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United States District Court Northern District of California ROHINI Case4:14-cv-02411-YGR Document50 Filed02/03/15 Page1 of 10 1 2 3 UNITED STATES DISTRICT COURT 4 NORTHERN DISTRICT OF CALIFORNIA 5 6 7 ROHINI KUMAR, individually and on behalf of Case No.: 14-CV-2411- YGR the general public and those similarly situated, 8 ORDER GRANTING IN PART AND DENYING IN 9 Plaintiff, PART MOTION TO DISMISS 10 vs. 11 SALOV NORTH AMERICA CORP., 12 Defendants. 13 14 Plaintiff Rohini Kumar brings this putative class action against Defendant Salov North 15 America Corp. alleging claims for: (1) violation of the California Consumer Legal Remedies Act 16 (“CLRA”), California Civil Code § 1750, et. seq.; (2) violation of the California False Advertising 17 Law(“FAL”), Business and Professions Code § 17500, et. seq.; (3) breach of contract; (4) breach of United States District Court Northern District of California California Northern District of 18 the covenant of good faith and fair dealing; (5) fraud, deceit and/or misrepresentation; and (6) 19 violation of the California Unfair Competition Law (“UCL”), Business and Professions Code § 20 17500, et. seq. Salov has filed a Motion to Dismiss on the grounds that Kumar lacks standing, has 21 not alleged plausible claims, failed to plead fraud with particularity, and failed to set forth sufficient 22 facts to state a claim for breach of contract. 23 Having carefully considered the papers submitted, the arguments made at the hearing on this 24 matter, and the pleadings in this action, and for the reasons set forth below, the Court ORDERS that 25 the Motion is GRANTED IN PART AND DENIED IN PART. While Plaintiff has sufficiently alleged 26 claims for violation of the CLRA, FAL, and UCL, as well as a claim for fraud and deceit, the 27 allegations in support of breach of contract, and covenant of good faith and fair dealing claims do not 28 Case4:14-cv-02411-YGR Document50 Filed02/03/15 Page2 of 10 1 set forth a cognizable basis for relief since there is no authority for finding privity of contract under 2 the circumstances alleged. 3 I. BACKGROUND 4 Defendant Salov imports, markets, and sells several different types of olive oil under its 5 “Filippo Berio” brand, including: “Robusto Extra Virgin Olive Oil,” “Extra Virgin Olive Oil,” 6 “Delicato Extra Virgin Olive Oil,” “Organic Extra Virgin Olive Oil,” “Olive Oil,” and “Extra Light 7 Olive Oil.” (Complaint, Dkt. No. 1, at ¶ 17.) The words “Imported from Italy” appear prominently 8 on the front label of each product. (Id. at ¶ 23.) However, a smaller statement on the back of the 9 products indicates that the olives are grown, and pressed, in many other countries, such as Spain, 10 Greece, and Tunisia, and the oils are shipped to Italy where they are blended and bottled for export. 11 (Id.) Kumar alleges that the “Imported from Italy” statement on the product labels is false and 12 violates federal regulations concerning country of origin and misbranding of food products. (Id. at 13 ¶¶ 24-26.) 14 In addition, on two varieties of Salov’s products (“Extra Virgin Olive Oil” and “Organic 15 Extra Virgin Olive Oil”), the label contains the term “Extra Virgin,” a descriptor reserved for the 16 highest grade and quality of olive oil. (Complaint at ¶ 27.) The International Olive Council, the 17 United States Department of Agriculture and the State of California all maintain standards for use of 18 the term “extra virgin” in olive oil. (Id. at ¶¶ 27-30.) Kumar alleges that her counsel, in March of United States District Court Northern District of California California Northern District of 19 2014, had several bottles of Salov’s “Extra Virgin” products tested in an independent lab, which 20 found that none of the sampled products met extra virgin standards. (Id. at ¶ 31.) Kumar alleges that 21 Salov: (1) adulterates its olive oil with cheaper, refined olive oil; and (2) uses substandard, non-light 22 protective (clear) bottles and unprotected transport/storage methods which allow the oil to degrade. 23 As a consequence, the products do not meet the “extra virgin” standard at the time of sale or the 24 “Best By” date on the package. (Id. at ¶¶ 35-38.) 