Forrett v. Gourmet Nut Inc

Background

John Forrett alleged that Gourmet Nut manufactures and sells Protein Packed Trail Mix. The package allegedly uses the words “PROTEIN PACKED,” includes a paragraph emphasizing protein, and lists seven grams of protein per serving without stating the protein Percent Daily Value (PDV). Forrett alleged that consumers could be misled into believing the product was an excellent source of protein even though the product contained incomplete proteins. He alleged that he purchased the product in June 2020, relying on the packaging representations.

The First Amended Complaint asserted claims under California’s Unfair Competition Law (UCL), False Advertising Law (FAL), and Consumer Legal Remedies Act (CLRA), as well as an unjust-enrichment claim. Forrett also sought to represent a California class of consumers who purchased the product during the relevant limitations periods.

Motion to Dismiss and Preemption

Gourmet Nut moved to dismiss the First Amended Complaint under Federal Rule of Civil Procedure 12(b)(6), arguing that the claims were preempted by the federal Food, Drug, and Cosmetic Act and Nutrition Labeling and Education Act. Federal regulations require a protein PDV when a product makes a protein claim. The court analyzed whether “Protein Packed” qualifies as a nutrient-content claim under the federal regulations.

The court held that “Protein Packed” is a nutrient-content claim characterizing the level of protein in the food. Because that claim triggered the federal requirement to include a protein PDV, the court determined that Forrett’s theory concerning the omitted PDV did not seek to impose a labeling requirement different from federal law and therefore was not preempted.

UCL, FAL, and CLRA Claims

The court applied the reasonable-consumer test, which asks whether members of the public are likely to be deceived. It agreed with Gourmet Nut that the omission was not actionable as contrary to the words “Protein Packed,” because the court had previously determined that “packed” has no defined meaning regarding nutrient content.

The court nevertheless concluded that Forrett adequately alleged that Gourmet Nut had a duty to disclose the PDV. The court found it plausible that the PDV would be material to a reasonable consumer because the product prominently emphasized protein and federal regulations require the information for products making nutrient-content claims. The court also agreed that Gourmet Nut had exclusive knowledge of the information needed to calculate the PDV. On that basis, the court held that Forrett adequately alleged his UCL, FAL, and CLRA claims.

Unjust Enrichment

Gourmet Nut argued that the unjust-enrichment claim should be dismissed because it was not tied to another claim. The court stated that unjust enrichment may be alleged as a remedy for another valid cause of action, but found that Forrett had again failed to connect the claim to another cause of action. Because Forrett had already received an opportunity to amend on this issue, the court dismissed the unjust-enrichment claim without leave to amend.

Standing and Equitable Jurisdiction

The court denied Gourmet Nut’s challenge to Article III standing. It concluded that Forrett adequately alleged a future injury because he would purchase the product again if it included the omitted PDV.

The court also denied the challenge to equitable jurisdiction. Equitable jurisdiction concerns whether a court may provide equitable relief, such as an injunction, and generally requires that the plaintiff lack an adequate legal remedy. The court found that Forrett had made that showing and held that it had equitable jurisdiction over the UCL, FAL, and unjust-enrichment claims.

Disposition

Judge Beth Labson Freeman ordered that Gourmet Nut’s motion to dismiss was denied as to the UCL, FAL, and CLRA claims for failure to state a claim; granted without leave to amend as to the unjust-enrichment claim for failure to state a claim; denied as to lack of standing; and denied as to lack of equitable jurisdiction. The order did not decide whether Gourmet Nut was ultimately liable or whether a class should be certified.