Court Guts Most Claims in Muscle Milk® Consumer Fraud Litigation
A federal court in California has granted in part and denied in part the defendant’s motion to dismiss claims that its product labels, ads and Website representations for Muscle Milk® ready-to-drink beverages and snack bars violate state unfair competition and false advertising laws and the California Consumers Legal Remedies Act, and constitute fraud, negligent misrepresentation and unjust enrichment. Delacruz v. Cytosport, Inc., No. 11-3532 (N.D. Cal., decided April 11, 2012). While the court determined that the plaintiff has standing to pursue the putative class claims and that the claims are not preempted by federal law nor should be stayed under the primary jurisdiction doctrine, it found many of her claims insufficiently pleaded.
According to the court, the only claim that survives the motion to dismiss alleges that the term “healthy fats” on the 14-ounce Muscle Milk® ready-to-drink label could constitute deceptive product labeling, because “[a] reasonable consumer would be likely to believe that the drink contains unsaturated, not saturated, fats.” Given that unsaturated fats are the “healthy fat,” and that the label also states that the product is a “nutritional shake,” the court found that “this representation, while ‘difficult to measure concretely’ like a similar claim in Williams, contributes to a sufficient claim of deceptive product labeling.” So ruling, the court rejected the defendant’s argument that the nutrient label on the package shielded it from liability for deception.
Among other matters, the court found the following terms to be non-actionable puffery: “Go from cover it up to take it off,” “From invisible to OMG!,” “From frumpy to fabulous,” and “an ideal nutritional choice.” The court also found that the plaintiff had not sufficiently alleged that the beverage contains “unhealthy amounts of fat, saturated fat or calories from fat, compared to its protein content, based on any objective criteria.” The complaint simply compared the products to certain Krispy Kreme doughnuts. According to the court, “this analogy is not helpful. Plaintiff does not explain how much protein, vitamins and minerals are in such a doughnut or posit an objectively healthy ratio of protein to fat.” The court relied on Kwikset v. Superior Court, 51 Cal. 4th 310 (2011), to explain that allegations that a plaintiff was denied the benefit of her bargain are sufficient to state a claim of injury.
While the court found that the plaintiff sufficiently alleged reliance on
product label misrepresentations by claiming that she was “exposed to” the
product labels, it also determined that she had inadequately pleaded reliance
on the defendant’s “long-term advertising campaign.” “Plaintiff does not plead
that she actually saw and relied upon any particular statements in Defendant’s
advertising” and failed to allege “that Defendant’s advertising campaign
approached the longevity and pervasiveness of the marketing at issue in
Tobacco II.” The court gave the plaintiff seven days to amend her complaint to
remedy “the defects addressed above if she is able truthfully to do so without
contradicting the allegations in her original complaint.”
Additional details about the complaint and a Food and Drug Administration
warning letter addressed to the defendant appear in issues 403 and 404 of
this Update, respectively.
