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Kennard v. Lamb Weston Holdings, Inc.

United States District Court, N.D. California

September 10, 2019

Angela Kennard, Plaintiff,
Lamb Weston Holdings, Inc., Defendant.


          Yvonne Gonzalez Rogers United States District Court Judge

         Now before the Court is defendant Lamb Weston Holdings, Inc.'s motion for judgment on the pleadings. (Dkt. No. 52 (“Motion”).) Having considered the pleadings in this action and the papers submitted, and for the reasons set forth below, the Court Denies defendant's motion.[1]

         I. Procedural Background[2]

         Plaintiff Angela Kennard brings this putative class action alleging that defendant “unlawfully and unfairly packag[ed] its ALEXIA brand SWEET POTATO fries WITH SEA SALT product (the ‘Product') in opaque containers that contain more than 50% empty space.” (Dkt. No. 38 (“SAC”) ¶ 1.) On January 29, 2019, defendant moved to dismiss the SAC. (Dkt. No. 39.) In its order granting in part and denying in part defendant's motion to dismiss, the Court noted that the SAC was based on two theories of liability: (1) consumer deception, namely, that the Alexia product packages were misleading because consumers expected more sweet potato fries than were actually included, and (2) slack fill, namely that the Alexia product packaging was unlawful because it violated the California Fair Packaging and Labeling Act's (“CFPLA”) regulation against nonfunctional slack fill, specifically Business & Professions Code section 12606.2. (Dkt. No. 49 (“Order”) at 4.) The Court analyzed plaintiff's claims based on both theories.

         As to the consumer deception theory, the Court applied a “reasonable consumer” standard and found that plaintiff did not plausibly allege that a reasonable consumer would be deceived as to the amount of fries in an Alexia product package in light of disclosures on the packaging regarding net weight, number of fries per serving, and number of servings per container. (Id. at 6-8.) The Court also rejected plaintiff's argument that defendant's packaging was “inherently deceptive, ” and therefore, that the disclosures on the packaging did not insulate defendant from liability based on a consumer deception theory. (Id. at 10.) Accordingly, the Court dismissed plaintiff's claims with prejudice to the extent they were based on a consumer deception theory. As to plaintiff's nonfunctional slack fill theory based on the CFPLA, the Court found that the SAC alleged with sufficient particularity that “[m]ore than 50% of the interior of the of the [Alexia product's] containers is comprised of empty space, or non-functional slack-fill, ” and that “[t]here is no practical reason for the non-functional slack-fill used to package the [p]roduct.” (Id. at 13, quoting SAC ¶¶ 25, 31.) Thus, the Court denied defendant's motion to dismiss to the extent plaintiff's claims were based on a nonfunctional slack fill theory of liability. (Id. at 14.)

         Defendant now argues it is entitled to judgment on the pleadings on the ground that plaintiff has not and cannot establish Article III or statutory standing on the remaining UCL and CLRA claims. (Motion at 1.) Specifically, defendant avers that plaintiff's injury allegations “necessarily depend on her now-rejected allegations that she was deceived, ” and accordingly, “[w]hatever their basis for liability, ” plaintiff's claims fail. (Id.)

         II. Legal Standard

         Under Rule 12(c) of the Federal Rules of Civil Procedure, judgment on the pleadings may be granted when, accepting as true all material allegations contained in the nonmoving party's pleadings, there are no issues of material fact and the moving party is entitled to judgment as a matter of law. General Conference Corp. of Seventh-Day Adventists v. Seventh-Day Adventist Congregational Church, 887 F.2d 228, 230 (9th Cir. 1989); Munoz v. Fin. Freedom Senior Funding Corp., 567 F.Supp.2d 1156, 1158 (C.D. Cal. 2008); Fed.R.Civ.P. 12(c). The applicable standard is essentially the same as a motion to dismiss for failure to allege facts sufficient to state a claim under Rule 12(b)(6). Thus, although the Court must accept well-pleaded facts as true, it is not required to accept mere conclusory allegations or conclusions of law. See Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009) (“[T]he tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions.”) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)).

