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In re Hydroxycut Marketing and Sales Practices Litigation

April 26, 2010

IN RE HYDROXYCUT MARKETING AND SALES PRACTICES LITIGATION
JUAN A. NOYOLA, PLAINTIFF,
v.
IOVATE HEALTH SCIENCES GROUP, INC., IOVATE HEALTH SCIENCES U.S.A., INC., MUSCLETECH RESEARCH AND DEVELOPMENT, LTD., AND HEALTH SCIENCES GROUP, INC., DEFENDANTS.



The opinion of the court was delivered by: Honorable Barry Ted Moskowitz United States District Judge

(S.D. Cal. No. 09CV2509)

MOTION TO DISMISS COUNTS IV AND V OF THE FIRST AMENDED COMPLAINT ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S

Defendant Iovate Health Sciences, U.S.A., Inc. ("Defendant") has filed a motion to dismiss Counts IV and V of Plaintiff Juan A. Noyola's First Amended Complaint ("Motion"). For the reasons set forth below, Defendant's Motion is GRANTED in part and DENIED in part. The Court denies the Motion as to Count IV. Count V is dismissed with leave to amend. Plaintiff shall have 21 days leave to amend as to Count V. The time for leave shall run from the date of entry of this order.

I. BACKGROUND

On July 29, 2009, Plaintiff filed a complaint in the District Court for the Southern District of New York (S.D.N.Y. Civil Action No. 09cv6740). On November 9, 2009, the case was transferred by the Panel on Multidistrict Litigation ("MDL") to the Southern District of California. On December 16, 2009, in the above-entitled MDL action (09MD2087), Plaintiff filed a First Amended Complaint ("FAC"). On January 22, 2010, Defendant filed a Motion to Dismiss Count IV (breach of express and implied warranties) and Count V (violation of N.Y. General Business Law § 349) of the FAC pursuant to Federal Rule of Civil Procedure 12(b)(6).

II. STANDARD

A motion to dismiss under Fed. R. Civ. P. 12(b)(6) tests the formal sufficiency of the plaintiff's statement of the claim for relief. The Court's inquiry is whether the allegations state a sufficient claim under Fed. R. Civ. P. 8, which sets forth the requirements for pleading. Under Fed. R. Civ. P. 8(a)(2), a pleading must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). In the adjudication of a motion to dismiss under 12(b)(6), plaintiff's allegations must be accepted as true, drawing all inferences from the pleaded facts in plaintiff's favor. Pension Comm. of Univ. of Montreal Pension Plan v. Banc of America Sec. LLC, 568 F.3d 374, 377 (2nd Cir. 2009). To survive a motion to dismiss, the complaint must allege facts that, if true, would create a judicially cognizable cause of action. South Road Assoc. v. Int'l Bus. Machines Corp., 216 F.3d 251, 253 (2nd Cir. 2000). Only factual allegations must be accepted as true-not legal conclusions. Iqbal, 129 S.Ct. at 1949. "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. Although detailed factual allegations are not required, the factual allegations "must be enough to raise a right to relief above the speculative level." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007).

III. DISCUSSION

Plaintiff, Juan A. Noyola, alleges that he suffered personal injuries, namely, acute rhabdomyalsis and liver failure, after ingesting a dietary supplement manufactured and sold by defendants, namely, Hydroxycut Hardcore Liquid Caplets. FAC ¶¶ 40, 21. Plaintiff's complaint contains five claims for relief: negligence, products liability (defective design and failure to warn), breach of warranties, and violation of New York General Business Law.

"Count IV" of the FAC, alleges breach of express and implied warranties and is based on the New York Uniform Commercial Code. FAC ¶¶ 88-92. Specifically, Plaintiff alleges that defendants expressly warranted that Hydroxycut products were safe and impliedly warranted that the products were reasonably fit for their intended purpose to increase energy, burn calories, and control appetite. FAC ¶ 89. According to Plaintiff, Hyrdroxycut products were unfit and unsafe for those purposes. Id. "Count V" of the FAC alleges a violation of the New York General Business Law § 349. FAC ¶¶ 93-97. Specifically, Plaintiff alleges defendants engaged in unfair and deceptive acts by failing to disclose the known risks of Hyrdroxycut products. FAC ¶ 95. Defendant Iovate Health Sciences U.S.A., Inc. moves to dismiss Counts IV and V.

A. Breach of Warranty Claims - Count IV

Defendant contends that Plaintiff's breach of warranty claims fail because he has not pled "notice" as required by New York warranty law. Specifically, Defendant argues that in order to properly plead a warranty claim under the New York Uniform Commercial Code ("N.Y.-U.C.C."), a buyer must plead factual allegations that he gave the seller prior notice of such claim. See N.Y.-U.C.C. § 2-607(3)(a). Section 2-607(3) of the New York Uniform Commercial Code provides:

Where a tender has been accepted (a) the buyer must within a reasonable time after he discovers or should have discovered any breach notify the seller of breach or be barred from any remedy.

Plaintiff contends that the notice requirement in N.Y.-U.C.C. § 2-607 is inapplicable to a product, such as Hyrdroxycut Hardcore Liquid Caplets, which is intended for human ingestion. In support of his contention, Plaintiff cites Fischer v. Mead Johnson Labs., 41 A.D.2d 737 (N.Y. App. Div. 1973). The Fischer case involved breach of warranty claims against the manufacturer of an oral contraceptive. In Fischer, the court noted that the notice provision contained in N.Y-U.C.C. § 2-607(3)(a) is to be applied, if at all, differently in commercial and retail sales situations and held the notice requirement to be inapplicable in cases involving goods sold for human consumption. Id. The court in Fischer looked to Kennedy v. Woolworth Co., 205 A.D. 648 (N.Y. App. Div. 1923), a case involving injuries caused by a ...


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