25 Kumar alleges that she purchased a bottle Filippo Berio Extra Virgin Olive Oil at a Safeway 26 in Berkeley, California, for approximately $6.00. (Complaint at ¶ 48.) She alleges that she later 27 learned that the product she purchased was not extra virgin and was not made from olives grown and 28 pressed in Italy. (Id. at ¶ 49.) She alleges that she relied on the statements on the label to assure that 2 Case4:14-cv-02411-YGR Document50 Filed02/03/15 Page3 of 10 1 she was purchasing extra virgin olive oil that was made from olives grown and pressed in Italy. (Id. 2 at ¶ 47.) But for Salov’s misrepresentations on the label, she would not have purchased the product 3 or, at a minimum, would have paid less for the product she purchased. (Id. at ¶ 48.) Kumar seeks to 4 represent three putative classes defined as follows: 5 All persons who, between May 23, 2010, and the present, purchased, in California, 6 any of Salov’s products labeled as “Imported from Italy” (the “California Italian Class”); 7 All persons who, between May 23, 2010 and the present, purchased, in the United 8 States, any of Salov’s products labeled as “Extra Virgin” (the “EVOO Class”); and All members of the EVOO Class who made their purchases in California (the 9 “California EVOO Subclass”). 10 II. APPLICABLE STANDARDS 11 Salov moves under Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure, 12 challenging the legal sufficiency of the claims alleged. “Federal Rule of Civil Procedure 8(a)(2) 13 requires only a ‘short and plain statement of the claim showing that the pleader is entitled to relief,’ 14 in order to ‘give the defendant fair notice of what the claim is and the grounds upon which it rests.’” 15 Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 554 (2007) (quoting Fed. R. Civ. P. 8(a)(2)). Even 16 under the liberal pleading standard of Rule 8(a)(2), “a plaintiff’s obligation to provide the grounds of 17 his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the 18 elements of a cause of action will not do.” Twombly, 550 U.S. at 555 (citing Papasan v. Allain, 478 United States District Court Northern District of California California Northern District of 19 U.S. 265, 286 (1986) (internal brackets and quotation marks omitted)). The Court will not assume 20 facts not alleged, nor will it draw unwarranted inferences. Ashcroft v. Iqbal, 556 U.S. 662, 679 21 (2009) (“Determining whether a complaint states a plausible claim for relief… [is] a context-specific 22 task that requires the reviewing court to draw on its judicial experience and common sense.”). 23 Rule 9(b) of the Federal Rules of Civil Procedure requires that “[i]n allegations of fraud or 24 mistake, a party must state with particularity the circumstances constituting fraud or mistake.” To 25 satisfy the rule, a plaintiff must allege the “who, what, where, when, and how” of the charged 26 misconduct. Vess v. Ciba-Geigy Corp. U.S.A., 317 F.3d 1097, 1106 (9th Cir. 2003). “[T]he 27 circumstances constituting the alleged fraud must be specific enough to give defendants notice of the 28 3 Case4:14-cv-02411-YGR Document50 Filed02/03/15 Page4 of 10 1 particular misconduct so that they can defend against the charge and not just deny that they have 2 done anything wrong.” Id. 3 Pursuant to Rule 12(b)(6), a complaint may be dismissed for failure to state a claim upon 4 which relief may be granted against that defendant. Dismissal may be based on either “the lack of a 5 cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory.” 6 Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1988) (citing Robertson v. Dean 7 Witter Reynolds, Inc., 749 F.2d 530, 533-34 (9th Cir. 1984)). The complaint must plead “enough 8 facts to state a claim [for] relief that is plausible on its face.” Twombly, 550 U.S. at 570. A claim is 9 plausible on its face “when the plaintiff pleads factual content that allows the court to draw the 10 reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 11 678. If the facts alleged do not support a reasonable inference of liability, stronger than a mere 12 possibility, the claim must be dismissed. Id. at 678–79; see also In re Gilead Scis. Sec. Litig., 536 13 F.3d 1049, 1055 (9th Cir. 2008) (the court is not required to accept as true “allegations that are 14 merely conclusory, unwarranted deductions of fact, or unreasonable inferences”). 15 A motion to dismiss for lack of subject matter jurisdiction may be made on the grounds that 16 the lack of jurisdiction appears from the “face of the complaint,” or may be based on extrinsic 17 evidence apart from the pleadings. Warren v. Fox Family Worldwide, Inc., 328 F.3d 1136, 1139 (9th 18 Cir. 2003). Where the jurisdictional issue is whether the plaintiff has standing, dismissal is also United States District Court Northern District of California California Northern District of 19 appropriate under Rule 12(b)(6) absent sufficient factual allegations in the complaint, which, if 20 proven, would confer standing.
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