United States District Court, S.D. California
ORDER GRANTING DEFENDANT DIAMOND FOODS, INC.'S
MOTION TO DISMISS PLAINTIFF'S FIRST AMENDED COMPLAINT
[DOC. NO. 27]
A. HOUSTON United States District Judge.
before the Court is Defendant Diamond Foods, Inc.'s
(“Defendant”) motion to dismiss Plaintiff
Jacquelyn McGee's (“Plaintiff”) First Amended
Complaint (“FAC”) for failure to state a claim,
[doc. no. 27], following this Court's March 1, 2016 order
dismissing Plaintiff's original Complaint, [doc. no. 26].
Defendant's motion has been fully briefed by the parties.
Doc. Nos. 28, 29. After careful consideration of the
pleadings, relevant exhibits, and the entire record in this
case, the Court exercised its discretion pursuant to CivLR
7.1(d.1) and took Defendant's motion under submission
without oral argument. Doc. No. 30. For the reasons set forth
below, the Court GRANTS Defendant's motion and DISMISSES
the FAC WITH PREJUDICE.
October 14, 2014, Plaintiff filed a class action against
Defendant, asserting claims for unfair and unlawful business
practices under California Unfair Competition Law, Cal. Bus.
& Prof. Code §§ 17200 et seq., public
nuisance under Cal. Civ. Code §§ 3479-3493, and
breach of the implied warranty of merchantability.
See Doc. No. 1. Plaintiff alleged that Defendant
manufactures and sells a variety of popcorn products
(“the Trans Fat Popcorns”) containing partially
hydrogenated vegetable oil (“PHVO”), the only
dietary source of artificial Trans Fat (“TFA”),
in the Pop Secret brand, which Plaintiff purchased and
consumed. Doc. No. 1 at 4. Plaintiff alleged that, since
there is “no safe level” of TFA intake and there
are safe, low-cost, and commercially acceptable alternatives
to TFA, Defendant unfairly elected not to use substitutes in
the Trans Fat Popcorns. Doc. No. 1 at 4, 7. Plaintiff further
alleged that consumption of TFAs is extremely harmful
[Id. at 7], contributes to the development of
cardiovascular disease [Id. at 10], type-2 diabetes
[Id. at 12], breast, prostate, and colorectal cancer
[Id. at 14], Alzheimer's disease and cognitive
decline [Id.], and organ damage [Id. at
November 12, 2014, Defendant filed a motion to dismiss,
arguing, inter alia, that Plaintiff lacks Article
III standing because she suffered no “injury in
fact” and, notwithstanding its standing argument,
Plaintiff fails to state a claim upon which relief can be
granted. See Doc. No. 7. On December 8, 2014,
Plaintiff filed a response in opposition to Defendant's
motion. Doc. No. 8. On December 15, 2014, Defendant filed a
reply and objection to Gregory S. Weston's Declaration in
support of Plaintiff's opposition. Doc. Nos. 9, 10. On
August 10, 2015, Plaintiff filed as supplemental authority:
(1) 80 Fed. Reg. 34650 (the Food and Drug
Administration's (“FDA”) June 17, 2015 final
determination regarding PHVO); and (2) Guttmann v. Nissin
Foods Co., 2015 U.S. Dist. LEXIS 92756 (N.D. Cal.)
(finding that the plaintiff's claims for violation of the
unfair prong of the Unfair Competition Law and breach of the
implied warranty of merchantability survive; while all other
claims are dismissed without leave to amend. However, that
Court made no determination as to whether the plaintiff had
standing). See Doc. No. 17. On August 18, 2015,
Defendant filed a response to Plaintiff's notice of
supplemental authority supporting her opposition to
Defendant's motion to dismiss. See Doc. No. 18.
On August 21, 2015, Defendant provided notice of supplemental
authority to the Court regarding Backus v. General Mills,
Inc., 2015 WL 4932687 (N.D. Cal.). See Doc. No.
March 1, 2016, this Court granted Defendant's motion to
dismiss the original complaint, finding that Plaintiff lacked
Article III standing. Doc. No. 25 at 12. Indeed, the Court
expressed apprehension with respect to reaching the merits of
Plaintiff's substantive claims, on the record before it,
because Plaintiff failed to demonstrate an injury in fact.
Id. The Court underscored defects with respect to
economic injury and physical harm suffered. Id. at
11-12. First, with respect to Plaintiff's failure to
demonstrate economic injury, the Court found that Plaintiff
did “not allege an economic injury which satisfies
Article III standing by alleging that she purchased a product
that was less healthy than expected. Also, the Court [found]
that Plaintiff received the benefit of her bargain when she
consumed Defendant's popcorn.” Doc. No. 25 at 11.
