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Bailey v. Rite Aid Corp.

United States District Court, N.D. California

September 9, 2019

Thomas Bailey, Plaintiff,
v.
Rite Aid Corporation, Defendant.

          ORDER GRANTING IN PART AND DENYING IN PART MOTION TO DISMISS RE: DKT. NOS. 25, 57

          YVONNE GONZALEZ ROGERS UNITED STATES DISTRICT COURT JUDGE

         Plaintiff Thomas Bailey brings this putative class action against defendant Rite Aid Corporation (“Rite Aid”) asserting eight causes of action arising out of defendant's sale and marketing of its over-the-counter rapid release acetaminophen gelcaps.[1] (See First Amended Complaint Dkt. No. 15 (“FAC”).) Now before the Court is defendant's motion to dismiss plaintiff's FAC for failure to state a claim under Rule 12(b)(6).[2] (Dkt. No. 25 (“MTD”).) Having carefully considered the pleadings and the papers submitted, as well as arguments by counsel during the hearing on May 28, 2019, and for the reasons set forth more fully below, the Court hereby Grants in Part and Denies in Part defendant's motion to dismiss.[3]

         I. Background

         Plaintiff alleges as follows:

         In response to Johnson & Johnson's 2005 release of Tylenol Extra Strength Rapid Release Gels and 2008 release of Tylenol PM Rapid Release Gels, both of which were launched with the promise that the gelcaps were “specially designed” “with holes to allow [for] the release of powerful medicine even faster than before, ” defendant Rite Aid released its own version of these medications called “Rite Aid Acetaminophen Rapid Release Gelcaps” and “Rite Aid Acetaminophen PM Rapid Release Gelcaps, ” (collectively, “Rite Aid RR Gelcaps”). (FAC ¶¶ 4-6.)

         Since their release, Rite Aid has marketed these medications as comparable to Tylenol Extra Strength Rapid Release Gels even though, they do not contain the unique laser drilled holes of Tylenol Extra Strength Rapid Release Gels. (Id. ¶ 8.) The Rite Aid version are nonetheless labeled and advertised as a “rapid release” product. (Id.) Additionally, the term “rapid release” does not actually mean that the drug works faster than non-rapid release products. (Id. ¶ 9.) Rite Aid has known, or should have known, that non-rapid release acetaminophen products can be equally effective in the same, if not faster, time period than its Rite Aid rapid release products. (Id. ¶ 10.) A recent study demonstrates that Ride Aid RR Gelcaps dissolve slower than Rite Aid non-rapid release products. (Id. ¶ 11.) Yet, Rite Aid charges a premium for the Rite Aid RR Gelcaps. (Id. ¶¶ 12, 45, 48, 50.)

         Plaintiff purchased a bottle of Rite Aid Acetaminophen Rapid Release Gelcaps, 100 count, in mid-2018 at a Rite Aid store in Alameda County, California for a price more than the brand's cheaper non-rapid release acetaminophen products in the same count. (Id. ¶ 73.) He purchased the Rite Aid RR Gelcaps “over other Rite Aid brand and other acetaminophen products solely because they were labeled as rapid release and he was seeking ‘faster' relief.” (Id. ¶ 76.) Rite Aid's marketing, labeling and advertising, misled plaintiff to believe that the Rite Aid RR Gelcaps he purchased would provide faster relief than other, cheaper Rite Aid acetaminophen products. (Id. ¶ 77.) Had plaintiff known that the Rite Aid RR Gelcaps did not act any faster than traditional, cheaper Rite Aid products, he would not have been willing to pay the premium that he paid for the Rite Aid RR Gelcaps. (Id. ¶ 78.) Instead, “he would have purchased a cheaper, just as effective and just as fast acting acetaminophen product.” (Id.) “The cost of the [Rite Aid RR Gelcaps] exceeded the value of the product and [p]laintiff Bailey did not receive the benefit of the bargain.” (Id. ¶ 79.)

