Case 3:15-cv-02961-MMA-DHB Document 23 Filed 05/12/16 Page 1 of 28 KAZEROUNI LAW GROUP, APC 1 Abbas Kazerounian, Esq. (SBN: 249203) 2 [email protected] 245 Fischer Avenue, Unit D1 3 Costa Mesa, CA 92626 4 Telephone: (800) 400-6808 Facsimile: (800) 520-5523 5 6 [ADDITIONAL PLAINTIFF’S COUNSEL ON SIGNATURE PAGE] 7 Attorneys for Plaintiff, 8 Suzanne Alaei 9 UNITED STATES DISTRICT COURT 10 SOUTHERN DISTRICT OF CALIFORNIA 11 SUZANNE ALAEI, Individually Case No.: 3:15-cv-02961-MMA-DHB 12 And On Behalf Of All Others Similarly Situated, D1 APC 13 CLASS ACTION UITE S 92626 SECOND AMENDED COMPLAINT 14 , Plaintiff, FOR VIOLATIONS OF: CA , 15 VENUE ESA A v. M 16 1) BUSINESS & PROFESSIONS CODE § 17533.7 (CALIFORNIA OSTA ISCHER F C 17 THE KRAFT HEINZ FOODS FALSE “MADE IN U.S.A.” CLAIM); 245 COMPANY, KAZEROUNI LAW GROUP, LAW KAZEROUNI 18 2) BUSINESS & PROFESSIONS 19 Defendant. CODE §§ 17200, ET SEQ. (CALIFORNIA UNFAIR 20 COMPETITION LAW); AND, 21 3) CONSUMER LEGAL REMEDIES ACT, CAL. CIVIL CODE § 1750 22 ET SEQ. 23 24 JURY TRIAL DEMANDED 25 26 27 28 SECOND AMENDED COMPLAINT Case 3:15-cv-02961-MMA-DHB Document 23 Filed 05/12/16 Page 2 of 28 1 INTRODUCTION 2 1. SUZANNE ALAEI (hereinafter “Plaintiff”) brings this Class Action 3 Complaint for damages, injunctive relief, and any other available legal or 4 equitable remedies, resulting from the illegal actions of THE KRAFT 5 HEINZ FOODS COMPANY (collectively “Kraft Heinz” and/or 6 “Defendant”) in unlawfully labeling Kraft Heinz’s consumable consumer 7 packaged goods with the false designation and representation that they are 8 “MFD. In U.S.A.” when the products contain ingredients that were produced 9 outside of the United States of America. 10 2. Plaintiff alleges as follows upon personal knowledge as to herself and her 11 own acts and experiences, and, as to all other matters, upon information and 12 belief, including investigation conducted by her attorneys. 1 D1 APC 3. Under Cal. Bus. & Prof. Code § 17553.7, it is unlawful for: 13 UITE S 92626 14 , A any person, firm, corporation, or association to sell or C , 15 offer for sale in this state any merchandise on which VENUE ESA A merchandise or on its container there appears the words M 16 ‘Made in U.S.A.,’ ‘Made in America,’ ‘U.S.A.,’ or OSTA ISCHER F C 17 similar words if the merchandise or any article, unit, or 245 part thereof, has been entirely or substantially made, KAZEROUNI LAW GROUP, LAW KAZEROUNI 18 manufactured, or produced outside of the United States. 19 20 4. As stated by the California Supreme Court in Kwikset v. Superior Court 21 (January 27, 2011) 51 Cal.4th 310, 328-29: 22 Simply stated: labels matter. The marketing industry is 23 based on the premise that labels matter, that consumers 24 will choose one product over another similar product based on its label and various tangible and intangible 25 qualities that may come to associate with a particular 26 source…In particular, to some consumers, the “Made in 27 1 Based on the version of the statute that was in effect in the year 2015 when the alleged violation occurred. 28 SECOND AMENDED COMPLAINT 1 OF 27 Case 3:15-cv-02961-MMA-DHB Document 23 Filed 05/12/16 Page 3 of 28 U.S.A.” label matters. A range of motivations may fuel 1 this preference, from the desire to support domestic jobs 2 to beliefs about quality, to concerns about overseas environmental or labor conditions, to simple patriotism. 3 The Legislature has recognized the materiality of this 4 representation by specifically outlawing deceptive and fraudulent “Made in America” representations. (Cal. Bus. 5 & Prof. Code section 17533.7; see also Cal. Civ. Code § 6 1770, subd. (a)(4) (prohibiting deceptive representations of geographic origin)). The object of section 17533.7 “is 7 to protect consumers from being misled when they 8 purchase products in the belief that they are advancing 9 the interest of the United States and its industries and workers…” (emphasis added). 10 11 5. Defendant’s “MFD. In U.S.A.” claim is prominently printed on the label of 12 Defendant’s consumable product purchased by Plaintiff. D1 APC 13 6. Contrary to Defendant’s representation and in violation of Cal. Bus. & Prof. UITE S 92626 Code § 17533.7, Defendant’s Heinz 57 Sauce (the “Product”) purchased by 14 , A C , 15 Plaintiff contains ingredients that were produced outside of the United States VENUE ESA A M 16 of America, including but not limited to the following ingredients: turmeric, OSTA ISCHER F C 17 tomato puree and mustard flour. 