Brown v. NATURES PATH FOODS, INC.

Background

Molly Brown, Parsa Miller, and Lauren Morgan alleged that they were deceived into buying Nature’s Path Foods, Inc.’s breakfast and snack products because of statements on the packaging about protein amounts. Their Second Amended Complaint asserted five causes of action: violations of California’s Consumers Legal Remedies Act, false advertising, common-law fraud, deceit, and misrepresentation, violations of California’s Unfair Competition Law, and unjust enrichment. The claims were brought on behalf of the named plaintiffs and others similarly situated.

Nature’s Path filed a second motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), which allows dismissal when a complaint does not state a legally sufficient claim. While the motion was pending, the plaintiffs filed the Second Amended Complaint, and the parties submitted additional briefing.

Standing

The court rejected Nature’s Path’s argument that the plaintiffs had not plausibly alleged reliance on the omission of a protein daily-value percentage from the Nutrition Facts Panel. Although the plaintiffs alleged that they read the panel before buying the product, the court held that this did not make their reliance allegations inherently implausible as a matter of law at the pleading stage.

The court also held that the plaintiffs had standing to seek an injunction. It found that the Second Amended Complaint met the requirements for alleging a real and immediate threat of future harm under the applicable false-advertising standard. Viewing the allegations in the plaintiffs’ favor, the court understood the requested relief to include providing a corrected protein amount in the daily-value percentage.

Nature’s Path also sought dismissal of claims involving products the named plaintiffs did not purchase. The court applied a substantial-similarity approach, asking whether the purchased and unpurchased products involved substantially similar claims and consumer injuries. It found the allegations sufficient because the plaintiffs alleged that the products made similar protein claims, lacked a corrected protein daily-value statement, and involved substantially similar alleged labeling problems. The court therefore denied the motion on this ground.

Preemption

Nature’s Path argued that the plaintiffs’ claims concerning the side label and added-ingredient statements were impliedly preempted under federal law. The court rejected that argument, adopting reasoning from other Northern District of California decisions and concluding that the claims were not subject to implied preemption.

Alleged deception

For claims under the Unfair Competition Law, the Consumers Legal Remedies Act, and the False Advertising Law, the court applied California’s reasonable-consumer test. That test asks whether a significant portion of reasonable consumers could probably be misled.

The court held that the plaintiffs plausibly alleged that consumers could be deceived by the omission of a protein daily-value percentage. The court also held that the plaintiffs plausibly alleged that the phrase “10g PROTEIN PER SERVING WITH MILK” could mislead consumers because the “WITH MILK” wording was allegedly insufficiently prominent. The court treated the prominence of that wording as an issue that could not be resolved on a motion to dismiss.

Disposition

The court DENIED Nature’s Path Foods, Inc.’s motion to dismiss. The order did not decide whether the plaintiffs will ultimately prove their claims or whether the company is liable. The court separately set a telephonic case-management conference for April 18, 2023, and directed the parties to submit a joint case-management statement by April 11, 2023.