motion to transfer is denied.

I.

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the sufficiency of a complaint, not the merits of a case. McReynolds v. Merrill Lynch & Co., 694 F.3d 873, 878 (7th Cir. 2012). In resolving such motions, I "construe the complaint in the light most favorable to the plaintiff, accepting as true all well-pleaded facts alleged, and drawing all possible inferences in her favor." Tamayo v. Blagojevich, 526 F.3d 1074, 1081 (7th Cir. 2008).

To survive a motion to dismiss, a complaint must assert sufficient factual content to make relief plausible, rather than merely conceivable. Ashcroft v. Iqbal, 556 U.S. 662, 683, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). The federal notice-pleading standards of Rule 8 require a plaintiff to "give the defendant fair notice of what the . . . claim is and the grounds upon which it rests." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). Claims sounding in fraud—which include claims alleging deceptive conduct under ICFA—are subject to the heightened pleading standards of Federal Rule of Civil Procedure 9(b). Camasta v. Jos. A. Bank Clothiers, Inc., 761 F.3d 732, 736 (7th Cir. 2014).

The federal change of venue statute, 28 U.S.C. § 1404, authorizes transfer of an action "[f]or the convenience of the parties and witnesses, in the interest of justice," if the case could have been brought originally in the transferee venue. Rsch. Automation, Inc. v. Schrader-Bridgeport Int'l, Inc., 626 F.3d 973, 977 (7th Cir. 2010). To determine whether transfer is appropriate, courts consider the statutory factors and assess convenience and fairness on an individualized, case-by-case basis. Coffey v. Van Dorn Iron Works, 796 F.2d 217, 219 (7th Cir. 1986) (citations omitted).

II.

Defendant's first argument for dismissal targets plaintiff's ICFA claim. The ICFA protects "consumers, borrowers, and business persons against fraud, unfair methods of competition, and other unfair and deceptive business practices." Siegel v. Shell Oil Co., 612 F.3d 932, 934 (7th Cir. 2010) (cleaned up). To state a claim under the statute, a plaintiff must show: "(1) a deceptive or unfair act or promise by the defendant; (2) the defendant's intent that the plaintiff rely on the deceptive or unfair practice; and (3) that the unfair or deceptive practice occurred during a course of conduct involving trade or commerce." Camasta, 761 F.3d at 739 (quoting Wigod v. Wells Fargo Bank, N.A., 673 F.3d 547, 574 (7th Cir. 2012)). Defendant argues that plaintiff's ICFA claim fails because her damages allegations are speculative and because her claim is duplicative of her warranty claims. Neither argument warrants dismissal.

A private action under the ICFA requires a plaintiff to plead and prove that defendant's violation of the statute caused her actual damages, which is to say, "actual pecuniary loss." Id. (citing Mulligan v. QVC, Inc., 382 Ill.App.3d 620, 321 Ill.Dec. 257, 888 N.E.2d 1190, 1196 (2008), and Kim v. Carter's Inc., 598 F.3d 362, 365 (7th Cir. 2010)). Many courts in this district have found damages allegations such as plaintiff's sufficient to satisfy this standard. See, e.g., Rudy v. Fam. Dollar Stores, Inc., 583 F. Supp. 3d 1149, 1160-61 (N.D. Ill. 2022) (citing Terrazzino v. Wal-Mart Stores, Inc., 335 F. Supp. 3d 1074, 1085 (N.D. Ill. 2018) (allegations that the plaintiff "paid more for the Pita Chips because they were labeled as 'All Natural,' and further that she would not have bought the Pita Chips if she had known that they were not, in fact, 'All Natural,' " sufficient to allege actual damages); McDonnell v. Nature's Way Prods., LLC, No. 16 C 5011, 2017 WL 1149336, at *3 (N.D. Ill. Mar. 28, 2017) (allegations that the plaintiff "paid more for the products than they were actually worth" and "would not have purchased the vitamins at the price she paid if she had known that they contained foreign-sourced vitamins" sufficient); Muir v. Playtex Prods., LLC, 983 F. Supp. 2d 980, 990 (N.D. Ill. 2013) (allegations that the plaintiff "was deprived of the benefit of the bargain because the Diaper Genie II Elite product was actually worth less than what it would have been worth had it actually been proven superior in odor control to its competitors" adequately pled actual damages element of ICFA claim)). See also Geske v. PNY Techs., Inc., 503 F. Supp. 3d 687, 709 (N.D. Ill. 2020) (citing, inter alia, Hobbs v. Gerber Prods. Co., 17 C 3534, 2018 WL 3861571, at *9 (N.D. Ill. Aug. 14, 2018) ("[T]he Court reads the complaint to claim that Hobbs did not receive the benefit of the bargain - that she did not receive what she thought she was paying for - and that suffices as a claim of actual pecuniary loss."), and Ulrich v. Probalance, Inc., 2017 WL 3581183, at *9 (N.D. Ill. Aug. 18, 2017) (allegations that the plaintiff received goods that were "worth less than was promised" sufficient to plead actual damages)).

It is true that in Sabo v. Wellpet, a case similarly involving allegations of deceptive "Made in the USA" labeling, I held that to raise a plausible inference of actual damages, the plaintiff was required to ground his allegations in something more than "his subjective estimation of the products' worth." 250 F. Supp. 3d 332, 337 (N.D. Ill. 2017). I concluded that the plaintiff's first amended complaint was too speculative to suggest actual damages, noting that he did not claim to have "paid more for defendant's pet food products because he believed they were American-made," did not assert that the defendant "charged more for its pet food products because they were (supposedly) 'Made in the USA,' " and did not allege that "comparable pet food products that lacked domestic-source designations were less expensive." Id. Although the plaintiff attempted to cure these deficiencies by amending his complaint, adding, inter alia, an allegation that absent the deceptive labeling, he "would not have purchased the dog food at the price he paid," 282 F. Supp. 3d 1040, 1042 (N.D. Ill. 2017), I held the amendments insufficient to raise his damages claim above a speculative level. I noted that although the plaintiff and the absent class members presumably had dogs they needed to feed in any event, the complaint said nothing about alternative products they would have bought instead of the defendant's dog food or how those products compared to the defendant's price-wise. Id. Here, by contrast, plaintiffs allege that they would not have purchased defendant's product at all had they known "the truth" (and there is no obvious reason, such as pets to feed, to presume that they would have had to purchase some alternative), and they further suggest that "other similar products" were available for sale at lower prices. Compl. at ¶ 27. While the differences between these allegations and those in Sabo are nuanced, they are sufficient to nudge plaintiff's claims "across the line from conceivable to plausible." Iqbal, at 683, 129 S.Ct. 1937 (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955).

Defendant's...