Pellegrino v. The Procter & Gamble Co.

Background

Regina Pellegrino brought a putative class action against The Procter & Gamble Co. She asserted claims under New York General Business Law §§ 349 and 350, alleging unfair and deceptive business practices and false advertising concerning Metamucil products. The complaint included sugar-related representations and additional allegations concerning lead levels in various Metamucil products.

A related consumer action had previously been filed in the Northern District of California. Pellegrino joined that earlier related proceeding and later voluntarily dismissed her claims without prejudice. She and another consumer then filed separate new actions: Pellegrino filed this case in the Southern District of New York, while the other consumer filed a related case in the Northern District of California. The California case was stayed while the court considered the issues addressed in this order.

Procter & Gamble moved under 28 U.S.C. § 1404(a) to transfer this case to the Northern District of California. Alternatively, it asked the court to stay this case while the California action proceeded and a potential motion to dismiss was considered there.

Transfer analysis

Section 1404(a) permits transfer for convenience and in the interest of justice only to a district where the action could have been brought when it was originally filed, or to a district to which all parties consented. The court stated that this threshold requirement must be satisfied before it considers the convenience factors.

The parties did not dispute that the California court would have subject-matter jurisdiction. They disputed whether that court would have had personal jurisdiction over Procter & Gamble and whether venue would have been proper there when Pellegrino filed this action. Procter & Gamble did not seriously argue that California independently had personal jurisdiction or proper venue. Instead, it argued that its request to transfer constituted consent to jurisdiction and venue and that it would waive those defenses.

The court rejected that argument. Although personal jurisdiction can be waived or established through consent in some circumstances, the Supreme Court’s decision in Hoffman v. Blaski requires the transfer forum to have been available when the lawsuit was filed. A defendant cannot make an otherwise unavailable forum proper for transfer merely by consenting after the case begins. The court therefore concluded that Procter & Gamble’s post-filing consent was insufficient.

The court also rejected Procter & Gamble’s judicial-estoppel argument. Judicial estoppel is a doctrine that can prevent a party from taking a position inconsistent with one it previously asserted and that an earlier court accepted. The court found that Pellegrino’s positions about California jurisdiction and venue were inconsistent with her position in the earlier related proceeding. But the earlier California court had not considered or adopted that position: its decision addressed federal preemption and whether the plaintiffs had adequately pleaded false or misleading statements, not personal jurisdiction or venue. Because there was no judicial acceptance of Pellegrino’s earlier position, judicial estoppel did not apply.

Because Procter & Gamble failed to establish that the California court was an appropriate transfer forum, the court did not analyze the remaining transfer factors, including witness convenience, access to evidence, the parties’ convenience, and trial efficiency.

Stay analysis

The court also denied the request to stay. Courts may pause proceedings, but they must balance the interests of the plaintiff, defendant, courts, nonparties, and the public while seeking to avoid prejudice.

The court found that Procter & Gamble had not identified a compelling reason for a stay. Avoiding simultaneous briefing of overlapping motions and possible inconsistent decisions did not justify a stay because both cases would require briefing, the cases involved different state laws and different claims, and neither court’s decisions would bind the other. The court also found that the length of a stay could not be predicted because the California case was itself stayed and no motion to dismiss had yet been filed there.

Disposition

Judge Karas denied Procter & Gamble’s Motion to Transfer. He also denied Procter & Gamble’s request to stay the action pending resolution of a potential motion to dismiss in the Northern District of California. The court directed the clerk to terminate the pending motion and scheduled a telephonic status conference for February 6, 2025.