Nacarino v. Chobani, LLC

Background

Elena Nacarino brought a proposed class action against Chobani, LLC concerning the labeling of its Greek Yogurt Vanilla Blended product. She alleged that the word “Vanilla,” images of vanilla flowers and beans, and a back-label passage stating “Entirely vanilla” represented that the product’s vanilla flavor came exclusively from ingredients derived from the vanilla plant. She alleged that mass spectrometry testing instead showed unusually high levels of vanillin and did not detect other compounds associated with real vanilla. The ingredient list included both “natural flavors” and “vanilla extract.”

Nacarino asserted four California consumer-protection claims: one under the unlawful prong of California’s Unfair Competition Law, one under its unfair and fraudulent prongs, one under the False Advertising Law, and one under the Consumer Legal Remedies Act. She sought damages under the Consumer Legal Remedies Act, injunctive relief and corrective advertising under the Unfair Competition Law and False Advertising Law, and restitution or disgorgement under the unlawful prong of the Unfair Competition Law.

Deceptive-labeling claims

The court applied the reasonable-consumer standard, which asks whether a significant portion of consumers acting reasonably would probably be misled. It held that Nacarino’s theory—that consumers would understand the product’s vanilla flavor to come exclusively from the vanilla plant—was implausible as a matter of law.

The court reasoned that the unqualified word “Vanilla” ordinarily identifies a flavor rather than the exclusive source of that flavor. It also found that the vanilla imagery did not communicate that vanilla bean or extract was the product’s sole flavor source. The court read the phrase “Entirely vanilla” in the context of the full poetic passage and concluded that it did not make the alleged exclusive-source representation plausible. The ingredient list’s reference to “natural flavors” alongside “vanilla extract” further undermined the theory. The consumer survey did not change the result because, in the court’s view, a survey could not rescue an otherwise implausible claim.

The court therefore granted Chobani’s motion to dismiss the deceptive-labeling claims under the Unfair Competition Law’s unfair and fraudulent prongs, the False Advertising Law, and the Consumer Legal Remedies Act. It denied leave to amend those claims because it found further amendment futile. Because it resolved those claims on implausibility grounds, it did not reach Chobani’s additional arguments about particularity under Federal Rule of Civil Procedure 9(b), standing for injunctive relief, or the adequacy of available legal remedies as to those claims.

Unlawful-practices claim

The unlawful prong of California’s Unfair Competition Law can treat a violation of another law as an independently actionable unlawful practice. Nacarino relied on 21 C.F.R. § 101.22(i)(1)(iii), a federal food-labeling regulation requiring certain products that combine a characterizing flavor with other natural flavor to use the words “with other natural flavor” on the label.

The court held that Nacarino plausibly alleged that Chobani’s product violated that regulation. The court relied on the alleged differences in vanillin levels between Chobani’s product and two competitor yogurts, the absence of aromatic compounds associated with real vanilla in Chobani’s product, and the ingredient list’s separate references to “natural flavors” and “vanilla extract.” Because the label used “Vanilla” but did not include “with other natural flavor,” the court found the alleged regulatory violation sufficient to support the unlawful-prong claim at the motion-to-dismiss stage.

The court also denied Chobani’s motion to dismiss that claim on federal-preemption grounds. It concluded that Nacarino was seeking to enforce the federal labeling requirement rather than impose a different labeling obligation.

Injunctive relief and restitution

The court denied Chobani’s motion to dismiss Nacarino’s request for injunctive relief based on standing. Standing is the constitutional requirement that a plaintiff show a concrete injury connected to the challenged conduct and capable of being remedied by the court. The court found that Nacarino plausibly alleged that she would buy the product again if it were reformulated or no longer deceptively labeled, and that she otherwise would not buy it because she could not rely on its labeling.

The court also held that the rule requiring an inadequate legal remedy did not bar prospective injunctive relief. Money damages for past harm would not prevent alleged future labeling violations. The court reached a different result for restitution or disgorgement. Under the governing equitable-remedy rule, Nacarino had to show that legal damages were inadequate or incomplete. The court found that she had not alleged facts showing why damages would be insufficient, so it dismissed the restitution or disgorgement request. It granted leave to amend that part of the claim to allege why legal remedies were inadequate.

Disposition

The court granted in part and denied in part Chobani’s motion to dismiss. The deceptive-labeling claims under the Unfair Competition Law’s unfair and fraudulent prongs, the False Advertising Law, and the Consumer Legal Remedies Act were dismissed without leave to amend. The unlawful-prong Unfair Competition Law claim could proceed as to injunctive relief and was not preempted, while the restitution or disgorgement request was dismissed with leave to amend. The amended complaint was due within 30 days of the order.