Lokey v. CVS Pharmacy, Inc.

Background

Danielle Lokey filed a proposed class action individually and on behalf of similarly situated people. She alleged that CVS sold CVS-branded liquid acetaminophen for infants at a higher price than CVS-branded liquid acetaminophen for children, even though the products had the same ingredients and the same concentration of 160 milligrams per 5 milliliters. The complaint alleged that the infant product cost as much as two and a half times more.

Lokey asserted claims under California’s False Advertising Law, Unfair Competition Law, and Consumer Legal Remedies Act. She alleged that CVS’s packaging and marketing suggested that the infant product was specially formulated for infants and that consumers could be confused into buying it instead of the less expensive children’s product. Her amended complaint also changed the allegations about where CVS placed the products in its stores and added allegations about consumer confusion.

Procedural history and arguments

The court had previously dismissed Lokey’s original complaint, allowing her to amend. CVS then moved to dismiss the First Amended Complaint. The parties consented to the magistrate judge’s jurisdiction, and the court held a hearing on February 18, 2021.

CVS argued that the amended complaint did not plausibly allege that the product labels would deceive a reasonable consumer. Lokey argued that she had adequately alleged consumer confusion and that whether the labels were misleading was a factual issue that should not be resolved on a motion to dismiss. A motion to dismiss tests whether the complaint alleges enough facts to state a legally plausible claim, while generally treating well-pleaded factual allegations as true.

Court’s analysis

The court applied the reasonable-consumer test governing Lokey’s three California claims. Under that test, a plaintiff must show that members of the public are likely to be deceived. The court held that the labels were accurate and disclosed the products’ composition. Both labels showed the same concentration. The products were also presented as serving different audiences: the infant product was labeled for infants and used a syringe, while the children’s product was labeled for children and used a dosing cup. The court noted that the products also differed in quantity: two ounces for the infant product and four ounces for the children’s product.

The court rejected the argument that the amended allegations about product placement and consumer confusion changed its earlier conclusion. It held that nothing about the labels was misleading about the products or their composition. The court distinguished cases involving products falsely marketed as effective or products whose labels omitted important information. Here, according to the court, CVS told consumers what they were buying.

Relying on a prior decision involving compositionally identical headache medicines sold under different branding and at different prices, the court held that Lokey’s claim was ultimately a challenge to CVS’s pricing decision. The court concluded that, absent deception beyond the price difference, the challenge was not justiciable—that is, it was not an issue the court could resolve under the asserted consumer-protection claims.

Disposition

The court granted CVS’s motion to dismiss with prejudice. The order stated that this disposed of ECF No. 42.