By Jeffrey H. Brochin, J.D.
A federal district court in California has dismissed—with leave to amend—a putative class action lawsuit filed by purchasers of a biotin supplement, for failure to plead with the particularity required by Rule 9(b), what they saw, relied upon, and understood with respect to the manufacturer’s labeling. Although the statement of benefit on the label contained an asterisk relating to a disclaimer, the purchasers’ complaint was devoid of any allegations of whether they saw the asterisk, read the corresponding disclaimer, and if they did read it, how the disclaimer affected their purchasing decision (Anthony v. Pharmavite, January 4, 2019, Chen, E.).
Biotin deficiencies quite rare. Pharmavite manufactures, markets, sells, and distributes biotin supplements under its Nature Made® brand. Three of its biotin supplements contain wording on the label known as health benefit representations, as follows: "May Help Support Healthy Hair, Skin & Nails*†". The asterisk or obelisk point to a disclaimer on the back of the labeling that states: "Biotin may help support healthy hair, skin, and nails in those that are biotin deficient."
The purchasers purchased the biotin products after reading the product labels and in reliance upon the health benefit representations. However, they alleged that the health benefit representations were false, misleading, and reasonably likely to deceive the public because the biotin products will not provide any benefits to the general population; the human body only requires a finite amount of biotin on a daily basis for it to perform its enzymatic functions, and once there is sufficient biotin in the body, any additional supplements are excreted. According to the purchasers, the only individuals who benefit from Pharmavite’s pharmacological doses of biotin are those with exceedingly rare conditions that cause biotin deficiencies—less than 0.00138 percent of the population.
Claims under California’s UCL. In May, 2018, the purchasers filed a class action complaint claiming that had they known the truth about Pharmavite’s alleged misrepresentations, they would not have purchased the biotin products, and they sought relief for alleged false, misleading, and deceptive advertising in violation of California’s Unfair Competition Law (UCL). Pharmavite moved to dismiss the complaint on the basis that that it failed to state a plausible claim with the particularity required by Rule 9(b), failed to state a UCL violation on the merits, and failed to demonstrate a real and immediate threat of repeated injury sufficient to sustain standing to seek injunctive relief.
UCL sounds in fraud. The court noted that because the purchasers’ UCL claim sounded in fraud, their complaint was also required to meet the heightened pleading standard of Federal Rule of Civil Procedure 9(b) by identifying the "who, what, when, where, and how" of the misconduct alleged against Pharmavite, and why it was false. However, the court found that the complaint was devoid of any allegations regarding whether the purchasers saw the asterisk, read the corresponding disclaimer, and if they did read it, how the disclaimer affected their purchasing decision. In fact, the complaint made no mention of the asterisk or disclaimer at all, rather, it merely alleged in a vague and general fashion, that they "saw and relied upon the health benefit representations by reading the biotin product label," and purchased the product in reliance on Pharmavite’s health benefit representations. They did not specify what part of the labels and representations they saw and relied upon.
For the foregoing reasons, the manufacturer’s motion to dismiss the UCL claims was granted, but with leave to amend. The motion to dismiss the claim for injunctive relief was granted with prejudice.
The case is No. 3:18-cv-02636-EMC.
Attorneys: Carrie Ann Laliberte (Bonnett Fairbourn Friedman Balint) for Eugene Anthony. Rene Pierre Tatro (Tatro Tekosky Sadwick LLP) for Pharmavite.
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