Prescott v. Reckitt Benckiser LLC

Background

Steven Prescott filed a proposed class action against Reckitt Benckiser LLC concerning Woolite Laundry Detergent, including Woolite Darks and Woolite Gentle Cycle. He alleged that Reckitt Benckiser’s advertising and product labels represented that the detergent “brings the color back,” “revives color,” and has “Color Renew,” even though the detergent does not restore color to clothing.

Prescott alleged that he bought more than ten bottles of Woolite Darks detergent in 2017 and 2018 after reading the “Color Renew” logo on the bottles. He claimed that he believed the detergent would revive clothing color, but his clothing faded after being washed with it. He also alleged that testing of clothing washed with Woolite showed significant color loss.

Prescott asserted three California-law claims: violation of the Unfair Competition Law, violation of the Consumer Legal Remedies Act, and a claim for restitution under a contract-like theory. He sought damages and other remedies, including restitution, disgorgement of profits, and an injunction.

Motion to Dismiss

Reckitt Benckiser moved to dismiss under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). Rule 12(b)(1) concerns the court’s subject-matter jurisdiction, while Rule 12(b)(6) tests whether a complaint states a legally sufficient claim. Because Prescott withdrew his request for injunctive relief, the court evaluated the motion under the Rule 12(b)(6) standard.

Reckitt Benckiser argued that no reasonable consumer would interpret the labels as promising that the detergent would put color back into clothing. It also argued that Prescott failed to plead fraud with the particularity required by Rule 9(b), which generally requires a plaintiff to identify the who, what, when, where, and how of the alleged fraud.

The court also addressed arguments concerning claims for lack of substantiation, injunctive relief, and non-restitutionary disgorgement of profits. Prescott stated that he was not asserting a lack-of-substantiation claim, withdrew his request for injunctive relief, and indicated that he sought disgorgement only in connection with his restitution claim. The court therefore granted the motion to dismiss without leave to amend as to any claims for lack of substantiation, injunctive relief, or non-restitutionary disgorgement of profits.

Reasonable Consumer Standard

The court held that the Unfair Competition Law and Consumer Legal Remedies Act claims were governed by the reasonable-consumer test. Under that test, Prescott had to allege facts showing that members of the public were likely to be deceived by a statement or representation from Reckitt Benckiser.

The court did not consider the television and YouTube advertisements because Prescott did not allege what those advertisements said. His claims instead turned on the product labels, including the “COLOR RENEW” logos and the statement that the detergent “revives colors.”

The court rejected Reckitt Benckiser’s argument that no reasonable consumer could understand those statements as promising that the detergent would restore color to clothing. The court found that the words “renew” and “revive” could support Prescott’s alleged interpretation. It also concluded that the explanatory graphic on the back label did not clearly contradict that interpretation. Whether a reasonable consumer would be deceived was generally a factual question, and the court concluded that this case was not one of the rare situations in which that issue could be resolved against Prescott at the motion-to-dismiss stage.

The court therefore denied Reckitt Benckiser’s motion to dismiss under the reasonable-consumer standard.

Rule 9(b)

The court held that all three remaining claims were subject to Rule 9(b) because they were based on the same allegedly misleading labeling and sounded in fraud.

The court agreed that Prescott had not described the content of the television advertisements with sufficient specificity. But it found that his allegations about the product labeling satisfied Rule 9(b). Prescott identified Reckitt Benckiser as the speaker, Woolite Laundry Detergent as the product, the “COLOR RENEW” logos and “revives color” statement as the allegedly misleading representations, the time when the representations began, the place of his purchase, and the reasons he claimed the representations were false.

The court also rejected the argument that the back-label graphic was an unambiguous disclaimer. It concluded that the graphic could be read as explaining how the product “revives color,” rather than eliminating the alleged representation that it does so. The court therefore denied Reckitt Benckiser’s motion to dismiss under Rule 9(b).

Disposition

The court ordered that the motion to dismiss was granted in part without leave to amend as to claims for lack of substantiation, injunctive relief, or non-restitutionary disgorgement of profits, and otherwise denied. The court ordered Reckitt Benckiser to file an answer by January 8, 2021, and terminated the motion.