         If, on a motion for judgment on the pleadings, a party raises an issue as to the court's subject matter jurisdiction, “the district judge will treat the motion as it if had been brought under Rule 12(b)(1).” San Luis Unit Food Producers v. United States, 772 F.Supp.2d 1210, 1218 (E.D. Cal. 2011), aff'd, 709 F.3d 798 (9th Cir. 2013) (quoting Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1367 (3d ed. 2004)). To survive a motion to dismiss under Rule 12(b)(1), named plaintiffs “must allege and show that they have personally been injured.” Warth v. Seldin, 422 U.S. 490, 502 (1975).

         III. Discussion

         Defendant argues that plaintiff lacks both Article III and statutory standing because the SAC's injury allegations rely on a consumer deception theory that this Court previously rejected.[3]

         As an initial matter, the Court notes that defendant's motion for judgment on the pleadings is essentially a motion for reconsideration of the Court's order granting in part and denying in part defendant's motion to dismiss the SAC, filed absent leave of Court. See L.R. 7-9(a) (“No party may notice a motion for reconsideration without first obtaining leave of Court to file the motion.”). Had defendant obtained leave to seek reconsideration, it would have been subject to a higher standard than on a motion for judgment on the pleadings. See Carroll v. Nakatani, 342 F.3d 934, 945 (9th Cir. 2003) (noting that reconsideration is an “extraordinary remedy, to be used sparingly in the interests of finality and conservation of judicial resources”) (citation omitted); McDowell v. Calderon, 197 F.3d 1253, 1255 (9th Cir. 1999) (noting that a reconsideration motion “should not be granted, absent highly unusual circumstances”) (citation omitted). Further, defendant at least partially raised the argument it raises in the instant motion, namely that plaintiff has not pleaded a plausible injury, in defendant's motion to dismiss the SAC. (See Dkt. No. 39 at 10-11 (“Plaintiff's claim fails under the balancing test because, as discussed, she fails to plausibly allege any consumer deception, foreclosing any ‘harm to the alleged victim.'”).) Such repetition of arguments is disfavored. See L.R. 7-9 (“No motion for leave to file a motion for reconsideration may repeat any oral or written argument made by the applying party in support of or in opposition to the interlocutory order which the party now seeks to have reconsidered.”). The Court cautions defendant that appropriate procedures must be used to seek relief from this Court.

         Notwithstanding the foregoing, the Court reviews the merits of the motion to determine whether defendant is entitled to judgment on the pleadings on the ground that plaintiff has failed to establish standing. To show standing under the UCL, a plaintiff must aver facts establishing that she “suffered injury in fact and has lost money or property as a result of the unfair competition.” Cal. Bus. & Prof. Code § 17204. To that end, the plaintiff must demonstrate that she relied on the allegedly deceptive or misleading statements. Kwikset Corp. v. Superior Court, 51 Cal.4th 310, 326 (2011). Similarly, under the CLRA, a plaintiff must establish actual reliance and economic injury. Victor v. R.C. Bigelow, Inc., No. 13-CV-02976-WHO, 2014 WL 1028881, at *5 (N.D. Cal. Mar. 14, 2014). Additionally, Article III of the U.S. Constitution requires that a plaintiff allege “injury in fact-an invasion of a legal protected interest which is (a) concrete and particularized, . . . and (b) actual or imminent, not conjectural or hypothetical.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992) (internal quotation marks and citations omitted).

         Here, plaintiff alleges that she and the class “lost money” as a result of defendant's conduct because “(a) they would not have purchased the [p]roduct on the same terms absent [d]efendant's illegal conduct . . ., or if the true facts were known concerning [d]efendant's representations; (b) they paid a higher price for the [d]efendant's [p]roduct due to [d]efendant's misrepresentations; and (c) [d]efendant's [p]roduct did not have the quantities as represented.” (SAC ¶¶ 57, 69.) In other words, taking these allegations as true, plaintiff spent money she otherwise would have saved but for defendant's act of including nonfunctional slack fill in its product packaging. Whether plaintiff actually suffered an economic loss as a result of the nonfunctional slack fill is a factual inquiry to be resolved at a later stage in the litigation. At this junction, however, plaintiff's allegations are sufficient to withstand defendant's motion. Indeed, courts have routinely found that such allegations are sufficient to state a plausible injury in similar cases. See, e.g., Cordes v. Boulder Brands USA, Inc., No. CV 18-6534 PSG (JCX), 2018 WL 6714323, at *2 (C.D. Cal. Oct. 17, 2018) (“His allegation that the package contained fewer pretzels than he ...

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