With respect to Plaintiff's failure to demonstrate injury
in fact, as to some physical harm suffered, the Court found
that “Plaintiff did not allege a credible threat of
harm and that the injury alleged does not ‘affect the
plaintiff in a personal and individual way.'”
Id. (quoting Lujan v. Defenders of
Wildlife, 504 U.S. 555, 560 (1992)). Accordingly, the
Court dismissed the original complaint without prejudice and
granted Plaintiff fourteen days to file an amended complaint.
Id. at 16.
March 16, 2016, Plaintiff filed the instant FAC re-alleging
the same causes of action asserted in the original complaint.
See Doc. No. 26 (alleging the following causes of
action: (1) injunctive relief; (2) unfair and unlawful
business practices under California Unfair Competition Law,
Cal. Bus. & Prof. Code §§ 17200 et seq.; (3)
public nuisance under Cal. Civ. Code §§ 3479-3493;
and (4) breach of implied warranty of merchantability);
cf. Doc. No. 1 (alleging claims for (1) injunctive
relief; (2) unfair and unlawful business practices under
California Unfair Competition Law, Cal. Bus. & Prof. Code
§§ 17200 et seq.; (3) public nuisance under Cal.
Civ. Code §§ 3479-3493; and (4) breach of implied
warranty of merchantability). However, the FAC now includes
additional facts pled in support of (1) Plaintiff's UCL
claim; and (2) Plaintiff's burden to demonstrate
standing. Id. at 19, 21. On April 4, 2016, Defendant
moved to dismiss the FAC. See Doc. No. 27. On May
17, 2016, Plaintiff filed an opposition to Defendant's
motion. See Doc. No. 28. On May 24, 2016, Defendant
replied. See Doc. No. 29.
motion to dismiss under Rule 12(b)(6) tests the sufficiency
of the complaint. Navarro v. Block, 250 F.3d 729,
732 (9th Cir. 2001). Dismissal is warranted under Rule
12(b)(6) where the complaint lacks a cognizable legal theory
or fails to allege sufficient facts to support a cognizable
legal theory. Li v. Kerry, 710 F.3d 995, 999 (9th
Cir. 2013). “To survive a motion to dismiss, a
complaint must contain sufficient factual matter, accepted as
true, to ‘state a claim to relief that is plausible on
its face.'” Ashcroft v. Iqbal, 556 U.S.
662, 678 (2009) (citing Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007)). A claim is facially
plausible when the factual allegations permit “the
court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.” Iqbal, 556
U.S. at 678. In other words, “the non-conclusory
‘factual content, ' and reasonable inferences from
that content, must be plausibly suggestive of a claim
entitling the plaintiff to relief.” Moss v. U.S.
Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009) (citing
Iqbal, 556 U.S. at 678). “Determining whether
a complaint states a plausible claim for relief will . . . be
a context-specific task that requires the reviewing court to
draw on its judicial experience and common sense.”
Iqbal, 556 U.S. at 679.
reviewing a motion to dismiss under Rule 12(b)(6), a court
must assume the truth of all factual allegations and construe
the factual allegations in the light most favorable to the
nonmoving party. Cahill v. Liberty Mut. Ins. Co., 80
F.3d 336, 337-38 (9th Cir. 1996). However, legal conclusions
need not be taken as true merely because they are “cast
in the form of factual allegations.” Ileto v. Glock
Inc., 349 F.3d 1191, 1200 (9th Cir. 2003). “Nor
does a complaint suffice if it tenders ‘naked
assertion[s]' devoid of ‘further factual
enhancement.'” Iqbal, 556 U.S. at 678
(citing Twombly, 550 U.S. at 557). The court may
consider facts alleged in the complaint, documents attached
to the complaint, documents relied upon but not attached to
the complaint when authenticity is not contested, and matters
of which the court takes judicial notice. Lee v. City of
Los Angeles, 250 F.3d 668, 688-89 (9th Cir. 2001). If a
court determines that a complaint fails to state a claim, the
court should grant leave to amend unless it determines that
the pleading could not possibly be cured by the allegation of
other facts. Doe v. United States, 58 F.3d 494, 497
(9th Cir. 1995).
contends that the FAC fails to state a claim because
Plaintiff has no injury in fact and still lacks Article III
standing. Doc. No. 27 at 14-18. Additionally, Defendant
argues that the supplemental authority provided to the Court
on August 10, 2015, bars Plaintiff's claims because they
are preempted by federal law. Id. at 26. Plaintiff
disagrees, arguing in opposition that she has properly
pleaded standing because she alleged facts demonstrating
physical injury, the risk of harm in the future, and economic
injury from purchasing an unlawful product. Doc. No. 28 at
13. In reply, Defendant maintains that (1) Plaintiff has not
properly alleged facts demonstrating standing; and (2) ...