Health Law Daily Consumers’ claims against pet food maker survive motion for dismissal
Friday, December 4, 2020

Consumers’ claims against pet food maker survive motion for dismissal

By Wolters Kluwer Editorial Staff

Federal court finds that a nationwide class may form from consumer complaint alleging mislabeling of food for dogs with sensitivities.

A class action filed against Mars Petcare US, Inc. (Mars), alleging that the company mislabeled premium dog food and caused financial harm to consumers, was partially dismissed by a Tennessee court. Mars filed a Motion to Dismiss and to Strike Plaintiffs’ First Amended Complaint. The Court ultimately decided to grant in part and deny in part. A New York unjust enrichment claim was dismissed with prejudice and the consumers’ request for injunctive relief were dismissed without prejudice. The court denied Mars’ motion to dismiss a claim for Breach of Express Warranty under New York Law and gave the consumer the opportunity to amend the Breach of Implied Warranty of Merchantability under New York Law to plausibly allege privity. (Fishon v. Mars Petcare US, Inc., November 11, 2020, Crenshaw, W.).

Background. The lawsuit, initiated by three named consumers as individuals and on behalf of a putative class, claims that Mars mislabeled a particular line of premium dog food as grain and soy free. The dog food, IAMS® Proactive Health Sensitive Skin & Stomach Grain-Free Recipe with Chicken & Peas (Grain-Free Recipe), is marketed as being "Tailored for Dogs with Grain Sensitivities". The consumer’s complaint states that dog owners are willing to pay premium prices to provide their dogs a grain-free and soy-free diet. The Complaint alleges that, based on Mars’ claims about their dog food, they purchased bags of the IAMS ® Grain-Free Recipe and fed it to their dogs with food sensitivities. However, independent testing revealed that the Grain-Free Recipe contains significant amounts of corn, rice wheat, and soy, which misled the named consumers.

Consumer Lawsuit. The consumers’ suit asserts that they suffered economic damages because they reasonably believed that Mars’ premium dog food contained no grain or soy protein, and they would not have purchased it or would have paid substantially less for it, had they known that Mars’ representations about its ingredients were false. The suit asserts claims against Mars for violating the Magnuson-Moss Warranty Act (MMWA) and state contract and consumer protection laws. The Complaint is brought on behalf of the named consumers and either a nationwide class or subclasses of New York, Tennessee, and Virginia consumers.

Mars moved to dismiss the Complaint for lack of subject matter jurisdiction and failure to state a claim upon which relief can be granted. Mars also seeks to strike the consumers’ nationwide class allegations.

Standing. Consumers must allege facts plausibly demonstrating that they 1) suffered an injury in fact, (2) which is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision. In addition, in order to obtain injunctive relief, consumers must show that they suffered past injury and that there is a real and immediate threat of future injury.

Mars argues that the consumers’ case should be dismissed because the Complaint does not plausibly allege that the consumers suffered an injury sufficient to recover damages or obtain injunctive relief. Specifically, Mars claims that the consumers have not explicitly alleged that they purchased or used any bag of the Grain-Free Recipe that contained grain or soy. Mars relies on previous court decisions which held that plaintiffs lacked standing because they alleged only that "some" of defendant’s products were mislabeled and could not specifically state that the packages they purchased were among those that were mislabeled.

The court reviewed these previous decisions and found that the complaint plausibly alleged that all bags of the Grain-Free Recipe were falsely advertised and that the consumers overpaid for the food through their reliance on Mars’ misleading representations. In fact, the consumers’ complaint stated that independent testing confirms the Grain-Free Recipe contains significant amounts of both grain and soy protein. The complaint alleged that not just some, but all, of the Grain-Free Recipe bags contain the unwanted ingredients and are falsely advertised. As such, it can be deduced that the consumers allege that the bags they purchased also contained the unwanted ingredients. The court found that the consumers demonstrated a real and particularized injury, at the hands of Mars, that can be redressed by an award of monetary damages.

Despite finding that the consumers plausibly alleged an Article III injury to seek damages, the court determined that they have not plausibly alleged a threat of future injury sufficient to seek injunctive relief. There is no indication that the consumers, who are now aware that the premium pet food is improperly labeled, will purchase additional bags in the future. With no threat of future harm from the misrepresentations, the consumers were found to lack Article III standing to seek injunctive relief.

The court denied Mars’ motion to dismiss for lack of standing to claim damages and granted its motion to dismiss for lack of standing to seek injunctive relief.

Failure to state a claim. First, Mars sought to dismiss the consumer claims, claiming the entire case was "implausible" because the consumers did not plausibly allege that the Grain-Free Recipe harmed their dogs. The court was not persuaded by this as the consumers were seeking only to recover for their economic losses and were not seeking to recover for damages to their pets. To that end, the consumers adequately alleged that they were misled by Mars to believe that the pet food was grain-free and that they would not have purchased or would have paid less for the dog food had they known its true contents.

The court denied Mars’ motion to dismiss the claim for Breach of Express Warranty under New York Law and gave the consumer the opportunity to amend the Breach of Implied Warranty of Merchantability under New York Law claim to plausibly allege privity.

Mars moved to dismiss the claim for violation of the Magnuson-Moss Warranty Act. The MMWA creates separate federal rights of action for violations of "written warranties," and state-law breaches of warranty. Mars asserted that the consumers have not alleged a violation of the MMWA because they had not identified a written warranty and because the claims are otherwise barred. However, the court determined that this argument was moot as consumers did not allege a violation of any MMWA written warranty. Instead, the consumers were asserting MMWA claims that are derivative of the state law implied warranty claims. As such, having found that the New York breach of implied warranty currently failed for lack of privity, the court also denied without prejudice the MMWA claim for the same reasons.

Mars argued that a New York unjust enrichment claim must also be dismissed because it is duplicative of the other contract-based causes of action. The New York consumer alleged that the unjust enrichment claim was not duplicative and may be pleaded in the alternative. However, the Court also dismissed this claim, noting that New York law does not allow claims for unjust enrichment to serve as "catch all" causes of action to be used when others fail.

Motion to strike nationwide allegations. Mars moved to strike the nationwide class allegations, arguing that the consumers’ claims were untenable for class treatment due to variation in state law. However, the Court found that potential class members here allegedly suffered the same overpayment injury regardless of their location within the United States. Further, using the "under no set of circumstances" standard for striking class allegations at the pleading stage, the Court stated that the viability of the class is better addressed in the context of a motion to certify under Rule 23 after discovery is completed.

The case is No. 3:19-cv-00816.

Attorneys: Adam A. Edwards (Greg Coleman Law PC) and Charles E. Schaffer (Levin Fishbein Sedran & Berman) for Arnold Fishon. David A. Forkner (Williams & Connolly) and Ryan Thomas Holt (Sherrard Roe Voight & Harbison, PLC) for Mars Petcare US, Inc.

Companies: Mars Petcare US, Inc.

MainStory: TopStory CaseDecisions FDCActNews FoodNews FoodSafetyNews FoodStandardsNews LabelingNews

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