Cimoli v. Alacer Corp.

Background

Jeffrey Cimoli brought a proposed consumer class action against Alacer Corp. concerning the labels on two Emergen-C Immune Support Gummies products: Vitamin C Gummies and Elderberry Gummies. The Vitamin C Gummies label stated “750 mg of Vitamin C,” and the Elderberry Gummies label stated that the product was “Crafted with 50 mg of elderberry juice concentrate.” Cimoli alleged that a reasonable consumer could understand those statements to mean that each gummy contained the listed amount, even though the products’ back labels described a three-gummy serving size.

Cimoli alleged that he purchased the Vitamin C Gummies in San Jose, California, but did not purchase the Elderberry Gummies. He proposed a nationwide class, a California subclass, and a California consumer subclass. His complaint asserted claims under California’s Unfair Competition Law, Consumers Legal Remedies Act, and False Advertising Law; claims for breach of express and implied warranty, unjust enrichment, and common-law fraud; and a claim under Pennsylvania’s Unfair Trade Practices and Consumer Protection Law.

Rulings on the Motion to Dismiss

Alacer moved to dismiss under Federal Rule of Civil Procedure 12(b)(1), which concerns jurisdiction, and Rule 12(b)(6), which tests whether a complaint adequately states a claim. The court addressed each argument as follows:

- Pennsylvania consumer-protection claim: The court concluded that Pennsylvania’s law can reach transactions outside Pennsylvania, but that its application remains subject to choice-of-law rules. The court deferred ruling on the Pennsylvania claim until it could review a fully amended complaint. - California consumer-protection and fraud claims: The court denied the motion to dismiss the claims under the California Unfair Competition Law, Consumers Legal Remedies Act, and False Advertising Law, as well as the common-law fraud claim. Applying the reasonable-consumer test, the court held that Cimoli adequately alleged that the front-label dosage statements could mislead consumers. The court relied on Ninth Circuit authority stating that consumers generally do not have to use small-print information on the back of a package to correct a potentially misleading front-label representation. - Unjust enrichment: Because the court denied dismissal of the underlying consumer-protection and fraud claims, it denied the motion to dismiss the unjust-enrichment claim. - Express and implied warranties: The court found that the front-label statements did not expressly promise that the listed dosage was contained in each gummy. It also found that the statements were otherwise truthful as alleged because the complaint did not claim that the products failed to contain the listed amounts per serving. The court dismissed with leave to amend the express- and implied-warranty claims. The court did not need to decide Alacer’s separate argument that the implied-warranty claim failed for lack of contractual closeness between Cimoli and Alacer. - Request for injunctive relief: The court granted the motion to dismiss Cimoli’s request for an injunction under the California consumer-protection laws. Because Cimoli knew he could determine the products’ dosages by reading the back labels, the court found that he had not plausibly alleged a real or immediate threat of being harmed in the same way again. - Claims involving Elderberry Gummies: The court denied Alacer’s motion to strike claims involving purchasers of the Elderberry Gummies. Although Cimoli had not purchased that product, the court found sufficient similarity between the two products, the alleged misrepresentations, and the alleged consumer injuries to support standing at this stage.

Disposition

The court’s order granted in part and denied in part Alacer’s motion to dismiss, with leave to amend. Cimoli was ordered to file an amended complaint by August 2, 2021. The order also stated that no new claims or parties could be added without the court’s permission.