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Ham v. Hain Celestial Group, Inc.

United States District Court, N.D. California

October 3, 2014

ANA BELEN HAM, Plaintiff,
v.
HAIN CELESTIAL GROUP, INC., Defendant

Page 1189

[Copyrighted Material Omitted]

Page 1190

Re: Dkt. Nos. 25, 29.

For Ana Belen Ham, individually and on behalf of all others similarly situated, Plaintiff: Molly Ann DeSario, LEAD ATTORNEY, Stephen Noel Ilg, Scott Edward Cole, Scott Cole & Associates, APC, Oakland, CA.

For Hain Celestial Group, Inc., Defendant: Dean N. Panos, LEAD ATTORNEY, PRO HAC VICE, Jenner And Block LLP, Chicago, IL; Kenneth Kiyul Lee, LEAD ATTORNEY, Jenner & Block LLP, Los Angeles, CA.

Page 1191

ORDER GRANTING IN PART AND DENYING IN PART MOTION TO DISMISS; GRANTING PARTIES' REQUESTS FOR JUDICIAL NOTICE

WILLIAM H. ORRICK, United States District Judge.

INTRODUCTION

Defendant Hain Celestial Group Inc. manufactures Earth's Best Organic Mini Waffles (the " Waffles" ), which are identified as " All Natural" on their labels. Plaintiff Ana Belen Ham alleges that the Waffles are not, in fact, " All Natural" because they contain sodium acid pyrophosphate (" SAPP" ), a synthetic substance, and sued Hain for violations of California consumer protection laws, fraud, breach of contract, breach of express warranty, and unjust enrichment.

Hain moves to dismiss Ham's complaint. The papers repeat well-worn arguments from numerous similar cases, and I will apply the reasoning that has developed in the Northern District of California. Hain's motion is GRANTED IN PART and DENIED IN PART. Ham's breach of contract claim is dismissed because the parties lack privity, the unjust enrichment claim is dismissed because unjust enrichment is not an independent cause of action, and injunctive relief is not available. The motion is denied in all other respects because Ham has plausibly alleged that the " All Natural" label is misleading from the perspective of a reasonable consumer since the Waffles contain a synthetic substance.

BACKGROUND

Ham purchased two varieties of the Waffles: Blueberry and Homestyle. Compl. ¶ ¶ 3, 11 [Dkt. No. 1]. The Waffles are labeled organic and " All Natural." [1] Compl. ¶ ¶ 3, 29, Ex. A. Ham alleges that the Waffles are, in fact, not " All Natural" because one of the ingredients is a nonorganic synthetic substance, SAPP.[2] Compl.

Page 1192

¶ ¶ 3, 29. The " 'All Natural' labeling is central to [the Organic Waffle's] marketing" and makes " maximum use of the available space on the [front of the Organic Waffle's] packaging." [3] Compl. ¶ ¶ 32, 53. Ham saw the labeling each time she purchased the products and " would not have purchased and consumed the products had it not been for [Hain]'s misrepresentations." Compl. ¶ ¶ 63, 65, 76.

Ham alleges causes of action for (i) violations of California's deceptive advertising practices laws (" FAL" ), Cal. Bus. & Prof. Code § § 17500, et seq.; (ii) violations of the Consumers Legal Remedies Act (" CLRA" ), Cal. Civ. Code § § 1750, et seq.; (iii) common law fraud; (iv) negligent misrepresentation; v) breach of express warranty; (vi) breach of contract; (vii) violations of the California's Unfair Competition Law (" UCL" ), Cal. Bus. & Prof. Code § § 17200-17208; and (viii) quasi-contract/unjust enrichment. She seeks to represent two different classes: (i) residents of California " who, on or after May 2, 2010 purchased any of " The Hain Celestial Group Inc.'s 'Earth's Best' food products that were labeled 'All Natural' yet contained Sodium Acid Pyrophosphate," and (ii) residents of the United States who purchased the same products.[4] Compl. ¶ 19. I heard argument on the motion to dismiss on September 17, 2014.

LEGAL STANDARD

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) is proper where the pleadings fail to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). I must " accept factual allegations in the complaint as true and construe the pleadings in the light most favorable to the nonmoving party." Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). The complaint " does not need detailed factual allegations," rather must plead enough factual allegations " to raise a right to relief above the speculative level." Bell A. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007).

Fraud claims are subject to an elevated pleading standard and must " be accompanied by the who, what, when, where, and how of the misconduct charged." Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1103, 1106 (9th Cir. 2003) (quotation marks omitted). Such claims " must be specific enough to give defendants notice of the particular misconduct which is alleged to constitute the fraud charged so that they can defend against the charge and not just deny that they ...


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