Jacqueline Jackson v. Diageo North America, Inc.

Background

Diageo moved to transfer the action to the Eastern District of New York or, alternatively, to stay the proceedings. Diageo relied on the first-to-file rule, which can apply when a similar case involving substantially similar issues and parties was filed earlier in another federal district.

The earlier New York action, Pusateri v. Diageo North America, Inc., was filed on May 5, 2025. Jackson’s California action was filed on July 4, 2025. The court described both actions as involving allegations that Diageo sold specified tequila brands with labels or advertising stating that the products were “Tequila 100% Agave Azul,” “100% Blue Weber Agave,” or “100% de Agave,” even though Jackson alleged the products were adulterated with non-agave sugars.

Court’s Analysis

The court found that the two actions raised substantially similar issues. Jackson argued that her California action differed because it included a claim under the Racketeer Influenced and Corrupt Organizations Act, or RICO. The court rejected that argument because the RICO claim was based on the same allegedly false labeling and advertising underlying the claims in the New York action. The court also noted that Jackson’s RICO theory required proof that Diageo knew its statements were false, and that knowledge issue also appeared in some of the New York state-law claims.

The court further found that the parties were substantially similar. It compared the proposed classes rather than only the named representatives and determined that each person in the proposed New York classes was also a proposed member of the nationwide class in the California action. Diageo was the only defendant in both actions.

The court considered whether fairness justified declining to apply the first-to-file rule. It identified bad faith, forum shopping, and an anticipatory suit as examples of circumstances that could support such a departure. Jackson did not rely on those grounds; instead, she repeated her argument that the issues and parties were not substantially similar. The court found that argument unpersuasive.

Disposition

The court held that the first-to-file rule applied and ordered that the California action be transferred to the Eastern District of New York. Diageo’s motion to transfer was GRANTED, and the clerk was directed to transfer the action. The court did not consider Diageo’s alternative argument that transfer was appropriate for convenience under 28 U.S.C. § 1404(a).