A federal court has dismissed a proposed class action accusing General Mills Inc. of somehow misleading consumers by labeling granola bars that contained high fructose corn syrup as “100 percent natural.”  Wright v. General Mills Inc., No. 08-cv-01532, 2009 WL 3247148 (S.D. Calif. Sept. 30, 2009). The dismissal turned on the complaint’s sparse allegations of injury-in-fact, which did not meet the pleading standards mandated in Twombly/Iqbal.

General Mills markets, advertises, promotes, and sells “Nature Valley” crunchy granola bar products and “Nature Valley” chewy-trail-mix bar products. Plaintiff alleged that the Nature Valley products were sold as “100% Natural” even though the products allegedly contained one or more non-natural or artificial ingredients, such as high fructose corn syrup. Plaintiff asserted because HFCS does not occur in nature and is a man-made sweetener, the use of “100% Natural” on the package and in the advertising for the Nature Valley products is false, misleading and deceptive. The complaint alleged violations of California Business and Professions Code, Unfair Competition Law; and False Advertising Law. The suit was purportedly filed on behalf of a putative class of all California residents who bought Nature Valley granola bars.

Defendants moved to dismiss the complaint on two bases: preemption and the Rule 8 pleading standards. Regarding the former, defendant argued that plaintiff’s claims are impliedly preempted by regulations promulgated by the Food and Drug Administration (“FDA”) pursuant to the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. § 301, et seq. The FDCA gives the FDA the authority to regulate certain aspects of food and beverage safety and labeling. 21 U.S.C. § 371. General Mills first asserted that plaintiff’s claims are impliedly preempted because Congress intended the federal government to occupy the field of food and beverage labeling. Defendant based this argument on the FDA’s enactment of what it called a detailed, rigorous, and comprehensive system for labeling food products through the FDCA and related regulations. Readers of MassTortDefense know that field preemption may be implied from a scheme of federal regulation so pervasive as to make reasonable the inference that Congress left no room for the states to
supplement it, or where an Act of Congress touches a field in which federal interest is so
dominant that the federal system will be assumed to preclude enforcement of state laws on the same subject. The court here ruled, however, that although the FDA has promulgated several food-labeling requirements, Congress has specifically indicated that it does not intend to occupy the field of food and beverage nutritional labeling, and states are permitted to regulate matters covered by the NLEA and its regulations, provided that such state laws do not fall within the FDCA’s express preemption provisions.

Next, conflict preemption analysis examines the federal statute as a whole to determine whether a party’s compliance with both federal and state requirements is impossible or whether, in light of the federal statute’s purpose and intended effects, state law poses an obstacle to the accomplishment of Congress’s objectives. The court found that the FDA has generally deferred taking regulatory action with respect to the term “natural,” and thus plaintiff’s state law claims do not stand as an obstacle to accomplishing Congress’s objectives of uniformity and consistency in regulating labeling.

Although the FDA has addressed the use of the term “natural” in depicting food and beverage products, its policy with respect to the use of the term “natural” is unrestrictive, said the court. The FDA follows a policy of not taking enforcement action charging that a product labeled as “natural” is misbranded, so long as the product has no “added color, synthetic substances, and flavors.” Thus, state law claims based upon the use of the term “natural” do not require technical expertise within the special competence of the FDA, and the primary jurisdiction doctrine does not apply either.

However, a motion to dismiss should be granted if plaintiffs have not pleaded enough facts to state a claim to relief that is plausible on its face. Bell Atlantic Corp. v. Twombly, 127 S. Ct. 1955, 1974 (2007). Factual allegations must be enough to raise a right to relief above the speculative level. A plaintiff’s obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do. Here, the complaint was based on little more than conclusory and speculative factual content. For example, the causes of action which plaintiff asserts require an injury in fact, an injury based upon
defendant’s use of “100% Natural” on its product labeling and advertising. The plaintiff’s sparse allegation of injury-in-fact did not meet the Twombley and Iqbal pleading standard.

Similarly, plaintiff failed to adequately assert an untrue or misleading advertising claim or a fraudulent business practice because all she alleged was that members of the public were likely to have been deceived and likely made their purchases on the basis that “100% Natural” would not include a highly processed ingredient. A claim for unfair or fraudulent business practices is an averment of fraud which must be accompanied by the who, what, when, where, and how of the misconduct charged. And, on the issue of injunctive relief, it was undisputed that by the time plaintiff filed her complaint defendant’s products no longer contained HFCS. As a result, there was no basis for injunctive relief.

In sum, plaintiff’s complaint did not meet the pleading standard of Twombly or Iqbal, or
Rule 9(b) where the state law claims are based on fraudulent acts. The court dismissed the claims without prejudice, giving plaintiff an opportunity to cure.