         II. Legal Standard

         Federal Rule of Civil Procedure 8(a) requires a plaintiff to plead each claim with sufficient specificity to “give the defendant fair notice of what the . . . claim is and the ground upon which it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal quotation marks omitted). The factual allegations in the complaint “must be enough to raise a right to relief above the speculative level” such that the claim “is plausible on its face.” Id. at 556-57. Moreover, a plaintiff suing multiple defendants “must allege the basis of his claim against each defendant to satisfy Federal Rule of Civil Procedure 8(a)(2) . . . .” Gauvin v. Trombatore, 682 F.Supp. 1067, 1071 (N.D. Cal. 1988). “Specific identification of the parties to the activities alleged by the plaintiff[] is required . . . to enable [a] defendant to plead intelligently.” Herrejon v. Ocwen Loan Servicing, LLC, 980 F.Supp.2d 1186, 1196 (E.D. Cal. 2013) (internal quotation marks omitted).

         A complaint that falls short of the Rule 8(a) standard may be dismissed if it fails to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). “Dismissal under Rule 12(b)(6) is appropriate only where the complaint lacks a cognizable legal theory or sufficient facts to support a cognizable legal theory.” Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008). For purposes of ruling on a Rule 12(b)(6) motion, the Court “accept[s] factual allegations in the complaint as true and construe[s] the pleadings in the light most favorable to a nonmoving party.” Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008).

         The Court, however, need not accept as true allegations contradicted by judicially noticeable facts, see Shwarz v. United States, 234 F.3d 428, 435 (9th Cir. 2000), and it “may look beyond the plaintiff's complaint to matters of public record” without converting the Rule 12(b)(6) motion to a motion for summary judgment, Shaw v. Hahn, 56 F.3d 1128, 1129 n.1 (9th Cir. 1995). Nor must the Court “assume the truth of legal conclusions merely because they are cast in the form of factual allegations.” Fayer v. Vaughn, 649 F.3d 1061, 1064 (9th Cir. 2011) (per curiam) (internal quotation marks omitted). Mere “conclusory allegations of law and unwarranted inferences are insufficient to defeat a motion to dismiss.” Adams v. Johnson, 355 F.3d 1179, 1183 (9th Cir. 2004).

         If a court determines that a complaint should be dismissed, it should give leave to amend unless “the pleading could not possibly be cured by the allegation of other facts.” Cook, Perkiss & Liehe, Inc. v. N. Cal. Collection Serv. Inc., 911 F.2d 242, 247 (9th Cir. 1990). In making this determination, a court must bear in mind “the underlying purpose of Rule 15 to facilitate decisions on the merits, rather than on the pleadings or technicalities.” Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (en banc) (alterations and internal quotation marks omitted).

         III. Analysis

         Defendant's MTD attacks the FAC on five bases. First, defendant contends that plaintiff's claims are preempted by Section 379r of the Food and Drug Administration Modernization Act of 1996 (“FDAMA”). (MTD at 2 (citing 21 U.S.C. § 379r).) Second, and in the alternative, defendant asserts that the FAC should be dismissed under the doctrine of primary jurisdiction. (Id. at 3 n.1.) Next, defendant argues that the UCL, FAL, and CLRA claims fail under Rules 12(b)(6) and 9(b) as well as for failure to allege a duty to disclose with respect to the UCL claim and application of California's safe harbor doctrine. (Id. at 3.) Fourth, defendant contends that plaintiff's Song-Beverly Act and UCC claims fail to allege breach of any warranty. Finally, the motion seeks dismissal of the unjust enrichment and declaratory and injunctive relief claims as “derivative and duplicative of his other claims and similarly flawed . . . .” (Id. at 4.) The Court addresses each argument in turn.

         A. Preemption

         Under the Supremacy Clause of Article VI of the Constitution, “state law that conflicts with federal law is without effect.” Cipollone v. Liggett Group, Inc., 505 U.S. 504, 516 (1992). Federal preemption of state law, however, “will not lie unless it is the clear and manifest purpose of Congress.” CSX Transp., Inc. v. Easterwood, 507 U.S. 658, 664 (1993) (internal citation omitted). If a federal statue contains an express preemption clause, the plain wording of the clause necessarily contains the best evidence of Congress' preemptive intent. Id.

         The Natural Uniformity Nonprescription Drugs provision of the Food, Drug, and Cosmetic Act (“FDCA”), 21 U.S.C. § 379r, includes an express preemption provision, which the provides: [N]o State or political ...


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