Fukaya v. Daiso California LLC

Background

Makiko Fukaya alleged that Daiso’s English-language ingredient labels failed to identify tree nuts in packaged food products. She alleged that she bought a Tiramisu Twist Cookie at a Daiso store, had a severe allergic reaction after eating it, discovered that the Japanese ingredient list identified two nut ingredients, and later received emergency treatment. She further alleged that another product, Carmel Corn, had an English label that omitted almonds even though the Japanese ingredient list stated that it contained almonds.

Fukaya brought claims under California’s Consumer Legal Remedies Act, False Advertising Law, and Unfair Competition Law on behalf of a proposed California consumer class. She also asserted breach of express warranty under the laws of 43 jurisdictions and identified a nationwide class without specifying which claims applied to it. She sought damages and other relief, including injunctions, a product recall, corrective labeling, and disgorgement of revenues or profits.

Rulings

Daiso moved to dismiss under Federal Rule of Civil Procedure 12(b)(1) for lack of subject-matter jurisdiction and under Rule 12(b)(6) for failure to state a legally sufficient claim. It also moved to strike parts of the complaint under Rule 12(f).

Injunctive relief

The court held that Fukaya did not establish standing to seek an injunction concerning her Consumer Legal Remedies Act, False Advertising Law, and Unfair Competition Law claims. To seek an injunction, she had to plausibly allege an actual and imminent threat of future harm. The court found that she did not allege that she would purchase the products again or otherwise face a likely future injury. It therefore granted Daiso’s motion to dismiss as to the request for injunctive relief on those claims.

The court dismissed that requested relief with leave to amend because it was not clear that the pleading defects could not be cured with additional facts. The court also rejected Daiso’s argument that the product recalls resolved the issue, explaining that the complaint plausibly suggested that other products might also be mislabeled.

Disgorgement

The court denied Daiso’s motion to strike Fukaya’s request for disgorgement under the False Advertising Law and Unfair Competition Law. It concluded that the request did not fall within the categories of material that Rule 12(f) permits a court to strike.

Express warranty claim

The court granted Daiso’s motion to dismiss Fukaya’s breach-of-express-warranty claim. The complaint did not plausibly allege that sales occurred in each of the 43 jurisdictions whose laws Fukaya invoked. The court noted that the complaint alleged Daiso had stores in only six states and included no allegations about United States sales volume, whether through stores or online. The dismissal was with leave to amend.

The court did not decide whether Fukaya could represent class members whose transactions were governed by different states’ laws, or whether that issue should be addressed when deciding class certification rather than at the pleading stage.

Class allegations

The court denied Daiso’s motion to dismiss or strike the proposed class allegations as unmanageable and denied its request to require Fukaya to pay the costs of class notice. The court found those arguments premature because they could properly be considered at the class-certification stage.

Disposition

Judge Corl concluded that Daiso’s motion to dismiss and to strike was granted in part and denied in part. Fukaya’s breach-of-express-warranty claim and her request for injunctive relief under the California consumer-protection claims were dismissed with leave to amend. The court referred the parties to a settlement conference and allowed Fukaya to file an amended complaint by June 15, 2023. The order disposed of Docket No. 18.