Twohig v. Shop-Rite Supermarkets, Inc.

Background

ShopRite manufactures, distributes, markets, labels, and sells Wholesome Pantry organic vanilla soymilk. Plaintiffs Sean Twohig and Sandy Balbin alleged that the word “Vanilla” on the front label led them to believe that the product’s vanilla flavor came only, or primarily, from vanilla beans. They alleged that vanillin and other compounds contributed to the flavor and that the ingredient list—listing “Organic Natural Flavors” before “Organic Vanilla Extract”—did not correct the alleged impression.

The plaintiffs cited a consumer survey and gas chromatography-mass spectrometry testing. They asserted claims under New York General Business Law §§ 349 and 350, fraud, negligent misrepresentation, breach of express and implied warranties, the Magnuson-Moss Warranty Act, and unjust enrichment. They sought damages and injunctive relief and proposed a class of New York residents who purchased the product. ShopRite moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint adequately alleges a legally viable claim.

Court’s Analysis

For the New York General Business Law claims, the court held that the plaintiffs had not plausibly alleged that a reasonable consumer would be misled. In the court’s view, “vanilla” on this label was a flavor designation, not an ingredient claim. The label did not say “made with” vanilla beans or otherwise state that vanilla beans were the exclusive or predominant source of the flavor.

The court also found that the product’s packaging, considered as a whole, did not make the alleged representation. The ingredient list indicated that natural flavors appeared before organic vanilla extract, and the plaintiffs did not plausibly allege that the detected vanillin, piperonal, and maltol came from artificial rather than natural sources. The court concluded that the survey did not establish that consumers believed the flavor came predominantly or exclusively from vanilla beans, and that the testing did not show that the label made an ingredient claim. Alleged federal labeling requirements also did not establish what ordinary consumers reasonably understood from the label.

Because the labeling claims failed, the court dismissed the fraud, negligent-misrepresentation, warranty, Magnuson-Moss Warranty Act, and unjust-enrichment claims to the extent they depended on the same alleged deception. Independently, the fraud claim lacked particularized allegations supporting fraudulent intent; the negligent-misrepresentation claim did not adequately allege a special relationship; the express-warranty claim identified no specific promise; the implied-warranty claim did not allege that the soymilk was unfit to drink; the Magnuson-Moss claim lacked an adequately pleaded state-law warranty claim; and the unjust-enrichment claim was duplicative of the other claims. The court stated that it therefore did not need to consider the parties’ preemption or standing arguments.

Disposition

The court granted ShopRite’s motion to dismiss. It declined to grant leave to amend because the plaintiffs had already amended once after receiving notice of the alleged deficiencies, did not ask to amend again, and did not identify additional facts that would cure the problems. The clerk was directed to terminate the motion and close the case. The opinion does not expressly state whether the dismissal was with or without prejudice.

Effect

The ruling rejected the plaintiffs’ proposed consumer-labeling claims against ShopRite at the pleading stage and ended this case in the district court. It also prevented the proposed class claims from proceeding in this action.