245 KAZEROUNI LAW GROUP, LAW KAZEROUNI 18 JURISDICTION AND VENUE 19 7. This Court has jurisdiction over this matter pursuant to the Class Action 20 Fairness Act (CAFA) because the amount in controversy in this matter 21 exceeds $5,000,000.00 as to all putative Class members, inclusive of 22 attorneys’ fees and costs, and injunctive relief. 28 U.S.C. Sections 1332(d), 23 1453, and 1711-1715. 24 8. Venue is proper in the United States District Court for the Southern District 25 of California pursuant to 28 U.S.C. § 1391 for the following reasons: (i) 26 Plaintiff resides in the County of San Diego, State of California, which is 27 within this judicial district; (ii) the conduct complained of herein occurred 28 SECOND AMENDED COMPLAINT 2 OF 27 Case 3:15-cv-02961-MMA-DHB Document 23 Filed 05/12/16 Page 4 of 28 1 within this judicial district; and, (iii) many of the acts and transactions giving 2 rise to this action occurred in this district because Kraft Heinz: 3 (a) is authorized to conduct business in this district and has 4 intentionally availed itself of the laws and markets within this 5 district and the County of San Diego, California; 6 (b) does substantial business within this district and the County of 7 San Diego, California; 8 (c) is subject to personal jurisdiction in this district because it has 9 availed itself of the laws and markets within this district; and, 10 (d) the harm to Plaintiff occurred within this district and within the 11 County of San Diego, California. 12 PARTIES D1 APC 9. Plaintiff is an individual residing in the County of San Diego, State of 13 UITE S 92626 California. 14 , A C , 15 10. Kraft Heinz is a corporation that is organized and exists under the laws of VENUE ESA A M 16 the State of Pennsylvania, with a principal place of business in the State of OSTA ISCHER F C Pennsylvania. 17 245 KAZEROUNI LAW GROUP, LAW KAZEROUNI 18 11. Kraft Heinz claims on its website that Kraft Heinz provides high quality, 19 great taste and nutrition for all eating occasions whether at home, in 20 restaurants on the go. 21 12. Following a merger in 2015, Kraft Heinz became the world’s fifth-largest 22 food company by sales. 23 13. Kraft Heinz’s annual revenue is in the several billions of dollars. 24 14. Kraft Heinz is an American conglomerate that manufactures and/or 25 distributes various products, including several consumable consumer 26 packaged goods such as sauces and condiments. Kraft Heinz conducts 27 business through Internet sales and enjoys wide retail distribution at 28 numerous stores within the United States. SECOND AMENDED COMPLAINT 3 OF 27 Case 3:15-cv-02961-MMA-DHB Document 23 Filed 05/12/16 Page 5 of 28 1 15. On Defendant’s website, located at http://www.kraftheinzcompany.com/, 2 accessed on December 23, 2015, Defendant claims: “The Kraft Heinz 3 Company is the third-largest food and beverage company in North America 4 and the fifth-largest food and beverage company in the world, with eight $1 5 billion+ brands.” 6 16. On Defendant’s website, located at http://www.kraftheinzcompany.com, 7 accessed on April 25, 2016, Defendant claims: “The Kraft Heinz Company 8 has an unparalleled portfolio of more than 200 powerful and iconic brands.” 9 17. One of the consumable products sold by Kraft Heinz is the Product 10 purchased by Plaintiff. 11 18. The mislabeled Product and the two Substantially Similar Products (as 12 identified below in ¶ 53) are available at numerous stores within the United D1 APC States, including the State of California. 13 UITE S ACTUAL LLEGATIONS 92626 F A 14 , A C , 15 19. Plaintiff re-alleges and incorporates by reference all of the above paragraphs VENUE ESA A M 16 of this Second Amended Complaint as though fully stated herein. OSTA ISCHER F C 20. Kraft Heinz manufactures, markets and/or sells various consumable 17 245 KAZEROUNI LAW GROUP, LAW KAZEROUNI 18 consumer packaged goods such as sauces and condiments that have been and 19 are currently still represented as “MFD. In U.S.A. By Heinz North America” 20 Kraft Heinz makes such representation on the consumable products 21 themselves, including the Product purchased by Plaintiff and the two 2 22 Substantially Similar Products that were not purchased by Plaintiff. 23 21. Contrary to the representation on the products’ labels, Defendant’s products 24 are wholly and/or substantially manufactured or produced with components 25 26 27 2 Plaintiff seeks to represent a class of persons that purchased Heinz 57 Sauce, Heinz 57 Steak Sauce or Heinz 57 Sauce with Honey. 28 SECOND AMENDED COMPLAINT 4 OF 27 Case 3:15-cv-02961-MMA-DHB Document 23 Filed 05/12/16 Page 6 of 28 1 that are manufactured, grown and/or produced outside of the United States 2 of America.