Tapia v. The Coca-Cola Company

Background

The Coca-Cola Company manufactures, distributes, markets, labels, and sells berry-flavored soda under the Fanta brand. Kyla Tapia alleged that the product’s “100% Natural Flavors” label was misleading and unlawful because the soda contains DL-malic acid, which she described as an artificial form of malic acid. She alleged that malic acid helps create, enhance, simulate, or reinforce the sweet and tart taste associated with berries. She also alleged that the ingredient list identifies only “malic acid,” rather than DL-malic acid, causing consumers to believe that the product’s flavoring ingredients come from natural sources.

Tapia sought to bring a statewide class action for California consumers who purchased the product for personal or household consumption during the applicable statutory period. Her amended complaint asserted claims under California’s Unfair Competition Law, including its unlawful, unfair, and fraudulent-practice provisions; California’s False Advertising Law; the Consumer Legal Remedies Act; and unjust enrichment. She sought declaratory and injunctive relief, damages, restitution, and disgorgement. The opinion notes that Tapia withdrew claims concerning the product’s blue color and consumers’ expectations about fruit juice.

The motion to dismiss

The Coca-Cola Company moved under Federal Rule of Civil Procedure 12(b)(6), which permits dismissal when a complaint fails to state a legally sufficient claim. It argued that Tapia had not plausibly alleged that consumers would be deceived. The company did not appear to dispute that the product contains artificial DL-malic acid, but argued that DL-malic acid is an artificial ingredient rather than an artificial flavor. It also argued that Tapia’s allegations about DL-malic acid’s function were conclusory or internally inconsistent because she described it as both a flavor and a flavor enhancer.

Tapia responded that the complaint sufficiently alleged that DL-malic acid functions as a flavor because malic acid contributes to the distinctive tart taste of blueberries and raspberries. She also argued that the competing explanations for the ingredient’s function presented factual issues that could not be resolved on a motion to dismiss.

Court’s analysis

The court applied the reasonable-consumer standard used for claims under California’s Unfair Competition Law, False Advertising Law, and Consumer Legal Remedies Act. Under that standard, a plaintiff must allege facts showing that a significant portion of reasonable consumers could be misled. The court observed that whether a business practice is deceptive is usually a question of fact and that dismissal of these types of claims is rarely appropriate at the pleading stage.

The court held that Tapia had sufficiently stated her deception claims. Whether a reasonable consumer would be deceived by the “100% Natural Flavors” label depended on whether malic acid functioned as a flavor or a flavor enhancer. The court recognized that federal regulations distinguish an artificial flavor, which imparts flavor not derived from a natural source, from a flavor enhancer, which supplements, enhances, or modifies taste without imparting a taste of its own. But it concluded that the ingredient’s function in this product was a factual dispute unsuitable for resolution on a motion to dismiss.

The court also found that Tapia had alleged facts—not merely legal conclusions—about malic acid’s role, including allegations that malic acid makes up a substantial portion of the acids in berries and gives the product its distinctive tart taste. At this stage, the court could not determine as a matter of law that the label was not misleading or that a reasonable consumer would not be deceived.

Disposition

Judge Gilliam denied the motion to dismiss as to Tapia’s deception claims under the Unfair Competition Law, False Advertising Law, and Consumer Legal Remedies Act. He also denied the motion to dismiss the unjust-enrichment claim because the company’s argument for dismissing that claim depended only on dismissal of the deception claims and offered no separate basis for dismissal. The court therefore denied the motion to dismiss in its entirety.

The court set a telephonic case-management conference for April 11, 2023, directed the parties to meet and confer and submit a joint case-management statement, and identified a possible early summary-judgment motion concerning whether the malic acid functioned as a flavor or flavor enhancer.