Stewart v. Kodiak Cakes, LLC

568 F.Supp.3d 1056

Ty STEWART, et al., Plaintiffs,

v.KODIAK CAKES, LLC, Defendant.

Case No.: 19-cv-2454-MMA (MSB)

United States District Court, S.D. California.

Signed October 25, 2021

Courtney M. Vasquez, David Adam Fox, Joanna Fox, Fox Law, A.P.C., Solana Beach, CA, for Plaintiff Ty Stewart.

Courtney M. Vasquez, David Adam Fox, Fox Law, A.P.C., Solana Beach, CA, for Plaintiffs Jocelyn Fielding, Laureene Buck, Anna Altomare.

Courtney M. Vasquez, Fox Law, A.P.C., Solana Beach, CA, for Plaintiffs Vicki Siverling, Tracy Hall, Mary McLeroy, Chad Humphrey, Victoria Johnson, Michael Smith, Harry Malakoff, Alyson Martin, Robin Curless, Jennifer Jenkins, Mary Hillary Pfeiffer, Suzanne Dagesse, Julie Lussier, Julie Stocker, Ivan Blanco, Eliza Reid, Evelyn Hernandez, Danielle Arno.

Danielle Stierna, Eric Y. Kizirian, Michael Grimaldi, Lewis Brisbois Bisgaard & Smith LLP, Los Angeles, CA, for Defendant.

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION TO DISMISS

MICHAEL M. ANELLO, United States District Judge

On May 17, 2021, Ty Stewart along with twenty-one (21) other named plaintiffs (collectively, "Plaintiffs") filed a second amended class action complaint against Kodiak Cakes, LLC ("Defendant") alleging violations of numerous state consumer protection laws. See Doc. No. 90 ("SAC").

Before the Court is Defendant's second motion to dismiss. See Doc. No. 91. Plaintiff filed an opposition, to which Defendant replied. See Doc. Nos. 92, 93. For the reasons set forth below, the Court GRANTS IN PART and DENIES IN PART Defendant's motion.

I. BACKGROUND

In their First Amended Complaint, Plaintiffs brought six causes of action against Defendant based on two issues with Defendant's products: "(1) the non-functional slack fill and (2) deceptive marketing practices." Doc. No. 37 ("FAC") ¶ 3. Regarding the former, Plaintiffs asserted that some of Defendant's products contain "empty space in a package that is filled to less than its capacity ... that serves no lawful purpose. Id. ¶ 5 (internal citation and quotation marks omitted). As to the latter, Plaintiffs alleged Defendant misleadingly labels and advertises its products as having "no preservatives," being "free of artificial additives," "non-GMO," "healthy," and "protein-packed." See id. ¶¶ 10, 63, 97–126, 127–31, 132–48. Plaintiffs thus brought the following causes of action: (1) "violation of the consumer protection acts of all 50 states (and the District of Columbia)" on behalf of the nationwide class; (2) violation of the California Consumers Legal Remedies Act (CLRA), Cal Civ. Code §§ 1750 – 1784, on behalf of the California class; (3) violations of the California Unfair Competition Law (CUCL), Cal. Bus. & Prof. Code §§ 17200 – 17210, on behalf of the California class; (4) violation of the California False Advertising Law (CFAL), Cal. Bus. & Prof. Code §§ 17500 – 17606 ; (5) breach of express warranty on behalf of the nationwide class; and (6) "[restitution] based on quasi-contract and unjust enrichment" on behalf of the nationwide class. See id. ¶¶ 161–222. On October 28, 2020, Defendant moved to dismiss each cause of action in the Plaintiffs’ FAC. See Doc. No. 44.

On April 29, 2021, this Court issued an order granting in part and denying in part Defendant's motion to dismiss and denying Defendant's motion to strike. See Doc. No. 87 ("FAC Dismissal Order"). The Court dismissed Plaintiffs’ first cause of action with leave to amend and directed Plaintiffs to separate their allegations of various state law violations into independent causes of action. See id. at 23.¹ The Court further directed Plaintiffs to identify the state laws applicable to their breach of express warranty claims. See id. at 66. The Court denied the motion to dismiss with respect to Plaintiffs’ CLRA, CUCL, and CFAL causes of action. See id. at 63. The Court dismissed Plaintiffs’ quasi-contract claim. See id. at 69.

With respect to the five deceptive marketing terms, the Court denied the motion to dismiss as to Plaintiffs’: (1) "no preservatives" theory; (2) "free of artificial additives" theory; and (3) "healthy" theory as it relates to the description of Defendant's Double Dark Chocolate Muffin Mix. See id. at 18, 57. The Court dismissed with leave to amend Plaintiffs’ "non-GMO" and "protein-packed" theories. See id. at 52, 58.

