Yu v. Dr Pepper Snapple Group, Inc.

Background

Hawyuan Yu brought a second complaint against Dr Pepper Snapple Group, Inc. and Mott’s, LLP on behalf of a proposed nationwide class and a California subclass. He alleged that the defendants sold applesauce and apple juice labeled “Natural” or “All Natural Ingredients” even though the products contained trace amounts of acetamiprid, a synthetic insecticide. Yu alleged that he purchased Mott’s applesauce and apple juice in California, relied on the labels, and was willing to pay more because he expected the products to be free of insecticides and other unnatural chemicals.

Yu asserted five causes of action: claims under California’s Consumer Legal Remedies Act, False Advertising Law, and Unfair Competition Law; breach of express warranty; and unjust enrichment. The court had previously dismissed all five claims but allowed amendment. Yu’s amended complaint added two surveys concerning consumers’ understanding of “natural” food labels.

Motion to dismiss

The defendants moved to dismiss the amended complaint. A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests whether the complaint alleges enough facts to state a legally plausible claim, accepting properly pleaded facts as true. The defendants argued that Yu had not plausibly alleged that a reasonable consumer would interpret “Natural” or “All Natural Ingredients” to mean that the products contained no trace pesticides.

The court agreed. It held that Yu’s theory was not plausible as a matter of law, relying on decisions addressing similar allegations involving trace amounts of pesticides. The court noted that Yu did not allege that the acetamiprid exceeded the applicable legal tolerance and stated that the amount alleged was well below the established tolerance.

The court also held that the two surveys did not make the claims plausible. It found that the surveys did not adequately establish that reasonable consumers interpret “natural” to require the complete absence of trace pesticides. The court relied on the Ninth Circuit’s decision that surveys alone cannot save an otherwise implausible deception theory.

Individual claims

The court granted the motion to dismiss the California consumer-protection claims under the Unfair Competition Law, False Advertising Law, and Consumer Legal Remedies Act, with prejudice. It also granted the motion to dismiss the breach-of-warranty and unjust-enrichment claims, with prejudice, because those claims depended on the alleged deception that the court found legally insufficient.

Injunctive relief and standing

The defendants also challenged Yu’s standing to seek injunctive relief. Standing is the constitutional requirement that a plaintiff show a concrete and imminent injury for the particular relief requested. The court had previously instructed Yu to allege a plausible intent to purchase the products in the future, but he had not done so in the amended complaint. He later submitted a declaration stating that he planned to continue purchasing applesauce and apple juice and would consider buying Mott’s.

The court nevertheless found deficiencies in the allegations supporting standing for injunctive relief. It reasoned that Yu knew the products contained acetamiprid and preferred products without trace pesticides or other unnatural chemicals. The court stated that it would have allowed another amendment if any substantive claim had survived, but concluded that amendment would be futile. It therefore granted the motion to dismiss the injunctive-relief claim without leave to amend.

Primary jurisdiction and disposition

The court declined to continue waiting for the Food and Drug Administration’s ongoing proceedings concerning the meaning of “natural” on food labels. It found dismissal appropriate and considered an indefinite stay unnecessary.

Judge Beth Labson Freeman ordered that the defendants’ motion to dismiss was granted in full, that the plaintiffs’ claims were dismissed with prejudice, that judgment be entered for the defendants, and that the clerk close the case.