Gonzalez Rodriguez v. Walmart Inc.

Background

Walmart marketed and sold four lidocaine products: two patches and two creams. The amended complaint alleged that the packaging falsely represented that some products provided “maximum strength” or “max strength” lidocaine and that both patches were “stay-put flexible patch[es]” that “last[] up to 12 hours.” The plaintiffs alleged that other over-the-counter and prescription products delivered more lidocaine and that Walmart’s patches often detached well before 12 hours, including during ordinary activities.

The plaintiffs asserted unjust-enrichment claims, consumer-protection claims under New York and other states’ laws, and claims under sections 349 and 350 of the New York General Business Law. The plaintiffs had voluntarily dismissed their New York unjust-enrichment claim without prejudice. They sought to represent themselves and proposed nationwide and New York classes.

The plaintiffs collectively purchased three of the four products. No plaintiff alleged purchasing the Equate Pain Relief Cream (Roll On). Walmart moved to dismiss the amended complaint under Rules 12(b)(1) and 12(b)(6). A Rule 12(b)(1) motion challenges the court’s authority to hear a dispute, including whether plaintiffs have constitutional standing. A Rule 12(b)(6) motion argues that the complaint does not allege enough facts to support a legally plausible claim.

Standing for the Unpurchased Roll-On Product

The court held that the plaintiffs had constitutional standing even though no plaintiff purchased the Roll On. Each named plaintiff alleged an injury from purchasing at least one of the other lidocaine products, and each could assert a claim directly against Walmart.

The court also held that the plaintiffs had adequately alleged “class standing” for the Roll On at the motion-to-dismiss stage. Class standing concerns whether a plaintiff’s alleged injury involves the same basic conduct and concerns as the conduct affecting proposed class members. The court found sufficient similarity because the Roll On, like products the plaintiffs purchased, was labeled as “maximum strength” or “max strength” and stated that it contained 4% lidocaine. Walmart could raise the issue again at the class-certification stage after further discovery.

“Maximum Strength” Claims

The court concluded that the plaintiffs plausibly alleged violations of New York General Business Law sections 349 and 350. Those laws prohibit deceptive business practices and false advertising. The plaintiffs had to plausibly allege consumer-oriented conduct that was materially misleading and caused injury.

The court found it plausible that a reasonable consumer could understand “maximum strength” to mean the highest amount of lidocaine available for that type of product. The complaint alleged that prescription patches delivered up to 5% lidocaine and that some over-the-counter patches delivered more lidocaine than Walmart’s patches. Walmart disputed whether the comparisons were proper and whether the plaintiffs’ calculations were accurate, but the court said those fact-based disputes were not suitable for resolution on a motion to dismiss.

The court also rejected Walmart’s distinction between “maximum strength” and “max strength” on the cream packaging. It found that the plaintiffs’ allegations, including the image of the packaging, adequately covered both phrases.

“Stay-Put Flexible Patch” and “Lasts Up to 12 Hours” Claims

The court held that the plaintiffs plausibly alleged that the patch packaging was misleading. It rejected Walmart’s argument that “stay-put flexible patch” was merely non-actionable puffery. The court explained that whether a patch remains attached and flexes with a user’s movements during ordinary use is objectively testable. The phrase was not so exaggerated that the court could rule as a matter of law that no reasonable consumer could rely on it.

The court likewise found plausible the allegation that “lasts up to 12 hours” could mislead a reasonable consumer. In context, a consumer could reasonably expect to use one patch for a period approaching 12 hours. The plaintiffs alleged that the patches systematically detached before a period close to 12 hours; they did not allege that the statement guaranteed 12 hours of performance.

The court also allowed the plaintiffs’ omission theory to proceed. Walmart argued that it had no duty to disclose that the patches might detach during exercise or ordinary daily activities. The court found that deciding whether consumers should have discovered that information themselves was premature at the motion-to-dismiss stage.

Nationwide Class and Unjust-Enrichment Claims

The court rejected Walmart’s argument that the plaintiffs lacked standing to represent proposed class members whose claims arose under other states’ laws. Under controlling Second Circuit precedent, differences among state laws generally concern whether a proposed class satisfies the requirements for class certification, rather than whether the named plaintiffs have constitutional standing.

The court also held that the named plaintiffs had standing to pursue unjust-enrichment claims on behalf of the proposed class, even though they had dismissed their own New York unjust-enrichment claim. Their alleged purchases supplied an injury allegedly caused by Walmart, and the products and packaging were identical across the named plaintiffs and proposed class members. Whether the plaintiffs’ claims were sufficiently typical of the class members’ claims was reserved for class certification.

Disposition

The court denied Walmart’s motion to dismiss the amended complaint. The order did not determine that the packaging was ultimately misleading or that the plaintiffs would prevail. It allowed the claims to continue, while reserving several issues for later proceedings. Walmart had to file an answer within 21 days, and the clerk was directed to close the motion.