On May 17, 2021, Plaintiffs filed the SAC. Plaintiffs are from eleven states: California, Colorado, Connecticut, Florida, Illinois, Massachusetts, Michigan, Missouri, New Jersey, New York, and Washington. See SAC at ¶¶ 16–66. In the SAC, Plaintiffs reallege the three California consumer protection causes of action identified above—violations of the CLRA, CUCL, CFAL—as well as bring a California state law claim for breach of express warranty, Cal. Com. Code § 2313. See id. at 53–60. As to the remaining ten states, Plaintiffs bring a state law claim under each respective consumer protection laws for deceptive practices,² as well as a state law claim for breach of warranty.³ See id. at 60–83. In essence, Plaintiffs assert that some of Defendant's products contain the non-functional slack-fill, see id. ¶ 64, and some are misleadingly labeled and advertised as: (1) "no preservatives;" (2) "free of artificial additives;" (3) "non-GMO;" and (4) "nourishing" and "healthy." See id. ¶¶ 65.

II. REQUESTS FOR JUDICIAL NOTICE

In support of their briefing on this matter, both parties have filed requests for judicial notice. See Doc. Nos. 91-2, 92-8. Plaintiffs object to Defendant's request for judicial notice. See Doc. No. 92-7.

While, generally, the scope of review on a motion to dismiss for failure to state a claim is limited to the contents of the complaint, see Warren v. Fox Family Worldwide, Inc. , 328 F.3d 1136, 1141 n.5 (9th Cir. 2003), a court may, however, consider certain materials, including matters of judicial notice, without converting the motion to dismiss into a motion for summary judgment, see United States v. Ritchie , 342 F.3d 903, 908 (9th Cir. 2003). For example, "a court may take judicial notice of matters of public record," Khoja v. Orexigen Therapeutics, Inc. , 899 F.3d 988, 999 (9th Cir. 2018) (quoting Lee v. City of Los Angeles , 250 F.3d 668, 689 (9th Cir. 2001), overruled on other grounds by Galbraith v. County of Santa Clara , 307 F.3d 1119, 1125–26 (9th Cir. 2002) ), and of "documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the pleading," Branch v. Tunnell , 14 F.3d 449, 454 (9th Cir. 1994), overruled on other grounds by Galbraith , 307 F.3d at 1125–26 ; see also Fed. R. Evid. 201. A judicially noticed fact must be one not subject to reasonable dispute in that it is either: (1) generally known within the territorial jurisdiction of the trial court; or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned. See Fed. R. Evid. 201(b) ; see also Khoja , 899 F.3d at 999 (quoting Fed. R. Evid. 201(b) ).

Defendant asks the Court to take judicial notice of fifty-nine exhibits in support of its motion to dismiss. See Doc. No. 91-2. Exhibits 1 through 58 are publicly available images from Defendant's website of various products’ labelling. Plaintiffs object to the fifty-eight exhibits on the ground that they are "current printouts of the labels." Doc. No. 92-7 at 2. As Defendant notes, the Court previously took judicial notice of these documents, which are publicly available images not subject to reasonable dispute. See Doc. No. 91-2 at 2 (citing Doc. No. 87 at 4–7). Accordingly, for the same reasons set forth in the FAC Dismissal Order, the Court OVERRULES Plaintiffs’ objection and GRANTS Defendant's request to judicially notice Exhibits 1 through 58.

Exhibit 59 is a sixty-four page compilation of what appears to be the Non-GMO Project's website and prospectus. See Doc. No. 91-61. Defendant explains that these images and information are publicly available and thus not reasonably subject to dispute. Alternatively, Defendant argues that the Court may consider Exhibit 59 through the incorporation by reference doctrine. Plaintiffs do not oppose this request.

The Court agrees that Exhibit 59 contains publicly available information that is not reasonably subject to dispute. Accordingly, the Court GRANTS the request and judicially notices Exhibit 59.⁴

Plaintiffs request that the Court take judicial notice of the verified complaint in Kodiak Cakes, LLC v. JRM Nutrasciences, LLC , 2:20-cv-00581-DBB (D. Utah Aug. 12, 2020). Courts may take judicial notice of their own records, and may also take judicial notice of other court proceedings if they "directly relate to matters before the court." Hayes v. Woodford , 444 F. Supp. 2d 1127, 1136-37 (S.D. Cal. 2006). Because this document is a matter of judicial record, and its authenticity is not in question, the Court GRANTS Plaintiffs’ request and takes judicial notice of the existence of the verified complaint in Kodiak Cakes, LLC v. JRM Nutrasciences, LLC , 2:20-cv-00581-DBB (D. Utah Aug. 12, 2020). See In re Bare Escentuals, Inc. Sec. Litig. , 745 F. Supp. 2d 1052, 1067 (N.D. Cal. 2010) ("[T]he court may take judicial notice of the existence of unrelated court documents, although it will not take judicial notice of such documents for the truth of the matter asserted therein.").

That said, the Court reminds the parties that while it may take judicial notice of these exhibits, the Court will not rely on them to the extent they are irrelevant to the issues presented in the present motion or are offered in an attempt to "short-circuit the resolution of a well-pleaded claim." In re Facebook, Inc. Sec. Litig. , 405 F. Supp. 3d 809, 829–30 (N.D. Cal. 2019).

III. LEGAL STANDARD

A. Federal Rule of Civil Procedure 12(b)(1)

Pursuant to Rule 12(b)(1), a party may seek dismissal of an action for lack of subject matter jurisdiction "either on the face of the pleadings or by presenting extrinsic...